Document:

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                                                                    Exhibit 10.4

           CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
                        SECURITIES AND EXCHANGE COMMISSION.

                         ASTERISKS DENOTE SUCH OMISSIONS.

                               SUBLEASE AGREEMENT

This Sublease Agreement (this "Sublease") is made on this 16 day of July, 2002
between Antigenics, Inc., a Massachusetts Corporation, with an address of 34
Commerce Way, Woburn, Massachusetts 01801 a wholly-owned subsidiary of
Antigenics Inc., a Delaware corporation formerly known as Aquila
Biopharmaceuticals, Inc. ("Sublessor") and GTC Biotherapeutics, Inc., a
Massachusetts corporation with an address of 175 Crossing Boulevard, Suite 410,
Framingham, Massachusetts ("Sublessee").

                                    RECITALS

         WHEREAS, Aquila Biopharmaceuticals, Inc., a Delaware corporation and
wholly owned subsidiary of Sublessor, is the tenant under a lease with NDNE 9/90
Corporate Center LLC (the "Prime Lessor") dated September 19, 1997 as amended by
that certain First Amendment to Lease ("First Amendment") dated December 17,
1997, as further amended by that certain Second Amendment to Lease ("Second
Amendment") dated as of January 14, 1998, as further amended by that certain
Third Amendment to Lease ("Third Amendment") dated as of February 3, 1998, as
further amended by that certain Fourth Amendment to Lease ("Fourth Amendment")
dated as of February 27, 1998, as further Amended by that certain Fifth
Amendment to Lease ("Fifth Amendment") dated as of March 13, 1998 and as
affected by that certain Consent to Assignment of Lease ("Consent") dated April
2001 (the Lease as so amended and affected by the First Amendment, the Second
Amendment, the Third Amendment, the Fourth Amendment, the Fifth Amendment and
the Consent is hereinafter called the "Prime Lease") which relates to space in
the Building (as said term is defined in the Prime Lease) comprised of
approximately 41,020 rentable square feet located on the 1st, 2nd and 3rd floors
of the Building (the "Leased Premises");

         WHEREAS, Sublessee desires, and Sublessor has agreed, to sublet a
portion of the Leased Premises to the Sublessee consisting of approximately
11,852 rentable square feet located on the third floor of the Leased Premises
(referred to hereinafter as "Primary Space") and a portion of the Leased
Premises located on the second floor to Sublessee consisting of approximately
8,036 rentable square feet located on the second floor of the Leased Premises
(referred to hereinafter as "Secondary Space"); and

         WHEREAS, Sublessee desires, and Sublessor has agreed to grant, an
option to sublease the remainder of the Leased Premises consisting of
approximately 21,132 rentable square feet located on the first and second floor
of the Leased Premises (referred to hereinafter as "Tertiary Space").

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         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Sublessor and Sublessee covenant
and agree as follows:

1.       DEFINITIONS:

         a.       ADDITIONAL RENT: any sum designated under this Sublease and/or
                  the Prime Lease constitutes "Additional Rent" including,
                  without limitation, payments by Sublessee to the Sublessor
                  under the Antigenics Leasehold Lease. With respect to any
                  amounts due under Prime Lease, Sublessee shall only be
                  responsible for Sublessee's Proportionate Share of such costs.

         b.       ANNUAL FIXED RENT: the Annual Fixed Rent payable by the
                  Sublessee to the Sublessor as set forth in EXHIBIT B attached
                  hereto and made a part hereof, shall commence on the Sublease
                  Commencement Date.

         c.       ANNUAL RENT: Annual Fixed Rent, Additional Rent and any other
                  charge, and/or assessment payable by Sublessor to the Prime
                  Lessor under the Prime Lease or payable by Sublessee to
                  Sublessor under this Sublease. With respect to any amounts due
                  under the Prime Lease, Sublessee shall only be responsible for
                  Sublessee's Proportionate Share of such costs.

         d.       COMMENCEMENT DATE OF PRIME LEASE: September 9, 1998.

         e.       ANTIGENICS LEASEHOLD LEASE: shall refer to that lease
                  agreement entered into between the Sublessor and the Sublessee
                  as of the date hereof, attached hereto as EXHIBIT C.

         f.       PRIMARY SPACE: shall refer to that portion of the Leased
                  Premises consisting of approximately 11,852 rentable square
                  feet located on the third floor.

         g.       SECONDARY SPACE: shall refer to that portion of the Leased
                  Premises consisting of approximately 8,036 rentable square
                  feet located on the second floor.

         h.       SUBLEASE COMMENCEMENT DATE: July 19th 2002 for the Primary
                  Space and January 1, 2003 for the Secondary Space.

         i.       SUBLEASE TERMINATION DATE: December 31, 2006, unless the
                  Sublessee exercises its rights to sublease the Tertiary Space,
                  in which event the Sublease Termination Date shall be extended
                  to September 30, 2010.

         j.       SUBLEASED PREMISES: the Subleased Premises consists of the
                  Primary Space, the Secondary Space and the Tertiary Space, in
                  the event Sublessee elects to exercise its rights under the
                  Tertiary Space Option, as shown on a sketch plan attached
                  hereto as EXHIBIT A.

         k.       SUBLESSEE'S PROPORTIONATE SHARE: shall be based on the square
                  footage of the Subleased Premises leased by the Sublessee
                  divided by the square footage of the

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                  Leased Premises in order to determine the Sublessee's
                  equitable share of expenses.

         l.       SUBLESSEE'S SECURITY DEPOSIT: shall refer to the Letter of
                  Credit to be provided by the Sublessee to the Sublessor in an
                  amount not less than Two Hundred Thousand and 00/100 Dollars
                  ($200,000.00), the form of which is attached hereto as EXHIBIT
                  E.

         m.       SUBLEASE TERM: shall refer to the Sublessor's remaining term
                  under the Prime Lease, specifically excluding any option
                  terms.

         n.       TERTIARY SPACE: the remaining portion of the Leased Premises
                  consisting of approximately 21,132 rentable square feet
                  located on the second floor and first floor of the Leased
                  Premises.

         o.       TERTIARY SPACE OPTION: shall refer to the Sublessee's option
                  to sublease the Tertiary Space, as further set forth herein.

All other capitalized terms used in this Sublease not otherwise defined herein
shall have the meanings ascribed to such terms as set forth in the Prime Lease
and/or the Antigenics Leasehold Lease.

2. PRIME LEASE: The terms and conditions of the Prime Lease are hereby
incorporated by reference and made a part hereof, meaning that, as applicable,
references to "Tenant" therein shall be deemed to be "Sublessee" hereunder,
references to "Landlord" therein shall be deemed to be "Sublessor" hereunder,
and such other terms shall be deemed modified as may be appropriate in the given
context, provided:

         a.       Prime Lessor shall continue to have all rights set forth in
                  the Prime Lease (notwithstanding the fact that Sublessor shall
                  also have the same rights under this Sublease);

         b.       Sublessor shall not be deemed to have assumed any of the
                  obligations of Prime Lessor as a result of the incorporation
                  of the Prime Lease unless specifically set forth herein;

         c.       Sublessor, except as otherwise provided herein, shall not be
                  liable for the performance of any of the obligations of Prime
                  Lessor under the Prime Lease;

         d.       Sublessee shall have no claim against Sublessor by reason of
                  any default in fulfilling such obligations upon the part of
                  Prime Lessor unless such default

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                  results from Sublessor's being in default under the Prime
                  Lease and not due to a default of Sublessee hereunder;

         e.       Sublessor agrees not to modify or amend the Prime Lease
                  without the consent of the Sublessee, which consent shall not
                  be unreasonably withheld or delayed; and

         f.       with respect to work, services, repairs and restoration or the
                  performance of other obligations required of Prime Lessor
                  under the Prime Lease, if any, Sublessor's sole obligation
                  with respect thereto, shall be to request the same, after
                  requested by Sublessee, and to send all notices required under
                  the Prime Lease to Prime Lessor, as the case may be.

3. TERM AND SUBLEASED PREMISES. Sublessor hereby sublets and demises unto
Sublessee and Sublessee hereby takes and hires from Sublessor the Subleased
Premises for the period commencing on the Sublease Commencement Date until the
Sublease Termination Date, unless this Sublease shall sooner terminate as herein
provided. Sublessee shall have the non-exclusive right to use, in common with
others entitled thereto, that certain number of parking spaces on the Leasehold
Parking Area, as defined under Section 2.3(a) of the Prime Lease, equal to four
(4) spaces per each 1,000 square feet of Subleased Premises.

4. ANNUAL RENT. Sublessee covenants and agrees to pay to Sublessor at the
address set forth above, or to such other address as Sublessor may specify by
notice to Sublessee:

         a.       Annual Fixed Rent which shall commence on Sublease
                  Commencement Date and thereafter be due and payable on the
                  first day of each and every month during the term of this
                  Sublease at the rates set forth in EXHIBIT B, without notice
                  or demand:

         b.       Additional Rent which shall be due and payable within the
                  applicable time periods set forth in the Prime Lease and/or
                  within ten (10) days after Sublessee's receipt of a demand in
                  writing for such payment by Sublessor, or as otherwise set
                  forth in the Antigenics Leasehold Lease. If the Sublessee
                  shall fail to pay the Additional Rent when due or any other
                  amounts, the Sublessor may elect to pay the same in which
                  event all such payments shall be charged to and paid by the
                  Sublessee, on demand, as Additional Rent, at Sublessor's
                  option draw under the Letter of Credit. Sublessor shall be
                  entitled to charge any fees or interest on such Additional
                  Rent as permitted under the Prime Lease; and

         c.       Annual Rent for any portion of a calendar month at the
                  beginning or end of the Sublease Term shall be prorated on a
                  per diem basis.

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5. SECURITY DEPOSIT. This Sublease and the Antigenics Leasehold Lease shall be
secured by an Irrevocable Letter of Credit ("Letter of Credit") as further set
forth herein. The Letter of Credit shall be in the form of EXHIBIT E and shall
otherwise:

         a.       be in the stated original amount of not less than Two Hundred
                  Thousand and 00/00 Dollars ($200,000.00) which amount shall
                  increase by One Hundred Seventy Five Thousand Dollars
                  ($175,000.00) by a replacement Letter of Credit for a total of
                  Three Hundred Seventy Five Thousand 00/100 Dollars
                  ($375,000.00), in the event the Sublessee shall elect to
                  exercise its right to sublease the Tertiary Space, as provided
                  hereunder. The Sublessor's receipt of the replacement Letter
                  of Credit in the amount of Three Hundred Seventy Five Thousand
                  00/100 Dollars ($375,000.00) shall be a condition precedent to
                  Sublessee occupying the Tertiary Space;

         b.       be issued in a form reasonably acceptable to Sublessor;

         c.       name Sublessor as its beneficiary;

         d.       be drawn on a FDIC insured financial institution reasonably
                  satisfactory to Sublessor; and

         e.       expire no earlier than thirty (30) days after the expiration
                  of the Sublease Termination Date.

Sublessor may, from time to time, without prejudice to any other remedy, use all
or a portion of the Letter of Credit to:

         a.       satisfy amounts owing to Sublessor under this Sublease and/or
                  the Antigenics Leasehold Lease as a result of an Event of
                  Default under such agreements;

         b.       cure any uncured Event of Default by Sublessee under this
                  Sublease or the Antigenics Leasehold Lease; or

         c.       pay for any and all damages or costs incurred by Sublessor to
                  enforce its rights under this Sublease or the Antigenics
                  Leasehold Lease.

6. USE. Sublessee covenants and agrees to use the Subleased Premises only for
those uses specifically authorized in the Prime Lease.

7. INSURANCE. Sublessee agrees to observe and comply with the provisions of
Section 7 of the Prime Lease and, in addition, Sublessee shall maintain its own
insurance with respect to its personal property. All policies of insurance
procured by Sublessee shall be issued in forms and

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by insurance carriers reasonably acceptable to Sublessor and Prime Lessor and
name them both as additional insureds. Before Sublessor shall deliver possession
of the Subleased Premises to Sublessee, Sublessee shall provide Sublessor with
certificates of insurance evidencing the insurance coverages set forth in this
Section. Such certificates shall provide that, in the event of cancellation or
material change, thirty (30) days' prior written notice shall be given to
Sublessor and all other named insureds. To the extent provided in the Prime
Lease, each party agrees to waive the rights of recovery and to obtain from its
respective insurer a waiver of subrogation.

8. CONDITION OF SUBLEASED PREMISES: Sublessee acknowledges that it has inspected
the Subleased Premises and agrees to accept the Subleased Premises in "as-is"
condition, and further acknowledges that no representations or warranties as to
the condition thereof have been made to it by Sublessor and/or the Prime Lessor,
except as may be specifically set forth in Paragraph 9 of this Sublease.
Sublessee hereby covenants and agrees to undertake and perform all obligations
with respect to the Subleased Premises that Sublessor has undertaken to Prime
Lessor in the Prime Lease except as specifically set forth in Paragraph 9 of
this Sublease. Notwithstanding the above, Sublessor hereby agrees that it shall
be Sublessor's obligation to deliver the Subleased Premises, including the
Tertiary Space, on the Sublease Commencement Date, in the following condition
and with all of the following tasks completed (the "Sublessor Tasks") prior to
the Sublease Commencement Date for each leased space, at Sublessor's sole cost
and expense, subject only to the Sublessee Contribution, as defined below:

         a.       The Subleased Premises shall be clean of all chemicals and
                  reagents;

         b.       All biosafety cabinets shall be decontaminated by a qualified
                  vendor licensed in The Commonwealth of Massachusetts and
                  Sublessor shall deliver to Sublessee copies of all
                  decontamination records including documentation qualifying the
                  Subleased Premises for release for unrestricted use per
                  Commonwealth of Massachusetts regulations, 105 CMR 120.291 and
                  the Nuclear Regulatory Commission (NRC) document entitled
                  "Guidelines for Decontamination of Facilities and Equipment
                  Prior to Release for Unrestricted Use: Table 1."

         c.       All floors shall be broom clean and all lab counters and desks
                  shall be free of dust and debris; and

         d.       Any damage to walls, floors, and/or ceilings caused by
                  equipment removal shall be repaired and painted.

Sublessee shall reimburse Sublessor for costs associated with undertaking and
completing the Sublessor Tasks, in an aggregate amount for all of the Subleased
Premises not to exceed Fifteen Thousand and 00/100 Dollars ($15,000.00)
("Sublessee Contribution"). The Sublessee Contribution shall be charged to and
paid by the Sublessee, as Additional Rent with the monthly

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rent payment next due after Sublessee receives copies of invoices from the
vendors or suppliers substantiating the Sublessee Contribution.

9. OBLIGATION TO PROVIDE AND MAINTAIN UTILITY SERVICES

         a.       SUBLESSOR'S OBLIGATIONS. Sublessor agrees to provide the
                  following utility services which are located in Tertiary Space
                  to the Primary and Secondary Spaces, respectively, for the
                  sole benefit of Sublessee, such services to be provided seven
                  (7) days per week, twenty-four (24) hours per day, with the
                  exception of steam which shall only be provided between the
                  hours of 6:00 AM and 4:30 PM Monday-Friday.

                  i.       Commencing on the Sublease Commencement Date the
                           Sublessor shall provide:

                           (aa)     water (hot and cold);

                           (bb)     tempered water for the safety showers and
                                    eye washers;

                           (cc)     compressed air;

                           (dd)     steam;

                           (ee)     purified water (RODI);

                           (ff)     electricity;

                           (gg)     natural gas;

                           (hh)     heating ventilation and cooling (HVAC);

                           (ii)     PH adjustment for the waste system;

                           (jj)     emergency power; and

                           (kk)     plumbing systems.

                  (Subparagraphs (aa) through (kk) shall be collectively
                  referred to as the "Utility Services").

                  ii.      Sublessor's obligation to provide Utility Services
                           for the benefit of Sublessee shall terminate on
                           December 31, 2006 (the "Utility Services Termination
                           Date").

                  iii.     Sublessor's obligations to provide Utility Services
                           shall only apply to those Utility Services that are
                           generated from the utility/maintenance room located
                           in the Tertiary Space.

                  iv.      Utilities Services will be charged by Sublessor and
                           paid by Sublessee at the rates set forth in Exhibit B
                           (the "Utility Rates"), which are based on the
                           percentage of office space and laboratory space
                           located in the Subleased Premises as of the date of
                           this Sublease. The Utility Rates are subject to
                           change based on Sublessee's change in use or
                           percentage of office and laboratory space of the
                           Subleased Premises and/or an increase

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                           in actual rates charged to Sublessor by the utility
                           providers. In the event that any of the utility
                           providers increase the rates payable by Sublessor,
                           Sublessor shall deliver to Sublessee copies of
                           written notices, bills or invoices received by
                           Sublessor from the utility providers documenting the
                           increased rates before increasing any such Utility
                           Rates. The increases in Utility Rates shall exclude
                           however, costs that are directly attributable to
                           those portions of the Leased Premises leased by
                           Sublessor. Any adjustments to the Utility Rates shall
                           not be effective until twenty (20) days after
                           Sublessor provides written notice to Sublessee of
                           such increased Utility Rate. Notwithstanding the
                           foregoing, in no event shall the Utility Rates or
                           monthly payment amounts set forth in EXHIBIT B
                           increase prior to January 1, 2003.

                  v.       Payment's for Utility Services shall be due and
                           payable as Annual Fixed Rent on the first day of each
                           month without notice, in the amounts set forth in
                           Exhibit B commencing on the Sublease Commencement
                           Date and ending on the Utility Services Termination
                           Date, provided, however, that Sublessee shall remain
                           responsible for the cost of any Utility Services
                           provided to Sublessee during such term,
                           notwithstanding, whether an invoice was submitted by
                           Sublessor or the utility providers prior to the
                           Utility Services Termination Date. Failure to pay
                           such charges when due shall constitute a monetary
                           Event of Default under Paragraph 14 of this Sublease.

                  vi.      Sublessor, to the best of its knowledge, represents
                           that all of the Utility Services are connected to the
                           Subleased Premises and the Utility Systems that
                           provide the Utility Services to the Subleased
                           Premises, including all generation and distribution
                           systems located in any of the Subleased Premises
                           (collectively referred to herein as the "Utility
                           Systems"), are in good condition and repair.

                  vii.     Except as expressly provided in subparagraphs
                           9(b)(ii) and 9(b)(iii) below, Sublessor agrees to
                           perform all ordinary maintenance, repair, and
                           replacement of the Utility Systems located within the
                           utility/maintenance room in the Tertiary Space at its
                           sole cost and expense until the Utility Services
                           Termination Date. In addition, Sublessor shall be
                           responsible for any and all damage to the Utility
                           Services and Utility Systems caused by Sublessor, its
                           employees, contractors, licensees, and invitees.
                           Notwithstanding the above, Sublessor shall not be
                           responsible for undertaking and/or completing any
                           improvements to the Utility Systems or the Utility
                           Services in order to upgrade and/or expand the
                           capacities of the Utility Systems or the Utility
                           Services for Sublessee's use, provided

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                           however, that Sublessee shall have the right to make
                           such improvements, at its expense, subject to the
                           provisions below.

                  viii.    Sublessor agrees to use reasonable efforts to ensure
                           that the Utility Systems and Utility Services are
                           maintained and functioning properly prior to the
                           earlier of the Sublease Termination Date or the
                           Sublessee's occupancy of the Tertiary Space.

         b.       Sublessee's Obligations Concerning Utility Services.

                  i.       Sublessee agrees and acknowledges that commencing on
                           the Sublease Commencement Date until the Sublease
                           Termination Date, to pay for all Utility Services at
                           the rates and at the monthly payment amounts set
                           forth in EXHIBIT B on the first day of each month
                           without notice or demand;

                  ii.      Sublessee agrees and acknowledges that it has had the
                           opportunity to inspect the Utility Systems and
                           Utility Services and is accepting the Utility Systems
                           and Utility Services in their current condition (the
                           "Acceptance"), subject only to Sublessor obligation
                           to continue to maintain, repair and replace the
                           Utility Systems as set forth in subparagraph
                           9(a)(vii) of this Sublease;

                  iii.     Sublessee agrees and acknowledges that in the event
                           the sublessee elects to exercise its right to
                           sublease the Tertiary Space commencing on January 1,
                           2007 or the sooner occupancy of the Tertiary Space,
                           Sublessee shall be solely responsible for the
                           maintenance, repair and replacement of the Utility
                           Services and Utility Systems.

                  iv.      Sublessee shall be solely responsible for any and all
                           damage to the Utility Services and Utility Systems
                           caused by Sublessee, its employees, contractors,
                           licensees, and invitees and for any Alterations (as
                           defined below). In the event the Sublessee exercises
                           its right to occupy the Tertiary Space, Sublessee
                           shall be solely responsible for any and all damage to
                           the Utility Services and Utility Systems commencing
                           on January 1, 2007.

                  v.       Sublessee shall coordinate the construction, repair,
                           replacement or maintenance of the Utility Systems
                           with Sublessor;

                  vi.      Sublessee shall certify to Sublessor the square
                           footage of laboratory space and office space leased
                           by Sublessee, on a semi-annual basis;

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                  vii.     Sublessee shall be solely responsible for providing
                           telecommunication services to the Subleased Premises.

         c.       Utility Rates do not include the construction, repair,
                  replacement or maintenance of any Utility Systems and/or
                  Utility Services located within the Subleased Premises leased
                  by the Sublessee, which shall be the sole and exclusive
                  responsibility of Sublessee, except as otherwise provided in
                  subparagraph 9(a)(vii) of this Sublease.

         d.       Sublessor acknowledges and agrees that Sublessee may desire to
                  upgrade and/or expand the capacities of the Utility Services
                  and Utility Systems, provided, however that Sublessee shall
                  not make or perform, or permit the making or performance of,
                  any alterations, improvements, or additions in or about the
                  Subleased Premises, including upgrading and/or expanding the
                  capacities of the Utility Services and Utility Systems
                  (collectively, "Alterations") without obtaining on each
                  occasion Sublessor's prior written consent which consent shall
                  not be unreasonably withheld or delayed and the consent of the
                  Prime Lessor. Sublessor agrees not to unreasonably withhold
                  its consent to such Alterations, provided that such
                  Alterations are performed only by licensed and insured
                  contractors or mechanics first reasonably approved by
                  Sublessor and no Alterations shall adversely affect the
                  Utility Services and/or Utility Systems within the Leased
                  Premises. All Alterations shall be done at Sublessee's sole
                  cost and expense and at such times and in such manner as to
                  minimize, interference with the operations of Sublessor.
                  Sublessee shall provide not less than 24 hour prior written
                  notice to Sublessor of the commencement of any such
                  Alterations.

                  No approval of any plans or specifications by Sublessor or
                  consent by Sublessor allowing Sublessee to make any
                  Alterations or any inspection of Alterations made by or for
                  Sublessor shall in any way be deemed to be an agreement by
                  Sublessor that the contemplated Alterations comply with any
                  legal requirements or insurance requirements or the
                  certificate of occupancy for the Subleased Premises, nor shall
                  it be deemed to be a waiver by Sublessor of the compliance by
                  Sublessee of any provision of this Sublease.
                  Sublessee shall promptly reimburse Sublessor for all
                  reasonable fees, costs and expenses including, but not limited
                  to, those of architects and engineers, incurred by Sublessor
                  in connection with the review of Sublessee's plans and
                  specifications and inspecting the Alterations to determine
                  whether the same are being or have been performed in
                  accordance with the approved plans and specifications therefor
                  and with all legal and insurance requirements in an aggregate
                  amount not to exceed Five Thousand Dollars ($5,000.00) on each
                  occasion.

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10. ANTIGENICS LEASEHOLD LEASE. In consideration of Sublessor's current
leasehold improvements made to the Subleased Premises and for Sublessor's right,
title and interest in the Yield Up Equipment located within the Subleased
Premises, Sublessee hereby agrees to pay, without notice or demand except as set
forth therein , the Antigenics Leasehold Lease Payments in accordance with the
terms and conditions of the Antigenics Leasehold Lease, attached hereto and made
a part hereof as EXHIBIT C.

11. GRANT OF OPTION FOR THE TERTIARY SPACE. Sublessor does hereby grant to
Sublessee the exclusive right and option to sublease the Tertiary Space upon the
terms and conditions as set forth below:

         a.       Sublessee may exercise its exclusive right to sublease the
                  Tertiary Space pursuant to the terms in this Sublease,
                  effective as of January 1, 2007, by giving written notice
                  thereof to Sublessor not later than July 1, 2006 in which
                  event Sublessor agrees to deliver the Tertiary Space to
                  Sublessee in the condition required under Section 8 of this
                  Sublease on or before January 1, 2007. The parties agree to
                  execute an amendment to this Sublease within thirty (30) days
                  after the date Sublessee exercises its option for the sole
                  purpose of:

                  i.       incorporating the Tertiary Space as being a part of
                           the Subleased Premises;

                  ii.      adjusting the Sublessee's Proportionate Share and the
                           Annual Rent, as set forth in EXHIBIT B attached
                           hereto and made a part hereof;

                  iii.     providing Sublessor with an amended or replacement
                           Letter of Credit in an amount equal to Three Hundred
                           Seventy Five Thousand and 00/100 Dollars
                           ($375,000.00).

         b.       At the time of leasing the Tertiary Space, the Sublessee shall
                  have any and all rights of Sublessor under the Prime Lease
                  with respect to the exterior signage.

         c.       Sublessor hereby agrees that the rights granted herein for the
                  Subleased Premises shall be exclusive and agrees that, from
                  and after the Sublease Commencement Date until the Sublease
                  Termination Date, Sublessor shall not offer to or enter into a
                  lease, sublease, rental, or occupancy agreement affecting any
                  portion of the Subleased Premises, nor permit any tenant or
                  licensee to use or occupy any portion of the Subleased
                  Premises, without receipt of written consent of Sublessee,
                  which consent shall not be unreasonably withheld or delayed.

12. ASSIGNMENT AND SUBLETTING. Sublessee shall not assign this Sublease, nor
sublet the whole or any part of the Subleased Premises, or suffer or permit any
other person to occupy the same without first obtaining, on each occasion, the
prior written consent of Sublessor and Prime

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Lessor, which consent shall not be unreasonably withheld but shall be
conditioned upon the same terms set forth in Section 9.13 of the Prime Lease.
Notwithstanding the foregoing, Sublessee may assign or sub-sublease this
Sublease to Related Occupants, as defined in Section 9.13 of the Prime Lease,
any affiliated entity or purchaser so long as the affiliated entity or purchaser
has a net worth equal to or greater than Sublessee as of the date of this
Sublease or on the date of such assignment, whichever is greater. Sublessee
agrees to pay all Sublessor's reasonable attorneys' fees in connection with such
assignment and/or subletting and the cost of preparation of any documents
required by the Sublessor and/or Prime Lessor in connection therewith with the
Sublessor's legal fees and document preparation not to exceed Five Thousand
Dollars ($5,000.00) on each occasion.. In all events, Sublessee will continue to
remain responsible to Sublessor for the payment of the Annual Rent and the
performance of all obligations contained herein. At Sublessor's sole election,
Sublessor may require Sublessee to cause any permitted sub-Sublessee to pay the
Annual Rent directly to Sublessor.

13. DAMAGE, DESTRUCTION OR TAKING. Sublessor and Sublessee agree that in the
event the Subleased Premises is destroyed, damaged by fire or other casualty, or
taken by eminent domain, payment of the Annual Rent, the right to terminate this
Sublease and the right to pursue awards shall be governed by the provisions of
Section 10 of the Prime Lease.

14. DEFAULT AND REMEDIES. An Event of Default shall occur if:

         a.       if a Default, as defined in Section 11 of the Prime Lease,
                  shall occur with respect to the Sublessee.

         b.       Sublessee fails to pay when due any installment of Annual
                  Rent, without notice or demand, provided, however that
                  Sublessor agrees to permit Sublessee to cure such monetary
                  default by paying the late fee set forth herein,, within five
                  (5) days after receipt of written notice to Sublessee of such
                  non-payment of Annual Rent ("Grace Period"), provided further
                  that such Grace Period shall only be permitted to occur twice
                  in any twelve month period.

         c.       Sublessee shall fail to perform or observe any non-monetary
                  covenant, condition or agreement to be performed or observed
                  by it under this Sublease and such failure continues uncured
                  for more than twenty (20) days after written notice thereof to
                  Sublessee by Sublessor (unless such default is of a nature
                  that it cannot be cured within such twenty (20) day period, in
                  which event no default shall occur so long as Sublessee shall
                  diligently commence the curing of the default within the
                  twenty (20) day cure period and promptly prosecutes the curing
                  of the same), provided further that such event of default
                  shall not be deemed an Event of Default under the Prime Lease,
                  in which event the notice periods set forth in the Prime Lease
                  shall control.

<PAGE>

         d.       Sublessee attempts to remove, sell, transfer, encumber, part
                  with possession or sublet the Equipment, as defined under the
                  Antigenics Leasehold Lease, without the prior written approval
                  of Sublessor.

         e.       Sublessee, as Lessee, defaults under the Antigenics Leasehold
                  Lease.

         Upon the occurrence of an Event of Default and the expiration of any
applicable notice and cure period, Sublessor shall have all the rights and
remedies provided by applicable law, this Sublease, the Prime Lease and/or the
Antigenics Leasehold Lease. In addition, Sublessor, at its sole election, may:

         a.       declare all unpaid Annual Fixed Rent and other sums due and to
                  become due hereunder under this Sublease immediately due and
                  payable; and/or

         b.       proceed by appropriate court action or actions or other
                  proceedings either at law or in equity to enforce performance
                  by Lessee of any and all covenants of this Sublease and to
                  recover damages for the breach thereof; and/or

         c.       draw on the Letter of Credit; and/or

         d.       perform the same for the account of Sublessee without thereby
                  waiving such Event of Default, and any reasonable amount paid
                  or expense (including reasonable attorneys' fees), penalty or
                  other liability incurred by Sublessor in such performance,
                  together with interest at the rate of one and one-half (1
                  1/2%) percent per month thereon until paid by Sublessee to
                  Sublessor, shall be payable by the Sublessee upon demand as
                  Additional Rent").

Should any proceedings be instituted by or against Sublessor hereunder and/or
for possession of any or all of the Sublease Premises and/or the Equipment or
for any other relief, Sublessee shall pay a Sublessor's reasonable attorney's
fees and court costs.

No remedy of Sublessor hereunder shall be exclusive of any remedy herein or by
law provided, but each shall be cumulative and in addition to every other
remedy.

In addition to any and all remedies set forth herein, Sublessor shall have all
remedies available to the Prime Lessor under the Prime Lease and at law or in
equity, and any and all remedies shall be cumulative and non-exclusive.

15. SUBLESSEE'S OBLIGATIONS UNDER PRIME LEASE. For so long as the Prime Lease
remains in full force and effect, Sublessee agrees to perform, fulfill and
observe all of the covenants, agreements, obligations, conditions,
representations, warranties, terms and provisions imposed upon Sublessor as
tenant under the Prime Lease and which are applicable to the Subleased Premises
except for the covenants and agreements of Sublessor set forth therein with
respect to any remaining portions of the Leased Premises not being Subleased to
the Sublessee hereunder, including, Sublessor's obligations with respect to the
payment of the Annual Rent. Sublessee

<PAGE>

agrees to indemnify and hold Sublessor harmless from and against all claims,
liabilities, losses and damages of any kind whatsoever which Sublessor may incur
by reason of Sublessee's failure to perform, fulfill or observe any of the
covenants or agreements set forth herein or the applicable provisions set forth
in the Prime Lease. Sublessor agrees to indemnify and hold Sublessee harmless
from and against all claims, liabilities, losses and damages of any kind
whatsoever incurred by Sublessee as a result of any default by Sublessor under
the Prime Lease.

16. ENFORCEMENT AND DELIVERY OF PREMISES AT SUBLEASE TERMINATION DATE. Sublessee
agrees that it will pay all Sublessor's expenses, including reasonable
attorneys' fees incurred in enforcing any obligation of the Sublessee or
remedies of the Sublessor under this Sublease, or in recovering possession of
the Subleased Premises. Sublessee agrees that the Subleased Premises will, at
the expiration or earlier termination of this Sublease, be returned in good
condition, ordinary wear and tear and damage by fire or other casualty only
excepted. In the event of the Sublessee's failure to remove any of the
Sublessee's property from the Subleased Premises, specifically excluding the
Yield Up Equipment, the Sublessor is hereby authorized, after written notice to
Sublessee without liability to the Sublessee for any loss or damage thereto, and
at the sole risk of the Sublessee, to remove and store any of the property at
the Sublessee's sole cost and expense; or to retain same under the Sublessor's
exclusive use and control; or to sell at public or private sale, without notice
to the Sublessee all of the property not so removed and to apply the net
proceeds of such sale to the payment of any sum due hereunder, or to destroy
such property.

17. NOTICES. All notices or other communications hereunder shall be in writing
and delivered to the addresses set forth below by registered or certified mail,
return receipt requested, postage prepaid, or sent by an overnight express
courier service which provides evidence of delivery or attempted delivery. If
intended for Sublessor addressed to it at 34 Commerce Way, Woburn, Massachusetts
01801, Attention: Mr. Neal Gordon. If intended for Sublessee, addressed to it at
175 Crossing Boulevard, Suite 410, Framingham, Massachusetts 01702, Attention:
Mr. Jack Green, with a courtesy copy to Palmer & Dodge LLP, 111 Huntington
Avenue, Boston, Massachusetts 02199; Attention: Thomas G. Schnorr, Esq. Notices
shall be deemed given when mailed and otherwise on the earlier to occur of the
date of delivery or the date delivery was first attempted, as shown by postal
records. The parties hereto may, from time to time, by notice given hereunder,
designate in writing any different address to which subsequent notices,
certificates or other communications shall be sent.

18. BROKERAGE COMMISSION. Sublessor shall be solely responsible for the payment
of a Eighty Thousand and 00/100 Dollar ($80,000.00) brokerage commission to CB
Richard Ellis. Sublessor represents and warrants that it has not dealt with any
broker any other than Insignia/ESG in connection with this Sublease and will
indemnify and hold harmless Sublessee from and against any loss or expense
suffered by Sublessee as a result of such dealings with any other broker. If
Sublessee exercises its option for the Tertiary Space, and an amendment is fully
executed by both parties and consented to by the Prime Lessor, Sublessor shall
pay CB Richard

<PAGE>

Ellis an additional brokerage fee of $21,132.00. Sublessee represents and
warrants that it has not dealt with any broker other than CB Richard Ellis in
connection with this Sublease and will indemnify and hold harmless each of
Sublessor and Prime Lessor from and against any loss and expenses suffered by
either of them as a result of such dealings with any broker. Sublessor
represents and warrants that it has not dealt with any broker other than
Insignia/ESG in connection with this Sublease and will indemnify and hold
harmless the Sublessee from and against any loss and expenses suffered by
Sublessee as a result of such dealings with any broker, including any additional
brokerage commissions which may be due CB Richard Ellis in connection with this
Sublease.

19. SUBLESSEE'S REPRESENTATIONS AND WARRANTIES.

         a.       Sublessee acknowledges it has read and examined the Prime
                  Lease, and is fully familiar with the terms, covenants and
                  conditions on the Sublessor's part as tenant, to be performed
                  thereunder, and all of the applicable terms, covenants and
                  conditions of the Prime Lease are included herein.

         b.       Sublessee does hereby assume and agree to be bound by and
                  perform all the aforesaid terms, covenants and conditions on
                  the Sublessor's part (as tenant under the Prime Lease) to be
                  performed under the Prime Lease with respect to the Subleased
                  Premises, except as otherwise herein specified, and Sublessee
                  agrees to indemnify, defend (by counsel reasonably acceptable
                  to Sublessor) and hold Sublessor harmless against any claim or
                  liability asserted against Sublessor by reason of Sublessee's
                  failure to perform such obligations. Sublessee agrees that
                  this Sublease is separate from and subordinate in all respects
                  to the Prime Lease (and amendments thereto) and to any
                  agreement to which the Prime Lease is subject. In the event
                  Sublessee shall default in the full performance of any of the
                  terms, covenants and conditions on its part to be performed
                  under this Sublease, then Sublessor shall have the same rights
                  and remedies with respect to such default as are given to
                  Prime Lessor with respect to defaults by Sublessor as tenant
                  under the Prime Lease, all with the same force and effect as
                  though the provisions of the Prime Lease with respect to
                  defaults, and the rights and remedies of Prime Lessor in the
                  event thereof, were set forth at length herein. Sublessee
                  further agrees that Sublessor shall have no liability of any
                  nature whatsoever to Sublessee as a consequence of Prime
                  Lessor's default under the Prime Lease, including, but not
                  limited to, Prime Lessor's breach of a covenant of quiet
                  enjoyment. Any conflicts between the terms, covenants and
                  conditions of this Sublease and the Prime Lease shall be
                  resolved in favor of the Prime Lease.

<PAGE>

         c.       In any case, where Prime Lessor reserves the right to enter
                  the Subleased Premises, said right shall enure to Prime Lessor
                  as well as to Sublessor. Furthermore, Sublessor reserves the
                  right upon 24 hours prior notice to Sublessee to enter the
                  Subleased Premises for the purpose of accessing, repairing and
                  maintaining the Subleased Premises. Sublessee may elect to
                  have a representative present at the time of such entry. No
                  such prior notice shall be required in the event of an
                  emergency.

         d.       Sublessee agrees to perform and comply with the terms,
                  provisions, covenants and conditions of the Prime Lease and
                  not to do, or suffer or permit anything to be done, which
                  would result in a default under, or cause the Prime Lease to
                  be terminated or forfeited.

         e.       In the event that any mechanic's lien or other lien is filed
                  against the Sublease Premises, or any part thereof, for any
                  reason whatsoever by reason of Sublessee's acts or failure to
                  act, then Sublessee shall cause same to be discharged in the
                  time periods set forth in Section 9.4 of the Prime Lease.

         f.       Sublessee will fully and faithfully perform the terms and
                  conditions of the Prime Lease on its part to be performed, and
                  in addition thereto, Sublessee will not do, or cause to be
                  done or suffer or permit any act or thing to be done, which
                  would, or might, cause the Prime Lease or the rights of
                  Sublessor as tenant under the Prime Lease to be endangered,
                  cancelled, terminated, forfeited, or surrendered, or which
                  would or might make Sublessor liable for any damages, claim or
                  penalty.

20. SUBLESSOR'S REPRESENTATIONS AND WARRANTIES.

Sublessor represents and warrants to Sublessee that:

         a.       the Prime Lease is in full force and effect and has not been
                  modified or amended (except as expressly set forth in the
                  recitals to this Sublease); and there are no other documents,
                  instruments, agreements or the like creating obligations on
                  Sublessor's part under the Prime Lease;

         b.       Sublessor has delivered to Sublessee redacted copies of:

                  i.       the Prime Lease and the other documents expressly set
                           forth in the recitals to this Sublease, and

                  ii.      all riders, modifications, schedules, exhibits and
                           addenda relating thereto;

         c.       Sublessor is the current tenant under the Prime Lease;

         d.       neither the Prime Lessor nor Sublessor is in default under the
                  Prime Lease; nor has any event occurred which, with the giving
                  of notice, the passage of time, or

<PAGE>

                  both, would constitute a default under the Prime Lease; nor
                  has Sublessor received any notice from Prime Lessor that any
                  outstanding charges for Annual Fixed Rent, Additional Rent
                  and/or other charges under the Prime Lease are past due;

         e.       Prime Lessor has consented to this Sublease and this Sublease
                  shall not constitute a default under the Prime Lease; and

         f.       In the event that pursuant to the terms in the Prime Lease,
                  the Sublessor under the fire and condemnation provisions, if
                  any, contained in the Prime Lease has the right to terminate
                  the Prime Lease, Sublessor agrees that it will not exercise
                  such right of termination without first obtaining Sublessee's
                  consent to said termination.

         g.       Sublessor does hereby assume and agree to be bound by and
                  perform all the aforesaid terms, covenants and conditions on
                  the Sublessor's part to be performed under this Sublease with
                  respect to the Subleased Premises, and Sublessee agrees to
                  indemnify, defend (by counsel reasonably acceptable to
                  Sublessee) and hold Sublessee harmless against any claim or
                  liability asserted against Sublessee by reason of Sublessor's
                  failure to perform such obligations.

         h.       Sublessor agrees to perform and comply with the terms,
                  provisions, covenants and conditions of the Prime Lease and
                  not to do, or suffer or permit anything to be done, which
                  would result in a default under, or cause the Prime Lease to
                  be terminated or forfeited.

21. ARBITRATION. All disputes arising out of or in connection with this Sublease
Agreement and/or the Antigenics Leasehold Lease shall be finally settled under
the Commercial Arbitration Rules of the American Arbitration Association then in
effect by an arbitrator appointed in accordance with such rules. The
arbitrator's award shall be final and binding. Judgment upon the award rendered
may be entered in any court having jurisdiction over the party against which the
award is rendered. The parties expressly consent to the jurisdiction of the
federal and state courts situated in The Commonwealth of Massachusetts for the
purpose of enforcing any arbitration award rendered pursuant to this Section.
The arbitration shall take place in Framingham, Massachusetts or such other
place as the parties may agree. The arbitration shall include (a) a provision
that the prevailing party in such arbitration shall recover its costs of the
arbitration and reasonable attorneys' fees from the other party, and (b) the
amount of such costs and fees.

22. PRIME LANDLORD CONSENT. This Sublease shall be contingent upon the
Sublessor's receipt of the Prime Landlord's written consent to this Sublease, in
the form attached hereto as EXHIBIT E.

<PAGE>

23. COVENANT OF QUIET ENJOYMENT. Sublessor hereby warrants and covenants that
upon payment of the Annual Rent and any additional rent due hereunder, and upon
the performance of all the terms and covenants of this Sublease, Sublessee shall
have peaceful and quiet use and possession of the Subleased Premises without
hindrance or interruption on the part of Sublessor.

24. MISCELLANEOUS.

         a.       This Sublease and the Antigenics Leasehold Lease contain the
                  entire and exclusive agreement between the parties and
                  supersedes all prior arrangements, understandings and
                  agreements, whether oral or written. This Sublease may not be
                  amended or modified except by a written instrument executed by
                  Sublessor and Sublessee and approved in each instance by Prime
                  Lessor.

         b.       One or more waivers of any covenant or condition by Sublessor
                  shall not be construed as a waiver of a subsequent breach of
                  the same or any other covenant or condition, and the consent
                  or approval by Sublessor to or of any act by Sublessee
                  requiring Sublessor's consent or approval shall not be
                  construed to waive or render unnecessary Sublessor's consent
                  or approval to or of any subsequent similar act by Sublessee.

         c.       This Sublease shall be governed by and interpreted in
                  accordance with the laws of The Commonwealth of Massachusetts.
                  In the event any provision of this Sublease shall be
                  determined invalid or unenforceable under applicable law, or
                  shall be determined to be a violation of the Prime Lease, this
                  Sublease shall be construed as if such provision had never
                  been made a part hereof, but shall otherwise continue in full
                  force and effect.

         d.       The headings used herein are used only for convenience of
                  reference and are not to be considered part of this Sublease
                  or to be used in determining the intent of the parties hereto.

         e.       This Sublease shall be binding upon and inure to all
                  successors and permitted assigns, including all permitted
                  sub-subleases, of the parties hereto.

         f.       Sublessor shall in no event be construed, held or become in
                  any way or for any purpose a partner, associate or joint
                  venturer of Sublessee or any party associated with Sublessee
                  in the conduct of its business or otherwise.

         g.       Sublessee knowingly agrees to and hereby waives any and all
                  rights to trial by jury in any matter arising out of this
                  Sublease or otherwise with the Sublessor.

<PAGE>

         h.       The specific remedies to which Sublessor may resort under the
                  terms of this Sublease are cumulative and are not intended to
                  be exclusive of any other remedies or means of redress to
                  which it may be lawfully entitled in case of any breach or
                  threatened breach by Sublessee of any provisions of this
                  Sublease. In addition to the other remedies provided in this
                  Sublease, Sublessor shall be entitled to the restraint by
                  injunction of the violation or attempted or threatened
                  violation of any of the covenants, conditions or provisions of
                  this Sublease or to a decree compelling specific performance
                  of any such covenants, conditions or provisions.

IN WITNESS WHEREOF, Sublessor and Sublessee have executed this Sublease as an
instrument under seal by their duly authorized officers on the day and the year
first above written

PRIME LESSOR                                SUBLESSOR

                                            Antigenics Inc., a Massachusetts
                                            corporation and a wholly owned
                                            subsidiary of Antigenics Inc.,
                                            a Delaware corporation.

__________________________________          By: /s/ NEAL GORDON
                                                -------------------------------
                                            Name:  Neal Gordon
All Terms and Provisions Approved           Title: Senior Vice President

                                            SUBLESSEE

                                            GTC Biotherapeutics, Inc.

                                            By: /s/ JOHN B. GREEN
                                                -------------------------------
                                            Name:  John B. Green
                                            Title: Senior Vice President

                                            By:________________________________
                                            Name:
                                            Title:

<PAGE>

                                    EXHIBIT A

                               (SUBLEASE PREMISES)
                                   SKETCH PLAN
              Utility Equipment Area - Tertiary Space - First Floor

                                  [FLOOR PLAN]

<PAGE>

              Secondary/Tertiary Space Segregation on Second Floor
                         Hatched Area is Secondary Space
                           Open Area is Tertiary Space

                                  [FLOOR PLAN]

<PAGE>

                           Primary Space - Third Floor

                                  [FLOOR PLAN]

<PAGE>

                                    EXHIBIT B
                     (ANNUAL FIXED RENT AND ADDITIONAL RENT)

                                    [*****]

--------------------------
* Confidential Treatment has been requested for the marked portion.

<PAGE>

                                    EXHIBIT C
                            ANTIGENICS LEASEHOLD LEASE

<PAGE>

                           ANTIGENICS LEASEHOLD LEASE

         THIS ANTIGENICS LEASEHOLD LEASE (this "Leasehold Lease") dated as of
this 19th day of July, 2002 entered into between GTC Biotherapeutics, Inc. a
Massachusetts corporation, formerly known as Genzyme Transgenics Corporation,
with an address of 175 Crossing Boulevard, Suite 410, Framingham, Massachusetts
("Lessee") and Antigenics Inc., a Massachusetts Corporation ("Lessor"), and a
wholly-owned subsidiary of Antigenics Inc., a Delaware corporation, formerly
known as Aquila Biopharmaceuticals, Inc., with an address of 34 Commerce Way,
Woburn, Massachusetts 01801.

                                    RECITALS

         WHEREAS, Aquila Biopharmaceuticals, Inc., a Delaware corporation and
wholly owned subsidiary of Sublessor, is the tenant under a lease with NDNE 9/90
Corporate Center LLC (the "Prime Lessor") dated September 19, 1997 as amended by
that certain First Amendment to Lease ("First Amendment") dated December 17,
1997, as further amended by that certain Second Amendment to Lease ("Second
Amendment") dated as of January 14, 1998, as further amended by that certain
Third Amendment to Lease ("Third Amendment") dated as of February 3, 1998, as
further amended by that certain Fourth Amendment to Lease ("Fourth Amendment")
dated as of February 27, 1998, as further Amended by that certain Fifth
Amendment to Lease ("Fifth Amendment") dated as of March 13, 1998 and as
affected by that certain Consent to Assignment of Lease ("Consent") dated April,
2001 (the Lease as so amended and affected by the First Amendment, the Second
Amendment, the Third Amendment, the Fourth Amendment, the Fifth Amendment and
the Consent is hereinafter called the "Prime Lease") which relates to space in
the Building (as said term is defined in the Prime Lease) comprised of
approximately 41,020 rentable square feet located on the 1st, 2nd and 3rd floors
of the building (the "Leased Premises");

         WHEREAS, Lessor and Lessee entered into a Sublease Agreement (the
"Sublease") for a portion of the Leased Premises dated July 16, 2002 (the
"Subleased Premises");

         WHEREAS, pursuant to the terms of the Sublease, the Lessor, as
Sublessor, and the Lessee, as Sublessee, agreed to enter into this Leasehold
Lease Agreement.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Lessor and Lessee covenant and
agree as follows:

         All terms not otherwise defined herein shall have the same meaning as
set forth in the Prime Lease and the Sublease.

         Lessor hereby leases to Lessee, and Lessee hereby hires and takes from
Lessor, the leasehold improvements, fixtures and personal property described in
EXHIBIT A, attached hereto and made a part hereof (hereinafter, with all
replacement parts, additions, repairs and accessories incorporated therein
and/or affixed thereto, collectively referred to as "Equipment"), subject to the
following terms and conditions:

         1. TERM AND RENTALS: This Leasehold Lease is for the term beginning on
the Sublease Commencement Date and terminating on December 31, 2006 unless all
of the following conditions are satisfied:

<PAGE>

         (a)      Lessee exercises its right under the Tertiary Space Option;

         (b)      Lessor and Lessee enter into an amendment to the Sublease
                  adding the Tertiary Space and extending the term of the
                  Sublease until September 30, 2010, as provided for under the
                  Sublease; and

         (c)      Prime Lessor fails to exercise its Take Back Option with
                  respect to the Leased Premises pursuant to Section 9.13 of the
                  Prime Lease, in which event this Leasehold Lease shall
                  terminate on September 30, 2010.

         During the term, Lessee agrees to pay to Lessor the monthly rental
amounts set forth in Exhibit B of the Sublease as the Leasehold Improvements
Allocation (the "Leasehold Rent") on or before the first day of each month. All
Leasehold Rent due under this Leasehold Lease shall be paid to Lessor or its
assigns without notice or demand and without abatement, offset, defense or
counterclaim, with the exception of any rights Lessee may have under subsection
3(d) of this Leasehold Lease, at Lessor's principal office address set forth
above, or such other place as Lessor or its assignee may designate in writing to
Lessee.

         If Lessee fails to pay Leasehold Rent or other payments due under this
Leasehold Lease on or before the same becomes due and upon the expiration of any
applicable notice and grade periods, Lessor may, at its election without notice
or demand:

         (a)      accept the Leasehold Rent payment in arrears and Lessee shall
                  pay, as liquidated damages, a late charge equal to one and
                  one-half (1 1/2) percent per month (computed on the basis of a
                  thirty (30) day month) on each defaulted Leasehold Rent
                  payment from the due date thereof; or

         (b)      declare all unpaid Leasehold Rent and other sums due hereunder
                  immediately due and payable, as further set forth in Section 7
                  of this Leasehold Lease.

In addition, Lessor, as Sublessor, shall have all of the rights under the
Sublease, including the right to draw down on the Letter of Credit.

         Lessee's obligation to pay the Leasehold Rent and other payments due
under this Leasehold Lease shall be absolute and unconditional and shall not be
affected by reason of:

         (a)      any defect in, lack of fitness for a particular purpose, use
                  of, damage to, loss of possession or use of or destruction of,
                  all or any of the Equipment;

         (b)      the prohibition or other restriction against Lessee's use of
                  said Equipment; or

         (c)      for any other cause, being the agreement of the parties that
                  this Leasehold Lease and any other amount payable by Lessee
                  hereunder shall continue to be payable in all events in the
                  manner and at the times provided herein.

<PAGE>

Notwithstanding the above, Lessee shall be entitled to off-set Leasehold Rent
payments due under this Leasehold Lease but not the Sublease, pursuant to the
provisions of subsection 3(d)(iii)) of this Leasehold Lease.

         2. DESTRUCTION OF EQUIPMENT: The Lessor agrees to maintain insurance on
the Equipment located in the Subleased Premises (the location of the Equipment
is set forth in EXHIBIT B) until the Sublease Commencement Date for the Primary
Space, Secondary Space and the Tertiary Space, respectively. Lessee agrees to
maintain insurance on the Equipment located in the Subleased Premises during the
Sublessee's lease of the Primary, Secondary and Tertiary Space. In the event of
any loss or damage to the Equipment the respective party shall, to the extent
permitted under the Prime Lease, use the proceeds of any insurance to repair or
replace the Equipment. Lessor shall have no further obligations with respect to
the Equipment after the Lessee's leasing of the Tertiary Space.

         3. INSPECTION; WARRANTIES BY LESSOR; MAINTENANCE, COMPLIANCE WITH LAWS
AND INSURANCE:

         (a)      Except as provided in subsection 3(d) of this Leasehold Lease,
                  Lessee agrees that it has had the opportunity to inspect all
                  of the Equipment prior to the date of this Leasehold Lease and
                  that Lessee is taking the Equipment "as-is" in its current
                  condition and location as set forth in EXHIBIT B (the
                  "Acceptance").

         (b)      Except as provided in subsection 3(d) of this Leasehold Lease,
                  Lessor, not being the manufacturer of the Equipment, nor
                  manufacturer's agent, makes no warranty or representation,
                  either express or implied, as to the fitness, quality, design,
                  capacity, suitability, merchantability or performance of the
                  Equipment or of the material or workmanship thereof, it being
                  agreed that the Equipment is leased "as is" and that all such
                  risks, as between Lessor and Lessee, are to be borne by the
                  Lessee at its sole risk and expense. Lessee further agrees,
                  regardless of cause, not to assert any claim whatsoever
                  against the Lessor for loss of anticipatory profits or
                  consequential damages.

         (c)      No oral agreement, guaranty, promise, condition,
                  representation or warranty shall be binding; all prior
                  conversations, agreements or representations related hereto
                  and/or to the equipment are integrated herein, and no
                  modification hereof shall be binding unless in writing signed
                  by parties.

         (d)      Lessor shall have the following maintenance obligations with
                  regard to the Equipment.

                  (i)      Lessor agrees to maintain the Equipment located
                           within the Leased Premises leased by Lessor in at
                           least the same condition as of the date of this
                           Leasehold Lease (with the exception of normal wear
                           and tear), under the same maintenance procedures
                           currently utilized by Lessor, until the Sublease
                           Commencement Date for the Primary Space, Secondary
                           Space

<PAGE>

                           and Tertiary Space, respectively, at which time
                           Lessee shall be solely obligated to maintain the
                           Equipment located within the applicable portion of
                           the Subleased Premises as set forth below. As stated
                           above, Lessee's obligation to maintain, install,
                           repair, erect, test, adjust or service the Equipment
                           shall not commence until such time as the Sublease
                           Commencement Date for the Primary Space, with respect
                           to Equipment located in the Primary Space, the
                           Sublease Commencement Date for the Secondary Space
                           with respect to Equipment located in the Secondary
                           Space and in the event the Lessee elects to exercise
                           its option to sublease the Tertiary Space, January 1,
                           2007 with respect to Equipment located in the
                           Tertiary Space.

                  (ii)     Lessor shall provide reasonable evidence of such
                           maintenance to Lessee upon written request by sending
                           Lessee copies of its maintenance records and Lessee
                           shall have the right to inspect the Equipment and
                           audit such maintenance records at reasonable times
                           upon 24 hour prior written notice to Lessor.

                  (iii)    If Lessor fails to maintain the Equipment in the
                           required condition during its occupancy thereof,
                           Lessee may, after prior written notice to Lessor and
                           only after Lessor fails to maintain such Equipment
                           within ten (10) days after receipt of such written
                           notice, arrange to have the Equipment maintained or
                           repaired by a licensed professional and off-set an
                           amount equal to the actual cost of such
                           maintenance/repair from its next Leasehold Rent
                           payment under this Leasehold Lease, provided however,
                           that any rights of off-set shall not apply to a
                           Lessee, as Sublessee, payment of Annual Fixed
                           Leasehold Rent under the Sublease. Lessee shall
                           provide Lessor with copies of all such invoices for
                           such maintenance as a condition precedent to any
                           rights of set-off. Provided further that, Lessee
                           shall not be entitled to off-set Leasehold Rent, if
                           it is determined that such maintenance obligation
                           resulted from any acts of Lessee, its contractors,
                           employees or invitees.

                  (iv)     From and after Sublessee's occupancy of the Primary
                           Space, Secondary Space, and Tertiary Space, Lessor
                           shall have no further obligations to maintain,
                           install, repair, erect, test, adjust or service the
                           Equipment located within such occupied space.

         (e)      LESSEE SHALL HAVE THE FOLLOWING MAINTENANCE OBLIGATIONS WITH
                  REGARD TO THE EQUIPMENT:

                  (i)      From and after the Sublease Commencement Date for the
                           Primary Space, Secondary Space and Tertiary Space,
                           respectively, Lessee shall be obligated to maintain
                           the Equipment located in the applicable portion of
                           the Subleased Premises as set forth in Schedule C in
                           at least the same

<PAGE>

                           condition as of the date Sublessee leases such
                           portion of the Subleased Premises (with the exception
                           of normal wear and tear), under the same maintenance
                           procedures currently utilized by Lessor.

                  (ii)     If Lessee has not maintained the Equipment in the
                           required condition, Lessor may, after prior written
                           notice to Lessee and only after Lessee fails to
                           maintain such Equipment within ten (10) days after
                           receipt of such written notice, arrange to have the
                           Equipment maintained or repaired by a licensed
                           professional and charge the actual cost of such
                           maintenance/ repair as Additional Rent due with the
                           next monthly Leasehold Rent payment. Lessor shall
                           provide Lessee with copies of all such invoices for
                           such maintenance as a condition precedent to charging
                           any Additional Rent.

         (f)      Lessee and Lessor each agree, at their own cost and expense,
                  to comply with all of the following requirements with respect
                  to the Equipment while such party leases the Leased Premises
                  in which such Equipment is located:

                  (i)      to pay all charges and expenses in connection with
                           the operation of each item of Equipment;

                  (ii)     to comply with all governmental laws, ordinances,
                           regulations, requirements and rules with respect to
                           the use, maintenance and operation of each item of
                           Equipment;

                  (iii)    to maintain at all times public liability, property
                           damage, fire with extended coverage, theft and
                           comprehensive insurance in an amount equal to the
                           book value of such Equipment, as set forth on the
                           depreciation schedule attached hereto as EXHIBIT C,
                           protecting the other party's interest as it may
                           appear, delivering to the other party evidence of
                           such insurance coverage upon the commencement of this
                           Leasehold Lease and annually thereafter, provided,
                           however that Lessor shall have no further obligations
                           to insure the Equipment after the earlier of the
                           Sublease Termination Date or the Sublessee's leasing
                           of the Tertiary Space; and

                  (iv)     all insurance policies shall provide that no
                           cancellation thereof shall be effective without
                           thirty (30) days prior written notice to the other
                           party.

         4. LESSOR'S TITLE, RIGHT OF INSPECTION AND IDENTIFICATION OF EQUIPMENT:
Title to the Equipment shall at all times remain in the Lessor and Lessee will
at all times protect and defend, at its own cost and expense, the title of
Lessor from and against all claims, liens and legal processes of creditors of
Lessee and keep all the Equipment free and clear from all such claims, liens and
processes. Lessor shall have the right from time to time during reasonable
business hours, with reasonable advance notice, to enter upon the Subleased
Premises for the purpose of confirming the existence, condition and proper
maintenance of the Equipment.

<PAGE>

Lessor shall be accompanied by a representative of Lessee during any such
inspection. The foregoing rights of entry are subject to any applicable
governmental laws, regulations and rules concerning industrial security. Prime
Lessor has consented to this Leasehold Lease and this Leasehold Lease shall not
constitute a default under the Prime Lease. Lessor hereby represents that it
either has or does not require authority to lease the Equipment and that this
Leasehold Lease does not constitute a breach of any agreement with respect to
the Equipment.

         5. POSSESSION, PLACE OF USE AND CHANGES IN LOCATION OF EQUIPMENT: So
long as Lessee shall not be in default under this Leasehold Lease or the
Sublease the Lessee shall be entitled to the possession and use of the Equipment
in accordance with the terms of this Leasehold Lease and the Sublease. The
Equipment shall be used in the conduct of the lawful business of Lessee and
shall be kept at the address of Lessee set forth above. Lessee shall not,
without Lessor's prior written consent, remove the Equipment from such location,
part with possession or control of the Equipment or attempt or purport to sell,
pledge, mortgage or otherwise encumber any of the Equipment or otherwise dispose
of or encumber any interest under this Leasehold Lease.

         6. PERFORMANCE OF OBLIGATIONS OF LESSEE BY LESSOR: In the Event of
Default (as defined below), the Lessor may, at its option, perform the same for
the account of Lessee without thereby waiving such Event of Default, and any
reasonable amount paid or expense (including reasonable attorneys' fees),
penalty or other liability incurred by Lessor in such performance, together with
interest at the rate of one and one-half (1 1/2%) percent per month thereon
until paid by Lessee to Lessor, shall be payable by the Lessee upon demand as
additional rent ("Additional Rent") for the Equipment.

         7. EVENT OF DEFAULT: An "Event of Default" by Lessee shall occur if:

         (a)      Lessee fails to pay when due any installment of Leasehold Rent
                  and/or Additional Rent, without notice or demand, provided,
                  however that Lessor agrees to permit Lessee to cure such
                  monetary default by paying the late fee set forth in Section
                  1(a) of this Leasehold Lease, within five (5) days after
                  receipt of written notice to Lessee of such non-payment of
                  Leasehold Rent ("Grace Period"), provided further that such
                  Grace Period shall only be permitted to occur twice in any
                  twelve month period and shall not apply to any payments due
                  under the Sublease with the exception of payments made under
                  this Leasehold Lease;

         (b)      Lessee shall fail to perform or observe any non-monetary
                  covenant, condition or agreement to be performed or observed
                  by it under this Leasehold Lease and such failure continues
                  uncured for twenty (20) days after written notice thereof to
                  Lessee by Lessor (unless such default is of a nature that it
                  cannot be cured within such twenty (20) day period, in which
                  event no default shall occur so long as Lessee shall
                  diligently commence the curing of the default within the
                  twenty (20) day cure period and promptly prosecutes the curing
                  of the same);

<PAGE>

         (c)      Lessee ceases doing business, makes an assignment for the
                  benefit of creditors, admits in writing its inability to pay
                  its debts as they become due, files a voluntary petition in
                  bankruptcy, is adjudicated a bankrupt or an insolvent, files a
                  petition seeking for itself any reorganization, arrangement,
                  composition, readjustment, liquidation, dissolution or similar
                  arrangement under any present or future statute, law or
                  regulation or files an answer admitting the material
                  allegations of a petition filed against it in any such
                  proceeding, consents to or acquiesces in the appointment of a
                  trustee, receiver, or liquidator of it or of all or any
                  substantial part of its assets or properties, or if it or its
                  shareholders shall take any action looking to its dissolution
                  or liquidation;

         (d)      within ninety (90) days after the commencement of any
                  proceedings against Lessee seeking reorganization,
                  arrangement, readjustment, liquidation dissolution or similar
                  relief under any present or future statute, law or regulation,
                  such proceedings shall not have been dismissed, or if within
                  ninety (90) days after the appointment without Lessee's
                  consent or acquiescence of any trustee, receiver or liquidator
                  of it or of all or any substantial part of its assets and
                  properties, such appointment shall not be vacated;

         (e)      Lessee attempts to remove, sell, transfer, encumber, part with
                  possession or sublet the Equipment or any item thereof,
                  without the prior written approval of Lessor; or

         (f)      Lessee, as Sublessee shall be in default under the Sublease.

         Upon the occurrence of an Event of Default and the expiration of any
applicable notice and cure period, Lessor shall have all the rights and remedies
provided by applicable law, this Leasehold Lease and/or the Sublease. In
addition, Lessor, at its sole election, may:

         (a)      declare all unpaid Leasehold Rent and other sums due and to
                  become due under this Leasehold Lease immediately due and
                  payable; and/or

         (b)      proceed by appropriate court action or actions or other
                  proceedings either at law or in equity to enforce performance
                  by Lessee of any and all covenants of this Leasehold Lease and
                  to recover damages for the breach thereof.

         Lessor shall also be entitled to recover immediately as liquidated
damages for loss of the bargain and not as penalty any unpaid Leasehold Rent
that accrued on or before the occurrence of the Event of Default for the
unexpired term of this Leasehold Lease. No remedy of Lessor hereunder shall be
exclusive of any remedy herein or by law provided, but each shall be cumulative
and in addition to every other remedy.

         8. INDEMNITY: Lessee agrees that Lessor shall not be liable to Lessee
for, and Lessee shall indemnify and save Lessor harmless from and against any
and all liability, loss,

<PAGE>

damage, expense, causes of action, suits, claims or judgments arising from or
caused directly or indirectly by an Event of Default by Lessee under this
Leasehold Lease; or injury to person or property resulting from or based upon
the actual use, operation, delivery or transportation of any or all of the
Equipment or its location or condition, after the Sublease Commencement Date
unless caused by the negligence of Lessor or its agents, employees, contractors
or representatives; and shall, at its own cost and expense, defend any and all
suits which may be brought against Lessor, either alone or in conjunction with
others upon any such liability or claim or claims and shall satisfy, pay and
discharge any and all judgments and fines that may be recovered against Lessor
in any such action or actions, provided, however, that Lessor shall give Lessee
written notice of any such claim or demand.

         9. ASSIGNMENT, NOTICES, REMEDIES AND WAIVERS: Lessee shall not be
permitted to assign this Leasehold Lease without the prior written consent of
Lessor, which consent shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, as long as there is no Event of Default by the
Lessee under the provisions of this Leasehold Lease and/or the Sublease, this
Leasehold Lease and any rights pursuant hereto may be assigned by Lessee as
provided under Section 9.13 of the Prime Lease. Notwithstanding, the Lessee may
assign its rights hereunder to any Related Occupants, as defined in Section 9.13
of the Prime Lease, any affiliated entity or purchaser so long as the affiliated
entity or purchaser has a net worth equal to or greater than Lessee as of the
date of this Leasehold Lease or on the date of such assignment, whichever is
greater. It shall be a condition of the validity of any assignment that the
assignee agrees directly with Lessor, to be bound by all of the terms and
obligations of Lessee hereunder. No assignment shall relieve Lessee from its
obligations hereunder and Lessee shall remain fully and primarily liable
therefor.

         10. NOTICES: All notices relating hereto shall be delivered in person
to an officer of the Lessor or Lessee or shall be mailed registered to Lessor or
Lessee at its respective address below shown or at any later address last known
to the sender. If intended for Lessor, addressed to Antigenics Inc., 34 Commerce
Way, Woburn, Massachusetts 01801, Attention: Mr. Neal Gordon. If intended for
Lessee, addressed to GTC Biotherapeutics, Inc., 175 Crossing Boulevard, Suite
410, Framingham, Massachusetts 01702, Attention: Mr. Jack Green, with a courtesy
copy to Palmer & Dodge LLP, 111 Huntington Avenue, Boston, Massachusetts 02199,
Attention: Thomas G. Schnorr, Esq. No remedy of Lessor hereunder shall be
exclusive of any other remedy herein or by law provided, but each shall be
cumulative and in addition to every other remedy. A waiver of a default shall
not be a waiver of any other or a subsequent default.

         11. FURTHER ASSURANCES: Lessee shall execute and deliver to Lessor,
upon Lessor's request, such instruments and assurances as Lessor deems necessary
or advisable for the confirmation or perfection of this Leasehold Lease and
Lessor's rights hereunder, including the filing or recording of this agreement
at Lessor's option and at Lessor's sole cost and expense.

<PAGE>

         12. LEASE IRREVOCABILITY: This Leasehold Lease is irrevocable for the
full term hereof and for the aggregate rentals hereinabove reserved and the
Leasehold Rent shall not abate by reason of termination of Lessee's right of
possession, except in the event of default by the Lessor under the Prime Lease
or in the event Prime Lessor exercises its Take Back Option with respect to the
Leased Premises pursuant to Section 9.13 of the Prime Lease

         13. PURCHASE OPTION: Lessee shall purchase the Equipment upon the
expiration of this Leasehold Lease, provided all Leasehold Rent and Additional
Rent is paid in full, for consideration in the amount of One Dollar ($1.00).

         14. LESSOR AND LESSEE REPRESENTATION: The parties hereto hereby
represent and warrant as follows:

         (a)      Lessee hereby represents and warrants as follows:

                           (i) is a corporation duly organized, validly existing
                  and in good standing under the laws of the jurisdiction of its
                  incorporation, has all requisite corporate power and authority
                  to own its property and conduct its business as is now
                  conducted, is duly qualified and in good standing as a
                  Massachusetts corporation and is duly authorized to do
                  business in each jurisdiction where the nature of its
                  properties or business requires such qualification; and

                           (ii) the execution, delivery and performance of this
                  Leasehold Lease and the related documents referenced to
                  herein: (aa) is within its corporate power and authority; (bb)
                  has been authorized by all necessary corporate proceedings;
                  (cc) does not and will not require the consent of the
                  stockholders of Lessee or approvals of any governmental
                  authority; (dd) will not contravene any provision of the
                  charter documents or by-laws of Lessee or any law, rule or
                  regulation applicable to Lessee; (ee) will not constitute a
                  default under any other agreement, order or undertaking
                  binding on Lessee; and (ff) will not require the consent or
                  approval of any obligee or holder of any instrument relating
                  to any indebtedness of Lessee.

         (b)      Lessor hereby represents and warrants as follows:

                           (i) is a corporation duly organized, validly existing
                  and in good standing under the laws of the jurisdiction of its
                  incorporation, has all requisite corporate power and authority
                  to own its property and conduct its business as is now
                  conducted, is duly qualified and in good standing as a
                  Massachusetts corporation and is duly authorized to do
                  business in each jurisdiction where the nature of its
                  properties or business requires such qualification; and

<PAGE>

                           (ii) the execution, delivery and performance of this
                  Leasehold Lease and the related documents referenced to
                  herein: (aa) is within its corporate power and authority; (bb)
                  has been authorized by all necessary corporate proceedings;
                  (cc) does not and will not require the consent of the
                  stockholders of Lessor or approvals of any governmental
                  authority; (dd) will not contravene any provision of the
                  charter documents or by-laws of Lessee or any law, rule or
                  regulation applicable to Lessee; and (ee) will not constitute
                  a default under any other agreement, order or undertaking
                  binding on Lessor.

                           (iii) Prime Lessor has consented to this Leasehold
                  Lease and this Leasehold Lease shall not constitute a default
                  under the Prime Lease;

         15. CONSENT: This Leasehold Lease is contingent upon the prior written
approval of Silicon Valley Bank and shall not be effective until and unless
Silicon Valley Bank has given its approval hereto, if such approval is required.

         16. ARBITRATION: All disputes arising out of or in connection with this
Lease Agreement shall be finally settled under the Commercial Arbitration Rules
of the American Arbitration Association then in effect by an arbitrator
appointed in accordance with such rules. The arbitrator's award shall be final
and binding. Judgment upon the award rendered may be entered in any court having
jurisdiction over the party against which the award is rendered. The parties
expressly consent to the jurisdiction of the federal and state courts situated
in The Commonwealth of Massachusetts for the purpose of enforcing any
arbitration award rendered pursuant to this Section. The arbitration shall take
place in Framingham, Massachusetts or such other place as the parties may agree.
The arbitration shall include (a) a provision that the prevailing party in such
arbitration shall recover its costs of the arbitration and reasonable attorneys'
fees from the other party, and (b) the amount of such costs and fees.

         17. MISCELLANEOUS PROVISIONS: No oral agreement, guaranty, promise,
condition, representation or warranty shall be binding; all prior conversations,
agreements or representations related hereto and/or to the equipment are
integrated herein, and no modification hereof shall be binding unless in writing
signed by Lessor and Lessee. If any provision of the Leasehold Lease is held to
be invalid or unenforceable by a court of competent jurisdiction, all of the
other provisions hereof shall remain in full force and effect and shall be
liberally construed in favor of the Lessor in order to effect the provisions of
the Leasehold Lease.

         This Leasehold Lease shall be governed, construed and enforced under
the laws of the Commonwealth of Massachusetts. Lessee also agrees that any and
all legal actions hereunder or related to the Leasehold Lease shall be pursued
in the courts located in the Commonwealth of Massachusetts and agrees to submit
to the jurisdiction of the courts of the Commonwealth of Massachusetts for such
purposes.

         No delays or omissions by the Lessor in exercising or enforcing any of
the Lessor's rights and remedies shall constitute a waiver of or otherwise
impair any such right or remedy, nor shall

<PAGE>

it be construed to be a waiver of any such Event of Default or an acquiescence
therein. A waiver on one occasion shall not operate as a bar to or waiver of any
such right or remedy on any future occasion, nor shall it be deemed a continuing
waiver.

         The Schedules attached hereto are made a part of this Leasehold Lease
for all purposes.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.

                                             LESSEE
                                             GTC BIOTHERAPEUTICS, INC.

                                            By:
________________________                        ________________________
Witness                                          Name:
                                                 Title:

_________________________                   By: _______________________________
Witness                                          Name:
                                                 Title:

<PAGE>

                                            LESSOR

                                            ANTIGENICS INC., a Massachusetts
                                            Corporation and a wholly owned
                                            subsidiary of Antigenics Inc.,
                                            a Delaware Corporation

                                            By:
________________________                        ________________________
Witness                                          Name:
                                                 Title:

_________________________                   By: _______________________________
Witness                                          Name:
                                                 Title:

<PAGE>

                                    Exhibit A

                         (Equipment and Fixed Equipment)

                                    [*****]

--------------------------
* Confidential Treatment has been requested for the marked portion.

<PAGE>

                      Equipment Lease Agreement - Exhibit B
                         Breakdown of Equipment by Room
                             Updated: July 10, 2002

<TABLE>
<CAPTION>
Manufacturing Areas-Second Floor
           Space             Room Equipment                           Tag Number        Serial Number  Vendor
---------------------------- ---------------------------------------  ----------------- -------------  ----------------
<S>                          <C>                                      <C>               <C>            <C>
                    Tertiary 200 2-Combo Walk In/Bench top Fume hoods Hood 200-01                      Labconco
                    Tertiary 200 2-Combo Walk In/Bench top Fume hoods Hood 200-02                      Labconco
                    Tertiary 200 Exhaust "Snorkels"                                                    Alsedent
                    Tertiary 206 Walk In Hood                         No Tag                           Labconco
                    Tertiary 206 Exhaust "Snorkel"                                                     Alsedent
                    Tertiary 208 Lancer Glass Washer                  4042 Aquila                      Lancer
                    Tertiary 215 Getinge Autoclave                    0237 Aquila                      Getinge
                    Tertiary 215 Getinge Autoclave                    0155 Aquila                      Getinge
                    Tertiary 215 1 Gruenberg Oven                     4136 Aquila                      Gruenberg
                    Tertiary 211 1 BSC (Not ducted)                   1227 Cambridge                   Nuaire
                    Tertiary 213 Walk in Fume Hood                    0277 Aquila                      Labconco
                    Tertiary 213 Combo Walk In/bench top Fume Hood    0276 Aquila                      Labconco
                    Tertiary 214 Lancer Glass Washer                  4120 Aquila                      Lancer
                    Tertiary 214 Dryer                                4119 Aquila                      Forma Quick
                    Tertiary 219 Fume Hood                                              981141263F     Labconco
                    Tertiary 221 1 BSC                                0194 Cambridge
                    Tertiary 221 1 Class 100 Soft Wall Clean Room     4114 Aquila
                    Tertiary 223 Cold Room
                    Tertiary 224 1 BSC                                000304 Antigenics                The Baker Company

Animal Facility-Second Floor
                   Secondary 246 6' BSC (Ducted)                      1226 Cambridge    56-1530IV
                   Secondary 246 4' BSC (Ducted)                      4223 Aquila                      Nuaire
                   Secondary 246 1 Getinge Autoclave                  4220 Aquila                      Getinge

Research Labs-Second Floor
                    Tertiary 250 1-6' BSC 9Not Ducted)                4206 Aquila       14154 SR       Nuaire
                    Tertiary 252 1-6' BSC (Not Ducted)                4214 Aquila       18940 UT       Nuaire
                    Tertiary 254 1 Fume Hood                          No Tag            13937SP        Nuaire
                    Tertiary 254 BSC (Not ducted)                     117 Cambridge                    Nuaire
                    Tertiary 254 BSC (Not ducted)                     175 Cambridge                    Nuaire
                    Tertiary 257 Fume Hood                            No Tag                           Labconco
                    Tertiary
                    Tertiary 257 Electric Boiler                      4186 Aquila       N4-11336-P89
                    Tertiary 257 Autoclave (small)                    4280              120176         Market Forge
                        2    260 Fume Hood                            No Tag                           Labconco
                        2    262 1-4' BSC (Not ducted)                4208 Aquila                      Nuaire
                        2    262 1-6' BSC (Not ducted)                4209 Aquila                      Nuaire
                        2    264 Cold Room                                                             Bally
                    Tertiary 267 Cold Room                                                             Masterbilt

Facility Systems-First Floor
                    Tertiary     PH Neutralization System                              P73938A-2       Nettco
                    Tertiary     PH Neutralization System                              P73938A-1       Nettco
                    Tertiary     Solvent Delivery System                               PRV602501
                    Tertiary     Purified Water System                                 Cal Tags 683,
                                                                                         684,685
                    Tertiary     Compressed Air                                        K7775U84F
                    Tertiary     Glycol Chiller                       3396 Cambridge   L87E02251
                    Tertiary     2 Hot Water Boilers                                   BT-6384         Cleaver Brooks
                    Tertiary     Hot Water Boiler                                      BT-6385         Cleaver Brooks
                    Tertiary     High Pressure Boilers                                 64638           Fulton
                    Tertiary     High Pressure Boilers                                 81992           Fulton
                    Tertiary     1 Low Pressure Boiler                                 64546           Fulton
                    Tertiary     1 Electric Chromulux Boiler                           875-10882
                    Tertiary     1 Clean Steam Generator                               910125A-1
                    Tertiary     1 Biokill System                                      LSL 112100
                    Tertiary     1 Stand by Generator                                  981120
                    Tertiary     1 Siemens Building Automation System No Tag
                    Tertiary     1 Intellution Monitoring System for
                                     Biokill/Solvent                                   66685A1
                                                                                       6685A2
</TABLE>

<PAGE>

                      Equipment Lease Agreement - Exhibit C
                            Depreciation Calculations
                             Updated: July 10, 2002

                                  [*****]

--------------------------
* Confidential Treatment has been requested for the marked portion.

<PAGE>

                                    EXHIBIT D
                              PRIME LESSOR CONSENT

<PAGE>

                               CONSENT TO SUBLEASE

                                    PREAMBLE

     THIS CONSENT TO SUBLEASE ("Consent") dated as of July 18, 2002, is made
with reference to that certain Sublease dated July 16, 2002 (the "Sublease") by
and between Antigenics, Inc., a Massachusetts corporation having an address of
34 Commerce Way, Woburn, MA 01801,a wholly owned subsidiary of Antigenics, Inc.,
a Delaware corporation formerly known as Aquila Biopharmaceuticals, Inc.
("Sublandlord") and GTC Biotherapeutics, Inc., a Massachusetts corporation
having an address at 175 Crossing Boulevard, Suite 410, Framingham, MA 01702
("Subtenant"), and is entered into by and among NDNE 9/90 Corporate Center LLC,
a Massachusetts limited liability company, having an address c/o National
Development, 2310 Washington Street, Newton Lower Falls, MA 02462
("Overlandlord"), Sublandlord, and Subtenant, with respect to the following
facts:

     A.   Overlandlord and Sublandlord are the parties to that certain Lease
          dated as of September 19, 1997, as amended by (i) that certain First
          Amendment to Lease ("First Amendment") dated December 17, 1997 (ii)
          that certain Second Amendment to Lease ("Second Amendment") dated as
          of January 14, 1998 (iii) that certain Third Amendment to Lease
          ("Third Amendment") dated February 3, 1998 (iv) that certain Fourth
          Amendment to Lease ("Fourth Amendment") dated February 27, 1998 and
          (v) that certain Fifth Amendment to Lease ("Fifth Amendment") dated as
          of March 13, 1998 and as affected by that certain Consent to
          Assignment of Lease ("Consent") dated April __, 2001 (said Lease as
          amended and affected by the First Amendment, the Second Amendment, the
          Third Amendment, the Fourth Amendment, the Fifth Amendment and the
          Consent is hereafter the "Overlease") pertaining to certain space
          comprised of approximately 41,020 rentable square feet rentable square
          feet located on the 1st, 2nd and 3rd floor(s) (the "Original
          Premises") of a building owned by Overlandlord and known as and
          numbered 175 Crossing Boulevard, Framingham, Massachusetts (the
          "Building");

     B.   Sublandlord and Subtenant wish to enter into the Sublease;

     C.   The Overlease provides, INTER ALIA, that Sublandlord may not enter
          into any sublease without Overlandlord's prior written approval; and

     D.   Sublandlord and Subtenant have presented the fully executed Sublease
          (a true copy of which is attached hereto as Exhibit A) to Overlandlord
          for Overlandlord's review and approval.

<PAGE>

                                   AGREEMENTS

     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

     1.   Overlandlord hereby consents to the execution and delivery of the
          Sublease upon the terms and conditions set forth in the General
          Conditions of Consent to Sublease ("General Conditions") attached
          hereto and made an integral part hereof.

     2.   Sublandlord and Subtenant hereby acknowledge receipt of the General
          Conditions and further acknowledge that Overlandlord's consent is
          subject to such General Conditions, and that in the event of a
          conflict between (a) this Consent and the General Conditions and (b)
          the Sublease or any other agreement by and between Sublandlord and
          Subtenant including, without limitation, the Equipment Lease (as
          defined in the Sublease), this Consent and the General Conditions
          shall control.

     3.   Notwithstanding anything contained in the Sublease to the contrary, as
          a result of the subletting of the Subleased Premises to Subtenant and
          the Additional Rent payable under the Sublease as the result of the
          Antigenics Leasehold Lease, Overlandlord is entitled to receive the
          amounts set forth in Exhibit B to this Consent from Sublandlord
          pursuant to the last sentence of Section 9.13(a) of the Overlease.
          Such amount is considered Additional Rent under the Overlease and
          shall be paid by Sublandlord to Overlandlord as Additional Rent under
          the Overlease on or before the first (1st) day of each and every
          calendar month. The Sublease Overage is subject to increase and
          adjustment upon any increase in the rent payable under the Sublease
          and/or the Antigenics Leasehold Lease from time to time (whether due
          to increased rates or additions to the Subleased Premises or equipment
          demised under the Sublease and/or Antigenics Leasehold Lease from time
          to time).

     4.   In no event shall Sublandlord or Subtenant remove any of the Yield Up
          Equipment described in Exhibit N of the Overlease from the Original
          Premises or Property upon expiration or earlier termination of the
          Sublease Term.

     5.   The parties hereto acknowledge and agree that, as and to the extent
          that the Sublease initially constitutes a subletting of only 19,888
          square feet of the 41,020 square foot Original Premises, this Consent
          does not constitute a consent to a subletting of the entire Original
          Premises demised under the

<PAGE>

          Overlease and, accordingly, the Take Back Option set forth in Section
          9.13(c) of the Lease does not apply to the initial subletting of only
          the Primary Space and the Secondary Space. However, in the event
          Subtenant shall exercise its option to sublease the "Tertiary Space"
          pursuant to the Tertiary Space Option contained in paragraph 11 of the
          Sublease, the Take Back Option set forth in Section 9.13(c) of the
          Lease shall be applicable and, in such event, Landlord shall be
          entitled to exercise any and all rights afforded Landlord under
          Section 9.13(c) of the Overlease.

          Notwithstanding anything contained in the Sublease to the contrary,
          upon the giving of the notice of exercise of Subtenant's option to
          sublease the Tertiary Space described in paragraph 11(a) of the
          Sublease by Subtenant, Subtenant shall simultaneously provide
          Overlandlord with such written notice in the form sent to Sublandlord.
          The parties agree that the Take Back Option granted to Overlandlord
          pursuant to Section 9.13(c) of the Lease shall then apply and
          Overlandlord shall have the right to exercise the Take Back Option as
          to the entire Premises then demised under the Overlease (including the
          Primary Space, the Secondary Space, the Tertiary Space and any other
          portion of the Building then leased by Sublandlord pursuant to the
          Overlease, as amended) within the thirty (30) day period immediately
          following Overlandlord's receipt of the notice from Subtenant
          exercising its right to Sublease the Tertiary Space. In no event shall
          any exercise of the Tertiary Space Option be effective unless and
          until Overlandlord is provided with a copy of the Subtenant's exercise
          of the Tertiary Space Option and Overlandlord shall fail or refuse to
          timely exercise the Take Back Option with respect to the entire
          Premises then demised under the Overlease within the thirty (30) day
          period provided in this paragraph 5 of this Agreements section of this
          Consent.

     6.   In no event shall Subtenant or Sublandlord modify, amend or alter the
          terms and provisions of the Sublease and/or the Antigenics Leasehold
          Lease without the written consent of Overlandlord, which consent may
          be granted or denied by Overlandlord in its sole but reasonable
          judgment.

          Overlandlord shall not unreasonably withhold or delay its consent to
          any such modification, alteration or amendment unless the same would
          materially and adversely affect Overlandlord's rights or the economic
          entitlements of the Overlandlord under the Overlease or this Consent.

EXECUTED under seal as of the date first written above.

<PAGE>

OVERLANDLORD:                      SUBLANDLORD:

NDNE 9/90 Corporate Center LLC       Antigenics, Inc.

By:
Its:

By:                                  By:
   ----------------------------         --------------------------------

Its:                                 Its:
    ---------------------------          -------------------------------
      hereunto duly authorized             hereunto duly authorized

                                   SUBTENANT:

                                     GTC Biotherapeutics, Inc.

                                     By:
                                          ------------------------------

                                     Its: ------------------------------
                                             hereunto duly authorized

<PAGE>

                    GENERAL CONDITIONS OF CONSENT TO SUBLEASE

     The following General Conditions are an integral part of and are hereby
incorporated into the foregoing Consent to Sublease:

     1.   Neither the Overlease, the Sublease nor this Consent shall be deemed,
          nor are such documents intended to grant to Subtenant, any rights
          whatsoever against Overlandlord. Subtenant hereby acknowledges and
          agrees that its sole remedy for any alleged or actual breach of its
          rights in connection with the Sublease shall be solely against
          Sublandlord. Subtenant acknowledges and agrees that it is not a third
          party beneficiary under the Overlease and is not entitled to assert
          any of Sublandlord's rights thereunder against Overlandlord, whether
          in its own right or on behalf of Sublandlord.

     2.   This Consent and the Sublease shall not (i) be deemed or construed to
          mean that Overlandlord shall be bound by any of the terms, covenants
          or conditions of the Sublease and Overlandlord shall not be bound
          thereby or (ii) release Sublandlord from any existing or future duty,
          obligation or liability to Overlandlord pursuant to the Overlease (and
          Sublandlord shall be and remain liable for the full payment,
          performance and observance of all of the terms, covenants and
          conditions contained in the Overlease to be paid, performed and
          observed by the "Tenant" thereunder as if the Sublease and this
          Consent had never been made), or (iii) change, modify or amend the
          Overlease in any manner, except insofar as it constitutes
          Overlandlord's mere consent to the execution and delivery of the
          Sublease. Notwithstanding the generality of the foregoing, this
          Consent expressly shall not absolve Sublandlord from any requirement
          set forth in the Overlease that Sublandlord (a) obtain Overlandlord's
          prior written approval of any additional subleases, assignments or
          other dispositions of its interest in the Overlease or the Premises
          (as defined in the Overlease) or (b) pay any amounts due and payable
          to Overlandlord pursuant to Section 9.13 of the Overlease in
          connection with the subletting contemplated by the Sublease and/or the
          letting under the Antigenics Leasehold Lease as they may be amended
          (with Overlandlord's Consent as provided herein) from time to time or
          (c) surrender and deliver the Premises to Overlandlord in the
          condition and manner required by the Lease upon expiration or earlier
          termination of the Lease including, without limitation, surrender and
          delivery of the Yield-up Equipment described in Exhibit N of the
          Overlease.

     3.   (a) In the event of Overlease Termination (as hereinafter defined)
          prior to the expiration or earlier termination of the Sublease, and
          subject to the provisions of Section 3(b) hereof, Overlandlord may, at
          its discretion, by written notice to Subtenant (an "Assumption
          Notice") within ten (10) days after Overlease

<PAGE>

          Termination, but shall not be required to, require Subtenant to assume
          and agree to perform Sublandlord's obligations under the Overlease
          with respect to the entire Original Premises as a direct tenancy
          between Overlandlord and Subtenant beginning as of and with respect to
          matters which accrue or are to be performed from and after (x) the
          date (the "Assumption Date") of such Assumption Notice with respect to
          those portions of the Original Premises subleased to Subtenant under
          the Sublease as of the date of Overlease Termination and (y) the
          Effective Date (as hereafter defined) as to those portions of the
          Original Premises then not leased to Subtenant. It is agreed and
          understood that Subtenant shall not be responsible for any breaches of
          the Overlease by Sublandlord prior to the Assumption Date and the
          Effective Date as to those respective portions of the Original
          Premises provided, however, that Subtenant shall be responsible for
          any breach or default under the Overlease which arises or occurs prior
          to such dates where such breach or default is the result of the acts
          or omissions of Subtenant. Such assumption by Subtenant of each and
          every one of the obligations of Sublandlord under the Overlease with
          respect to the entire Original Premises shall entitle the Subtenant to
          occupy the entire Original Premises leased pursuant to the Overlease,
          but shall not relieve Sublandlord from any liability to Overlandlord
          under the Overlease. In the event of such assumption, Subtenant agrees
          to execute and deliver at any time and from time to time, within ten
          (10) business days after written request of Overlandlord, any
          instruments which may reasonably be necessary or reasonably
          appropriate to evidence such assumption; provided, however, that
          Subtenant's failure or refusal to execute and deliver such instruments
          within such ten (10) day period shall not be deemed or construed to
          release Subtenant from its obligations under the Overlease as a direct
          tenancy with Overlandlord as provided herein. As used herein, the term
          "Effective Date" shall mean that date upon which Sublandlord shall
          vacate and deliver up the portions of the Original Premises which are
          not then subleased to Subtenant as of the date of Overlease
          Termination. In the event Overlandlord requires such assumption,
          Overlandlord shall not (i) be liable to Subtenant for any act,
          omission or breach of the Sublease by Sublandlord, (ii) be subject to
          any offsets or defenses which Subtenant might have against Sublandlord
          under the Sublease, (iii) be bound by any rent or additional rent
          which Subtenant might have paid in advance to Sublandlord, (iv) be
          bound to honor any rights of Subtenant in any security deposit or
          advance rent made with or paid to Sublandlord by Subtenant except to
          the extent Sublandlord has specifically assigned and turned over such
          security deposits and advance rent to Overlandlord, or (v) be bound by
          any provision of the Sublease.

          Sublandlord hereby agrees that in the event of Overlease Termination,
          at Overlandlord's request, Sublandlord shall immediately pay or
          transfer to Overlandlord any security deposits (or cause Overlandlord
          to be named as the

<PAGE>

          beneficiary under any Letter of Credit given as a Security Deposit
          under the Sublease and simultaneously amend such Letter of Credit so
          that it constitutes a security deposit under the Overlease between
          Subtenant and Overlandlord in form satisfactory to Overlandlord in its
          sole but reasonable judgment), rent or other sums then held by
          Sublandlord in connection with the subleasing of the Subleased
          Premises. Such security deposit or Letter of Credit may be applied by
          Overlandlord pursuant to the terms of the Overlease in the event of
          any holding over by Subtenant beyond expiration of the Sublease or
          upon the occurrence of a Monetary Default by the Subtenant pursuant to
          Section 11.1(a) of the Overlease after an Overlease Termination and
          exercise of Landlord's rights pursuant to this Section 3(a) to cause
          Subtenant to assume Sublandlord's rights and obligations under the
          Overlease as a direct Lease between Overlandlord and Subtenant as
          provided above. Subtenant hereby agrees that under no circumstances
          whatsoever shall Overlandlord (x) be required to release any Security
          Deposit or other form of Security given to Overlandlord by Sublandlord
          and securing Sublandlord's obligations to Overlandlord under the
          Overlease whether or not such obligations accrue or arise under the
          Overlease before or after Overlease Termination or (y) be held in any
          way responsible or accountable for any security deposit or any sums
          paid by Subtenant to Sublandlord unless and until and to the extent
          that Overlandlord has actually received such sums from Sublandlord and
          has acknowledged their source, and Subtenant shall have no claim to
          any security or other deposit made by Sublandlord under the Overlease.

          (b) "Overlease Termination" means any event, which by voluntary or
          involuntary act or by operation of law, causes the Overlease to be
          terminated, expire, or be canceled including, but not limited to: (i)
          a termination of the Overlease as the result of a default by
          Sublandlord under the Overlease or any of the terms and provisions
          thereof or hereof which continues past receipt of applicable notice of
          such default and the expiration of any applicable cure period, if any;
          (ii) foreclosure proceedings brought by the holder of any mortgage or
          trust deed to which the Overlease is subject and from whom Sublandlord
          has not received a non-disturbance agreement pursuant to Section 12.2
          of the Overlease; (iii) the termination of Sublandlord's leasehold
          estate by dispossession proceeding or otherwise; and (iv) termination
          of the Overlease in accordance with its terms.

     4.   In addition to Overlandlord's rights under Section 3 hereof, in the
          event Sublandlord is in default under any of the terms and provisions
          of the Overlease after receipt of applicable notice(if any is
          required) and expiration of applicable cure periods, if any,
          Overlandlord may elect to receive directly from Subtenant all sums due
          or payable to Sublandlord by Subtenant pursuant to the Sublease, and
          upon receipt of Overlandlord's written notice to Sublandlord and
          Subtenant, Sublandlord agrees that Subtenant shall thereafter pay to
          Overlandlord any and all

<PAGE>

          sums becoming due or payable under the Sublease and Sublandlord shall
          receive from Overlandlord a credit for such sums actually received by
          Overlandlord against any and all payments then owing from Sublandlord
          under the Overlease. Neither the service of such written notice nor
          the receipt of such direct payments shall cause Overlandlord to assume
          any of Sublandlord's duties, obligations and/or liabilities under the
          Sublease, nor shall such event impose upon Overlandlord the duty or
          obligation to honor the Sublease, nor subsequently to accept any
          purported attornment by Subtenant. Sublandlord grants Overlandlord a
          security interest in all such future payments due to Sublandlord from
          Subtenant, which security interest Overlandlord may perfect by filing
          a UCC-1 (which Sublandlord shall sign within three (3) days of
          Overlandlord's request and Sublandlord hereby irrevocably appoints
          Overlandlord as its attorney-in-fact, coupled with an interest, to
          execute on behalf of Sublandlord and file such instrument if
          Sublandlord fails to do so). Overlandlord shall credit payments
          actually received pursuant to this conditional assignment to
          Sublandlord's obligations under the Overlease. Without limitation of
          the foregoing, acceptance of rent or other payments from Sublandlord
          and/or Subtenant by Overlandlord shall not: (i) constitute a waiver or
          cure of any default or breach of the Overlease or (ii) cause nor
          result in a reinstatement of the Overlease as between Overlandlord and
          Sublandlord after Overlease Termination or (iii) be deemed or
          construed to mean that Overlandlord has accepted the Subtenant as its
          "Tenant" under the Overlease (unless Overlandlord expressly so elects
          in writing pursuant to paragraph 3 of these General Conditions) or
          (iv) be deemed to mean that Subtenant is entitled to any rights under
          the Sublease or the Overlease.

     5.   Subtenant hereby acknowledges that it has read and has knowledge of
          all of the terms, provisions, rules and regulations of the Overlease
          and agrees not to do or omit to do anything which would cause
          Sublandlord to be in breach of the Overlease. Any such act or omission
          also shall constitute a breach of the Overlease and this Consent and
          shall entitle Overlandlord to recover any damage, loss, cost, or
          expense which it thereby suffers, from Sublandlord and/or Subtenant.

     6.   In the event of the commencement of an action at law or in equity by
          the filing of a complaint or other similar action involving a request
          for relief from a judicial body between or involving the parties
          hereto with respect to the Sublease, the Overlease, this Consent or
          the rights of the parties hereto, hereunder or thereunder, the
          Sublandlord and Subtenant, jointly and severally, hereby agree to pay
          the Overlandlord on demand all reasonable costs, expense and
          attorneys' fees incurred therein by Overlandlord, which amounts may be
          included as a part of any judgment rendered in favor of Overlandlord
          therein.

<PAGE>

     7.   The parties acknowledge that the Sublease constitutes the entire
          agreement between Sublandlord and Subtenant with respect to the
          subject matter thereof, and that no amendment, termination,
          modification or change therein will be binding upon Overlandlord
          unless Overlandlord shall have given its prior written consent
          thereto, which consent may be granted or denied by Overlandlord in its
          sole and absolute discretion.

     8.   This Consent shall be binding upon and shall inure to the benefit of
          the parties' respective successors in interest and assigns, subject at
          all times, nevertheless, to all agreements and restrictions contained
          in the Overlease, the Sublease, and herein, with respect to
          subleasing, assignment or other transfer and the foregoing shall not
          be deemed to limit or negate Overlandlord's rights to prohibit or
          condition its consent to a future dispossession of Sublandlord's or
          Subtenant's interests. The agreements contained herein constitute the
          entire understanding between parties with respect to the subject
          matter hereof and supersede all prior agreements.

     9.   This Consent shall not be assignable and shall only apply with respect
          to the Sublease by and between Sublandlord and Subtenant.

     10.  The consent by Overlandlord to the use and occupancy of the Subleased
          Premises by Subtenant shall not be construed as a consent by
          Overlandlord to the use and occupancy of the Subleased Premises by
          anyone other than Subtenant or Sublandlord or as a consent to further
          subletting by Sublandlord or by Subtenant of the Subleased Premises,
          or any part thereof except as expressly provided in the Sublease but
          subject to the provisions of paragraph 5 of the "Agreements" section
          of this Consent and the Take Back Option set forth in Section 9.13(c)
          of the Overlease with respect to Subtenant's right to Lease any
          portion of the Original Premises other than the Primary Space and the
          Secondary Space (as each of those terms are defined in the Sublease).
          Neither the Sublease nor any of the rights, privileges or obligations
          thereunder shall be assigned, modified, renewed or extended, nor shall
          the Subleased Premises, or any part thereof, be further sublet or
          occupied by others except by Sublandlord, in accordance with and
          subject to the terms and provisions of the Overlease or by Subtenant
          in accordance with the terms and provisions of the Sublease but
          subject to the provisions of paragraph 5 of the "Agreements" section
          of this Consent and the Take Back Option set forth in Section 9.13(c)
          of the Overlease with respect to Subtenant's right to Lease any
          portion of the Original Premises other than the Primary Space and the
          Secondary Space (as each of those terms are defined in the Sublease).

<PAGE>

     11.  Subject to the provisions of General Condition numbered 3 of this
          Consent to Sublease and the rights of Overlandlord thereunder, on or
          before the day immediately preceding the date of expiration of the
          Overlease or upon the date of any earlier termination of the term of
          the Overlease, the Sublease and its term shall expire, terminate and
          come to an end as of the effective date of the expiration or
          termination of the Overlease, and Sublandlord shall cause Subtenant to
          vacate and surrender the Subleased Premises on or before such date in
          accordance with the applicable provisions of the Overlease regarding
          surrender and delivery of the Premises to Overlandlord.

     12.  Sublandlord and Subtenant hereby acknowledge and agree that
          Overlandlord shall not be responsible for any brokers commissions or
          fees of any kind or nature in connection with the Sublease or the
          subject matter thereof and they each hereby agree to indemnify and
          hold Overlandlord harmless from and against any such claims including
          all reasonable attorneys fees sustained or incurred by Overlandlord as
          a result of any such claim against Overlandlord. Sublandlord and
          Subtenant hereby jointly and severally agree to indemnify and hold
          Overlandlord harmless from and against any and all claims, costs or
          damages sustained or incurred by Overlandlord as the result of any
          claim by any party that they are entitled to a commission or broker's
          fee in connection with this Consent or the Sublease. The indemnity
          contained herein shall include, without limitation, all reasonable
          attorneys' fees and expenses incurred by Overlandlord in connection
          with any such claim. This paragraph 12 shall survive expiration or
          earlier termination of the Sublease.

     13.  Sublandlord and Subtenant, jointly and severally, hereby agree to
          indemnify and hold Overlandlord harmless with respect to any and all
          liability to and claims by Subtenant in connection with the Sublease,
          Subtenant's use and occupancy of the Subleased Premises, or the
          subject matter hereof unless arising from the gross negligence or
          willful misconduct of Overlandlord. The within indemnity shall be
          joint and several and shall include all losses, costs, damages or
          expenses including, without limitation, reasonable attorneys fees
          sustained or incurred by Overlandlord arising out of the matters
          contained herein. The provisions of this paragraph 13 shall survive
          any expiration or earlier termination of the Sublease or the
          Overlease.

     14.  In the event that there shall be any conflict between the terms,
          covenants and conditions of this Consent to Sublease and the terms,
          covenants and, conditions of the Sublease and/or any other agreement
          by and between Sublandlord and Subtenant, then the terms, covenants
          and conditions of this Consent to Sublease shall prevail in each
          instance and any conflicting terms, covenants or conditions of the
          Sublease shall be deemed

<PAGE>

          modified to conform with the terms, covenants and conditions of this
          Consent to Sublease.

     15.  Notwithstanding anything contained in the Sublease to the contrary,
          Sublandlord and Subtenant represent to and agree with Overlandlord
          that no changes, additions or improvements including, without
          limitation, electrical, HVAC or other construction work shall be
          performed in the Subleased Premises unless detailed plans and
          specifications for such work are first submitted to Overlandlord for
          its approval and Overlandlord shall have granted such approval in
          writing. Such approval shall be given or withheld in accordance with
          the applicable terms of the Overlease. In accordance with the
          provisions of the Overlease, all such work, if approved by
          Overlandlord, shall be subject to the requirements contained in the
          Overlease applicable to construction within or alterations of the
          Subleased Premises and shall be performed in accordance with the
          Overlease.

     16.  No signs shall be placed upon or within the Building and/or the
          Subleased Premises without the express written consent of
          Overlandlord, which consent may be granted or withheld by Overlandlord
          in its sole and absolute discretion.

     17.  Subtenant shall, within 10 Business Days of written request from
          Overlandlord therefor, execute and deliver to Overlandlord and/or the
          holder of any mortgage upon or proposed purchasers of the Building, a
          so-called "Estoppel Letter" in form satisfactory to Overlandlord or
          such holder of a Mortgage or proposed purchaser which shall include,
          among other things, if so requested, a statement (i) certifying that
          the Sublease is in full force and effect and has not been assigned,
          modified or amended, (ii) that to Subtenant's knowledge, Sublandlord
          is not in default thereunder, (iii) the date through which rent has
          been paid and (iv) that, to Subtenant's knowledge, there are no
          defenses or set-offs against enforcement of the Sublease or this
          Agreement against Subtenant.

     18.  Subtenant hereby further agrees that upon the written request of
          Overlandlord, Subtenant shall subordinate its interest in the Sublease
          to the lien of any mortgage, security agreement or lease now or
          hereafter affecting the Building or the land upon which the Building
          is constructed. Provided, however, that in the event of Overlease
          Termination and Overlandlord's election to treat the Overlease as a
          direct lease between Subtenant and Overlandlord pursuant to Section 3
          of these General Conditions then, Subtenant shall step into the place
          of Sublandlord for purposes of Section 12.2 of

<PAGE>

          the Lease and Sublandlord's rights to receive a non-disturbance
          agreement in accordance with and subject to the provisions of Section
          12.2.

     19.  As a condition to the effectiveness of the within Consent, as
          additional rent under the Overlease, Sublandlord shall, within ten
          (10) days after invoice, reimburse Overlandlord for all costs and
          expenses including without limitation, attorneys fees sustained or
          incurred by Overlandlord in connection with Sublandlord's request for
          Overlandlord's Consent to the execution and delivery of the Sublease
          including, without limitation, review of the Sublease and preparation
          and negotiation of this Consent.

     20.  All notices and demands which may or are to be required or permitted
          to be given by any party hereunder shall be in writing. All notices
          and demands to Subtenant shall be sent by United States Mail,
          certified mail return receipt requested, postage prepaid, addressed to
          Subtenant at the Subleased Premises, and to the address of Subtenant
          set forth in the Preamble to this Consent, or to such other place as
          Subtenant may from time to time designate in a notice to the other
          parties hereto given in the manner herein provided.

               All notices and demands to Sublandlord shall be sent by United
          States Mail, certified mail return receipt requested, postage prepaid,
          addressed to the Sublandlord at the address of Sublandlord set forth
          in the Preamble to this Consent, and to such other person or place as
          the Subtenant may from time to time designate in a notice to the other
          parties hereto given in the manner herein provided.

               ALL NOTICES AND DEMANDS TO OVERLANDLORD SHALL BE SENT BY UNITED
          STATES MAIL, CERTIFIED MAIL RETURN RECEIPT REQUESTED, POSTAGE PREPAID,
          ADDRESSED TO THE OVERLANDLORD AT THE ADDRESS OF OVERLANDLORD SET FORTH
          IN THE PREAMBLE TO THIS CONSENT, AND TO SUCH OTHER PERSON OR PLACE AS
          THE OVERLANDLORD MAY FROM TIME TO TIME DESIGNATE IN A NOTICE TO THE
          OTHER PARTIES HERETO GIVEN IN THE MANNER HEREIN PROVIDED.

               Notices may also be sent via overnight courier to such addresses,
          as applicable.

     21.  Submission of this document to the Sublandlord and/or the Subtenant
          shall have no binding effect and shall not be deemed or construed to
          mean that Overlandlord has consented or will consent to the subletting
          contemplated by the Sublessor. Execution of this Consent to Sublease
          by Sublandlord and/or Subtenant and delivery thereof to Overlandlord
          shall similarly have no binding effect unless and until Overlandlord
          has approved the terms and provisions of

<PAGE>

          the Sublease and Landlord has approved, executed and delivered this
          Consent to Sublease to both Sublandlord and Subtenant. In submitting
          this document to Sublandlord and/or Subtenant, Overlandlord hereby
          reserves any and all rights, privileges and protections afforded to
          Overlandlord under the Lease, at law and in equity.

                -Remainder of this Page Intentionally left Blank-

<PAGE>

                                    EXHIBIT E
                            Form of Letter of Credit
               STANDBY LETTER OF CREDIT DRAFT FOR REGIONAL OFFICES

IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB02ISXXXX

DATE: JULY 11, 2002

BENEFICIARY:
ANTIGENICS, INC
--------------------------------------

--------------------------------------

--------------------------------------
AS "SUBLANDLORD"

APPLICANT:
GTC BIOTHERAPEUTICS
175 CROSSING BLVD., SUITE 410
FRAMINGHAM, MA 01702
AS "SUBTENANT"

AMOUNT: US$200,000.00 (TWO HUNDRED THOUSAND AND 00/100 U.S. DOLLARS)

EXPIRATION DATE: JULY __, 2003

LOCATION: AT OUR COUNTERS IN SANTA CLARA, CALIFORNIA

DEAR SIR/MADAM:

WE HEREBY ESTABLISH OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB02ISXXXX IN
YOUR FAVOR AVAILABLE BY YOUR DRAFT DRAWN ON US AT SIGHT IN THE FORM OF EXHIBIT
"B" ATTACHED AND ACCOMPANIED BY THE FOLLOWING DOCUMENTS:

1. THE ORIGINAL OF THIS LETTER OF CREDIT AND ALL AMENDMENT(S), IF ANY.

2. A DATED CERTIFICATION FROM THE BENEFICIARY SIGNED BY AN AUTHORIZED OFFICER,
   FOLLOWED BY ITS DESIGNATED TITLE, STATING THE FOLLOWING:

   (A) "THE AMOUNT REPRESENTS FUNDS DUE AND OWING TO US AS A RESULT OF AN EVENT
       OF DEFAULT BY APPLICANT WITH RESPECTS TO ONE OR MORE OF THE TERMS OF THAT
       CERTAIN SUBLEASE AND/OR ANTIGENICS LEASEHOLD LEASE BY AND BETWEEN
       BENFICIARY, AS SUBLANDLORD, AND APPLICANT, AS SUBTENANT."

                                       OR

   (B) "WE HEREBY CERTIFY THAT WE HAVE RECEIVED WRITTEN NOTICE FROM SILICON
       VALLEY BANK THAT LETTER OF CREDIT NO. SVB02ISXXXX WILL NOT BE RENEWED,
       AND THAT WE HAVE NOT RECEIVED A REPLACEMENT OF THIS LETTER OF CREDIT FROM
       APPLICANT SATISFACTORY TO US AT LEAST THIRTY (30) DAYS PRIOR TO THE
       EXPIRATION DATE OF THIS LETTER OF CREDIT."

<PAGE>

IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB02ISXXXX
DATED JULY 11, 2002

PARTIAL DRAWS ARE ALLOWED. THIS LETTER OF CREDIT MUST ACCOMPANY ANY DRAWINGS
HEREUNDER FOR ENDORSEMENT OF THE DRAWING AMOUNT AND WILL BE RETURNED TO THE
BENEFICIARY UNLESS IT IS FULLY UTILIZED

DRAFT(S) AND DOCUMENTS MUST INDICATE THE NUMBER AND DATE OF THIS LETTER OF
CREDIT.

THIS LETTER OF CREDIT SHALL BE AUTOMATICALLY EXTENDED FOR AN ADDITIONAL PERIOD
OF ONE YEAR, WITHOUT AMENDMENT, FROM THE PRESENT OR EACH FUTURE EXPIRATION DATE
UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO THE THEN CURRENT EXPIRATION DATE WE
NOTIFY YOU AND THE APPLICANT BY REGISTERED MAIL/OVERNIGHT COURIER SERVICE AT THE
ABOVE ADDRESSES THAT THIS LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE
CURRENT EXPIRATION DATE. IN NO EVENT SHALL THIS LETTER OF CREDIT BE
AUTOMATICALLY EXTENDED BEYOND DECEMBER 31, 2006.

THIS LETTER OF CREDIT MAY ONLY BE TRANSFERRED IN ITS ENTIRETY BY THE ISSUING
BANK UPON OUR RECEIPT OF THE ATTACHED "EXHIBIT A" DULY COMPLETED AND EXECUTED BY
THE BENEFICIARY AND ACCOMPANIED BY THE ORIGINAL LETTER OF CREDIT AND ALL
AMENDMENTS, IF ANY, WITH THE PAYMENT OF OUR TRANSFER FEE OF 1/4 OF 1% OF THE
TRANSFER AMOUNT (MINIMUM USD250.00). THE TRANSFEREE FEE WILL BE PAID BY THE
BENEFICIARY.

ALL DEMANDS FOR PAYMENT SHALL BE MADE BY PRESENTATION OF THE ORIGINAL
APPROPRIATE DOCUMENTS PRIOR TO 10:00 A.M. CALIFORNIA TIME, ON A BUSINESS DAY AT
OUR OFFICE (THE "BANK'S OFFICE") AT: SILICON VALLEY BANK, 3003 TASMAN DRIVE
SANTA CLARA, CA 95054, ATTENTION: STANDBY LETTER OF CREDIT NEGOTIATION SECTION
OR BY FACSIMILE TRANSMISSION AT: (408) 654-6211 OR (408) 496-2418; AND
SIMULTANEOUSLY UNDER TELEPHONE ADVICE TO: (408) 654-7120 OR (408) 654-3052),
ATTENTION: STANDBY LETTER OF CREDIT NEGOTIATION SECTION WITH ORIGINALS TO FOLLOW
BY OVERNIGHT COURIER SERVICE; PROVIDED, HOWEVER, THE BANK WILL DETERMINE HONOR
OR DISHONOR ON THE BASIS OF PRESENTATION BY FACSIMILE ALONE, AND WILL NOT
EXAMINE THE ORIGINALS.

PAYMENT AGAINST CONFORMING PRESENTATIONS HEREUNDER SHALL BE MADE BY BANK DURING
NORMAL BUSINESS HOURS OF THE BANK'S OFFICE WITHIN TWO (2) BUSINESS DAYS AFTER
PRESENTATION.

WE HEREBY AGREE WITH THE DRAWERS, ENDORSERS AND BONAFIDE HOLDERS THAT THE DRAFTS
DRAWN UNDER AND IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF
CREDIT SHALL BE DULY HONORED UPON PRESENTATION TO THE DRAWEE, IF NEGOTIATED ON
OR BEFORE THE EXPIRATION DATE OF THIS CREDIT.

<PAGE>

THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR
DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF COMMERCE,
PUBLICATION NO. 500.

      ---------------------------             ---------------------------
        AUTHORIZED SIGNATURE                     AUTHORIZED SIGNATURE

<PAGE>

                                   EXHIBIT "A"

DATE:

TO: SILICON VALLEY BANK                     RE: STANDBY LETTER OF CREDIT
    3003 TASMAN DRIVE                           NO.                  ISSUED BY
    SANTA CLARA, CA 95054                       SILICON VALLEY BANK, SANTA CLARA
    ATTN:INTERNATIONAL DIVISION.                L/C AMOUNT:
         STANDBY LETTERS OF CREDIT

GENTLEMEN:

FOR VALUE RECEIVED, THE UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:

(NAME OF TRANSFEREE)
(ADDRESS)

ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF
CREDIT UP TO ITS AVAILABLE AMOUNT AS SHOWN ABOVE AS OF THE DATE OF THIS
TRANSFER.

BY THIS TRANSFER, ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF
CREDIT ARE TRANSFERRED TO THE TRANSFEREE. TRANSFEREE SHALL HAVE THE SOLE RIGHTS
AS BENEFICIARY THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS,
WHETHER INCREASES OR EXTENSIONS OR OTHER AMENDMENTS, AND WHETHER NOW EXISTING OR
HEREAFTER MADE. ALL AMENDMENTS ARE TO BE ADVISED DIRECT TO THE TRANSFEREE
WITHOUT NECESSITY OF ANY CONSENT OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.

THE ORIGINAL OF SUCH LETTER OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO
ENDORSE THE TRANSFER ON THE REVERSE THEREOF, AND FORWARD IT DIRECTLY TO THE
TRANSFEREE WITH YOUR CUSTOMARY NOTICE OF TRANSFER.

SINCERELY,

-----------------------------
   (BENEFICIARY'S NAME)

-----------------------------
  SIGNATURE OF BENEFICIARY

SIGNATURE AUTHENTICATED

----------------------------
     (NAME OF BANK)

----------------------------
    AUTHORIZED SIGNATURE

<PAGE>

                                   EXHIBIT "B"

================================================================================

   DATE:                                          REF. NO.
         ---------------                                  ----------------------

   AT SIGHT OF THIS DRAFT

   PAY TO THE ORDER OF                                 US$
                      -------------------------------     ----------------------

   USDOLLARS
             -------------------------------------------------------------------

   -----------------------------------------------------------------------------

   DRAWN UNDER SILICON VALLEY BANK, SANTA CLARA, CALIFORNIA, STANDBY
   LETTER OF CREDIT NUMBER NO.                         DATED
                               -----------------------       -------------------

   TO: SILICON VALLEY BANK
       3003 TASMAN DRIVE                       ------------------------------
       SANTA CLARA, CA 95054                        (BENEFICIARY'S NAME)

   ....................................

                                               AUTHORIZED SIGNATURE

================================================================================

                         GUIDELINES TO PREPARE THE DRAFT

1. DATE: ISSUANCE DATE OF DRAFT.

2. REF. NO.: BENEFICIARY'S REFERENCE NUMBER, IF ANY.

3. PAY TO THE ORDER OF: NAME OF BENEFICIARY AS INDICATED IN THE L/C (MAKE SURE
   BENEFICIARY ENDORSES IT ON THE REVERSE SIDE).

4. US$: AMOUNT OF DRAWING IN FIGURES.

5. USDOLLARS: AMOUNT OF DRAWING IN WORDS.

6. LETTER OF CREDIT NUMBER: SILICON VALLEY BANK'S STANDBY L/C NUMBER THAT
   PERTAINS TO THE DRAWING.

7. DATED: ISSUANCE DATE OF THE STANDBY L/C.

8. BENEFICIARY'S NAME: NAME OF BENEFICIARY AS INDICATED IN THE L/C.

9. AUTHORIZED SIGNATURE: SIGNED BY AN AUTHORIZED SIGNER OF BENEFICIARY.

IF YOU NEED FURTHER ASSISTANCE IN COMPLETING THIS DRAFT, PLEASE CALL OUR L/C
PAYMENT SECTION AND ASK FOR:

ALICA DA LUZ: 408-654-7120
CESAR AGONCILLO: 408-654-3052QuickLinks
 -- Click here to rapidly navigate through this document

Exhibit 4.2  

THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i) EFFECTIVE REGISTRATION
STATEMENTS RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATIONS ARE NOT REQUIRED, (iii) RECEIPT OF
NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THIS WARRANT. 

 
 

DOT HILL SYSTEMS CORP.
  WARRANT TO PURCHASE SHARES OF COMMON STOCK    
  

        THIS CERTIFIES THAT, for value received, SUN MICROSYSTEMS, INC. and its assigns are entitled to subscribe for and purchase 1,239,527 shares of the fully
paid and nonassessable Common Stock (as adjusted pursuant to Section 4 hereof, the "Shares") of Dot Hill Systems Corp., a Delaware corporation (the "Company"), at the price of $2.97 per share,
the average of the Company's closing price as reported by the New York Stock Exchange 60 trading days before the Date of Grant (such price and such other price as shall result, from time to time, from
the adjustments specified in Section 4 hereof is herein referred to as the "Warrant Price"), subject to the provisions and upon the terms and conditions hereinafter set forth. As used herein,
the term "Date of Grant" shall mean the date set forth underneath the Company's signature hereto, and (b) the term "Other Warrants" shall mean any other warrants issued by the Company in
connection with the transaction with respect to which this Warrant was issued, and any warrant issued upon transfer or partial exercise of this Warrant. The term "Warrant" as used herein shall be
deemed to include Other Warrants unless the context clearly requires otherwise. 

        1.    Exercisability; Term.    Subject to Section 10.1 below, the purchase right represented by this Warrant is
exercisable as to 413,175 shares immediately, and an additional 413,176 shares on each of the first anniversary and second anniversary of the Date of Grant, in whole or in part, at any time and from
time to time from the Date of Grant through Five (5) years after the Date of Grant. 

        2.    Method of Exercise; Payment; Issuance of New Warrant.    Subject to Section 1 hereof, the purchase right
represented by this Warrant may be exercised by the holder hereof, in whole or in part and from time
to time, at the election of the holder hereof, by (a) the surrender of this Warrant (with the notice of exercise substantially in the form attached hereto as Exhibit A-1 duly
completed and executed) at the principal office of the Company and by the payment to the Company, by certified or bank check, or by wire transfer to an account designated by the Company (a "Wire
Transfer") of an amount equal to the then applicable Warrant Price multiplied by the number of Shares then being purchased, or (b) if in connection with a registered public offering of the
Company's securities, the surrender of this Warrant (with the notice of exercise form attached hereto as Exhibit A-2 duly completed and executed) at the principal office of the
Company together with notice of arrangements reasonably satisfactory to the Company for payment to the Company either by certified or bank check or by Wire Transfer from the proceeds of the sale of
shares to be sold by the holder in such public offering of an amount equal to the then applicable Warrant Price per share multiplied by the number of Shares then being purchased or (c) exercise
of the "net issuance" right provided for in Section 10.2 hereof. The person or persons in whose name(s) any certificate(s) representing the Shares shall be issuable upon exercise of this
Warrant shall be deemed to have become the holder(s) of record of, and shall be treated for all purposes as the record holder(s) of, the shares represented thereby (and such shares shall be deemed to
have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised. In the event of any exercise of the rights represented by this Warrant,
certificates for the shares of stock so purchased shall be delivered to the holder hereof as soon as practicable and, if requested by the holder of this Warrant, the Company shall cause its transfer
agent to deliver the certificate representing Shares issued upon exercise of this Warrant to a broker or 

 

other person (as directed by the holder exercising this Warrant) within the time period required to settle any trade made by the holder after exercise of this Warrant. 

        3.    Stock Fully Paid; Reservation of Shares.    All Shares that may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance pursuant to the terms and conditions herein, be fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issue
thereof. During the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized, and reserved for the purpose of the issue upon exercise
of the purchase rights evidenced by this Warrant, a sufficient number of shares of its Common Stock to provide for the exercise of the rights represented by this Warrant. 

        4.    Adjustment of Warrant Price and Number of Shares.    The number and kind of securities purchasable upon the
exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows: 

        (a)    Reclassification or Merger.    In case of any reclassification or change of securities of the class issuable
upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), or in case of
any merger of the Company with or into another corporation (other than a merger with another
corporation in which the Company is the acquiring and the surviving corporation and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this
Warrant), or in case of any sale of all or substantially all of the assets of the Company, the Company, or such successor or purchasing corporation, as the case may be, shall duly execute and deliver
to the holder of this Warrant a new Warrant (in form and substance satisfactory to the holder of this Warrant), or the Company shall make appropriate provision without the issuance of a new Warrant,
so that the holder of this Warrant shall have the right to receive upon exercise of this Warrant, at a total purchase price not to exceed that payable upon the exercise of the unexercised portion of
this Warrant, and in lieu of the shares of Common Stock theretofore issuable upon exercise of this Warrant, the kind and amount of shares of stock, other securities, money and property receivable upon
such reclassification, change or merger by a holder of the number of shares of Common Stock then purchasable under this Warrant. Such new Warrant shall provide for adjustments that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this subparagraph (a) shall similarly apply to successive reclassifications,
changes, mergers and transfers. 

        (b)    Subdivision or Combination of Shares.    If the Company at any time while this Warrant remains outstanding and
unexpired shall subdivide or combine its outstanding shares of Common Stock, the Warrant Price shall be proportionately decreased and the number of Shares issuable hereunder shall be proportionately
increased in the case of a subdivision or and the Warrant Price shall be proportionately increased and the number of Shares issuable hereunder shall be proportionately decreased in the case of a
combination. 

        (c)    Stock Dividends and Other Distributions.    If the Company at any time while this Warrant is outstanding and
unexpired shall (i) pay a dividend with respect to its Common Stock payable in Common Stock, then the Warrant Price shall be adjusted, from and after the date of determination of shareholders
entitled to receive such dividend or distribution, to that price determined by multiplying the Warrant Price in effect immediately prior to such date of determination by a fraction (A) the
numerator of which shall be the total number of shares of Common Stock outstanding immediately prior to such dividend or distribution, and (B) the denominator of which shall be the total number
of shares of Common Stock outstanding immediately after such dividend or distribution; or (ii) make any other distribution with respect to Common Stock (except any distribution specifically
provided for in Sections 4(a) and 4(b)), then, in each such case, provision shall be made by the Company such that the holder of this Warrant shall receive upon exercise of this Warrant a
proportionate share of any such dividend or distribution as though it were the 

2

 

holder of the Shares as of the record date fixed for the determination of the shareholders of the Company entitled to receive such dividend or distribution. 

        (d)    Adjustment of Number of Shares.    Upon each adjustment in the Warrant Price, the number of Shares purchasable
hereunder shall be adjusted, to the nearest whole share, to the product obtained by multiplying the number of Shares purchasable immediately prior to such adjustment in the Warrant Price by a
fraction, the numerator of which shall be the Warrant Price immediately prior to such adjustment and the denominator of which shall be the Warrant Price immediately thereafter. 

        5.    Notice of Adjustments.    Whenever the Warrant Price or the number of Shares purchasable hereunder shall be
adjusted pursuant to Section 4 hereof, the Company shall make a certificate signed by its chief financial officer setting forth, in reasonable detail, the event requiring the adjustment, the
amount of the adjustment, the method by which such adjustment was calculated, and the Warrant Price and the number of Shares purchasable hereunder after giving effect to such adjustment, and shall
cause copies of such certificate to be mailed (without regard to Section 13 hereof, by first class mail, postage prepaid) to the holder of this Warrant at such holder's last known address. 

        6.    Fractional Shares.    No fractional shares of Common Stock will be issued in connection with any exercise
hereunder, but in lieu of such fractional shares the Company shall make a cash payment therefor based on the fair market value of the Common Stock on the date of exercise as reasonably determined in
good faith by the Company's Board of Directors. 

        7.    Compliance with Securities Act; Disposition of Warrant or Shares of Common Stock.    

        (a)    Compliance with Securities Act.    The holder of this Warrant, by acceptance hereof, agrees that this Warrant,
and the Shares to be issued upon exercise hereof are being acquired for investment and that such holder will not offer, sell or otherwise dispose of this Warrant, or any Shares except under
circumstances which will not result in a violation of the Securities Act of 1933, as amended (the "Act") or any applicable state securities laws. Upon exercise of this Warrant, unless the Shares being
acquired are registered under the Act and any applicable state securities laws or an exemption from such registration is available, the holder hereof shall confirm in writing that the Shares so
purchased are being acquired for investment and not with a view toward distribution or resale in violation of the Act and shall confirm such other matters related thereto as may be reasonably
requested by the Company. This Warrant and all Shares issued upon exercise of this Warrant (unless registered under the Act and any applicable state securities laws) shall be stamped or imprinted with
a legend in substantially the following form: 

"THE
SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT
(i) EFFECTIVE REGISTRATION STATEMENTS RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATIONS ARE NOT REQUIRED,
(iii) RECEIPT OF NOACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THE WARRANT UNDER WHICH THESE SECURITIES
WERE ISSUED, DIRECTLY OR INDIRECTLY." 

        Said
legend shall be removed by the Company, upon the request of a holder, at such time as the restrictions on the transfer of the applicable security shall have terminated. In addition,
in 

3

 

connection with the issuance of this Warrant, the holder specifically represents to the Company by acceptance of this Warrant as follows: 

        (1)  The
holder is aware of the Company's business affairs and financial condition, and has acquired information about the Company sufficient to reach an informed and
knowledgeable decision to acquire this Warrant. The holder is acquiring this Warrant for its own account for investment purposes only and not with a view to, or for the resale in connection with, any
"distribution" thereof in violation of the Act. 

        (2)  The
holder understands that this Warrant has not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other
things, the bona fide nature of the holder's investment intent as expressed herein. 

        (3)  The
holder further understands that this Warrant must be held indefinitely unless subsequently registered under the Act and qualified under any applicable state
securities laws, or unless exemptions from registration and qualification are otherwise available. The holder is aware of the provisions of Rule 144, promulgated under the Act. 

        (4)  The
holder is an "accredited investor" as such term is defined in Rule 501 of Regulation D promulgated under the Act. 

        (b)    Disposition of Warrant or Shares.    With respect to any offer, sale or other disposition, in whole or in part,
of this Warrant or of any Shares acquired pursuant to the exercise of this Warrant prior to registration of such Warrant or Shares, the holder hereof agrees to give written notice to the Company prior
thereto, describing briefly the manner thereof, together with a written opinion of such holder's counsel, or other evidence, if reasonably satisfactory to the Company, to the effect that such offer,
sale or other disposition may be effected without registration or qualification (under the Act as then in effect or any federal or state securities law then in effect) of this Warrant, the Shares or
any portion thereof and indicating whether or not under the Act certificates for this Warrant, the Shares or any portion thereof to be sold or otherwise disposed of require any restrictive legend as
to applicable restrictions on transferability in order to ensure compliance with such law. Upon receiving such written notice and reasonably satisfactory opinion or other evidence, the Company, as
promptly as practicable but no later than fifteen (15) days after receipt of the written notice, shall take such steps as necessary for such holder to sell or otherwise dispose of this Warrant,
such Shares or any portion thereof, all in accordance with the terms of the notice delivered to the Company. If a determination has been made pursuant to this Section 7(b) that the opinion of
counsel for the holder or other evidence is not reasonably satisfactory to the Company, the Company shall so notify the holder promptly with details thereof after such determination has been made.
Notwithstanding the foregoing, this Warrant, such Shares or any portion thereof, may, as to such federal laws, be offered, sold or otherwise disposed of in accordance with Rule 144 or 144A
under the Act, provided that the Company shall have been furnished with such information as the Company may reasonably request to provide a reasonable assurance that the provisions of Rule 144
or 144A have been satisfied. Each certificate representing this Warrant, the Shares or any portion thereof thus transferred (except a transfer pursuant to Rule 144 or 144A) shall bear a legend
as to the applicable restrictions on transferability in order to ensure compliance with
such laws, unless in the aforesaid opinion of counsel for the holder, such legend is not required in order to ensure compliance with such laws. The Company may issue stop transfer instructions to its
transfer agent in connection with such restrictions. 

        (c)    Applicability of Restrictions.    Neither any restrictions of any legend described in this Warrant nor the
requirements of Section 7(b) above shall apply to any transfer or grant of a security interest in, this Warrant (or the Common Stock obtainable upon exercise thereof) or any part hereof
(i) to a partner of the holder if the holder is a partnership or to a member of the holder if the holder is a limited liability company, (ii) to a partnership of which the holder is a 

4

 

partner or a limited liability company of which the holder is a member, or (iii) to any affiliate of the holder if the holder is a corporation; provided,
however, in any such transfer, if applicable, the transferee shall on the Company's request agree in writing to be bound by the terms of this Warrant as if an original holder
hereof. 

        8.    Rights as Shareholders; Information.    No holder of this Warrant, as such, shall be entitled to vote or receive
dividends or be deemed the holder of Common Stock or any other securities which may at any time be issuable upon the exercise hereof for any purpose, nor shall anything contained herein be construed
to confer upon the holder of this Warrant, as such, any of the rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at
any meeting thereof, or to receive notice of meetings, or to receive dividends or subscription rights or otherwise until this Warrant shall have been exercised and the Shares purchasable upon the
exercise hereof shall have become deliverable, as provided herein. Notwithstanding the foregoing, the Company will transmit to the holder of this Warrant such information, documents and reports as are
generally distributed to the holders of any class or series of the securities of the Company concurrently with the distribution thereof to the shareholders. 

        9.    Registration Rights.    

        (a)    Registration.    

          (i)  On
or before the date six months after the Date of Grant, the Company shall, prepare and file with the Securities and Exchange Commission ("SEC") a registration
statement under Rule 415 of the Act to register the resale of the Common Stock issuable upon exercise of this Warrant (the "Registrable Shares") and shall thereafter use all reasonable efforts
to cause such registration statement to become effective as promptly as practicable. 

        (ii)  The
Company shall, until the date 30 months after the Date of Grant, keep such registration statement for the Registrable Shares in effect and current and from
time to time amend or supplement the registration statement and the prospectus in connection therewith in compliance with the Act to
permit the sale or distribution of the Registrable Shares with respect to which such registration statement shall have become effective. If at any time the SEC should institute or threaten to
institute any proceedings for the purpose of issuing, or should issue a stop order suspending the effectiveness of any such registration statement, the Company will promptly notify the holder of this
Warrant (which term shall include any holder of the Shares) and will use its reasonable best efforts to prevent the issuance of any such stop order or to obtain the withdrawal thereof as soon as
possible. The Company will advise the holder of this Warrant promptly of any order or communication of any public board or body addressed to the Company suspending or threatening to suspend the
registration or qualification of any of the Registrable Shares for sale in any jurisdiction. 

        (iii)  The
holder of this Warrant agrees, by acceptance of this Warrant, that, upon receipt of any notice from the Company of (A) the happening of any event which
makes any statements made in the registration statement or related prospectus filed pursuant to this Section 9, or any document incorporated or deemed to be incorporated therein by reference,
untrue in any material respect or which requires the making of any changes in such registration statement or prospectus so that, in the case of such registration statement, it will not contain any
untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the prospectus,
it will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading or (B) that, in the judgment of the Company's Board of Directors, it is advisable to suspend use of the prospectus for a discrete period of time due
to pending corporate developments, public filings 

5

 

with the SEC or similar events, the holder will forthwith discontinue, for a period not to exceed sixty (60) days, disposition of such Registrable Shares covered by such registration statement
or prospectus until it is advised in writing by the Company that use of the applicable prospectus may be resumed, and has received copies of any additional or supplemented filings that are
incorporated or deemed to be incorporated by reference in such prospectus. The Company shall use all reasonable efforts to insure that the use of the prospectus may be resumed as soon as practicable,
and in any event shall not be entitled to require the holder to suspend use of any prospectus for more than ninety (90) days in any twelve month period. 

        (b)    Company Obligations.    Whenever any Registrable Shares become subject to a registration statement pursuant to
this Section 9, the Company shall: 

          (i)  Promptly
notify the holder of this Warrant and confirm such advice in writing (i) when such registration statement becomes effective, (ii) when any
post-effective amendment to any such registration statement becomes effective and (iii) of any request by the SEC for any amendment or supplement to such registration statement or
any prospectus relating thereto or for additional information; 

        (ii)  Furnish
to the holder of this Warrant such number of copies of any registration statement or any amendment or supplement thereto, and any prospectus (including any
preliminary prospectus) contained therein in conformity with the requirements of the Act as the holder of this Warrant may reasonably request in order to effect the offering and sale of the
Registrable Shares being offered and
sold by the holder of this Warrant, but only while the Company is required under the provisions hereof to cause the registration statement to remain current; 

        (iii)  Use
its reasonable best efforts to register or qualify not later than the effective date of such registration statement the Registrable Shares registered thereunder
under the "blue sky" laws of such states as the holder of this Warrant may reasonably request; provided, however, that the Company shall not be obligated to qualify as a foreign corporation or as a
dealer in securities or to execute or file any general consent to service of process under the laws of any such state where it is not at such time so qualified or subject; 

        (iv)  Immediately
notify the holder of this Warrant, at any time when a prospectus relating to a sale of Registrable Shares is required by law to be delivered in connection
with sales thereof, of the occurrence of an event requiring the preparation of a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable
Shares, such prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading and promptly make available to the holder of this Warrant and to the underwriters any such amendment or supplement; 

        (v)  The
Company and the holder of this Warrant will enter into customary agreements (including an underwriting or indemnity agreement in customary form) and take such other
actions as are reasonably required in order to expedite or facilitate the sale of the Registrable Shares; 

        (vi)  In
the event of an underwritten offering (in the Company's sole discretion), the Company will use its reasonable best efforts to cause to be furnished to the holder of
this Warrant a signed counterpart, addressed to the holder of this Warrant or such underwriter, of (i) an opinion or opinions of counsel to the Company and (ii) a comfort letter or
comfort letters from the Company's independent accountants, each in customary form and covering 

6

 

such matters of the type customarily covered by opinions or comfort letters as the case may be, as the holder of this Warrant reasonably requests; 

      (vii)  In
the event of an underwritten offering (in the Company's sole discretion), the Company will make generally available to its security holders, as soon as reasonably
practicable, an earnings statement covering the period of twelve months, beginning within three months after the effective date of the registration statement, which earnings statement shall satisfy
the provisions of Section 11(a) of the Act; and 

      (viii)  The
Company will use its reasonably best efforts to cause all Common Stock to be listed on each securities exchange (or the Nasdaq National Market System) on which
similar securities issued by the Company are then listed. 

        (c)    Expenses.    The Company shall bear the out-of-pocket costs and expenses incurred in
connection with any registration pursuant to this Section 9. The costs and expenses of any such registration shall include, without limitation, the reasonable fees and expenses of the Company's
counsel and its accountants and all other out-of-pocket costs and expenses of the Company incident to the preparation, printing and filing under the Act of the registration
statement and all amendments and supplements thereto and the cost of furnishing copies of each preliminary prospectus, each final prospectus and each amendment or supplement thereto to underwriters,
dealers and other purchasers of the securities so registered, the costs and expenses incurred in connection with the qualification of such securities so registered under the "blue sky" laws of various
jurisdictions, the fees and expenses of the Company's transfer agent and all other costs and expenses of complying with the foregoing provisions of this Section 9. The holder of this Warrant
shall pay any underwriting fees, discounts or commissions attributable to the sale of Registrable Shares. The Company shall pay internal Company expenses (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting duties). 

        (d)    Indemnification.    

          (i)  In
the case of any offering registered pursuant to Section 9(a), the Company hereby indemnifies and agrees to hold harmless the holder of this Warrant (or the
Registrable Shares) and each person, if any, who controls the holder of this Warrant (or the Registrable Shares) within the meaning of either Section 15 of the Act or Section 20 of the
Securities and Exchange Act of 1934, as amended. (the "Exchange Act") from and against any losses, claims, damages or liabilities, joint or several, to which any such persons may be subject, under the
Act, the Exchange Act or otherwise, and to reimburse any of such persons for any legal or other expenses reasonably incurred by them in connection with investigating any claims or defending against
any actions, insofar as such losses, claims, damages or liabilities arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the registration
statement under which such Registrable Shares were registered under the Act pursuant to this Section 9, any prospectus (including any preliminary prospectus) contained therein, if used during
the period appropriate for such prospectus, or any amendment or supplement thereto, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances in which they were made, not misleading; provided that the indemnification agreement contained in this Section 9(d)(i) shall
not apply to such losses, claims, damages or liabilities which shall arise out of the sale of Registrable Shares to any person to the extent such losses, claims, damages or liabilities arise out of or
are based upon any such untrue statement or omission or alleged untrue statement or omission if such statement or omission shall have been made (A) in reliance upon information furnished to the
Company in writing by the holder of this Warrant specifically for use therein, or (B) in any preliminary prospectus, and the prospectus contained in the registration statement as declared
effective or in the form filed by the Company with the SEC pursuant to Rule 424 under the 

7

 

Act corrected such statement or omission and a copy of such final prospectus shall not have been sent or otherwise delivered to such person at or prior to the confirmation of such sale to such person
or to the holder of this Warrant for delivery to such person. The Company also agrees to indemnify the
underwriters (as defined in the Act) of the Registrable Shares, their officers and directors and each person who controls such underwriters on substantially the same basis as that of the
indemnification of the holder of this Warrant provided in this Section 9(d)(i). 

        (ii)  By
acceptance of this Warrant, the holder of this Warrant agrees, in the same manner and to the same extent as set forth in the preceding paragraph, to indemnify and to
hold harmless the Company and its directors and officers against any losses, claims, damages or liabilities, joint or several, to which any of such persons may be subject under the Act or otherwise,
and to reimburse any of such persons for any legal or other expenses incurred in connection with investigating or defending against any such losses, claims, damages or liabilities, but only to the
extent it arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission of a material fact in any registration statement under which the Registrable
Shares were registered under the Act pursuant to this Section 9, any prospectus contained therein, or any amendment or supplement thereto, which was based upon and made in conformity with
information furnished to the Company in writing by the holder of this Warrant expressly for use therein. The holder of this Warrant also agrees to indemnify and hold harmless any underwriter (as
defined in the Act) of the Registrable Shares, its officers and directors and each person who controls such underwriter on substantially the same basis as that of the indemnification of the Company
provided in this Section 9(d)(ii). Provided however, that the obligations of the holder of this Warrant hereunder shall be limited to an amount equal to the net proceeds after expenses and
commissions to such holder of Registrable Shares sold as contemplated herein. 

        (iii)  Each
party indemnified under this Section 9 shall, promptly after receipt of notice of the commencement of any action against such indemnified party in respect
of which indemnity may be sought, notify the indemnifying party in writing of the commencement thereof. The omission of any indemnified party so to notify an indemnifying party of any such action
shall not relieve the indemnifying party from any liability in respect of such action which it may have to such indemnified party on account of the indemnity agreement contained in this
Section 9, unless the indemnifying party was materially prejudiced by such omission, and in no event shall relieve the indemnifying party from any other liability which it may have to such
indemnified party. In case any such action shall be brought against any indemnified party and it shall notify an indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory
to the indemnified party. In any such action, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (A) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (B) the named parties to any such action
(including any impleaded parties) include both the indemnified party and the indemnifying party and representation of both parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) at any time for all such indemnified parties, and that all such fees and expenses shall be reimbursed as they are incurred. 

        (iv)  If
the indemnification provided for in this Section 9 as between the holder of this Warrant and the Company is unavailable to the holder of this Warrant and each
person, if 

8

 

any, who controls the holder of this Warrant within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act or to the Company in respect of any losses, claims,
damages or liabilities referred to herein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities in such proportion as is appropriate to reflect the relative fault of the Company and of the holder of this Warrant in connection with such
statements or omissions, as well as other relevant equitable considerations. The relative fault of the Company on the one hand and of the holder of this Warrant on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of material fact or the omission or alleged omission to state a material fact relates to information supplied by such
party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. 

        (v)  The
Company and holder of this Warrant agree that it would not be just and equitable if contribution pursuant to this Section 9(d)(iv) were determined by
pro rata allocation (even if the underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to
in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 9(d)(iv), the holder of this Warrant shall not be required to contribute any amount in excess of the amount by which the net
proceeds of the offering (before deducting expenses) received by the holder of this Warrant exceeds the amount of any damages which the holder of this Warrant would have or has been required to pay by
reason of the relevant fault in connection with such untrue or alleged untrue statement or omission or alleged omission allocated to the holder of this Warrant. Notwithstanding the foregoing, the
obligations of the holder of this Warrant hereunder shall be limited to an amount equal to the net proceeds after expenses and commissions to such holder of Registrable Shares sold as contemplated
herein. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. 

        9.    Additional Rights.    

        10.1    Mergers.    The Company shall provide the holder of this Warrant with at least twenty (20) days'
written notice prior to the closing thereof of the terms and conditions of any of the following transactions (an "Acquisition"): (i) the sale, lease, exchange, conveyance or other disposition
of all or substantially all of the Company's property or business, or (ii) its merger into or consolidation with any other corporation (other than a wholly-owned subsidiary of the Company), or
any transaction (including a merger or other reorganization) or series of related transactions, in which more than 50% of the voting power of the Company is disposed of. In the event of an
Acquisition, the purchase rights represented by this Warrant shall be fully exercisable. 

        10.2    Right to Convert Warrant into Stock: Net Issuance.    

        (a)    Right to Convert.    In addition to and without limiting the rights of the holder under the terms of this
Warrant, the holder shall have the right to convert this Warrant or any portion thereof (the "Conversion Right") into shares of Common Stock as provided in this Section 10.2 at any time or from
time to time the number of shares of Common Stock for which this Warrant is exercisable pursuant to Section 1 and 10.1 above, during the term of this Warrant. Upon exercise of the Conversion
Right with respect to a particular number of shares subject to this Warrant (the 

9

 

"Converted Warrant Shares"), the Company shall deliver to the holder (without payment by the holder of any exercise price or any cash or other consideration) that number of shares of fully paid and
nonassessable Common Stock as is determined according to the following formula: 

	 	X =	 	B - A
 Y	 	 	 	 
	

 	

Where:	
 	

X =	
 	

the number of shares of Common Stock that may be issued to the holder
	

 	

 	
 	

 	
 	

Y =	
 	

the fair market value of one share of Common Stock
	

 	

 	
 	

 	
 	

A =	
 	

the aggregate Warrant Price of the specified number of Converted Warrant Shares immediately prior to the exercise of the Conversion Right (i.e., the number of Converted Warrant Shares multiplied by the Warrant Price)
	

 	

 	
 	

 	
 	

B =	
 	

the aggregate fair market value of the specified number of converted Warrant Shares (i.e., the number of Converted Warrant Shares multiplied by the fair
market value of one Converted Warrant Shares)

        No
fractional shares shall be issuable upon exercise of the Conversion Right, and, if the number of shares to be issued determined in accordance with the foregoing formula is other than
a whole number, the Company shall pay to the holder an amount in cash equal to the fair market value of the resulting fractional share on the Conversion Date (as hereinafter defined). For purposes of
Section 9 of this Warrant, shares issued pursuant to the Conversion Right shall be treated as if they were issued upon the exercise of this Warrant. 

        (b)    Method of Exercise.    The Conversion Right may be exercised by the holder by the surrender of this Warrant at
the principal office of the Company together with a written statement (which may be in the
form of Exhibit A-1 or Exhibit A-2 hereto) specifying that the holder thereby intends to exercise the Conversion Right and indicating the number of shares subject
to this Warrant which are being surrendered (referred to in Section 10.2(a) hereof as the Converted Warrant Shares) in exercise of the Conversion Right. Such conversion shall be effective upon
receipt by the Company of this Warrant together with the aforesaid written statement, or on such later date as is specified therein (the "Conversion Date"), and, at the election of the holder hereof,
may be made contingent upon the closing of the sale of the Company's Common Stock to the public in a public offering pursuant to a Registration Statement under the Act (a "Public Offering").
Certificates for the shares issuable upon exercise of the Conversion Right and, if applicable, a new warrant evidencing the balance of the shares remaining subject to this Warrant, shall be issued as
of the Conversion Date and shall be delivered to the holder within thirty (30) days following the Conversion Date. 

        (c)    Determination of Fair Market Value.    For purposes of this Section 10.2, "fair market value" of a share
of Common Stock as of a particular date (the "Determination Date") shall mean: 

          (i)  If
the Conversion Right is exercised in connection with and contingent upon a Public Offering, and if the Company's Registration Statement relating to such Public
Offering ("Registration Statement") has been declared effective by the Securities and Exchange Commission, then the initial "Price to Public" specified in the final prospectus with respect to such
offering. 

        (ii)  If
the Conversion Right is not exercised in connection with and contingent upon a Public Offering, then as follows: 

	(A)
	If
traded on a securities exchange, the fair market value of the Common Stock shall be deemed to be the average of the closing prices of the Common Stock on such exchange over the
five trading days immediately prior to the Determination Date; 

10

 

	(B)
	If
traded on the Nasdaq Stock Market or other over-the-counter system, the fair market value of the Common Stock shall be deemed to be the average of the
closing bid prices of the Common Stock over the five trading days immediately prior to the Determination Date; and

	(C)
	If
there is no public market for the Common Stock, then fair market value shall be determined by mutual agreement of the holder of this Warrant and the Company. 

If
closing prices or closing bid prices are no longer reported by a securities exchange or other trading system, the closing price or closing bid price shall be that which is reported by such
securities exchange or other trading system at 4:00 p.m. New York City time on the applicable trading day. 

        10.3    Exercise Prior to Expiration.    To the extent this Warrant is not previously exercised as to all of the
Shares subject hereto, and if the fair market value of one share of the Common Stock is greater than the Warrant Price then in effect, this Warrant shall be deemed automatically exercised pursuant to
Section 10.2 above (even if not surrendered) immediately before its expiration. For purposes of such automatic exercise, the fair market value of one share of the Series Preferred upon such
expiration shall be determined pursuant to Section 10.2(c). To the extent this Warrant or any portion thereof is deemed automatically exercised pursuant to this Section 10.3, the Company
agrees to promptly notify the holder hereof of the number of Shares, if any, the holder hereof is to receive by reason of such automatic exercise. 

        10.    Representations and Warranties.    The Company represents and warrants to the holder of this Warrant as
follows: 

        (a)  This
Warrant has been duly authorized and executed by the Company and is a valid and binding obligation of the Company enforceable in accordance with its terms, subject
to laws of general application relating to bankruptcy, insolvency and the relief of debtors and the rules of law or principles at equity governing specific performance, injunctive relief and other
equitable remedies; 

        (b)  The
Shares have been duly authorized and reserved for issuance by the Company and, when issued in accordance with the terms hereof will be validly issued, fully paid and
non-assessable; 

        (c)  The
execution and delivery of this Warrant are not, and the issuance of the Shares upon exercise of this Warrant in accordance with the terms hereof will not be,
inconsistent with the Company's Charter or by-laws, do not and will not contravene any law, governmental rule or regulation, judgment or order applicable to the Company, and do not and
will not conflict with or contravene any provision of, or constitute a default under, any indenture, mortgage, contract or other instrument of which the Company is a party or by which it is bound or
require the consent or approval of, the giving of notice to, the registration or filing with or the taking of any action in respect of or by, any Federal, state or local government authority or agency
or other person, except for the filing of notices pursuant to federal and state securities laws, which filings will be effected by the time required thereby; and 

        (d)  There
are no actions, suits, audits, investigations or proceedings pending or, to the knowledge of the Company, threatened against the Company in any court or before any
governmental commission, board or authority which, if adversely determined, will have a material adverse effect on the ability of the Company to perform its obligations under this Warrant. 

        11.    Modification and Waiver.    This Warrant and any provision hereof may be changed, waived, discharged or
terminated only by an instrument in writing signed by the party against which enforcement of the same is sought. 

        12.    Notices.    Any notice, request, communication or other document required or permitted to be given or delivered
to the holder hereof or the Company shall be delivered, or shall be sent by certified 

11

 

or registered mail, postage prepaid, to each such holder at its address as shown on the books of the Company or to the Company at the address indicated therefor on the signature page of this Warrant. 

        13.    Binding Effect on Successors.    This Warrant shall be binding upon any corporation succeeding the Company by
merger, consolidation or acquisition of all or substantially all of the Company's assets, and all of the obligations of the Company relating to the Shares issuable upon the exercise or conversion of
this Warrant shall survive the exercise, conversion and termination of this Warrant and all of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of
the holder hereof. 

        14.    Lost Warrants or Stock Certificates.    The Company covenants to the holder hereof that, upon receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant or any stock certificate and, in the case of any such loss, theft or destruction, upon
receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company will make and
deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate. 

        15.    Descriptive Headings.    The descriptive headings of the several paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. The language in this Warrant shall be construed as to its fair meaning without regard to which party drafted this Warrant. 

        16.    Governing Law.    This Warrant shall be construed and enforced in accordance with, and the rights of the
parties shall be governed by, the laws of the State of California. 

        17.    Survival of Representations, Warranties and Agreements.    All representations and warranties of the Company
and the holder hereof contained herein shall survive the Date of Grant, the exercise or conversion of this Warrant (or any part hereof) or the termination or expiration of rights hereunder. All
agreements of the Company and the holder hereof contained herein shall survive indefinitely until, by their respective terms, they are no longer operative. 

        18.    Remedies.    In case any one or more of the covenants and agreements contained in this Warrant shall have been
breached, the holders hereof (in the case of a breach by the Company), or the Company (in the case of a breach by a holder), may proceed to protect and enforce their or its rights either by suit in
equity and/or by action at law, including, but not limited to, an action for damages as a result of any such breach and/or an action for specific performance of any such covenant or agreement
contained in this Warrant. 

        19.    No Impairment of Rights.    The Company will not, by amendment of its Charter or through any other means, avoid
or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment. 

        20.    Severability.    The invalidity or unenforceability of any provision of this Warrant in any jurisdiction shall
not affect the validity or enforceability of such provision in any other jurisdiction, or affect any other provision of this Warrant, which shall remain in full force and effect. 

        21.    Recovery of Litigation Costs.    If any legal action or other proceeding is brought for the enforcement of this
Warrant, or because of an alleged dispute, breach, default, or misrepresentation in connection with any of the provisions of this Warrant, the successful or prevailing party or parties shall be
entitled to recover reasonable attorneys' fees and other costs incurred in that action or proceeding, in addition to any other relief to which it or they may be entitled. 

[Remainder of page intentionally left blank] 

12

 

        22.    Entire Agreement; Modification.    This Warrant constitutes the entire agreement between the parties pertaining
to the subject matter contained in it and supersedes all prior and contemporaneous agreements, representations, and undertakings of the parties, whether oral or written, with respect to such subject
matter. 

	

 	
 	

DOT HILL SYSTEMS CORP.
	

 	
 	

By:	

    

	

 	
 	

Title:	

    

	

 	
 	

Address:	

    
    
    

	

 	
 	

Date:	

    

13

 
 

EXHIBIT A-1    
    
    NOTICE OF EXERCISE    
  

To: DOT HILL SYSTEMS CORP. (the "Company")  

        1.    The
undersigned hereby: 

	o
	elects
to purchase            shares of Common Stock of the Company pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price of such shares in full, or

	o
	elects
to exercise its net issuance rights pursuant to Section 10.2 of the attached Warrant with respect to            shares
of Common Stock. 

        2.    Please
issue a certificate or certificates representing said shares in the name of the undersigned or in such other name or names as are specified below: 

	

 (Name)
	

 
	

	

 (Address)

	3.
	The
undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection with, the
distribution thereof and that the undersigned has no present intention of distributing or reselling such shares, all except as in compliance with applicable securities laws. 

	SUN MICROSYSTEMS, INC.
	

 
	
 (Signature)

	

 (Date)	
 	

 

 
 

EXHIBIT A-2    
    
    NOTICE OF EXERCISE    
  

To: DOT HILL SYSTEMS CORP. (the "Company")  

        1.    Contingent
upon and effective immediately prior to the closing (the "Closing") of the Company's public offering contemplated by the Registration Statement on
Form S, filed, 19, the undersigned hereby: 

	o
	elects
to purchase            shares of Common Stock of the Company (or such lesser number of shares as may be sold on behalf of the
undersigned at the Closing) pursuant to the terms of the attached Warrant, or

	o
	elects
to exercise its net issuance rights pursuant to Section 10.2 of the attached Warrant with respect to            Shares
of Common Stock. 

        2.    Please
deliver to the custodian for the selling shareholders a stock certificate representing such shares. 

        3.    The
undersigned has instructed the custodian for the selling shareholders to deliver to the Company $                        or, if
less, the net proceeds due the undersigned
from the sale of shares in the aforesaid public offering. If such net proceeds are less than the purchase price for such shares, the undersigned agrees to deliver the difference to the Company prior
to the Closing. 

	

SUN MICROSYSTEMS, INC.
	

 (Name)
	

 
	

	

 (Address)

	

 (Date)	
 	

 

 
 

EXHIBIT B    
    
    CHARTER    
  

QuickLinks

DOT HILL SYSTEMS CORP. WARRANT TO PURCHASE SHARES OF COMMON STOCK

EXHIBIT A-1 NOTICE OF EXERCISE

EXHIBIT A-2 NOTICE OF EXERCISE

EXHIBIT B CHARTER

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