Document:

exv10w1

 

Exhibit 10.1

COLLABORATION AND LICENSE AGREEMENT

     This Collaboration and License Agreement (the “Agreement”) is made and entered into effective
as of May 24, 2007 (the “Effective Date”), by and between Micromet AG, having its
principal place of business at Staffelseestrasse 2, 81477, Munich, Germany (“Micromet”), and
Altana Pharma AG, a wholly owned subsidiary of Nycomed A/S, having its principal place of
business at Byk Gulden Str. 2, 78467 Konstanz, Germany (“Nycomed”). Micromet and Nycomed each may
be referred to herein individually as a “Party,” or collectively as the “Parties.”

Recitals

     A. Micromet is developing
the MT203 Product, an anti-GM-CSF [***].

     B. Nycomed is a pharmaceutical company with experience in the development and
commercialization of pharmaceutical products.

     C. Micromet and Nycomed desire to exclusively collaborate on the development of one or more
products binding to and inhibiting the activity of GM-CSF in order to obtain marketing approval of
such products for various indications, and thereafter to have Nycomed commercialize such products.

     In consideration of the foregoing premises and the mutual promises and covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows:

Agreement

1. Definitions

     When used in this Agreement, capitalized terms shall have the meanings as defined below and
throughout the Agreement.

     1.1 “Affiliate” means a legal entity that, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with a Party. For purposes
of this definition only, “control” and, with correlative meanings, the terms “controlled by” and
“under common control with” means (a) the possession, directly or indirectly, of the power to
direct the management or policies of a legal entity, whether through the ownership of voting
securities or by contract relating to voting rights or corporate governance, or (b) the ownership,
directly or indirectly, of more than 50% of the voting securities or other ownership interest of a
legal entity; provided, however, that if local law restricts foreign ownership, control shall be
established by direct or indirect ownership of the maximum ownership percentage that may, under
such local law, be owned by foreign interests.

     1.2 “Antibody” means a molecule or gene encoding such a molecule comprising or containing at
least one immunoglobulin variable domain or parts of such domain or any existing or future
fragments, variants, modifications or antibody derivatives thereof.

 

			
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     1.3 “Applicable Law” means the laws, rules, and regulations, including any statutes, rules,
regulations, guidelines, or other governmental requirements that may be in effect from time to time
and apply to the development, manufacture, registration, and marketing of a Product in the
countries of the Territory, including any such statutes, rules, regulations, guidelines, or other
requirements of the FDA or the EMEA or other national or international bodies relevant for
medicinal or medical products, including devices, materials and services required for application
of a pharmaceutical product.

     1.4 “Bioequivalent Product” means, with respect to a particular Product, any Third Party
pharmaceutical product that contains an anti-GM-CSF [***] or an [***], in each case, with
[***] and [***] to the Product.

     1.5 “BITE” means a bi-specific Single Chain Antibody wherein one arm of the Single Chain
Antibody binds to T-cells.

     1.6 “BLA” means a Biologics License Application for submission to the FDA and the equivalent
application in jurisdictions outside the United States of America, including a Marketing Approval
application for submission to the EMEA, in each case in conformance with Applicable Law.

     1.7 “Change in Control” means (i) a sale, lease, license or other disposition of all or
substantially all of the assets of a person or entity (in one transaction or a series of related
transactions), or (ii) any sale, exchange or other transfer to a Third Party (or several Third
Parties acting together) of shares representing more than fifty percent (50%) of the aggregate
ordinary voting power represented by the issued and outstanding stock of a person or entity,
whether such transfer is made directly or indirectly, beneficially or of record.

     1.8 “Clinical Failure” means any of the following: (i) receipt of a written order by a
Regulatory Authority to cease development in a clinical trial in one or more Indications of the
MT203 Product; or (ii) a determination [***] by [***] or [***] (1) that the continued development
of the MT203 Product would not be ethical or in the best interest of patient safety or (2) that the
MT203 Product has failed to achieve the primary efficacy endpoints [***] based upon an applicable
final or interim study report.

     1.9 “Collaboration Technology” means Joint Collaboration Technology, Micromet Collaboration
Technology, and Nycomed Collaboration Technology.

     1.10 “Commercialization” means the manufacture, marketing, promotion, advertising, selling and
distribution of a Product in a country after Marketing Approval has been obtained in such country.
The term “Commercialize” has a correlative meaning.

     1.11 “Commercially Reasonable Efforts” means the level of efforts consistent with the
reasonable best practices of the pharmaceutical industry and the exercise of prudent scientific and
business judgment for the development and commercialization of a pharmaceutical product having
similar market potential, profit potential or strategic value, based upon conditions then
prevailing. Without limiting the foregoing, Commercially Reasonable Efforts requires, with respect
to such an obligation, that the Party: (a) within a reasonable time assign responsibility for such
obligation to specific employee(s) who are held accountable for progress and monitor

 

			
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such progress on an on-going basis, (b) set and consistently seek to achieve specific,
meaningful and measurable objectives for carrying out such obligation, and (c) consistently make
and implement decisions and allocate resources designed to advance progress with respect to such
objectives.

     1.12 “Control” and, with correlative meaning, the term “Controlled”, means, with respect to a
Party and any Patent, Know-How, or other intellectual property right, the ability to grant the
other Party access, a license, a sublicense or the right to use (as applicable) such Patent,
Know-How, or intellectual property right as provided in this Agreement without violating the terms
of any agreement or other arrangement with any Third Party existing at the time such Party would be
required under this Agreement to grant the other Party such access, license, sublicense or right of
use.

     1.13 “Development Expenses” means, with respect to a Party, all costs and expenses incurred by
a Party in carrying out any activities to be performed pursuant to the Development Plan, calculated
in accordance with generally accepted accounting principles consistently applied and such Party’s
cost accounting systems, provided that the cost of a Party’s FTEs performing such activities shall
be calculated at the FTE Rate.

     1.14 “Development Plan” has the meaning as defined in Section 3.2.1.

     1.15 “EMEA” means the European Medicines Agency, or any successor agency thereto.

     1.16 “European Union” means those countries that during the Term are member states of the
European Union.

     1.17 “FDA” means the United States Food and Drug Administration, or any successor agency
thereto.

     1.18 “Field” means the treatment of human diseases and conditions.

     1.19 “FTE” means the full time equivalent of a total of [***] working hours per year of
scientific or technical or managerial work on or directly related to the execution or
implementation of the Development Plan, or other tasks to be performed under this Agreement,
carried out by a qualified employee or consultant of a Party. Scientific or technical work may
include, but is not limited to, research, experimental laboratory work, developing manufacturing
processes for a Product, conducting pre-clinical and clinical development of a Product, recording
and writing up results, reviewing literature and references, holding scientific discussions, and
attending conferences in the relevant field.

     1.20 “FTE Cost” means the product of (a) the number of FTEs, which are documented using a
reasonably reliable tracking system and (b) the FTE Rate. The tracking system should include
employee’s function, performed tasks, and corresponding hours performed by the employee.

     1.21 “FTE Rate” means [***] per FTE, which amounts include, for each FTE, laboratory supplies
and equipment (excluding items provided for separately under the applicable

 

			
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Development Plan), equipment maintenance costs, utilities, waste removal, and a pro rata
allocation of general and administrative expenses plus facilities expenses.

     1.22 “GM-CSF” means the whole or part and natural variants of the granulocyte-macrophage
colony stimulating factor (GM-CSF) identified by the [***] entry name [***] and accession number
[***] with the amino acid sequence as set out in Exhibit G.

     1.23 “IND” means an Investigational New Drug Application for submission to the FDA, and the
equivalent application in jurisdictions outside the United States of America, including
Investigational Medicinal Product Dossier for submission to a Regulatory Authority in Europe.

     1.24 “Indication” means any discrete disease pattern in the Field for which a BLA,
supplemental BLA, Marketing Approval application or similar Regulatory Filing may be made.

     1.25 “Joint Collaboration Technology” means any Patents claiming or covering a discovery or
invention conceived, and any Know-How generated, jointly by employees, agents or independent
contractors of both Parties during the course of, in furtherance of, and as a direct result of such
employees, agents or independent contractors performing an activity pursuant to this Agreement.

     1.26 “JSC” has the meaning as defined in Section 2.2.

     1.27 “Know-How” means (a) any scientific or technical information, results and data of any
type whatsoever, in any tangible or intangible form whatsoever, that is not in the public domain or
otherwise publicly known, including databases, practices, methods, techniques, specifications,
formulations, formulae, knowledge, know-how, skill, experience, test data including
pharmacological, medicinal chemistry, biological, chemical, biochemical, toxicological and clinical
test data, analytical and quality control data, stability data, studies and procedures, and
manufacturing process and development information, results and data, and (b) any biological,
chemical, or physical materials that are not in the public domain or otherwise available to the
public; all to the extent not claimed or disclosed in a Patent.

     1.28 “Licensed Know-How” means (a) any Know-How Controlled by Micromet as of the Effective
Date, (b) any Know-How included in the Micromet Collaboration Technology, or (c) any Know-How
included in the Joint Collaboration Technology (but only with respect to Micromet’s rights and
interest in such Joint Collaboration Technology), to the extent such Know-How is necessary or
useful for the research, development, use, or Commercialization of a Product in the Field.

     1.29 “Licensed Patents” means (a) any Patents Controlled by Micromet during the Term that
claim any invention or discovery included within any Know-How Controlled by Micromet as of the
Effective Date, Micromet Collaboration Technology or Micromet’s interest in Joint Collaboration
Technology, to the extent necessary or useful for the research, development, import, use or
Commercialization of a Product and (b) all of the Patents listed on Exhibit A.

     1.30 “Licensed Technology” means the Licensed Patents, any Sublicensed Patents,
and Sublicensed Know-How and the Licensed Know-How.

 

			
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     1.31 “Major Market” means each of the United States of America, the United Kingdom, Germany,
France, Italy, Spain and Japan.

     1.32 “Marketing Approval” means the approval of a BLA, and any pricing and reimbursement
approvals to the extent required by Applicable Law prior to the sale of pharmaceutical products in
a country.

     1.33 “Micromet Collaboration Technology” means any Patents claiming or covering a discovery
or invention conceived, and any Know-How generated, solely by employees, agents or independent
contractors of Micromet during the course of, in furtherance of, and as a direct result of such
employees, agents or independent contractors performing an activity pursuant to this Agreement.

     1.34 “MT203 Product”
means any pharmaceutical product comprising the [***] with the
variable domain amino sequence set forth in Exhibit B.

     1.35 “Net Sales” means the gross amount invoiced by Nycomed, its Affiliates or sublicensees
for sales of a Product to any Third Party (and in all cases amounts actually received to the extent
not invoiced), less any (a) [***] and [***] , including [***] ; (b) amounts allowed for [***] or
[***] ; (c) [***] and [***] charges to the extent included in the invoiced amount; (d) [***] or
other [***] paid in connection with such sales (but excluding [***] ); and (e) the [***] and
[***] [***] including [***] to [***] , but excluding any [***] or [***] . Any of the
deductions listed above that involve a payment by Nycomed, its Affiliates or sublicensees shall be
taken as a deduction in the calendar quarter in which the payment is actually made by such entity.
Any amounts received on account of transfers of a Product between Nycomed, its Affiliates or
sublicensees shall be excluded from the calculation of Net Sales, and Net Sales shall be calculated
based on the final sale of such transferred product by Nycomed, its Affiliates or sublicensees to
any Third Party. If Nycomed or its Affiliates or sublicensees receive non-cash consideration for
Product sold or otherwise transferred to a Third Party, Net Sales for such sale or transfer shall
be determined based on the average of the gross invoice prices charged to other Third Parties in
respect of cash sales of Product during the applicable reporting period.

     1.36 “Nycomed Collaboration Technology” means any Patents claiming or covering a discovery or
invention conceived, and any Know-How generated, solely by employees, agents or independent
contractors of Nycomed during the course of, in furtherance of, and as a direct result of such
employees, agents or independent contractors performing an activity pursuant to this Agreement.

     1.37 “Patents” means (a) all patents, patent applications, utility models and design patents
in any country or supranational jurisdiction, and (b) any provisionals, substitutions, divisions,
continuations, continuations in part, reissues, renewals, registrations, confirmations,
reexaminations, extensions, supplementary protection certificates and the like, of any such patents
or patent applications.

     1.38 “Phase 2 Trial” means a clinical trial in human patient population to determine the safe
and effective dose range in the proposed therapeutic indication, as more fully defined in

 

			
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21 C.F.R. § 312.21(b), or its successor regulation, or the equivalent in any foreign country.

     1.39 “Phase 3 Trial” means a clinical trial in human patients designed to (a) establish that a
drug is safe and efficacious for its intended use; (b) define warnings, precautions and adverse
reactions that are associated with the drug in the dosage range to be prescribed; and (c) support
Marketing Approval of such drug, as more fully defined in 21 C.F.R. § 312.21(c), or its successor
regulation, or the equivalent in any foreign country.

     1.40 “Pivotal Trial” means (a) Phase 3 Trial or (b) a Phase 2 Trial that is of appropriate
size and design to establish that a pharmaceutical product is safe and effective for its intended
use, to define warnings, precautions and adverse reactions that are associated with the
pharmaceutical product in the dosage range to be prescribed, and to support a BLA for such
pharmaceutical product or label expansion of such pharmaceutical product. For clarity, the
determination of whether a Phase 2 Trial is a Pivotal Trial for purposes of this Agreement shall be
based upon a determination by the relevant Regulatory Authority that such trial could be
sufficient, depending on its outcome, to support the filing of a BLA for such pharmaceutical
product or label expansion of such pharmaceutical product.

     1.41 “Product” means any (i) MT203 Product;
and (ii) any product comprising any [***] developed pursuant to this Agreement including any
fragment or Single Chain Antibody fragment thereof, in each of subsections (i) and (ii) that is
covered or claimed by, incorporates, comprises or was developed using the Licensed Technology. The
definition of “Product” shall exclude in all cases any composition or formulation of a product
comprising a BITE molecule or fragment thereof.

     1.42 “Regulatory Authority” means, in a particular country or jurisdiction, any applicable
government regulatory authorities or other bodies involved in granting approval to market or sell
a Product, including any pricing and reimbursement approvals, in such country or jurisdiction,
including, (a) in the United States, the FDA, and any successor government authority having
substantially the same function, (b) any non-United States equivalent thereof, and (c) in the
European Union, the EMEA and any national regulatory authority in any member state of the European
Union.

     1.43 “Regulatory Filing” means any submission or application made or filed with a Regulatory
Authority, including any IND or BLA.

     1.44 “SCA Patents” means those Patents identified on Exhibit F, and any provisionals,
substitutions, divisions, continuations, continuations in part, reissues, renewals, registrations,
confirmations, reexaminations, extensions, supplementary protection certificates and the like, of
any such patents or patent applications.

     1.45 “Single Chain Antibody” or “SCA” means an Antibody comprising (a) a polypeptide segment
having a light chain variable region, (b) a polypeptide segment having a heavy chain variable
region, and (c) at least one peptide linker linking those polypeptides into a single chain
polypeptide.

     1.46 “Sublicensed Know-How” means the Know-How Controlled by Micromet pursuant to the Upstream
Agreements.

 

			
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     1.47 “Sublicensed Patents” means the Patents Controlled by Micromet pursuant to the Upstream
Agreements.

     1.48 “Sublicensed Technology” means any Sublicensed Patents and Sublicensed Know-How.

     1.49 “Territory” means all countries of the world.

     1.50 “Third Party” means any entity other than Micromet, Nycomed or their respective
Affiliates.

     1.51 “Upstream Agreement” means any of the agreements listed in Exhibit D and as may
be amended in accordance with Section 7.3.3.

     1.52 “Valid Claim” means (a) an issued claim of an issued Patent that has not (i) expired or
been canceled, (ii) been declared invalid by a decision of a court or other appropriate body of
competent jurisdiction, from which no appeal is or can be taken, (iii) been admitted to be invalid
or unenforceable through reissue, disclaimer or otherwise, or (iv) been abandoned or disclaimed;
and (b) a claim included in a pending patent application that is being actively prosecuted and that
has not been (i) canceled, (ii) withdrawn from consideration, (iii) finally determined to be
unallowable by the applicable governmental authority (from which no appeal is or can be taken), or
(iv) abandoned or disclaimed, provided, however, that if a claim of a patent application has been
pending for more than [***] years, such claim shall not constitute a Valid Claim for the purposes
of this Agreement unless and until a Patent issues with such claim.

2. Collaboration Governance

     2.1 Exclusive co-development. The Parties shall conduct in good faith the exclusive
collaboration on the terms set out below.

     2.2 Establishment of Joint Steering Committee. Within [***] days following the Effective
Date, the Parties shall establish a joint steering committee (the “JSC”) to oversee the development
of the Products under this Agreement. Each Party shall appoint three employees to serve as their
representatives on the JSC. From time to time, on written notice to the other Party, Micromet and
Nycomed each may substitute any of its representatives on the JSC. Each Party shall designate one
of its members of the JSC as the “Co-Chair.” Subject to the provisions of this Section 2, the JSC
shall establish its own procedural rules for its operation. The JSC shall be disbanded upon the
earlier to occur of (a) anytime following the receipt of the first Marketing Approval of a Product,
at the option of Micromet, (b) anytime the Parties have ceased development of all Products under
this Agreement, or (c) the [***] anniversary of the Effective Date. Following any such
dissolution of the JSC and for the remainder of the Term, Nycomed shall provide Micromet with
quarterly written reports regarding the status of and plans for the development and
commercialization of all Products as applicable, including copies of Nycomed’s then-existing
development and commercialization plans, as applicable, for such Product and other such information
as may be reasonably requested by Micromet regarding such Product.

     2.3 Tasks of the JSC. The JSC shall: (a) review and approve the Development Plan

 

			
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and any updates or amendments to the Development Plan and any budgets for such activities; (b)
monitor the progress of and coordinate the activities undertaken pursuant to the Development Plan;
(c) review the product lifecycle plans of the Parties for all Products, including Indication and
label expansions, new dosage forms, and new formulations or delivery systems; and (d) take such
other actions as are expressly delegated to the JSC in this Agreement. The JSC shall not have any
power to amend this Agreement and shall have only such powers as are specifically delegated to it
under this Agreement.

     2.4 JSC Meetings. The JSC shall meet not less than once every calendar quarter. Meetings may
be held in person or by means of telecommunication (telephone, video, or web conferences); provided
that at least two meetings per year shall be held in person. The JSC may meet more frequently by
agreement of the Parties. The Co-Chairs shall be responsible for organizing the meetings of the
JSC and for distributing the agenda of the meetings. The Co-Chairs shall include on the agenda any
item within the scope of the responsibility of the JSC that is requested to be included by a Party,
and shall distribute the agenda to the Parties no less than one week before any meeting of the JSC.
Each Party may, in its discretion, invite non-voting employees, consultants or advisors (which
consultants and advisors shall be under an obligation of confidentiality no less stringent than the
terms set forth in Section 9) to attend any meeting of the JSC. Each Party shall bear its own
costs associated with holding and attending JSC meetings.

     2.5 Meeting Minutes. The Co-Chairs (or their designee(s)) shall prepare the minutes of each
JSC meeting, and send it to all members of the JSC for review and approval within [***] days after
each meeting. Minutes shall be deemed approved unless any member of the JSC objects to the
accuracy of such minutes by providing written notice to the other members of the JSC within [***]
days of receipt of the minutes. In the event of any such objection that is not resolved by mutual
agreement of the Parties, such minutes shall be amended to reflect such unresolved dispute.

     2.6 Decision Making.

          2.6.1 The JSC shall take action on matters within its power by unanimous consent of the
Parties, with each Party having a single vote, irrespective of the number of representatives
actually in attendance at a meeting, or by a written resolution signed by the designated
representative of each Party.

          2.6.2 If the JSC is unable to reach unanimous consent on a particular matter (such matter a
“JSC Dispute”), then either Party may provide written notice of such dispute to the other Party’s
senior executive management representative as may be designated by a Party. Such senior executive
management representative shall have appropriate decision making authority for the Party and not be
a member of the JSC. The senior executive management representatives of each Party shall meet at
least once in person to discuss the dispute and use their good faith efforts to resolve the JSC
dispute within [***] days after submission of such dispute to such officers.

          2.6.3 If the senior executive management representatives (or their designees) cannot reach
agreement with respect to a JSC dispute within the time period set forth in

 

			
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subsection (b) above, the [***] shall have the authority to finally resolve such dispute.

          2.6.4 Notwithstanding the terms of subsections 2.6.2 and 2.6.3 above, if the matter concerns a
dispute regarding the interpretation of this Agreement, the performance or alleged nonperformance
of a Party’s obligations under this Agreement, or any other alleged breach of this Agreement, such
matter shall be resolved in accordance with the terms of Section 16.4.

          2.7 Project Team. The Parties shall establish a joint project team (the “JPT”) consisting of
an appropriate number of representatives of each Party. Each Party shall designate one of its JPT
members as the project team leader who shall be the primary contact person for the other Party for
matters relating to the development of a Product by such Party. The JPT shall coordinate the
day-to-day activities of the Parties in the performance of the Development Plan and conduct those
activities as directed by the JSC, including preparation of applicable budget expense reporting.
The JPT shall take action by unanimous consent of the Parties, with each Party having a single
vote, irrespective of the number of representatives actually in attendance at a meeting, or by a
written resolution signed by the designated representative of each Party. If the JPT is unable to
reach unanimous consent on a particular matter, such matter shall be submitted to the JSC for
resolution in accordance with Section 2.6. On a quarterly basis, the JPT shall provide a written
report to the JSC summarizing the Parties’ progress with respect to the development of the Products
and any matters directed by the JSC. The JPT shall be disbanded upon the earlier to occur of (a)
anytime following the receipt of the first Marketing Approval of the MT203 Product, at the option
of Micromet, (b) anytime Micromet is no longer actively participating in the development of the
MT203 Product under this Agreement, or (b) the [***] anniversary of the Effective Date.

3. Product Development

     3.1 General. Without limiting the Parties’ obligations under this Agreement, the Parties
acknowledge that the ultimate objective of the collaboration is to develop one or more
pharmaceutical products including formulation, packaging and application systems as an MT203
Product or Product to be launched and marketed in the Field in the Territory. The Parties shall
take into consideration this ultimate target when undertaking the development as set out below and
subject to the terms of this Agreement.

     3.2 Development Plan.

          3.2.1 Promptly following the execution of this Agreement with respect to the MT203 Product,
and the delivery of a written notice pursuant to Section 3.8.1 with respect to any Additional
Product, and pursuant to Section 3.8.2 with respect to any Substitute Product, the JPT shall
prepare for review by the JSC a detailed plan of the research, development and manufacturing
activities to be performed by the Parties with respect to the MT203 Product, and any such
Additional Product or Substitute Product (the “Development Plan”). The Development Plan shall
include an allocation of the responsibility for the performance of the development activities to
one or the other Party and an estimated budget for the activities to be conducted by each Party,
with Micromet being assigned those activities relating primarily to the preclinical development of
such Product and process development and manufacturing of such

 

			
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Product for clinical trials, and Nycomed being assigned those activities relating primarily to
the clinical development of such Product, including establishment of a commercial manufacturing
process and commercial manufacturing. Notwithstanding the above, the Development Plan shall in any
event include the activities and allocation of responsibilities described in the outline of the
Development Plan contained in Exhibit C (it being understood that the estimated budget on
Exhibit C is preliminary and subject to change based upon the Parties’ preparation and
review of the Development Plan). The JSC shall promptly review and approve the initial Development
Plan and on a regular basis review and revise the then-current Development Plan (including the
related budget) to reflect the progress achieved and the further development activities to be
undertaken by the Parties in the development of the Product. Any material revisions to the
Development Plan must be approved by the JSC in accordance with Section 2.6, provided that any
modifications to the obligations or expenses of Micromet under the Development Plan shall require
the prior written consent of Micromet not to be unreasonably withheld or delayed regarding any
activity for which Micromet is primarily responsible as described on Exhibit C or any
Development Plan approved by Micromet. Except as otherwise provided in this Agreement, Nycomed
shall control the performance of the activities performed in the Development Plan, and shall at its
discretion designate activities to be performed by Nycomed or by a Third Party.

          3.2.2 The Development Plan shall be designed to accomplish the filing of INDs, and BLAs and
the receipt of Marketing Approval in order to optimize the economic potential for the Product in
the Territory, including the proposed study designs for clinical trials and a budget of Development
Expenses to be incurred pursuant to the Development Plan. The Development Plan shall set specific
objectives and timelines for carrying out development activities sufficient in scope and quality to
progress the development of the Product towards Marketing Approval within timelines and using
standards customary in the biopharmaceutical industry for products at a similar stage of
development and with similar market potential. Without limiting the generality of the foregoing,
the Development Plan shall be designed to develop, and to obtain Marketing Approval for, such
Product in all Major Markets.

     3.3 Development Expenses. Nycomed shall bear all Development Expenses incurred by the Parties
after the Effective Date, and shall pay to Micromet on or before the first day of each calendar
quarter the amount of Development Expenses budgeted to be incurred by Micromet in such calendar
quarter as set forth in the applicable Development Plan. Nycomed shall pay all such amounts to an
account established by Micromet which is exclusively used for the coverage of the Development
Expenses. Any interest received from the deposited amount on the account shall be credited against
the Development Expenses. Micromet shall provide Nycomed with quarterly reports containing a
detailed account of development activities performed and Micromet’s Development Expenses incurred
during the preceding calendar quarter. The Parties shall work together to reconcile, in a timely
fashion, the Development Expenses set forth in the reports presented by Micromet with Nycomed’s
payments for such quarter. If the Parties determine that such payments exceed Micromet’s reported
Development Expenses, then the amount of such excess shall be credited against the next payment of
Development Expenses by Nycomed hereunder (or, if no such payment is anticipated, refunded by
Micromet to Nycomed within [***] days of such determination). If the Parties determine that
Micromet’s reported Development Expenses exceed the amount paid by Nycomed, then Nycomed shall pay
the excess amount to Micromet within [***] days of such determination but no later than the next
quarterly advance payment made by Nycomed under this Section 3.3. All

 

			
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such Development Expenses shall be paid to the extent made or incurred in conjunction with an
approved budget line item in the Development Plan as approved and revised from time to time by the
JSC as set forth below. The JSC shall monitor and review on a quarterly basis the actual expenses
incurred by the Parties in conducting development activities under the Development Plan and each
Party shall promptly notify the JSC if it reasonably expects that its Development Expenses during
any calendar period shall exceed by [***] percent [***] the then-current budgeted amount for such
period. In such event, the JSC shall in good faith consider and review a corresponding amendment
to either the applicable budget or the scope of development activities to be performed consistent
with the Parties’ obligations under this Agreement.

     3.4 Right of Negotiation for [***] . At any time prior to the initiation of the [***] with a
Product by Nycomed, upon written request of Micromet, the Parties shall [***] whether and under
what terms Micromet may [***] . Such [***] may include the [***] for the clinical development,
and an [***] to reflect the [***] borne by the Parties as a result of such [***] , and such other
terms that the Parties may deem appropriate under the circumstances. For clarity, the Parties agree
that Micromet’s rights with respect to [***] are limited to the [***] mentioned in this Section
3.4 unless the Parties agree otherwise in their sole discretion.

     3.5 Diligence in Development.

          3.5.1 Micromet shall use Commercially Reasonable Efforts to perform the activities assigned to
it in the Development Plan. Micromet shall deliver certain data generated by Micromet to be
included in the “CMC Part” of the BLA. All efforts of Micromet’s Affiliates, sublicensees and Third
Party contractors shall be considered efforts of Micromet for the purpose of determining Micromet’s
compliance with its obligations under this Section 3.5.1.

          3.5.2 Nycomed shall use Commercially Reasonable Efforts to develop each Product in one or more
Indications with the objective of maximizing the overall commercial potential of such Product and
to perform the activities assigned to it in the Development Plan. All efforts of Nycomed’s
Affiliates, sublicensees and Third Party contractors shall be considered efforts of Nycomed for the
purpose of determining Nycomed’s compliance with its obligations under this Section 3.5.2.

     3.6 Selection of Indications. The Parties agree that each Product may be effective for the
treatment of Indications in the field of [***] diseases, but not limited to, rheumatoid arthritis,
COPD, asthma, psoriasis, multiple sclerosis [***] diseases, and that it is in the best interest of
both Parties to develop such Product broadly in multiple Indications subject to reasonable
commercial and technical considerations. The Parties further agree to pursue a development
strategy that initially focuses on the clinical development of the MT203 Product in [***] , and
subject to reasonable commercial and technical considerations to expand the Development Plan to
include additional Indications following the achievement of clinical proof of principle of such
Product in [***] in a clinical trial. To that end, the Parties agree to include in the
Development Plan the performance of development activities designed to establish in preclinical
models proof of concept of the effectiveness of such Product in two other Indications. Such
development activities shall be performed in parallel with the development of the MT203 Product in
[***] . If the Parties achieve such preclinical proof of concept with one or more such additional
Indications, the Development Plan shall be amended to include the development of the

 

			
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11

 

MT203 Product in such additional Indications, subject to reasonable commercial and technical
considerations, promptly after the achievement of proof of principle of such Product [***] in a
clinical trial.

     3.7 Records.

          3.7.1 Micromet Records. All research, process development and preclinical work conducted by
or on behalf of Micromet under the Development Plan shall be completely and accurately recorded, in
sufficient detail and in good scientific manner, in separate laboratory notebooks in accordance
with Applicable Law distinct from other work being conducted by Micromet.

          3.7.2 Nycomed Records. All development work for all Products performed by or on behalf of
Nycomed shall be completely and accurately recorded, in sufficient detail and in good scientific
manner, in separate laboratory notebooks distinct from other work being conducted. Nycomed shall
also retain all clinical trial records required by Applicable Law to be maintained in connection
with the development of all Products.

     3.8 Additional Products.

          3.8.1 Nycomed shall have the right at any time during the Term to initiate development of a
Product in addition to the MT203 Product as an “Additional Product” under this Agreement upon prior
written notice to Micromet other than Substitute Products described below. For the avoidance of
doubt, the terms and conditions of this Agreement applicable to Products (other than those
specifically limited to the MT203 Product) shall apply to such Additional Product. The development
of the Product for an Indication following a Clinical Failure and discontinuance of development for
another Indication shall not be deemed an Additional Product but rather a Substitute Product as
defined below.

          3.8.2 Nycomed shall have the right at any time during the Term to initiate development of a
Product other than the MT203 Product as replacement Product (a “Substitute Product”) under this
Agreement upon prior written notice to Micromet in the event of a Clinical Failure of the MT203
Product and discontinuance of development of such Product by Nycomed. For the avoidance of doubt,
the terms and conditions of this Agreement applicable to Products (other than those specifically
limited to the MT203 Product) shall apply to such Substitute Product; provided, however, that
Nycomed shall not be obligated to pay Micromet upon the achievement of any milestone event
described in Exhibit E for such Substitute Product for which Nycomed previously paid
Micromet in respect of the MT203 Product.

     3.9 Product Manufacture. As between the Parties, Micromet shall be responsible for, and shall
use Commercially Reasonable Effort to, manufacture of the MT203 Product for clinical trials other
than Phase 3 Trials for the Territory as described on Exhibit C and to be set forth in the
Development Plan, including manufacturing of the finished Product, ingredients thereof and delivery
systems therefor, including test method development and stability testing, formulation, process
development, manufacturing scale-up, quality assurance/quality control development, quality control
testing, packaging, release and regulatory activities related to all of the foregoing (it being
understood that the supply and availability of a Product shall depend in

 

			
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12

 

part upon the selection and availability of Third Party suppliers). Except as described in
the foregoing, Nycomed shall be responsible for, and shall use Commercially Reasonable Efforts to,
manufacture the Products prior to and following Marketing Approval pursuant to Article 4, either
directly or through Third Parties (it being understood that the supply and availability of a
Product shall depend in part upon the selection and availability of Third Party suppliers). In
addition, Micromet and Nycomed shall agree and describe in the Development Plan the appropriate
timeframe and activities that provide for the transfer of the applicable manufacturing processes
for the MT203 Product to a Third Party manufacturer designated by Nycomed.

4. Product Commercialization

     4.1 General. As between the Parties, Nycomed shall be solely responsible for the
Commercialization of the Products in the Territory during the Term. Nycomed shall use Commercially
Reasonable Efforts to Commercialize the Products, either directly or through Third Parties (it
being understood that the supply and availability of a Product shall depend in part upon the
selection and availability of Third Party suppliers).

     4.2 Diligence in Commercialization. Nycomed shall, subject to reasonable commercial
considerations in such country, launch the Products within [***] months after receiving Marketing
Approval in any country in the Territory, and thereafter shall use Commercially Reasonable Efforts
to Commercialize the Products in each such country.

     4.3 Branding, Trademarks, Trade Dress, and Logos. Nycomed shall solely own, and shall be
solely responsible for selecting, the trademark used to identify a Product that shall be
Commercialized in the Territory pursuant to this Agreement. Nycomed shall oversee the filing,
prosecution and maintenance of all trademark registrations for a Product in the Territory. Nycomed
shall be responsible for the payment of any and all costs relating to filing, prosecution, and
maintenance of the trademarks for a Product in the Territory. Nycomed shall have sole
responsibility for, and shall be sole owner of, all trade dress, logos, slogans, and designs used
on and in connection with a Product in the Territory.

5. Regulatory Matters

     5.1 Regulatory Filings; Inspections. Subject to Nycomed’s obligation to Commercialize the
Products pursuant to Section 4, Nycomed shall be responsible for the preparation, filing,
prosecution and maintenance of any Regulatory Filings for the Products. Micromet shall assist
Nycomed, as reasonably necessary, in the preparation of Regulatory Filings, including providing
necessary documents or other materials required by Applicable Law, all as provided for in the
Development Plan (including any applicable timeframes) and in a format and standard reasonably
agreed by the Parties, in each case at Nycomed’s expense. Nycomed shall promptly notify Micromet in
writing and in advance of any meeting with or inspection by any Regulatory Authority relating to a
Product. At Micromet’s option, Micromet may have an employee or Third Party consultant participate
in such meeting or inspection as an observer.

     5.2 Regulatory Approvals; Adverse Drug Experiences. Nycomed shall be the holder of all
marketing authorizations for the Products and shall be responsible for obtaining and

 

			
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13

 

maintaining any Marketing Approvals and other regulatory approvals required for the
Commercialization of the Products in the Territory, including communicating and preparing and
filing all reports (including without limitation adverse drug experience reports) and the
application for Marketing Approval with the applicable regulatory authorities. Nycomed shall
comply with the standard of care in performing such activities reasonable and customary to the
pharmaceutical industry and in compliance with all Applicable Law. To the extent either Party
receives any information regarding adverse drug experiences related to the use of a Product, such
Party shall promptly provide the other Party with such information as is required under Applicable
Laws. Prior to the first commercial launch of a Product, the Parties shall agree on standard
operating procedures implementing the requirements under Applicable Law regarding adverse event
reporting, which procedures, as may be amended from time to time upon mutual agreement of the
Parties, shall be incorporated in this Agreement by reference. The Parties acknowledge that the
receipt of Marketing Approvals depends on, in part, the availability and sufficiency of efficacy
and safety data for a Product.

     5.3 Communications with Regulatory Authorities. Nycomed shall be solely responsible for any
communications with the regulatory authorities occurring or required in connection with obtaining
or maintaining any Marketing Approvals for a Product. Nycomed shall promptly provide Micromet with
copies of all written or electronic correspondence received from regulatory authorities relating to
a Product, and shall provide Micromet with a reasonable opportunity to provide comments on any
responses by Nycomed to such regulatory authorities. Upon the reasonable request of Nycomed,
Micromet shall assist Nycomed to address requests from and communications to regulatory authorities
applicable to Micromet’s activities conducted with respect to a Product, including data and
information held by Micromet.

     5.4 Regulatory Records. Each Party shall maintain, or cause to be maintained, for at least
[***] years and for at least [***] years after the termination of this Agreement, or for such
longer period as may be required by Applicable Law, complete and accurate records of its respective
development activities with respect to a Product in sufficient detail and in good scientific manner
appropriate for patent and regulatory purposes, which fully and properly reflect all work done and
results achieved in the performance of its respective development activities. Each Party shall have
the right, during normal business hours and upon reasonable notice, to inspect and copy any such
records, except to the extent that a Party reasonably determines that such records contain
Confidential Information that is not licensed to the other Party, or to which the other Party does
not otherwise have a right hereunder.

6. Intellectual Property

     6.1 License Grants by Micromet.

          6.1.1 Subject to the terms and conditions set forth in this Agreement, Micromet grants to
Nycomed an exclusive, royalty-bearing license, with the right to grant sublicenses in accordance
with Section 6.2, to the Licensed Technology (other than the Sublicensed Patents and the
Sublicensed Know-How), to conduct research and development, make, have made, use, Commercialize,
and import the Products in the Field in the Territory.

          6.1.2 Subject to the terms and conditions set forth in this Agreement and the

 

			
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14

 

applicable Upstream Agreements, Micromet grants to Nycomed an exclusive, royalty-bearing
sublicense, with the right to grant further sublicenses in accordance with Section 6.2, under the
rights and licenses granted to Micromet in the Upstream Agreements with respect to the Sublicensed
Technology, to research, develop, Commercialize, make, have made, use, offer for sale, sell, and
import the Products in the Field in the Territory. Nycomed acknowledges and agrees that it has
received a copy of each Upstream Agreement, and that the rights, licenses and sublicenses granted
by Micromet to Nycomed in this Agreement are subject to the terms of the Upstream Agreements.
Subject to section 6.8.2, Nycomed covenants not to take or fail to take any action that violates
the terms of such Upstream Agreements applicable to sublicensees, or that would cause Micromet to
be in breach of any of the terms of the Upstream Agreements.

     6.2 Sublicensing by Nycomed.

          6.2.1 General. Subject to the terms and conditions of this Agreement, Nycomed shall have the
right to sublicense to a Third Party any rights granted under Section 6.1.1 or 6.1.2 with respect
to a particular Product, through written sublicense agreements for (i) [***] to an entity having
[***] and [***] at least [***] to [***] for the [***] or
[***] of a Product, as [***] to the [***] and [***] under the
[***] for [***] and (ii) other [***] in the [***] in its
[***]. In connection with the grant of any such sublicense, Nycomed shall remain responsible
to Micromet for the performance of Nycomed’s obligations under this Agreement.

          6.2.2 SCA Patent
Option. If Nycomed desires to initiate the development of a Product
comprising a [***], Nycomed shall provide written notice thereof to Micromet. Upon
receipt of such notice, the definition of “Licensed Patents” shall be expanded to include the
Patents listed in Exhibit F, by amending Exhibit A-2 to include such Patents, and
Nycomed shall be granted a license or sublicense, as applicable, under the SCA Patents pursuant to
the terms of Section 6.1.1 or 6.1.2, as applicable, and the other terms of this Agreement. Any
license or sublicense under this Agreement to the [***] shall be subject to the terms of the
applicable Upstream Agreements, including the exclusion of the research, development, manufacture,
use, or sale of any product described in Exhibit I.

     6.3 License Grant by Nycomed. Subject to the terms and conditions set forth in this
Agreement, Nycomed grants to Micromet a non-exclusive, royalty-free license, under any applicable
Patents or Know-How Controlled by Nycomed, to conduct those development responsibilities assigned
to Micromet under the Development Plan. Such license shall be sublicensable solely to
subcontractors approved by the JSC, such approval not be unreasonably withheld.

     6.4 Reservation of Rights. Nycomed hereby covenants and agrees not to use any Licensed
Technology, nor cause or authorize any Affiliate or Third Party to use any Licensed Technology,
other than as expressly permitted in this Agreement. Except for the rights specifically granted in
this Agreement and subject to Section 6.9, Micromet reserves all rights to the Licensed Technology
and reserves the right to utilize or allow Third Parties to utilize the Licensed Technology
consistent with the terms of this Agreement. In addition, Micromet reserves all rights in the
Licensed Technology to the extent necessary for it to conduct those

 

			
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15

 

development responsibilities assigned to it under the Development Plan. No implied licenses
are granted under this Agreement. Notwithstanding anything in this Agreement to the contrary, no
license or right granted by Micromet under this Agreement, including Sections 6.1.1, 6.1.2 and
6.5.2, shall convey or grant to Nycomed any right, either directly or through a Third Party, to
research, develop, use, manufacture or Commercialize any product containing or comprising a BITE
molecule or fragment thereof.

     6.5 Ownership of Collaboration Technology; Licenses to Nycomed Collaboration Technology.

          6.5.1 Subject to the licenses granted to Nycomed in this Agreement, Micromet shall own all
right, title, and interest in and to the Micromet Collaboration Technology. Subject to the
licenses granted to Micromet in this Agreement, Nycomed shall own all right, title, and interest in
and to any Nycomed Collaboration Technology. Subject to the licenses granted to Nycomed in this
Agreement and the terms of this Agreement, Micromet and Nycomed shall each own an undivided equal
interest in any Joint Collaboration Technology, without obligation to account to the other for the
exploitation thereof or to seek consent of the other for the grant of any licenses under Joint
Collaboration Technology. Each Party shall disclose to the other Party in writing, and shall cause
its Affiliates, agents and independent contractors to so disclose to it, the development, making,
conception or reduction to practice of any Collaboration Technology owned by it pursuant to this
Section 6.5.1 in reports provided to the JPT or the JSC in the course of the performance of this
Agreement. Each Party shall take all necessary and proper acts, and shall cause its employees,
Affiliates, sublicensees, contractors, and consultants to take such necessary and proper acts, to
effectuate the ownership provisions provided in this Section 6.5.1.

          6.5.2 Each Party hereby grants, and agrees to grant, to the other Party a worldwide,
perpetual, non-exclusive, royalty free license (with the right to grant and authorize the further
grant of sublicenses), under any Patent or Know-How included within the Nycomed Collaboration
Technology and Micromet Collaboration Technology, respectively, to research, to have researched, to
develop, to have developed, to Commercialize, to import and to have imported pharmaceutical
products other than Products subject to the rights and licenses granted to Nycomed under this
Agreement and the mutual covenant in Section 6.9. Each of the Parties may grant sublicenses to
Third Parties under the foregoing license only for products developed or commercialized by such
Party or with a Third Party. Each Party shall provide the other Party with written notice promptly
following the grant of any such sublicense.

     6.6 Prosecution and Maintenance of Patents.

          6.6.1 As between the Parties, Micromet shall be responsible for the filing, prosecution and
maintenance of the Patents within the Licensed Technology, Micromet Collaboration Technology and
Joint Collaboration Technology. Nycomed shall reimburse Micromet for Micromet’s reasonable and
documented external costs incurred in connection with the filing, prosecution and maintenance of
the foregoing except for the Patents listed on Exhibit A-2; provided, however, that
Nycomed’s reimbursement obligation shall be limited to [***] percent [***] of any costs
associated with the Joint Collaboration Technology and the Micromet Collaboration Technology. Upon
receipt of written notice of the filing of a patent application within the Micromet Collaboration
Technology, Nycomed shall have the option to decline to pay

 

			
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16

 

for the filing, prosecution and maintenance of such patent by written notice to Micromet.
Upon receipt of such notice by Micromet, such patent shall be excluded from the licenses granted
under this Agreement. Nycomed shall be responsible, at its sole cost, for the filing, prosecution
and maintenance of the Patents within the Nycomed Collaboration Technology.

          6.6.2 With respect to each of the Patents within the Licensed Technology listed in Exhibit
A-1, Micromet Collaboration Technology and Joint Collaboration Technology, Micromet shall give
Nycomed an opportunity to review and comment on the text of the patent application, office action
(including restriction requirements) and substantive correspondence with the applicable patent
office before filing and shall supply Nycomed with a copy of each patent application as filed,
together with its notice of filing date and serial number. Micromet shall consider and incorporate
in good faith the requests and suggestions of Nycomed with respect to the foregoing.

          6.6.3 Micromet shall keep Nycomed informed of progress with regard to the preparation, filing,
prosecution and maintenance of the Patents within the Licensed Technology listed in Exhibit
A-1, Micromet Collaboration Technology and Joint Collaboration Technology. Nycomed shall
cooperate with Micromet, execute all lawful papers and instruments and make all rightful oaths and
declarations as may be necessary in the preparation, prosecution and maintenance of all patents and
other filings referred to in this Section 6.6.

          6.6.4 If Micromet, in its sole discretion, decides to abandon the preparation, filing,
prosecution or maintenance of any Patent within the Licensed Technology listed in Exhibit
A-1, Micromet Collaboration Technology or Joint Collaboration Technology, then Micromet shall
notify Nycomed in writing thereof and following the date of such notice (a) Nycomed shall, at its
option, be responsible for and shall control, [***] , the preparation, filing, prosecution and
maintenance of such patents and patent applications, and (b) if Nycomed does not assume such
control, then Micromet may abandon such Patent.

     6.7 Enforcement of Patents.

          6.7.1 Notice. If either Party learns that a Third Party is infringing or allegedly infringing
any Patent within the Licensed Technology or Joint Collaboration Technology, it shall promptly
notify the other Party thereof including available evidence of infringement. The Parties shall
cooperate and use reasonable efforts to stop such alleged infringement without litigation.

          6.7.2 Enforcement Actions for Licensed Technology.

               (a) As between the Parties, Micromet shall have the first right (but not the obligation) to
take the appropriate steps to remove the infringement or alleged infringement of Licensed
Technology or Joint Collaboration Technology, including, by initiation, prosecution and control at
its own expense of any suit, proceeding or other legal action by counsel of its own choice.

               (b) If Micromet fails to bring an action or proceeding to remove the infringement of the
Licensed Technology or Joint Collaboration Technology with respect to the research, development,
use, manufacture, filing for Marketing Approval of a product constituted through an “ANDA”
registration in the U.S., marketing or sale of a product potentially

 

			
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17

 

competitive with a Product (a “Product Infringement Claim”) within [***] days of a Party
giving notice to the other Party under Section 6.7.1 (or [***] days of a Party giving notice to
the other Party under Section 6.7.1 if the infringement is through an “ANDA” registration in the
U.S.), then (subject to the terms of the applicable Upstream Agreement with respect to the
Sublicensed Patents), Nycomed shall have the right (but not the obligation) to bring any such
action or proceeding by counsel of its own choice for any Licensed Patent listed on Exhibit
A-1 and Joint Collaboration Technology, and Micromet shall have the right, at its own expense,
to be represented in any such action by counsel of its own choice. To the extent that any alleged
infringer claims invalidity or non-enforceability of a Patent within Licensed Technology or Joint
Collaboration Technology as a defense, Micromet shall have the right to assume control of the
litigation with respect to such defense. The Parties mutually shall issue the necessary power of
attorneys for each other to undertake the steps described in subsection (a) above and in this
subsection (b).

          6.7.3 Enforcement Actions for Nycomed Collaboration Technology. Nycomed shall have the sole
right (but not the obligation) to take the appropriate steps to remove the infringement or alleged
infringement of Nycomed Collaboration Technology, including by initiation, prosecution and control
at its own expense of any suit, proceeding or other legal action by counsel of its own choice.
Micromet shall have the right, [***] , to be represented in any such action by counsel of its own
choice.

          6.7.4 Enforcement Actions for Micromet Collaboration Technology. Micromet shall have the sole
right (but not the obligation) to take the appropriate steps to remove the infringement or alleged
infringement of Micromet Collaboration Technology, including by initiation, prosecution and control
at its own expense of any suit, proceeding or other legal action by counsel of its own choice.
Nycomed shall have the right, [***] , to be represented in any such action by counsel of its own
choice.

          6.7.5 Cooperation; Damages.

               (a) If one Party brings any action or proceeding described in this Section 6.7, the other
Party agrees to be joined as party plaintiff if necessary to prosecute the action or proceeding and
to give the first Party reasonable assistance and authority to file and prosecute the suit;
provided, however, that neither Party shall be required to transfer any right, title or interest in
or to any property to the other Party or any other party to confer standing on a Party hereunder.

               (b) Any settlements, damages or other monetary awards (the “Recovery”) recovered pursuant to a
Product Infringement Claim shall be allocated first to the costs and expenses of the Party bringing
suit, and second to the costs and expenses (if any) of the other Party, with any remaining amounts
(if any) to be allocated as follows:

                    (i) If Nycomed pursued the Product Infringement Claim, the Recovery shall be [***] .

                    (ii) If Micromet pursued the Product Infringement Claim, the Recovery shall be [***] , and
[***] , and Micromet shall [***] after deducting the [***]
pursuant to [***] .

 

			
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18

 

     6.8 Consequences of Patent Challenge.

          6.8.1 Termination on Patent Challenge. Micromet shall be permitted to terminate this
Agreement by written notice effective upon receipt if Nycomed or its Affiliates directly, or
indirectly through assistance granted to a Third Party, commence any interference or opposition
proceeding, challenge the validity or enforceability of, or oppose any extension of or the grant of
a supplementary protection certificate with respect to, any Patent within the Licensed Technology
(other than the Sublicensed Patents and the Sublicensed Know-How) (each such action a “Patent
Challenge”).

          6.8.2 Patent Challenge on Sublicensed Patents. Before commencing any interference or
opposition proceeding, challenging the validity or enforceability of, or opposing any extension of
or the grant of a supplementary protection certificate with respect to any Sublicensed Patents,
Nycomed shall duly consult with Micromet and consider any comments from Micromet in that respect.
In particular, Nycomed shall consider consequences of Micromet’s contractual relationships in
relation to any such Sublicensed Patents. In the event that Nycomed either directly or indirectly
commences any such proceeding for any Patent covered by an Upstream Agreement over the objections
of Micromet, then Micromet may immediately terminate the license to Nycomed under Section 6.1 as to
any Sublicensed Technology under such applicable Upstream Agreement, or to the extent permitted
under the applicable Upstream Agreement, with respect to the Sublicensed Patent that is the subject
of such Patent Challenge.

          6.8.3 Sublicensees. Nycomed shall include provisions in all agreements granting sublicenses
of Nycomed’s rights hereunder providing that if the sublicensee or its Affiliates undertake a
Patent Challenge with respect to any Patent within the Licensed Technology under which the
sublicensee is sublicensed, Nycomed shall be permitted to terminate such sublicense agreement. If
a sublicensee of Nycomed (or an Affiliate of such sublicensee) undertakes a Patent Challenge of any
such Patent under which such sublicensee is sublicensed, then Nycomed upon receipt of notice from
Micromet of such Patent Challenge shall terminate the applicable sublicense agreement. If Nycomed
fails to so terminate such sublicense agreement, Micromet may terminate this Agreement.

     6.9 Parallel Programs.

          6.9.1 Permitted Products.

               (a) During the Term, neither Party, either on its own, through an Affiliate or in
collaboration with a Third Party, shall [***] or [***] , in the Territory an [***] ; provided,
however, the foregoing restriction shall not apply to any Permitted Product (defined below) of a
Third Party that [***] or [***] with other [***] all or [***] of
the [***] or [***] [***] % [***] the [***] of a [***] in [***]
with a [***] in
[***]. For purposes of this Section 6.9, a “Permitted Product” means any [***] then being
developed or commercialized by [***] . In the [***] of any [***] in [***] of [***]
where the
[***] a [***], then [***] [***] the

 

			
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19

 

[***] of
such [***]: [***] . Notwithstanding the above, no rights to
Collaboration Technology and Licensed Technology are or may be granted or exploited in connection
with the research, development or Commercialization of a Permitted Product.

               (b) Notwithstanding subsection (a) above, Nycomed shall have the right to research, develop
and Commercialize [***] that is based solely on patents and know-how generated by Nycomed
(“Independent Product”); provided, however, that Nycomed shall inform Micromet if and when it
initates the research, development or Commercialization of such product; and provided, further,
that Micromet shall have the right [***] to the extent permitted by applicable laws upon [***]
days prior written notice at any time after the [***] . For the avoidance of doubt, Nycomed has
not been granted any rights under the Licensed Technology, and shall not use any Licensed
Technology, for or in connection with the research, development or Commercialization of an
Independent Product.

          6.9.2 
In the event that, following the Effective Date, Nycomed or its Affiliates [***], as
part of a [***] of a [***], a [***] or [***] that [***] a [***],
then [***] shall upon the [***] the [***] (i) [***] ; or (ii) [***]
within the [***] [***] the [***] of
[***], subject to [***] it [***] understood that such [***] may be [***] other [***],
where such [***]; or (iii) [***] into a
[***] to a [***] such
[***] and [***] of its [***] of the
[***] ; [***] shall not [***] of such [***] as a part of a
[***] does not [***] . In the event that, [***] or its
[***], as part of a [***] of a [***], a person or
entity that [***] , then [***] may [***] following the closing of
such [***].

     6.10 Third Party Patent Rights. Upon the request of Nycomed, Micromet shall use reasonable
efforts to search, monitor, collate and evaluate Third Party Patent rights that may be potentially
related to the MT203 Product during a period not to exceed [***] months following the Effective
Date. Nycomed shall reimburse Micromet for its internal FTE Costs and external costs of conducting
such activities. Any Third Party Patent rights which in Micromet’s good faith evaluation
potentially related to the MT203 Product shall be brought to Nycomed’s attention without
unreasonable delay. Micromet shall reasonably cooperate with Nycomed upon request regarding the
review and analysis of such Third Party Patent rights. To the extent that the Parties reasonable
determine to acquire any rights in and to such Third Party Patents, the Parties shall discuss in
good faith the license or acquisition of such rights in accordance with Section 7.3.3.

7. Fees and Payments

     7.1 Initial License Fee. On the Effective Date, Nycomed shall pay to Micromet a
non-refundable, non-creditable initial license fee in the amount of five million Euros
(€5,000,000).

     7.2 Development Milestones. Nycomed shall pay Micromet each of the non-

 

			
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refundable, non-creditable payments in the amounts set forth on Exhibit E attached
hereto within [***] days after the first occurrence of the corresponding event described on such
exhibit with respect to a Product.

     7.3 Royalties.

          7.3.1 Royalty Rates. Subject to the adjustments provided for in Section 7.3.3, Nycomed shall
pay to Micromet a royalty equal to:

               (a) [***] percent [***] of worldwide Net Sales of a Product for that portion of the total
amount of aggregate worldwide Net Sales of all Products in any calendar year that is less than or
equal to [***] ;

               (b) [***] percent [***] of worldwide Net Sales of a Product for that portion of the total
amount of aggregate worldwide Net Sales of all Product in any calendar year that is greater than
[***] but less than or equal to [***] ;

               (c) [***] percent [***] of worldwide Net Sales of a Product for that portion of the total
amount of aggregate worldwide Net Sales of all Products in any calendar year that is greater than
[***] but less than or equal to [***] ; and

               (d) [***] percent [***] of worldwide Net Sales of a Product for that portion of the total
amount of aggregate worldwide Net Sales of all Products in any calendar year that is greater than
[***] .

          7.3.2 Aggregation of Net Sales; Royalty Term; Bioequivalent Products.

               (a) The Parties agree and acknowledge that the determination of aggregate worldwide Net Sales
for the tiers described in Section 7.3.1 shall be based upon the Net Sales of all Products then
accrued during each applicable calendar year (or portion thereof) and the determination of a
particular royalty rate then-applicable to a particular sale of a Product shall be made as of the
date such sale was invoiced.

               
(b) Royalties due under the preceding Section 7.3.1 shall commence upon first commercial sale
of a Product in a particular country in the Territory and shall expire on a country-by-country
basis upon the later of: (i) the [***] of the [***] within the [***] (other than
[***]) containing a [***] in such [***] from the [***] of a [***].

               (c) 
With respect to any country in the Territory, in the event that (i) [***]
within the [***] (other than [***] in such [***] have [***]
and (ii) the [***] of a [***] in such [***]
of the [***] of such [***] in the [***] for which the [***] is then
[***] in such [***], then the [***] in such [***] shall be [***]
in lieu of the [***] under [***] shall no longer be [***]
to any [***] under [***] in such [***].

 

			
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          7.3.3 Adjustment to Royalties. If (a) a Patent or Patents of a Third Party should exist in
any country during the Term that cover the research, development, use, manufacture, or sale of a
Product, which would prevent Nycomed or any Affiliate from undertaking any of the above-mentioned
activities without obtaining a royalty-bearing license from such Third Party under such Patent or
Patents, and (b) the total royalties payable by Nycomed under all such licenses including the
royalties payable under the Upstream Agreements with respect to sales of such Product in a
particular country exceeds [***] percent [***] of Net Sales, then Nycomed shall be entitled to
credit [***] against the royalty payments due to Micromet upon sales of such Product in the
applicable country; provided that such credit shall in no event cause the royalty payable to
Micromet as applicable to a particular country hereunder to be reduced to below [***] percent
[***] . Micromet shall reasonably cooperate with Nycomed upon request regarding whether Micromet
should obtain directly a license to any intellectual property described in this Section 7.3.3. If
agreed by the Parties, Micromet shall license such intellectual property from a Third Party for the
benefit of Nycomed (and with Nycomed bearing all such associated costs subject to this Section
7.3.3) and thereupon Exhibit D shall be automatically amended to include any corresponding
license agreement as an Upstream Agreement.

     7.4 Payments under Upstream Agreements. [***] shall pay to [***]
any and all [***]
and other [***] to the opposite [***] of the [***]
that may become due during the [***] of all [***]. Any such payment shall made into an [***]
for the specific purpose of [***] and making such
payments to the opposite parties of the [***]. Upon receipt of each such payment
from [***] shall make a corresponding payment to the opposite party in accordance with
the terms of the applicable [***]. The Parties shall agree on a process, [***] shall receive the
payment from [***] in time to make the [***] in a timely fashion. [***] due
to [***] under the [***] shall be due and payable at least [***]
before any [***] are owed [***] under the [***].
For purposes of this Agreement, “Business Days” mean dates that banks are open in Germany.

8. Payment Terms

     8.1 Payment Method. All amounts due hereunder shall be paid in Euros by wire transfer in
immediately available funds to an account designated by Micromet. Any payments or portions thereof
due hereunder which are not paid on the date such payments are due under this Agreement shall bear
interest at the lower of (i) [***] % over the [***] in effect on the due date, or (ii) the maximum
rate permitted by law, calculated on the number of days such payment is delinquent, compounded
monthly; provided that Nycomed shall not be obligated to pay interest on any amount that it
disputes in good faith are not due and payable while such dispute is pending, further provided that
such interest shall be due and payable if any such dispute is resolved in favor of Micromet.

     8.2 Payment Schedules; Reports. The milestone payments due pursuant to Section 7.2 are due
and payable within [***] days after the achievement of the applicable milestone

 

			
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event set forth in Exhibit E. Royalty payments due pursuant to Section 7.3 are due
and payable within [***] days of the end of each calendar quarter during the Term during which
there were Net Sales of any Product in the Territory. Nycomed shall accompany each payment of
royalties under this Agreement with a report containing a detailed and itemized calculation of Net
Sales of all Products in the Territory during the preceding calendar quarter, including a
description of the dates and territories in which any Product sales were made.

     8.3 Currency Conversion. For any currency conversion required in determining the amount of
royalties due, such conversion shall be made at the prevailing commercial rate of exchange for
purchasing the currency into which an amount is to be converted as set forth in the Frankfurter
Allgemeine Zeitung on the day that is the last business day of the applicable quarterly period for
any royalty payments made pursuant to this Agreement. For purposes of determining the amount of
royalties due, the amount of Net Sales in any foreign currency shall be computed by converting such
amount into Euros as provided in this Section 8.3. All payments due under this Agreement shall be
paid in full without deduction for any withholding or value added tax.

     8.4 Records Retention; Audit.

          8.4.1 Record Retention. Each Party shall maintain complete and accurate books, records and
accounts used for the determination of (a) any Development Expenses that the other Party is
required to reimburse under this Agreement and (b) Net Sales, in sufficient detail to confirm the
accuracy of any payments required under this Agreement, which books, records and accounts shall be
retained by such Party until [***] years after the end of the period to which such books, records
and accounts pertain.

          8.4.2 Audit. Each Party shall have the right to have an independent certified public
accounting firm of internationally recognized standing, reasonably acceptable to the other Party,
have access during normal business hours, and upon reasonable prior written notice, to such of the
records of the other Party as may be reasonably necessary to verify the accuracy of Development
Expenses or Net Sales for any calendar quarter ending not more than [***] months prior to the date
of such request; provided, however, that no Party shall have the right to conduct more than one
such audit in any [***] -month period. The accounting firm shall disclose to the Parties only
whether the Development Expenses or Net Sales reported by the audited Party are correct or
incorrect and the specific details concerning any discrepancies. The auditing Party shall bear all
costs of such audit, unless the audit reveals any discrepancy in the audited Party’s favor of more
than [***] %, in which case the audited Party shall bear the cost of the audit. The results of
such accounting firm shall be final, absent manifest error.

          8.4.3 Payment of Additional Amounts. If, based on the results of any audit, additional
payments are owed to Micromet under this Agreement, then Nycomed shall make such additional
payments promptly after the accounting firm’s written report is delivered to both Parties. If,
based on the results of any audit, royalty or development payments made by Nycomed hereunder
exceeded payments indicated by the audit as being due thereunder, such excess shall be credited
against future amounts owed by Nycomed under this Agreement.

          8.4.4 Confidentiality. Each Party shall treat all information subject to review

 

			
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under this Section 8.4 in accordance with the provisions of Section 9 and shall cause its
accounting firm to enter into a reasonably acceptable confidentiality agreement with the audited
Party obligating such firm to maintain all such financial information in confidence pursuant to
such confidentiality agreement.

9. Confidentiality

     9.1 Definition. During the Term and subject to the terms and conditions of this Agreement, a
Party (the “Disclosing Party”) may communicate to the other Party (the “Receiving Party”)
information in connection with this Agreement or the performance of its obligations under this
Agreement, including, without limitation, any information regarding Improvements, reports provided
pursuant to this Agreement, scientific and manufacturing information and plans, marketing and
business plans, and financial and personnel matters relating to a Party or its present or future
products, sales, suppliers, customers, employees, investors or business (collectively,
“Confidential Information”). Subject to Section 9.2, “Confidential Information” shall also include
any information disclosed prior to the Effective Date pursuant to that certain Confidentiality
Agreement between the Parties dated February 7, 2007.

     9.2 Exclusions.

          9.2.1 Notwithstanding the foregoing, any information of a Party shall not be deemed
Confidential Information with respect to the Receiving Party for purposes of this Agreement if such
information:

               (a) was already known or available to the Receiving Party or its Affiliates, other than under
an obligation of confidentiality or non-use to the Disclosing Party, at the time of disclosure to
the Receiving Party;

               (b) was generally available or known to parties reasonably skilled in the field to which such
information pertains, or was otherwise part of the public domain, at the time of its disclosure to
the Receiving Party;

               (c) became generally available or known to parties reasonably skilled in the field to which
such information pertains, or otherwise became part of the public domain, after its disclosure to
the Receiving Party through no fault of the Receiving Party or the Receiving Party’s breach of its
obligations under this Article 9;

               (d) was disclosed to the Receiving Party, other than under an obligation of confidentiality or
non-use, by a Third Party who had no obligation to the Disclosing Party not to disclose such
information to others; or

               (e) was independently discovered or developed by the Receiving Party or its Affiliates, as
evidenced by their written records, without the use of, and by personnel who had no access to,
Confidential Information of the Disclosing Party.

     9.3 Disclosure and Use Restriction. Except as expressly provided herein, the Parties agree
that, during the Term and for ten (10) years thereafter, each Party and its Affiliates and

 

			
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sublicensees shall keep completely confidential and shall not publish or otherwise disclose
any Confidential Information of the other Party, its Affiliates or sublicensees. Neither Party
shall use any Confidential Information of the other Party without such other Party’s consent,
except as expressly permitted by this Agreement.

     9.4 Authorized Disclosure. Each Party may use and disclose Confidential Information of the
other Party to the extent that such use and disclosure is:

          9.4.1 made in response to a valid order of a court of competent jurisdiction or other
governmental or regulatory body of competent jurisdiction; provided, however, that such Party shall
first have given notice to such other Party and given such other Party a reasonable opportunity to
quash such order and to obtain a protective order requiring that the Confidential Information and
documents that are the subject of such order be held in confidence by such court or governmental or
regulatory body or, if disclosed, be used only for the purposes for which the order was issued; and
provided, further, that if a disclosure order is not quashed or a protective order is not obtained,
the Confidential Information disclosed in response to such court or governmental order shall be
limited to that information which is legally required to be disclosed in response to such court or
governmental order;

          9.4.2 otherwise required by applicable laws or regulations, including the rules of any
applicable securities exchange; provided, however, that the Disclosing Party shall provide such
other Party with notice of such disclosure in advance thereof to the extent practicable;

          9.4.3 made by such Party to the regulatory authorities as required in connection with any
filing of INDs, BLAs, marketing approval applications, or similar applications or requests for
regulatory approvals; provided, however, that reasonable measures shall be taken to assure
confidential treatment of such information;

          9.4.4 made by such Party, in connection with the performance of this Agreement, on a
need-to-know basis to Affiliates, permitted sublicensees, research parties, employees, consultants,
representatives or agents, each of whom prior to disclosure must be bound by obligations of
confidentiality and non-use at least equivalent in scope to those set forth in this Section 9;

          9.4.5 made by such Party to existing or potential acquirers or merger candidates; existing or
potential pharmaceutical collaborators (to the extent contemplated under this Agreement);
investment bankers; or existing or potential investors, venture capital firms or other financial
institutions or investors for purposes of obtaining financing, each of whom prior to disclosure
must be bound by obligations of confidentiality and non-use at least equivalent in scope to those
set forth in this Section 9; or

          9.4.6 made in a patent application filed in conformance with this Agreement.

     9.5 Terms of Agreement to be Maintained in Confidence. Subject to the provisions of this
Section 9, the Parties agree that the terms of this Agreement are deemed Confidential Information
of both Parties and shall be subject to the restrictions on use and disclosure set forth herein

 

			
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25

 

     9.6 Replacement of existing CDA. This Agreement shall replace the Confidential Non Disclosure
Agreement entered into between Parties on February 7, 2007. Any Confidential Information provided
under that agreement shall be deemed provided under this Agreement.

10. Public Communications

     10.1 General Provisions. The Parties shall cooperate with respect to the timing and content
of communications with the public regarding the development and marketing of a Product, under the
terms to be set forth in the Development Plan and subject to the provisions of this Section 10.

     10.2 Use of Name. Neither Party shall make public use of the other Party’s name except (a) as
required by applicable law or regulation, or (b) otherwise as agreed in writing by such other
Party.

     10.3 Press Releases.

          10.3.1 The Parties (or their Affiliates) shall issue a joint press release regarding the
execution of this Agreement substantially in the form attached in Exhibit H. For
subsequent press releases relating to this Agreement or the Parties’ relationship hereunder, each
Party (or its Affiliate) shall use reasonable efforts to submit to the other Party a draft of such
press release for review and comment by the other Party at least [***] Business Days prior to the
date on which such Party plans to issue such press release (“Proposed Disclosure”), and shall
review and consider in good faith any comments provided by the other Party. If a Party is unable
to comply with the foregoing [***] -Business Day notice requirement because of a legal obligation
or stock exchange requirement to make more rapid disclosure, such Party shall not be in breach of
this Agreement but shall in that case give telephone notice to a senior executive of the other
Party and provide a draft disclosure with as much notice as possible prior to the release of such
press release. For the avoidance of doubt, Micromet or its Affiliate) may disclose the receipt and
amount of any milestone payment made by Nycomed under this Agreement in accordance with the
provisions of this Section 10.3.1.

          10.3.2 A Party may publicly disclose without regard to the preceding requirements of this
Section 10.3 information that was previously disclosed in a Proposed Disclosure that was in
compliance with such requirements.

     10.4 Publications. At least [***] days prior to submission of any material related to the
research or development activities hereunder for publication or presentation, the submitting Party
shall provide to the other Party a draft of such material for its review and comment. The
receiving Party shall provide any comments to the submitting Party within [***] days of receipt of
such materials. No publication or presentation with respect to the research or development
activities hereunder shall be made unless and until the other Party’s comments on the proposed
publication or presentation have been addressed and changes have been agreed upon and any
information determined by the other Party to be its Confidential Information has been removed. If
requested in writing by the other Party, the submitting Party shall withhold material from
submission for publication or presentation for the time reasonably required for the filing and
until expiry of the priority year relating to that patent application or the taking of such
measures

 

			
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to establish and preserve proprietary rights in the information in the material being
submitted for publication or presentation.

11. Term and Termination

     11.1 Term. The term of this Agreement (the “Term”) shall commence on the Effective Date and
end upon the date of expiration of all payment obligations for all Products, unless earlier
terminated as provided in this Agreement.

     11.2 Termination for Material Breach.

          11.2.1 Any material failure by a Party (the “Breaching Party”) to comply with any of its
material obligations provided for in this Agreement shall entitle the other Party (the
“Non-Breaching Party”) to give to the Breaching Party written notice specifying the nature of the
material breach, requiring the Breaching Party to make good or otherwise cure such material breach.

          11.2.2 If such breach is not cured within [***] days after the receipt of notice pursuant to
Section 11.2.1 above, the Non-Breaching Party shall have the right, on written notice to the
Breaching Party, to terminate this Agreement without prejudice to any of its other rights and
remedies conferred on it by this Agreement or by law.

     11.3 Termination at Will. At any time following the completion of the [***] for the MT203
Product described on Exhibit C and performed pursuant to the Development Plan, Nycomed may
terminate this Agreement it its entirety, for any reason or no reason by written notice to Micromet
effective upon [***] days from the date of receipt of the notice by Micromet.

12. Effects of Termination

     12.1 Program Transfer upon Termination. Upon any termination of this Agreement, Nycomed
shall, at no cost to Micromet, transfer to Micromet or its designee all materials, documentation,
processes, regulatory filings, licenses, and other items as are reasonably necessary for Micromet
to continue the development or Commercialization of each Product (such transfer, including the
actions listed below hereafter referred to as the “Program Transfer”). Without limiting the
generality of the foregoing, Nycomed shall:

               (a) upon Micromet’s request, assign to Micromet any agreements between Nycomed and Third
Parties relating solely to the development, Commercialization or manufacture of each Product;

               (b) deliver or return to Micromet all data, materials, and other deliverables developed under
the Development Plan and treat the foregoing as “Confidential Information” of Micromet under
Section 9;

               (c) assign to Micromet its entire right, title and interest in and to any trademarks, trade
dress, logos, slogans, designs and copyrights relating specifically to the Products, including any
registrations for the foregoing;

 

			
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               (d) transfer to Micromet all clinical and commercial supplies of the Products in Nycomed’s
possession or control;

               (e) transfer to Micromet the management and continued performance of any clinical trials for
each Product ongoing as of the effective date of such termination;

               (f) transfer to Micromet any and all regulatory filings and approvals relating to each
Product, including any INDs and BLAs.

               (g) complete all manufacturing activities ongoing as of the effective date of such termination
and, upon Micromet’s request, provide Micromet with clinical and commercial quantities of each
Product until such time as Micromet or its designee has established and validated a manufacturing
process for such Product and is approved to manufacture pivotal trial and commercial supplies of
such Product, at no cost to Micromet; provided, that Micromet shall reimburse Nycomed for [***] %
of the reasonable and documented costs incurred by Nycomed in such manufacturing activities
performed by or on behalf of Nycomed following the date [***] months after the effective date of
termination of this Agreement;

               (h) upon Micromet’s request, transfer the completed manufacturing process for each Product to
Micromet or its designee; and

               (i) grant to Micromet a worldwide, irrevocable, exclusive license (with the right to grant and
authorize the further grant of sublicenses), under any intellectual property right of Nycomed
related to any of the items described in Section 12.1.1(a)-(h) and under any Patents Controlled by
Nycomed claiming the use, manufacture, or sale of each Product, to make, have made, use, offer for
sale, sell and import such Product.

          12.1.2 In consideration of the Program Transfer, Micromet shall pay to Nycomed,
notwithstanding the reason of termination, a royalty of [***] % on Net Sales of each Product until
such time as Nycomed has received an amount equivalent to [***] and the [***] pursuant to this
Agreement; provided, however, that the foregoing shall not limit either Party’s rights or remedies
under this Agreement or at law or in equity. No other compensation shall be owed by Micromet to
Nycomed in connection with the Program Transfer or Micromet’s practice of the license granted under
Section 12.1.1(i).

     12.2 Rights Upon Expiration. Upon expiration of this Agreement pursuant to Section 11.1,
Nycomed shall have a non-exclusive, fully paid, royalty-free right and license under the Licensed
Technology to make, have made, use, sell, offer for sale, and import all Products in the Territory
in the Field.

     12.3 Accrued Rights. Termination of this Agreement for any reason shall be without prejudice
to any rights that shall have accrued to the benefit of a Party prior to the effective date of such
termination. Such termination shall not relieve a Party from obligations that are expressly
indicated to survive the termination of this Agreement.

     12.4 Survival. Sections 3.7, 5.4, 6.5, 6.7 (only with respect to pending actions), 7 and 8
(only as to accrued and unpaid amounts), 9, 12, 13, 15 and 16, together with any definitions

 

			
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used or exhibits referenced therein, shall survive any termination or expiration of this
Agreement.

13. Indemnification and Insurance

     13.1 Indemnification of Micromet. Nycomed shall indemnify Micromet and its Affiliates, and
their respective directors, officers, and employees (each, a “Micromet Indemnitee”), and defend and
save each of them harmless from and against any and all losses, damages, liabilities, costs and
expenses (including reasonable attorneys’ fees and expenses) (collectively, “Losses”) arising in
connection with any and all claims, demands, lawsuits, or investigations by a Third Party (each a
“Third Party Claim”) against a Micromet Indemnitee, to the extent caused by or arising out of: (a)
any breach by Nycomed of this Agreement, (b) the gross negligence or willful misconduct on the part
of Nycomed or its Affiliates, licensees or sublicensees in performing any activity contemplated by
this Agreement; or (c) the development, manufacture or Commercialization of any Product in the
Territory by Nycomed, its Affiliates, agents or sublicensees after the Effective Date, in each
case, excluding any Losses for which Micromet has an obligation to indemnify Nycomed pursuant to
Section 13.2.

     13.2 Indemnification of Nycomed. Micromet shall indemnify Nycomed, its Affiliates, and their
respective directors, officers, and employees (each, a “Nycomed Indemnitee”), and defend and save
each of them harmless from and against any and all Losses arising in connection with any Third
Party Claim against a Nycomed Indemnitee, to the extent caused by or arising out of: (a) any breach
by Micromet of this Agreement, (b) the gross negligence or willful misconduct on the part of
Micromet or its Affiliates in performing any activity contemplated by this Agreement; or (c) a
claim arising from: i) the development, ii) manufacture or iii) use of any Product, in each case
taking place prior to the Effective Date, by Micromet, its Affiliates, agents or sublicensees, in
each case, excluding any Losses for which Nycomed has an obligation to indemnify Micromet and its
Affiliates pursuant to Section 13.1.

     13.3 Notice of Claim. All indemnification claims in respect of any Nycomed Indemnitee or
Micromet Indemnitee seeking indemnity under Sections 13.1 or 13.2 (collectively, the “Indemnitees”
and each an “Indemnitee”) shall be made solely by the corresponding Party (the “Indemnified
Party”). The Indemnified Party shall give the indemnifying Party (the “Indemnifying Party”) prompt
written notice (an “Indemnification Claim Notice”) of any Losses or discovery of fact upon which
such Indemnified Party intends to base a request for indemnification under Section 13.1 or Section
13.2, but in no event shall the Indemnifying Party be liable for any Losses that result from any
delay in providing such notice. Each Indemnification Claim Notice must contain a description of
the claim and the nature and amount of such Loss (to the extent that the nature and amount of such
Loss are known at such time). Together with the Indemnification Claim Notice, the Indemnified
Party shall furnish promptly to the Indemnifying Party copies of all notices and documents
(including court papers) received by any Indemnitee in connection with the Third Party Claim.

     13.4 Control of Defense. At its option, the Indemnifying Party may assume the defense of any
Third Party Claim subject to indemnification as provided for in Sections 13.1 and 13.2 by giving
written notice to the Indemnified Party within [***] days after the Indemnifying Party’s receipt
of an Indemnification Claim Notice. Upon assuming the defense of a Third Party

 

			
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Claim, the Indemnifying Party may appoint as lead counsel in the defense of the Third Party
Claim any legal counsel selected by the Indemnifying Party. Should the Indemnifying Party assume
the defense of a Third Party Claim, the Indemnifying Party shall not be liable to the Indemnified
Party or any other Indemnitee for any legal expenses subsequently incurred by such Indemnified
Party or other Indemnitee in connection with the analysis, defense or settlement of the Third Party
Claim.

     13.5 Right to Participate in Defense. Without limiting Section 13.4, any Indemnitee shall be
entitled to participate in, but not control, the defense of such Third Party Claim and to employ
counsel of its choice for such purpose; provided, however, that such employment shall be at the
Indemnitee’s own expense unless (a) the employment thereof has been specifically authorized by the
Indemnifying Party in writing, or (b) the Indemnifying Party has failed to assume the defense and
employ counsel in accordance with Section 13.4 (in which case the Indemnified Party shall control
the defense).

     13.6 Settlement. With respect to any Losses relating solely to the payment of money damages
in connection with a Third Party Claim and that shall not result in the Indemnitee’s becoming
subject to injunctive or other relief or otherwise adversely affect the business of the Indemnitee
in any manner, and as to which the Indemnifying Party shall have acknowledged in writing the
obligation to indemnify the Indemnitee hereunder, the Indemnifying Party shall have the sole right
to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such
Loss, on such terms as the Indemnifying Party, in its sole discretion, shall deem appropriate, and
shall transfer to the Indemnified Party all amounts which said Indemnified Party shall be liable to
pay prior to the time of the entry of judgment. With respect to all other Losses in connection
with Third Party Claims, where the Indemnifying Party has assumed the defense of the Third Party
Claim in accordance with Section 13.4, the Indemnifying Party shall have authority to consent to
the entry of any judgment, enter into any settlement or otherwise dispose of such Loss provided it
obtains the prior written consent of the Indemnified Party (which consent shall be at the
Indemnified Party’s sole and absolute discretion). The Indemnifying Party that has assumed the
defense of the Third Party Claim in accordance with Section 13.4 shall not be liable for any
settlement or other disposition of a Loss by an Indemnitee that is reached without the written
consent of such Indemnifying Party. Regardless of whether the Indemnifying Party chooses to defend
or prosecute any Third Party Claim, no Indemnitee shall admit any liability with respect to, or
settle, compromise or discharge, any Third Party Claim without first offering to the Indemnifying
Party the opportunity to assume the defense of the Third Party Claim in accordance with Section
13.4.

     13.7 Cooperation. If the Indemnifying Party chooses to defend or prosecute any Third Party
Claim, the Indemnified Party shall, and shall cause each other Indemnitee to, cooperate in the
defense or prosecution thereof and shall furnish such records, information and testimony, provide
such witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as
may be reasonably requested in connection with such Third Party Claim. Such cooperation shall
include access during normal business hours afforded to the Indemnifying Party to, and reasonable
retention by the Indemnified Party of, records and information that are reasonably relevant to such
Third Party Claim, and making Indemnitees and other employees and agents available on a mutually
convenient basis to provide additional information and explanation of any material provided
hereunder, and the Indemnifying Party shall reimburse the

 

			
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Indemnified Party for all its reasonable out-of-pocket expenses in connection with such
cooperation.

     13.8 Expenses. Except as provided above, the reasonable and verifiable costs and expenses,
including fees and disbursements of counsel, incurred by the Indemnified Party in connection with
any claim shall be reimbursed on a calendar quarter basis by the Indemnifying Party, without
prejudice to the Indemnifying Party’s right to contest the Indemnified Party’s right to
indemnification and subject to refund in the event the Indemnifying Party is ultimately held not to
be obligated to indemnify the Indemnified Party.

     13.9 Insurance. During the Term, each Party shall have and maintain such types and amounts of
liability insurance as is normal and customary in the industry generally for parties similarly
situated, and shall upon request provide the other Party with a copy of its policies of insurance
in that regard, along with any amendments and revisions thereto.

14. Representations and Warranties

     14.1 Mutual Representations and Warranties. Each Party hereby represents and warrants to the
other Party that, as of the Effective Date:

          14.1.1 Such Party (a) has the corporate power and authority to enter into this Agreement and
perform its obligations hereunder, and (b) has taken all necessary corporate action on its part
required to authorize the execution and delivery of this Agreement and the performance of its
obligations hereunder;

          14.1.2 This Agreement has been duly executed and delivered on behalf of such Party and
constitutes a legal, valid and binding obligation of such Party and is enforceable against it in
accordance with its terms subject to the effects of bankruptcy, insolvency or other laws of general
application affecting the enforcement of creditor rights and judicial principles affecting the
availability of specific performance and general principles of equity, whether enforceability is
considered a proceeding at law or equity;

          14.1.3 The execution and delivery of this Agreement and the performance of such Party’s
obligations hereunder (a) do not conflict with or violate any requirement of any provision of the
articles of incorporation, bylaws or any similar instrument of such Party in any material way, and
(b) do not conflict with, violate, or breach or constitute a default or require any consent under,
any contractual obligation or court or administrative order by which such Party is bound.

          14.1.4 Such Party is a corporation duly organized, validly existing and in good standing under
the laws of the country of its incorporation, and has full corporate power and authority and the
legal right to own and operate its property and assets and to carry on its business as it is now
being conducted and as it is contemplated to be conducted by this Agreement.

     14.2 Additional Representations and Warranties of Micromet. Micromet hereby represents and
warrants to Nycomed that, as of the Effective Date:

 

			
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31

 

          14.2.1 To the knowledge of Micromet, and except as expressly notified to Nycomed with
reference to this Section 14.2.1 prior to the Effective Date, the research, development,
Commercialization or use of the MT203 Product does not infringe an issued Patent of any Third Party
in the Territory.

          14.2.2 Micromet has the right to grant the rights and licenses described in this Agreement.

          14.2.3 To the knowledge of Micromet, there is no Third Party infringing any of the Licensed
Patents or using any of the Licensed Know-How contrary to the rights granted to Nycomed pursuant to
this Agreement.

          14.2.4 Micromet has not been served with any interference action or litigation asserting the
invalidity, misuse, unregisterability, unenforceability or non-infringement of any of the Licensed
Patents or challenging Micromet’s rights to use any of the Licensed Patents or making any adverse
claim of ownership thereof and claiming any part of the MT203 Product or related to the MT203
Product or the manufacture hereof, and Micromet has not received any written communication which
expressly threatens interference actions or other litigation described above before any patent and
trademark office, court, or any other governmental entity in any jurisdiction in regard to any such
Licensed Patents.

          14.2.5 Micromet has provided Nycomed’s internal patent counsel, during a due diligence meeting
conducted on March 13, 2007 and subsequent telephone conferences, with access to complete copies of
the most current versions of all pending patent applications included in the Licensed Patents and
all material correspondence between Micromet and any patent office with respect to the pending
patent applications included in the Licensed Patents as of the Effective Date.

          14.2.6 Prior to the Effective Date, all maintenance fees associated with the Licensed Patents
that have issued as of the Effective Date have been paid;

          14.2.7 Prior to the Effective Date, Micromet has used commercially reasonable efforts to
maintain the Licensed Technology under its control in confidence and has not disclosed,
distributed, or disseminated such information to anyone who is not in turn under an obligation to
Micromet to maintain this information in confidence.

          14.2.8 To the knowledge of Micromet, there are no inquiries, actions, investigations or other
proceedings pending before or threatened by any Regulatory Authority with respect to the MT203
Product or any facility where the MT203 Product is manufactured, and Micromet, to its knowledge,
has not received written notice threatening any such inquiry, action, investigations or other
proceeding.

          14.2.9 To the knowledge of Micromet, no party to any of the Upstream Agreements is in breach
of such Agreement.

          14.2.10 To the knowledge of Micromet, the development and manufacture of the Product has been
conducted by Micromet, its Affiliates and subcontractors, to the extent necessary, in compliance in
all material respects with Applicable Law.

 

			
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32

 

          14.2.11 As used herein, “knowledge of Micromet” means the actual knowledge, as of the
Effective Date, of any executive officer of Micromet with operational responsibility for the
subject matter of the applicable representation or warranty.

     14.3 Additional Covenants of Micromet.

          14.3.1 Micromet shall not amend or waive, or take any other action or commit any omission that
would alter, any of its rights under any of the Upstream Agreements in any manner that would
materially and adversely affect Nycomed’s rights and benefits under this Agreement; and

          14.3.2 Micromet shall not license, sell or otherwise transfer any right, title or interest in,
to or under any Licensed Technology in contravention of the rights and licenses granted to Nycomed;
provided, however, that the foregoing shall not limit Micromet’s rights under Section 16.2.

15. Disclaimer; Limitation of Liability

     15.1 Disclaimer of Warranty. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTION 14,
NYCOMED AND MICROMET MAKE NO REPRESENTATIONS AND GRANT NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN
FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND NYCOMED AND MICROMET EACH SPECIFICALLY
DISCLAIMS ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS, STATUTORY OR
IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR
PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

     15.2 Limitation of Liability. IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR LOST PROFITS, LOSS
OF DATA, OR FOR ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER
CAUSED, ON ANY THEORY OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES, ARISING UNDER ANY CAUSE OF ACTION AND ARISING IN ANY WAY OUT OF THIS
AGREEMENT. THE FOREGOING LIMITATIONS SHALL NOT APPLY TO AN AWARD OF ENHANCED DAMAGES AVAILABLE
UNDER THE PATENT LAWS FOR WILLFUL PATENT INFRINGEMENT AND SHALL NOT LIMIT EITHER PARTY’S
OBLIGATIONS TO THE OTHER PARTY UNDER SECTIONS 9, 10 AND 13.

16. Miscellaneous

     16.1 Force Majeure. Neither Party shall be held liable or responsible to the other Party or
be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or
performing any term of this Agreement when such failure or delay is caused by or results from
events beyond the reasonable control of the non-performing Party, including fires, floods,
embargoes, shortages, epidemics, quarantines, war, acts of war (whether war be declared or not),
insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances, acts of

 

			
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33

 

God or acts, omissions or delays in acting by any governmental authority. The non-performing
Party shall notify the other Party of such force majeure within [***] days after such occurrence
by giving written notice to the other Party stating the nature of the event, its anticipated
duration, and any action being taken to avoid or minimize its effect. The suspension of
performance shall be of no greater scope and no longer duration than is necessary and the
non-performing Party shall use commercially reasonable efforts to remedy its inability to perform;
provided, however, that in the event the suspension of performance continues for [***] days after
the date of the occurrence, the Party not affected by such force majeure may terminate this
Agreement immediately upon written notice to the other Party.

     16.2 Assignment. Neither Party shall sell, transfer, assign, delegate, pledge or otherwise
dispose of, whether voluntarily, involuntarily, by operation of law or otherwise, this Agreement or
any of its rights or obligations under this Agreement without the prior written consent of the
other Party (which consent may be granted, withheld or conditioned at such other Party’s sole and
absolute discretion); provided, however, that either Party may assign or transfer this Agreement or
any of its rights or obligations under this Agreement without the consent of the other Party (a) to
any Affiliate of such Party provided that such transfer and assignment shall be effective for only
so long as such Affiliate remains an Affiliate of such Party, or (b) to any Third Party with which
it merges or consolidates, or to which it transfers all or substantially all of its assets. The
assigning Party (unless it is not the surviving entity) shall remain jointly and severally liable
with the relevant Affiliate or Third Party assignee under this Agreement, and the relevant
Affiliate assignee, Third Party assignee or surviving entity shall assume in writing all of the
assigning Party’s obligations under this Agreement. Any purported assignment or transfer in
violation of this section shall be void ab initio and of no force or effect.

     16.3 Severability. If any provision of this Agreement is held to be illegal, invalid or
unenforceable under any present or future law, and if the rights or obligations of either Party
under this Agreement shall not be materially and adversely affected thereby, (a) such provision
shall be fully severable, (b) this Agreement shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part of this Agreement, (c) the remaining
provisions of this Agreement shall remain in full force and effect and shall not be affected by the
illegal, invalid or unenforceable provision or by its severance from this Agreement, and (d) in
lieu of such illegal, invalid or unenforceable provision, there shall be added automatically as a
part of this Agreement a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible and reasonably acceptable to the
Parties.

     16.4 Governing Law; Dispute Resolution.

          16.4.1 This Agreement, and any claim, dispute, or controversy of whatever nature arising out
of or relating to this Agreement shall be governed by and construed in accordance with the laws of
Germany, without giving effect to any principles, statutory provisions or other rules of choice of
law that would require the application of the laws of a different state or country.

          16.4.2 The Parties shall try to settle their differences amicably between themselves. If any
claim, dispute, or controversy of whatever nature arising out of or relating to

 

			
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34

 

this Agreement, including the performance or alleged non-performance of a Party of its
obligations under this Agreement arises between the Parties (each a “Dispute”), a Party shall,
before initiating any proceedings pursuant to Section 16.4.3, notify the other Party in writing of
such Dispute. If the Parties are unable to resolve the Dispute within [***] days of receipt of
the written notice by the other Party, such dispute shall be referred to a member of each of the
Party’s senior executive management, with appropriate decision making authority (or its designee),
who is not on the JSC, who shall meet in person at least once and use their good faith efforts to
resolve the Dispute within [***] days after such referral.

          16.4.3 If a Dispute is not resolved as provided in the preceding Section 16.4.2, whether
before or after termination of this Agreement, the Parties hereby agree to the exclusive
jurisdiction of the courts of competent jurisdiction in Frankfurt, Germany. Each Party hereby
agrees to such exclusive jurisdiction and waives any objections as to the personal jurisdiction or
venue of such courts.

          16.4.4 Notwithstanding the provisions of this Section 16.4, either Party shall have the right
to seek temporary injunctive relief in any court of competent jurisdiction as may be available to
such Party under the laws and rules applicable in such jurisdiction.

     16.5 Notices. All notices or other communications that are required or permitted hereunder
shall be in writing and delivered personally, sent by facsimile (and promptly confirmed by personal
delivery or overnight courier as provided in this Agreement), or sent by internationally-recognized
overnight courier addressed as follows:

     If to Nycomed, to:

Altana Pharma AG

Byk Gulden Str. 2

78467 Konstanz

Germany

Attention: General Counsel

Facsimile: ++49 7531 84 2982

     If to Micromet, to:

Micromet AG

Staffelseestr. 2

81477 Munich

Germany

Attention: Business Development

Facsimile: ++49 89 895 277 205

with a copy to:

Micromet, Inc.

6707 Democracy Boulevard

Suite 505

 

			
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35

 

Bethesda, MD

Attention: General Counsel

Facsimile: +1-240-752-1425

or to such other address as the Party to whom notice is to be given may have furnished to the other
Party in writing in accordance with this Agreement. Any such communication shall be deemed to have
been given (i) when delivered, if personally delivered or sent by facsimile on a business day, and
(ii) on the second business day after dispatch, if sent by internationally-recognized overnight
courier. It is understood and agreed that this Section 16.5 is not intended to govern the
day-to-day business communications necessary between the Parties in performing their duties, in due
course, under the terms of this Agreement.

     16.6 Entire Agreement; Modifications. This Agreement sets forth and constitutes the entire
agreement and understanding between the Parties with respect to the subject matter of this
Agreement and all prior agreements, understanding, promises and representations, whether written or
oral, with respect thereto are superseded by this Agreement, including the Confidentiality
Agreement between the Parties dated February 7, 2007. Each Party confirms that it is not relying
on any representations or warranties of the other Party except those that are expressly made in
this Agreement. No amendment or modification of this Agreement shall be binding upon the Parties
unless made in writing and duly executed by authorized representatives of both Parties, including
any amendment to, or waiver of, the foregoing requirement that all amendments shall be made in
writing.

     16.7 Relationship of the Parties. It is expressly agreed that the relationship between the
Parties is and shall be that of independent contractors, and that the relationship between the
Parties shall not constitute a partnership, joint venture or agency. Neither Party shall have the
authority to make any statements, representations or commitments of any kind, or to take any
action, which shall be binding on the other, without the prior written consent of the other to do
so. All persons employed by a Party shall be employees of such Party and not of the other Party
and all costs and obligations incurred by reason of any such employment shall be for the account
and expense of such Party.

     16.8 Waiver. Any term or condition of this Agreement may be waived at any time by the Party
that is entitled to the benefit of such term or condition, but no such waiver shall be effective
unless set forth in a written instrument duly executed by or on behalf of the Party waiving such
term or condition. The waiver by either Party of any right under this Agreement or of claims based
on the failure to perform or a breach by the other Party shall not be deemed a waiver of any other
right under this Agreement or of any other breach or failure by said other Party whether of a
similar nature or otherwise.

     16.9 Counterparts. This Agreement may be executed in 2 or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same
instrument.

     16.10 No Benefit to Third Parties. The representations, warranties, covenants and agreements
set forth in this Agreement are for the sole benefit of the Parties hereto and their successors and
permitted assigns, and they shall not be construed as conferring any rights on any
other parties.

 

			
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36

 

     16.11 Further Assurance. Each Party shall duly execute and deliver, or cause to be duly
executed and delivered, such further instruments and do and cause to be done such further acts and
things, including the filing of such assignments, agreements, documents and instruments, as may be
necessary or as the other Party may reasonably request in connection with this Agreement or to
carry out more effectively the provisions and purposes, or to better assure and confirm unto such
other Party its rights and remedies under this Agreement.

     16.12 English Language. This Agreement has been written and executed in the English language.
Any translation into any other language shall not be an official version hereof, and in the event
of any conflict in interpretation between the English version and such translation, the English
version shall control.

     16.13 Construction. Except where the context otherwise requires, wherever used, the singular
shall include the plural, the plural the singular, the use of any gender shall be applicable to all
genders, and the word “or” is used in the inclusive sense (and/or). The captions of this Agreement
are for convenience of reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision contained in this Agreement. The term
“including” as used herein means including, without limiting the generality of any description
preceding such term. References to “Section” or “Exhibit” are references to the numbered sections
of this Agreement and the exhibits attached to this Agreement, unless expressly stated otherwise.

[Remainder of this page is left blank intentionally]

 

			
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37

 

     IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the date first above written.

	 	 	 	 	 	 	 	 	 	 	 
	Micromet AG	 	 	 	Altana Pharma AG 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Name: Patrick Baeuerle	 	 	 	Name: Anders Ullman	 	 
	Title: CSO	 	 	 	Title: Board of Management	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Name: Jens Hennecke	 	 	 	Name: Christian Kanzelmeyer	 	 
	Title: VP Business 

Development	 	 	 	Title: Corporate Vice

President	 	 

[Signature Page To The Collaboration And License Agreement]

 

			
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Exhibit A-1

Licensed Patents

	 	 	 	 	 	 	 	 	 
	Application	 	Application	 	 	 	 	 	 
	Number	 	Filing Date	 	Country	 	Title of Application	 	Status
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]

 

			
	*	 	Subject to the terms of an Upstream Agreement

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit A-2

Licensed Patents

	 	 	 	 	 	 	 	 	 
	Application	 	Application	 	 	 	 	 	 
	Number	 	Filing Date	 	Country	 	Title of Application	 	Status
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]
	[***]

	 	[***]
	 	[***]
	 	[***]
	 	[***]

 

			
	*	 	Subject to the terms of an Upstream Agreement

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit B

MT203 Amino Acid Sequence of Variable Domains

[***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit C

Development Plan Outline

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit D

List of Upstream Agreements

[***]

Upon exercise of the SCA Patent option pursuant to Section 6.2.2:

[***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit E

Milestone Schedule

	 	 	 
	Milestone Event	 	Milestone Payment
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]
	 	 
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]
	 	 
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]
	 	 
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]
	[***]

	 	[***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

	 	 	 
	Milestone Event	 	Milestone Payment
	[***]

	 	[***]
	[***]

	 	[***]

     If a milestone event described above is achieved that is subsequent to a preceding milestone
event with respect to which Nycomed has not yet made the corresponding milestone payment, the
preceding milestone event is deemed achieved, and the corresponding milestone payment is due and
payable together with the payment of the milestone payment for the subsequent milestone event.

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit F

SCA PATENTS

	 	 	 	 	 	 	 	 	 	 	 
	Application 	 	Application	 	 	 	 	 	 	 	 
	Number	 	Filing Date	 	Country	 	Title of Application	 	Status	 	Patent Number
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	 
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	 
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	 
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

	 	 	 	 	 	 	 	 	 	 	 
	Application 	 	Application	 	 	 	 	 	 	 	 
	Number	 	Filing Date	 	Country	 	Title of Application	 	Status	 	Patent Number
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
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	*	 	The license rights granted under this Agreement do not apply to claims relating to those
antibodies of specific sequences binding to [***] , which antibodies are described or
disclosed in the above-described Patents, and such claims are excluded from the definition of
the SCA Patents.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Application	 	 	 	 	 	 	 	 
	Application	 	Filing	 	 	 	 	 	 	 	 
	Number	 	Date	 	Country	 	Title of Application	 	Status	 	Patent Number
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	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit G

     [***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit H

Press Release

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.

 

 

Exhibit I

Excluded Field

Any license granted pursuant to this Agreement shall not include the right to use, research,
develop, manufacture, use, or commercialize the following products:

[***]

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.exv10w2

 

Exhibit 10.2

OFFICE BUILDING LEASE

FOR

MICROMET, INC.

TWO DEMOCRACY PLAZA

6707 DEMOCRACY BOULEVARD
Suite 505
Bethesda, Maryland 20817

CHARLES E. SMITH

REAL ESTATE SERVICES L.P.
2345 Crystal Drive
Crystal City
Arlington, Virginia 22202

 

     This Lease, made this    day of                , 200   , between SECOND ROCK SPRING PARK LIMITED PARTNERSHIP, a Maryland limited partnership (hereinafter referred to as “Landlord”), and MICROMET,
INC., a Delaware corporation (hereinafter referred to as “Tenant”).

     Landlord, for and in consideration of the covenants and agreements set forth hereinafter, leases
to Tenant, and Tenant leases from Landlord, the premises described, for the use set forth and
for the term and at the rent reserved herein.

	 	 	 	 	 	 	 	 	 
	I.	 	SPECIFIC PROVISIONS	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	1.1	 	 	PREMISES	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(a)      Demised Premises:
	 	Suite 505, as shown on Exhibit A.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(b)      Rentable Area:
	 	Approximately 4,045 rentable square feet (measured in accordance with the
“Standard Method for Measuring Floor Area in Office Buildings”, ANSI/BOMA Z65,1-1996 published
by the Building Owners and Managers Association International) (“BOMA”).
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(c)      Complex:
	 	The buildings, improvements and grounds known as Democracy Plaza, of which the Building is a part.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(d)       Building:
	 	TWO DEMOCRACY PLAZA
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(e)      Address:
	 	6707 Democracy Boulevard
	 

	 	 	 	 	 	 	 	Bethesda, Maryland 20817
	 
	 	 	 	 	 	 	 	 
	 

	 	 	1.2	 	 	LEASE DATES	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(a)      Lease Term:
	 	The term of this Lease (“Lease Term”) shall be Five (5) years and One (I)
month, commencing on April 1, 2007 (the “Commencement Date”), and expiring on April 30, 2012
(the “Expiration Date”), both dates inclusive, unless sooner terminated in accordance with the
provisions of this Lease.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(b)      Base Year:
	 	Base Year shall be defined as the period commencing on January 1, 2007, and ending on December 31, 2007.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(c)      Fiscal Year:
	 	Fiscal Year shall be defined as each annual period, or portion thereof,
included within the Lease Term commencing on January 1 and ending on December 31.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(d)      Lease Year:
	 	The first Lease Year shall commence on the Commencement Date and shall
terminate at 11:59 p.m. on the day before the first anniversary of the Rent Start Date. All
subsequent Lease Years shall be for twelve (12) calendar months, except that the last Lease Year
shall terminate on the date this Lease expires or is terminated in accordance with the provisions hereof.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	(e)      Rent Start Date:
	 	May 1, 2007.
	 
	 	 	 	 	 	 	 	 
	 
	 	 	1.3	 	 	BASE ANNUAL RENT	 	 

	 	(a)	 	Initial Base
Annual Rent: One Hundred Thirty-One Thousand Four Hundred Sixty-Two and 50/100
Dollars ($131,462.50), payable in twelve (12) equal monthly installments of Ten Thousand Nine
Hundred Fifty-Five and 21/100 Dollars ($10,955.21), hereinafter referred to as “base monthly rent”,
for the first Lease Year, commencing on the Rent Start Date.
	 
	 	(b)	 	Percentage
Factor: Three Percent (3.00%).

	 	1.4	 	BASE YEAR COSTS
	 
	 	 	 	Not Applicable.

1

 

	 	1.5	 	ADDITIONAL RENT
	 
	 	 	 	Additional Rent shall be payable by Tenant in accordance with Section 2, commencing on the
first (1st) anniversary of the Rent Start Date and each anniversary thereafter,
consisting of each of the following;

	 	(a) 	 	Increases in Real 
Estate Taxes: 	 	Tenant’s pro rata share, equal to One and Five Tenths Percent (1.50%), of
the amount of Real Estate Taxes in excess of the Base Year Real Estate Taxes
calculated based upon 269,043 BOMA rentable square feet in the Building.
	 
	 	(b) 	 	Increases in 
Operating Expenses: 	 	Tenant’s pro rata share, equal to One and Five Tenths Percent (1.50%), of the
amount of Operating Expenses in excess of the Base Year Operating Expenses
calculated based upon 269,043 BOMA rentable square feet in the Building.

	 	1.6	 	SECURITY DEPOSIT
	 
	 	 	 	Thirty-Two Thousand Eight Hundred Sixty-Five and 62/100 Dollars ($32,865.62). Notwithstanding
anything to the contrary in Section 15 of the Lease, the amount stipulated herein as a security
deposit shall be in the form of an irrevocable and unconditional letter of credit from a
Washington, D.C. area bank and materially in the form attached hereto as Exhibit E. If the
letter of credit would expire during the Lease Term, Tenant shall replace the letter of credit
at least thirty (30) days prior to its expiration. If Tenant has not, at least thirty (30) days
prior to the expiration of the letter of credit, delivered a replacement letter of credit
having an expiration date at least six months later, Landlord may convert any letter of credit
then held by Landlord into a cash deposit in the full amount thereof. If Tenant is in default
beyond the expiration of applicable notice and cure periods, or if the pre-conditions set forth
in Section 15 are not met with regard to the return of the letter of credit, then the letter of
credit shall be converted into a cash deposit and applied to sums due Landlord. If Tenant is
not in default and the pre-conditions set forth in Section 15 regarding the return of the letter
of credit are met, any letter of credit then held by Landlord shall be cancelled and returned
to Tenant within thirty (30) days after the expiration or earlier termination of this Lease.
	 
	 	1.7 	 	STANDARD BUILDING OPERATING DAYS AND HOURS
	 
	 	 	 	8:00 A.M. to 6:00 P.M. Monday — Friday 

8:00 A.M. to 1:00 P.M. Saturday
	 
	 	1.8	 	USE OF PREMISES
	 
	 	 	 	General office use in keeping with the quality and nature of this first class office building and for no other purpose.

	 	1.9	 	(a) 	 	ADDRESS FOR NOTICES TO TENANT
	 
	 	 	 	 	 	Micromet, Inc.

6707 Democracy Boulevard

Suite 505

Bethesda, Maryland 20817

	 	(b)	 	ADDRESS FOR NOTICES TO LANDLORD
	 
	 	 	 	Second Rock Spring Park Limited Partnership

c/o Charles E. Smith Real Estate Services L.P.

2345 Crystal Drive

Suite 1000

Arlington, Virginia 22202
	 
	 	(c)	 	ADDRESS FOR PAYMENT OF RENT
	 
	 	 	 	Second Rock Spring Park Limited Partnership 

c/o Charles E. Smith Real Estate Services L.P.

P. O. Box 642099

Pittsburgh, Pennsylvania 15264-2099

2

 

	 	1.10	 	EXHIBITS TO LEASE

Exhibit A — Demised Premises Floor Plan

Exhibit B — Building Work Rules and Regulations

Exhibit C — Building Rules and Regulations

Exhibit D — Minimum Cleaning Services by Landlord

Exhibit E — Form Letter of Credit

	 	1.11	 	SPECIAL PROVISIONS

	 	 	 	 	 
	 

	 	Acceptance of Space
	 	Section 36
	 

	 	Parking
	 	Section 37
	 

	 	Execution of Document
	 	Section 38

     IN WITNESS WHEREOF, Landlord has caused this Lease, composed of Specific Provisions, General
Provisions, Exhibits and Special Provisions, to be signed and sealed by one or more of its
officers, general partners, trustees, or agents, and Tenant has caused this Lease, as
described above, to be signed in its corporate name by its duly authorized officer and its
corporate seal to be hereto affixed and duly attested by its Secretary.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	WITNESS:	 	 	 	LANDLORD:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	SECOND ROCK SPRING PARK LIMITED PARTNERSHIP	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Second Rock Spring Park, LLC, a Delaware limited

liability company, General Partner	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
		 	 	 	By:	 		 	(SEAL)	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	Mitchell N. Schear	 	 	 	 
	 

	 	 	 	 	 	Title:	 	Executive Vice President	 	 	 	 
	 

	 	 	 	 	 	Date:	 	5/3/07	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	ATTEST:	 	 	 	TENANT:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	MICROMET, INC.	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 		 	(SEAL)	 	 
	 	 	 	 	 	 	 	 	 	 	 
	Secretary           
                    Corporate Seal		 	 	 	 	Name:	 	MATHIAS ALDER	 	 	 	 
	 	 	 	 	 	 	Title:	 	SVP, GENERAL COUNSEL	 	 	 	 

	 	 	 	 	 
	Witness: 

	 
	
 	 	 
	Susan R. Mullen                                                      	 	 
	 	 	 
	 

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3

 

TABLE OF CONTENTS

SPECIFIC AND GENERAL PROVISIONS

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	1.	 	SPECIFIC PROVISIONS	 	1	 
	 
	 	 	 	 	 	 	 	 
	2.	 	RENT	 	4	 
	 

	 	2.1	 	Base Annual Rent	 	 	4	 
	 
	 	 	 	(a) Payment of Base Annual Rent	 	 	4	 
	 
	 	 	 	(b) Escalation of Base Annual Rent	 	 	4	 
	 
	 	2.2	 	Additional Rent	 	 	4	 
	 
	 	 	 	(a) Real Estate Taxes	 	 	4	 
	 
	 	 	 	(b) Operation Expenses	 	 	4	 
	 
	 	2.3	 	Additional Rent Estimates and Adjustments	 	 	5	 
	 
	 	 	 	(a) Initial Additional Rent Adjustments	 	 	5	 
	 
	 	 	 	(b) Annual Budget	 	 	6	 
	 
	 	 	 	(c) Additional Rent Reconciliations	 	 	6	 
	 
	 	 	 	(d) Verification of Additional Rent	 	 	6	 
	 
	 	 	 	(e) Fiscal Year	 	 	6	 
	 
	 	2.4	 	Rent Adjustment Limit	 	 	6	 
	 
	 	2.5	 	Survival of Rent Obligation	 	 	6	 
	 
	 	2.6	 	Pro Rata Share	 	 	6	 
	 
	 	2.7	 	Prorated Rent	 	 	7	 
	 
	 	2.8	 	Application of Rent	 	 	7	 
	 
	 	2.9	 	Late Payment Fee and Interest Charge	 	 	7	 
	 
	 	 	 	 	 	 	 	 
	3.	 	CONSTRUCTION OF PREMISES AND OCCUPANCY	 	7	 
	 
	 	3.1	 	Tenant Plans	 	 	7	 
	 
	 	 	 	Preparation of Tenant Plans	 	 	7	 
	 
	 	3.2	 	Possession	 	 	7	 
	 
	 	3.3	 	Permits	 	 	7	 
	 
	 	3.4	 	Demised Premises	 	 	7	 
	 
	 	 	 	 	 	 	 	 
	4.	 	SUBLETTING AND ASSIGNMENT	 	7	 
	 
	 	4.1	 	Consent	 	 	7	 
	 
	 	4.2	 	Recapture of Premises	 	 	8	 
	 
	 	4.3	 	Excess Rent and Other Consideration	 	 	8	 
	 
	 	4.4	 	Tenant Liability	 	 	8	 
	 
	 	4.5	 	Reasonable Standards of Consent	 	 	8	 
	 
	 	4.6	 	Other Transfers	 	 	9	 
	 
	 	4.7	 	Rights on Default	 	 	9	 
	 
	 	4.9	 	Permitted Transfers	 	 	9	 
	 
	 	 	 	 	 	 	 	 
	5.	 	SERVICES AND UTILITIES	 	9	 
	 
	 	5.1	 	Building Standard Services and Utilities	 	 	9	 
	 
	 	5.2	 	Overtime Services	 	 	8	 
	 
	 	5.3	 	Excessive Usage	 	 	10	 
	 
	 	 	 	(a) Equipment Restrictions	 	 	10	 
	 

	 	 	 	(b) Excess Electrical Usage
	 	 	10	 
	 

	 	 	 	(c) Additional Utility Costs
	 	 	10	 
	 

	 	5.4	 	Excessive Heat Generation
	 	 	10	 
	 

	 	5.5	 	Building Security
	 	 	10	 
	 

	 	5.6	 	Roof and Auxiliary Spaces
	 	 	10	 
	 

	 	5.7	 	Trash Removal
	 	 	10	 
	 
	 	 	 	 	 	 	 	 
	6.	 	USE AND UPKEEP OF PREMISES	 	10	 
	 

	 	6.1	 	Use
	 	 	10	 
	 

	 	6.2	 	Illegal and Prohibited Uses
	 	 	11	 
	 

	 	6.3	 	Insurance Rating
	 	 	11	 
	 

	 	6.4	 	Alterations
	 	 	11	 
	 

	 	 	 	(a) Approval Required
	 	 	11	 
	 

	 	 	 	(b) Alteration Requirements
	 	 	11	 
	 

	 	 	 	(c) Removal of Leasehold Improvements and Tenant’s Property
	 	 	11	 
	 

	 	 	 	(d) Compliance with Laws
	 	 	12	 
	 

	 	6.5	 	Maintenance by Landlord
	 	 	12	 
	 
	 	 	 	(a) Landlord Repairs and Maintenance	 	 	12	 
	 

	 	 	 	(b) Use of Demised Premises by Landlord
	 	 	12	 
	 

	 	6.6	 	Signs and Publications
	 	 	12	 
	 

	 	6.7	 	Excessive Floor Load
	 	 	12	 
	 

	 	6.8	 	Moving and Deliveries
	 	 	13	 
	 

	 	 	 	(a) Prohibitions/Notices
	 	 	13	 
	 

	 	 	 	(b) Coordination with Landlord
	 	 	13	 
	 

	 	 	 	(c) Moving Damages
	 	 	13	 
	 

	 	6.9	 	Rules and Regulations
	 	 	13	 
	 

	 	6.10	 	Tenant Maintenance and Condition of Demised Premises Upon Surrender
	 	 	13	 
	 

	 	6.11	 	Tenant Property and Leasehold Improvements
	 	 	13	 
	 

	 	6.12	 	Landlord’s Right to Perform Tenant’s Duties
	 	 	13	 
	 

	 	6.13	 	OFAC Compliance	 	 	13	 

(i)

 

TABLE OF CONTENTS
(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	7.	 	ACCESS	 	14	 
	 

	 	7.1	 	Landlord’s Access
	 	 	14	 
	 

	 	7.2	 	Restricted Access
	 	 	14	 
	 

	 	7.3	 	Tenant’s Access
	 	 	14	 
	 
	 	 	 	 	 	 	 	 
	8.	 	LIABILITY	 	14	 
	 

	 	8.1	 	Tenant’s Property
	 	 	14	 
	 

	 	8.2	 	Criminal Acts of Third Parties
	 	 	14	 
	 

	 	8.3	 	Public Liability
	 	 	14	 
	 

	 	8.4	 	Construction On Contiguos Property
	 	 	14	 
	 

	 	8.5	 	Tenant Insurance
	 	 	15	 
	 

	 	 	 	(a) Liability Insurance
	 	 	15	 
	 

	 	 	 	(b) Fire and Casualty Insurance
	 	 	15	 
	 

	 	 	 	(c) Increases in Coverage
	 	 	15	 
	 

	 	 	 	(d) Policy Requirements
	 	 	15	 
	 

	 	 	 	(e) No Limitation of Liability
	 	 	15	 
	 

	 	 	 	(f) Waiver of Subrogation
	 	 	15	 
	 

	 	 	 	(g) Business lnterruption
	 	 	15	 
	 

	 	8.6	 	Incident Recoils
	 	 	15	 
	 

	 	8.7	 	Landlord’s Insurance
	 	 	15	 
	 
	 	 	 	 	 	 	 	 
	9.	 	DAMAGE	 	16	 
	 

	 	9.1	 	Damages Caused by Tenant
	 	 	16	 
	 

	 	9.2	 	Fire or Casualty Damage
	 	 	16	 
	 

	 	9.3	 	Untenantability
	 	 	16	 
	 

	 	 	 	(a) Restoration Requirements
	 	 	16	 
	 

	 	 	 	(b) Casualty Near Expiration of Lease Term
	 	 	16	 
	 
	 	 	 	 	 	 	 	 
	10.	 	CONDEMNATION	 	17	 
	 

	 	10.1	 	Landlord’s Right to Award
	 	 	17	 
	 

	 	10.2	 	Tenant’s Right to File Claim
	 	 	17	 
	 
	 	 	 	 	 	 	 	 
	11.	 	BANKRUPTCY	 	17	 
	 

	 	11.1	 	Events of Bankruptcy
	 	 	17	 
	 

	 	11.2	 	Landlord’s Remedies
	 	 	17	 
	 

	 	 	 	(a) Termination of Lease
	 	 	17	 
	 

	 	 	 	(b) Suit for Possession
	 	 	17	 
	 

	 	 	 	(c) Non-Exclusive Remedies
	 	 	17	 
	 

	 	 	 	(d) Assumption or Assignment by Trustee
	 	 	17	 
	 

	 	 	 	(e) Adequate Assurance of Future Performance
	 	 	17	 
	 

	 	 	 	(f) Failure to Provide Adequate Assurance
	 	 	18	 
	 

	 	11.3	 	Guarantors
	 	 	18	 
	 

	 	11.4	 	Damages
	 	 	18	 
	 
	 	 	 	 	 	 	 	 
	12.	 	DEFAULTS AND REMEDIES	 	18	 
	 

	 	12.1	 	Default
	 	 	18	 
	 

	 	12.2	 	Remedies
	 	 	18	 
	 

	 	12.3	 	Landlord’s Right to Relet
	 	 	19	 
	 

	 	12.4	 	Recovery of Damages
	 	 	19	 
	 

	 	 	 	(a) Quantification of Damages
	 	 	19	 
	 

	 	 	 	(b) Non-Exclusive Rights
	 	 	19	 
	 

	 	12.5	 	Waiver
	 	 	19	 
	 

	 	12.6	 	Anticipatory Repudiation
	 	 	20	 
	 

	 	 	 	(b) Intentionally Deleted
	 	 	20	 
	 

	 	12.7	 	Tenant Abandonment of Demised Promises
	 	 	20	 
	 

	 	 	 	(a) Abandonment
	 	 	20	 
	 

	 	 	 	(b) Landlord Right to Enter and to Relet
	 	 	20	 
	 

	 	12.8	 	Tenant’s Property
	 	 	20	 
	 

	 	12.9	 	Intentionally Deleted
	 	 	20	 
	 

	 	12.10	 	Injunctive Relief
	 	 	20	 
	 

	 	12.11 	 	Independent Covenants
	 	 	20	 
	 

	 	12.12	 	Waiver of Redemption
	 	 	20	 
	 
	 	 	 	 	 	 	 	 
	13.	 	SUBORDINATION	 	21	 
	 

	 	13.1	 	Subordination
	 	 	21	 
	 

	 	13.2	 	Estoppels Certificates
	 	 	21	 
	 

	 	13.3	 	Attornment
	 	 	21	 
	 

	 	13.4	 	Mortgagee Rights
	 	 	21	 
	 

	 	 	 	(a) Mortgagee Requirements
	 	 	21	 
	 

	 	 	 	(b) Notices to Mortgagee
	 	 	22	 

(ii)

 

TABLE OF CONTENTS
(continued)

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	PAGE
	14.	 	TENANT’S HOLDOVER	 	22	 
	 

	 	14.1	 	With Landlord Consent
	 	 	22	 
	 

	 	14.2	 	Without Landlord Consent
	 	 	22	 
	 
	 	 	 	 	 	 	 	 
	15.	 	SECURITY DEPOSIT	 	22	 
	 
	 	 	 	 	 	 	 	 
	16.	 	QUIET ENJOYMENT	 	22	 
	 
	 	 	 	 	 	 	 	 
	17.	 	SUCCESSORS	 	23	 
	 
	 	 	 	 	 	 	 	 
	18.	 	WAIVER OF JURY TRIAL	 	23	 
	 
	 	 	 	 	 	 	 	 
	19.	 	LIMITATION OF LANDLORD’S LIABILITY; NOTICE	 	23	 
	 

	 	19.1	 	Landlord’s Consent
	 	 	23	 
	 

	 	19.2	 	Individual Liability
	 	 	23	 
	 

	 	19.3	 	Notice in Event of Landlord’s Default
	 	 	23	 
	 
	 	 	 	 	 	 	 	 
	20.	 	AUTHORITY	 	23	 
	 
	 	 	 	 	 	 	 	 
	21.	 	TENANT’S RESPONSIBILITY REGARDING HAZARDOUS SUBSTANCES	 	23	 
	 

	 	21.1	 	Hazardous Substances
	 	 	23	 
	 

	 	21.2	 	Tenant’s Restrictions
	 	 	23	 
	 

	 	 	 	(a) Violations
	 	 	24	 
	 

	 	 	 	(b) Use
	 	 	24	 
	 

	 	21.3	 	Affirmative
	 	 	24	 
	 

	 	 	 	(a) Compliance with Laws
	 	 	24	 
	 

	 	 	 	(b) Clean-Up Plans
	 	 	24	 
	 

	 	 	 	(c) Information Requests
	 	 	24	 
	 

	 	21.4	 	Tenant’s Indemnity
	 	 	24	 
	 

	 	21.5	 	Survival of Obligations
	 	 	24	 
	 

	 	21.6	 	Landlord’s Representation
	 	 	24	 
	 
	 	 	 	 	 	 	 	 
	22.	 	JOINT AND SEVERAL LIABILITY	 	24	 
	 
	 	 	 	 	 	 	 	 
	23.	 	DEFINITIONS	 	24	 
	 

	 	23.1	 	Pronouns
	 	 	24	 
	 

	 	23.2	 	Demised Premises
	 	 	25	 
	 

	 	23.3	 	Lease Term
	 	 	25	 
	 

	 	23.4	 	Tenant’s Property
	 	 	25	 
	 

	 	23.5	 	Leasehold Improvements
	 	 	25	 
	 

	 	23.6	 	Calendar Year
	 	 	25	 
	 

	 	23.7	 	Construction Improvements
	 	 	25	 
	 
	 	 	 	 	 	 	 	 
	24.	 	NOTICE TO PARTIES	 	25	 
	 

	 	24.1	 	Addresses for Notices
	 	 	25	 
	 

	 	24.2	 	Effective Date of Notice
	 	 	25	 
	 
	 	 	 	 	 	 	 	 
	25.	 	NOTICE TO MORTGAGEES	 	25	 
	 
	 	 	 	 	 	 	 	 
	26.	 	SPECIAL PROVISIONS AND CONFLICTS; EXHIBITS	 	25	 
	 

	 	26.1	 	Incorporation in Lease
	 	 	25	 
	 

	 	26.2	 	Conflicts
	 	 	25	 
	 
	 	 	 	 	 	 	 	 
	27.	 	CAPTIONS	 	25	 
	 
	 	 	 	 	 	 	 	 
	28.	 	ENTIRE AGREEMENT; MODIFICATION	 	25	 
	 
	 	 	 	 	 	 	 	 
	29.	 	GOVERNING LAW; SEVERABILITY	 	26	 
	 
	 	 	 	 	 	 	 	 
	30.	 	BINDING EFFECT OF LEASE	 	26	 
	 
	 	 	 	 	 	 	 	 
	31.	 	FORCE MAJEURE	 	26	 
	 
	 	 	 	 	 	 	 	 
	32.	 	RECORDATION	 	26	 
	 
	 	 	 	 	 	 	 	 
	33.	 	TIME OF ESSENCE	 	26	 
	 
	 	 	 	 	 	 	 	 
	34.	 	BROKERS AND COMMISSIONS	 	26	 
	 
	 	 	 	 	 	 	 	 
	35.	 	RELATIONSHIP OF LANDLORD AND TENANT	 	26	 
	 
	 	 	 	 	 	 	 	 
	36.	 	ACCEPTANCE OF SPACE	 	26	 
	 
	 	 	 	 	 	 	 	 
	37.	 	PARKING	 	26	 
	 
	 	 	 	 	 	 	 	 
	38.	 	EXECUTION OF DOCUMENT	 	26	 

(iii)

 

GENERAL PROVISIONS

2. RENT

     2.1Base Annual Rent.

          (a) 
Payment of Base Annual Rent. Tenant shall pay the first monthly installment of
Base Annual Rent specified in Section 1.3 Upon execution of this Lease. After the Commencement
Date, Tenant shall pay the remaining monthly installments of Base Annual Rent in advance without
deduction, demand, right of set-off or recoupment, in immediately available funds, on the first
day of each and every calendar month throughout the entire Lease Term specified in Section l.2(a),
to Charles E. Smith Real Estate Services L.P. (“Landlord’s Agent”), by electronic funds transfer
if requested by Landlord, or otherwise at the address specified in Section 1.9(b) or 1.9(c), as
applicable, or to such other person or at such other place as Landlord may hereafter designate in
writing.

          (b) 
Escalation of Base Annual Rent. Commencing on the first anniversary date of the
Commencement Date and continuing on each subsequent anniversary thereof, the Base Annual Rent
shall be increased by the Percentage Factor stipulated in Section 1.3(b) times the Base Annual
Rent payable for the preceding Lease Year (all of which shall be calculated without giving effect
to any waiver of rent or rent credit otherwise provided to Tenant). The escalated Base Annual Rent
so determined shall be the “Base Annual Rent” for all purposes of this Lease, including the
calculation of the increase in Base Annual Rent for the subsequent Lease Year.

     2.2 
Additional Rent. Commencing on the date set forth in Section 1.5 and continuing
throughout the Lease Term, Tenant shall pay as Additional Rent Tenant’s pro rata share of any (i)
Real Estate Taxes and (ii) Operating Expenses, in excess of the (i) Real Estate Taxes and (ii)
Operating Expenses, respectively, accruing during the Base Year. Additional Rent shall be
determined as follows:

          (a) 
Real Estate Taxes. Tenant shall pay Tenant’s pro rata share, as defined in Section
1.5(a), of any Real Estate Taxes accruing during each Fiscal Year falling entirely or partly within the Lease Term, in excess of the
amount of Real Estate Taxes accruing during the Base Year. In the event that the Lease Term commences or expires on a day other than the first
or the last day of a Fiscal Year respectively, then Tenant’s liabilities pursuant to such Fiscal Year shall be apportioned by multiplying the
respective amount of Tenant’s pro rata share thereof for the Fiscal Year by a fraction, the numerator of which is the number of days during
such Fiscal Year falling within the period of the Lease Term and the denominator of which is three hundred sixty-five(365).

               
(i) The term “Real Estate Taxes” shall mean (1) all taxes, assessments (including all
assessments for public improvements or benefits, whether or not commenced or completed prior to
the date hereof and whether or not to be completed within the Lease Term), water, sewer,
transportation or other excises, levies, license fees, permit fees, impact fees, inspection fees,
and other authorization fees and other similar charges, in each case whether general or special,
levied or assessed, ordinary or extraordinary, foreseen or unforeseen, of every character
(including all interest and penalties thereon), which at any time during or in respect of the
Lease Term, may, by any governmental or taxing authority, be assessed, levied, confirmed, or
imposed on or in respect of, or be a lien upon, the land and the building improvements of which the
Demised Premises are a part, and on any land and/or improvements now or hereafter owned by
Landlord and/or others that provide the Complex or locality or the Demised Premises with Other
Services, programs, amenities or common facilities, together with (2) any other tax imposed on
real estate or on owners of real estate generally, including taxes imposed on leasehold
improvements which are assessed against the Landlord (excluding leasehold improvements for which
individual tenants are responsible) and taxes upon or with respect to any activity conducted on
the land  and improvements of which the Demised Premises are a part, upon this Lease or any rent
reserved or payable hereunder, and (3) to the extent the following taxes are in lieu of or a
substitute for any other taxes which are, or would be, payable by Landlord as Real Estate Taxes.
(a) any income, excess profits, or Other taxes of Landlord determined on the basis of its income,
receipts, or revenues, (b) any estate, inheritance, succession, gift, capital levy, or similar tax
of Landlord, (c) any franchise, capital stock, or similar taxes of Landlord and (d) any income,
excess profits, or other taxes of Landlord determined on the basis of its income or revenue
derived pursuant to this Lease. Notwithstanding anything to the contrary contained in this
Section(a), there shall be excluded from Real Estate Taxes (i) all excess profits taxes, franchise
taxes, gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes, federal
and state net income taxes, and other taxes to the extent applicable to Landlord’s net Income (as
opposed to rents, receipts or income attributable to operations at the Complex), (ii) any items
included as Operating Expenses, (iii) any penalties or interest on late payments by Landlord, (v)
any taxes imposed on the personal property of any tenant or occupant in the Building, and (v) any
transfer or recordation fees.

               (ii) If Real Estate Taxes accruing during the Base Year are subsequently reduced by any
application or proceeding brought by or on behalf of Landlord for reduction in the amount of Real
Estate Taxes payable by Landlord, the Real Estate Taxes deemed to have accrued during the Base
Year shall be decreased and Landlord may promptly bill Tenant for the Additional Rent not
previously paid by Tenant for any Fiscal Year during the Lease Term, based upon the reduced amount
of Real Estate Taxes accruing during the Bass Year.

               (iii) Notwithstanding anything in this Lease to the contrary, including Sections 1.4 and 2.2,
Real Estate Taxes for all Fiscal Years shall be “grossed-up” on the basis that the Building is
Ninety-Five Percent (95%) occupied and fully assessed.

               (iv) In addition to the pro rata share of any increase in Real Estate Taxes to be paid by
Tenant pursuant to Sections 2.2(a)(i), (ii) and (iii) above, Tenant shall reimburse Landlord upon
demand for any and all taxes required to be paid by Landlord upon, measured by, or reasonably
attributable to the cost or value of Tenant’s Property or by the cost or value of any Leasehold
Improvements made in or to the Demised Premises by or for Tenant, regardless of whether title to
such Leasehold Improvements shaft be in Tenant Landlord, and for all taxes required to be paid by
Landlord upon, measured by, or reasonably attributable to or with respect to the possession,
leasing, operation, management, maintenance, alteration, repair, use or occupancy by Tenant of the
Demised Premises or any portion thereof to the extent such taxes are not included in Real Estate
Taxes.

          
(b) Operating Expenses. Tenant shall pay Tenant’s pro rata share, as indicated in
Section 1.5(b), of any Operating Expenses accruing during each Fiscal Year falling entirely or partly within the Lease Term, in excess
of the Operating Expenses accruing during the Base Year.

               
(i) The term “Operating Expenses” shall mean any and all expenses of Landlord in connection
with the servicing, insuring, operation, maintenance, component replacement and repair of the
Building and related interior and exterior appurtenances of which the Demised Premises are a part,
or for health, welfare or safety; expenses, if any, of Landlord either alone or in conjunction with
others to maintain common facilities, amenities, programs and services required or approved by
jurisdictional authorities for the Building, the building site, the Complex or the locality in
which the Complex is situated; the cost of any services to achieve a reduction of, or to minimize

4

 

the increase in Operating Expenses or Real Estate Taxes; management fees; vault rentals; business
license, personal property and other taxes; capital expenditures and other costs of Landlord for
equipment or systems installed to reduce or minimize increases in Operating Expenses or to comply
with any governmental or quasi-governmental ordinance or requirement (at the option of Landlord,
such costs, with interest, may be recovered from Tenant in installments simultaneous with the
payment of monthly installments of Base Annual Rent in accordance with a cost repayment schedule
based on the useful life of such equipment or systems). At the sole discretion of Landlord,
certain of these expenses may be equitably apportioned among two or more buildings in the Complex.

               (ii) The term “Operating Expenses” shall not include any of the following, except to the
extent that such costs and expenses are specifically included in Operating Expenses as described
in Section 2.2(b)(i) above: capital expenditures and depreciation of the Building; painting and
decorating of tenant space; interest and amortization of mortgages; ground rent; compensation paid
to officers or executives of Landlord; taxes as measured by the net income of Landlord from the
operation of the Building; insurance reimbursements of Operating Expenses to Landlord; Real Estate
Taxes; brokerage commissions; and marketing expenses. Further, the term “Operating Expenses” shall
also not include any of the following:

	 	(a)	 	Rents under any ground lease or any other underlying lease wherein Landlord is the
lessee;
	 
	 	(b)	 	Interest or principal payments on any financing for the Building;
	 
	 	(c)	 	Leasing commissions;
	 
	 	(d)	 	Costs, including permit, license and inspection fees, incurred in
renovating, improving, decorating, painting or redecorating vacant tenant space or
space of other tenants in the Building;
	 
	 	(e)	 	Costs of repairs or maintenance caused or necessitated by the negligence
of Landlord, its agents, contractors or employees or due to defects in initial
construction of the Building;
	 
	 	(f)	 	Any expense resulting from the negligent acts or omissions of Landlord,
its agents, servants or employees;
	 
	 	(g)	 	Advertising and promotional expenditures;
	 
	 	(h)	 	Any costs for which Landlord received reimbursement from insurance proceeds or
condemnation awards;
	 
	 	(i)	 	Any costs for which Landlord is reimbursed by tenant(s) of the Building (other than
as a part of such other tenant’s proportionate share of Landlord’s Operating Expenses;
	 
	 	(j)	 	The cost of any work or alterations performed by Landlord for any other tenant in the
Building in connection with preparing space for such other tenant’s occupancy;
	 
	 	(k)	 	Any costs relating exclusively to a tenant in particular as contrasted to tenants in
general, such as build-out allowances, rent concessions and brokerage commissions;
	 
	 	(l)	 	Professional fees incurred by Landlord in the preparation of leases or in disputes with
tenants of the Building;
	 
	 	(m)	 	Salaries, wages, or other compensation or benefits paid to off-site employees or
other employees of Landlord who are not assigned full-time to the operation, management,
maintenance, or repair of the Building; provided however, Operating
Expenses shall include Landlord’s reasonable allocation of compensation
paid for the wages, salary, or other compensation or benefits paid to the
individual Building manager, if offsite, who is assigned part-time to the
operation, management, maintenance, or repair of the Building; and
	 
	 	(n)	 	Amounts paid to entities related to Landlord in excess of the cost of the then
existing market rate for such services from unrelated entities.

The foregoing definition of Operating Expenses is applicable to Tenant only and Landlord is not
prohibited from assessing other tenants for any and all other costs and expenses incurred by
Landlord in connection with the operation, management, maintenance and repair of the Building, the
land and all easements, rights and appurtenances thereto.

               (iii) Notwithstanding anything in this Lease to the contrary, including Sections 1.4 and 2.2,
Operating Expenses for all Fiscal Years shall be “grossed-up” on the basis that the Building is
Ninety-Five Percent (95%) occupied and fully assessed.

     2.3 Additional Rent Estimates and Adjustments.

          (a) Initial Additional Rent Adjustments. Landlord shall submit to Tenant prior to the
date set forth in Section 1.5 a statement of Landlord’s reasonable estimate of the increases
described in Sections 2.2(a) and (b) above, together with the amount of Tenant’s Additional Rent
which is estimated to result from such increases, in which event Tenant shall pay such estimated
Additional Rent to Landlord in equal monthly installments beginning on the date set forth in
Section 1.5, on the dates and in the manner required for the payment of Tenant’s monthly
installments of Base Annual Rent.

5

 

          (b) Annual Budget. Subsequent to the Calendar Year in which Tenant’s obligation
to pay each component of Additional Rent pursuant to Section 2.2 commences, Tenant shall thereafter
pay each such component of Additional Rent in twelve equal monthly installments based upon
Landlord’s estimates. In order to provide for the current monthly payment of each component of
Additional Rent described herein, Landlord shall submit to Tenant a statement of Landlord’s
reasonable estimate of the increases described in Section 2.2 above, together with the amount of
Tenant’s Additional Rent which is estimated to result from such increases. Tenant agrees to pay
each such estimated component of Additional Rent to Landlord in twelve equal installments beginning
on January 1, on the dates and in the manner required for the payment of Tenant’s monthly
installments of Base Annual Rent.

          (c) Additional Rent Reconciliations. Within approximately one hundred eighty
(180) days after the end of each Calendar Year, but without forfeiture or waiver of Landlord’s
right to Additional Rent if such deadline is not met, Landlord will submit to Tenant an un-audited
financial statement of the actual increases in Real Estate Taxes and Operating Expenses accruing
during the Fiscal Year which ended during such Calendar Year over the Real Estate Taxes and
Operating Expenses which accrued during the Base Year, respectively. Such statement shall also
indicate the amount of Tenant’s excess payment or underpayment of Additional Rent based on
Landlord’s estimate described in Sections 2.3(a) and 2.3(b). If Additional Rent paid by Tenant
during the preceding Calendar Year shall be in excess of, or less than, the aggregate of its share
of the actual increase in Real Estate Taxes and Operating Expenses, Landlord and Tenant agree to
make the appropriate adjustment following the submission of Landlord’s statement. Tenant shall
either pay any Additional Rent due with the installment of Base Annual Rent due for the month
following submission of Landlord’s statement, or pay any Additional Rent due within thirty (30)
days if the Lease Term has expired or has otherwise been terminated. Tenant shall deduct its excess
payment, if any, from the installment of Base Annual Rent due for the month following submission of
Landlord’s statement, or following the expiration or earlier termination of the Lease Term, Tenant
shall be reimbursed for any excess payments made, less any amounts then due Landlord under this
Lease, upon demand.

          (d) Verification of Additional Rent. Unless Tenant asserts specific errors
within ninety (90) days after Landlord has submitted the un-audited financial statement for a
Fiscal Year to Tenant, Tenant shall have no right to contest the amount of Tenant’s pro rata share
of Real Estate Taxes and/or Operating Expenses or the statement submitted by Landlord. No such
assertion of error by Tenant shall extend the time for payments as set forth in Sections 2.2 and
2.3 above. If Tenant has given a timely assertion of error and if it shall be determined by
Landlord there is an error in Landlord’s statement, Tenant shall be entitled to a credit for any
overpayment, which shall be applied to any sums then due Landlord under this Lease and then to the
next installment(s) of Additional Rent until fully credited for the overpayment, or refunded if
Tenant has vacated the Demised Premises, or Tenant shall be billed for any underpayment and shall
remit any amount owing to Landlord within ten (10) business days of Tenant’s receipt of such
statement. Notwithstanding the foregoing, provided that Tenant has made all payments that have been
invoiced by Landlord and is not otherwise in default beyond the expiration of any applicable notice
and cure period, and the Operating Expenses or Real Estate Taxes have increased by more than three
percent (3%) in the aggregate over the immediately previous Fiscal Year, Tenant shall have the
right to audit the books and records of landlord relating to Landlord’s Operating Expenses or Real
Estate Taxes provided: (i) Tenant gives Landlord thirty (30) days’ prior written notice of its
intent to audit; (ii) the audit occurs during Landlord’s normal business hours and in Landlord’s
principal offices; (iii) Tenant may only audit said records and books once during each calendar
year; (iv) Tenant may only conduct the audit of a calendar year’s books and records within ninety
(90) days following delivery of the Financial Statement for the item in question for any calendar
year; (v) the auditor shall not be compensated on a contingency basis; (vi) Tenant provides
Landlord with a copy of the auditor’s report, within ten (10) days after its receipt by Tenant; and
(vii) the auditor agrees to execute a confidentiality agreement with respect to such audit. Neither
Tenant nor its auditor shall be entitled to audit or examine any records specifically pertaining to
another tenant at the Building.

               (i) Confidentiality of Audit. All of the information obtained through said audit as
well as any compromise, settlement, or adjustment reached between Landlord and Tenant relative to
the results of the audit shall be held in strict confidence by Tenant and Tenant’s officers, agents
and employees and shall not be revealed in any manner to any person except upon the prior written
consent of Landlord, which consent may be withheld in Landlord’s sole discretion, or if required
pursuant to any litigation between Landlord and Tenant materially related to the facts disclosed by
such audit, or if otherwise required by law, Landlord shall have all rights allowed by law or
equity if Tenant, its officers, agents or employees and/or auditor violate the terms of this
provision, including without limitation, the right to terminate this Lease or the right to
terminate Tenant’s future right to audit pursuant to this Section.

               (ii) Landlord’s Right to Contest Audit. Landlord may contest Tenant’s audit
results by giving Tenant written notice of protest within thirty (30) days following Landlord’s
receipt of the audit report. If Landlord’s accountant and Tenant’s accountant cannot mutually
agree as to Tenant’s share of Operating Expenses or Real Estate Taxes, as applicable, due within
thirty (30) days after Tenant’s receipt of Landlords notice of protest, Landlord’s accountant and
Tenant’s accountant shall jointly choose a third independent Certified Public Accountant, whose
determination shall be binding upon the parties hereto. If the accountants fail to agree upon the
third accountant, the parties agree to proceed forthwith to arbitrate the issue in accordance with
the Commercial Arbitration Rules of the American Arbitration Association. The cost of the third
accountant or the cost of arbitration shall be borne squally by the parties.

          (e) Fiscal Year. Landlord shall have the right to change its Fiscal Year from time to
time. If Landlord changes its Fiscal Year during the Lease Term, thereby creating a Fiscal Year with fewer than twelve (12)
months (hereinafter “short year”), the Real Estate Taxes
and Operating Expenses for the short year shall be determined on an annualized basis by taking
the monthly average of the actual Real Estate Taxes and Operating Expenses, respectively, and multiplying each by twelve. The amounts
determined by this method shall be used in determining the increases described in Sections 2.2(a) and 2.2(b) for the short year.

     2.4 Rent Adjustment Limit. Notwithstanding any deductions from or adjustments to Base
Annual Rent and Additional Rent as provided for above, in no event shall the total monthly
installment of Base Annual Rent and Additional Rent to be paid by Tenant in any month during the
Lease Term or any extension thereof be less than the monthly installment of Base Annual Rent
stipulated in Section 1.3, except as required as the result of the Landlord’s application of a
credit due to Tenant pursuant to Section 2.3(c).

     2.5 Survival of Rent Obligation. The obligation of Tenant with respect to payment of
Base Annual Rent, as defined in Section 2.1, and Additional Rent as defined in Section 2.2,
together with all other sums due hereunder, accrued and unpaid during the lease Term, shall
survive the expiration or earlier termination of this Lease.

     2.6 Pro Rata Snare. Tenant’s “pro rata share” stipulated in Sections 1.5(a) and 1.5(b)
represents the ratio that the total rentable area of the Demised Premises bears to the total
rentable area of the Building. In the event of any dispute as to the Tenant’s “pro rata share”,
certification of the “pro rata share” by Landlord’s architect shall be binding on both Landlord
and Tenant.

6

 

     2.7 Prorated Rent. Any Base Annual Rent or Additional Rent payable pursuant to
Sections 2.1 and 2.2 for one or more full calendar months in a partial Fiscal Year at the beginning
or end of the Lease Term shall be prorated based upon the number of months in the Fiscal Year. Any
Base Annual Rent or Additional Rent payable pursuant to Sections 2.1 and 2.2 for a portion of a
calendar month shall be prorated based upon the number of days in the applicable calendar month.

     2.8 Application of Rent. No payment by Tenant or receipt by Landlord of lesser amounts
of Base Annual Rent or Additional Rent than those required by this Lease shall be deemed to be
other than on account of the earliest unpaid stipulated Base Annual Rent or Additional Rent. No
endorsement or statement on any check or any letter accompanying any check or payment as Base
Annual Rent or Additional Rent shall be deemed an accord and satisfaction, and Landlord
may accept such check or payment without prejudice to Landlord’s right to recover the balance of
such Base Annual Rent and Additional Rent or pursue any other remedy provided in this Lease. Any
credit due to Tenant hereunder by reason of overpayment of Base Annual Rent or Additional Rent
shall first be applied to any Base Annual Rent, Additional Rent or other sums owed to Landlord by
Tenant as set forth elsewhere in this Lease or if Tenant shall be in default when said credit
shall be owed.

     2.9 Late Payment Fee and Interest Charge. In the event any installment of Base Annual
Rent or Additional Rent due hereunder is not paid within ten (10) calendar days after it is due,
then Tenant shall also pay to Landlord as Additional Rent (a) a late payment fee equal to five
percent (5%) of the payment as liquidated damages for the additional administrative costs incurred
by Landlord as a result of such late payments, plus (b) an interest charge calculated at the rate
of eighteen percent (18%) per annum on the delinquent payment from the date due until paid.

	3.	 	CONSTRUCTION OF PREMISES AND OCCUPANCY

     3.1 Tenant Plans.

          Preparation of Tenant Plans. Landlord shall have the right to approve any architect
and/or engineer selected by Tenant, which approval shall not be unreasonably withheld, and each of
Tenant’s architects and engineers shall be licensed in the jurisdiction in which the Demised
Premises are located and shall maintain (and provide Landlord with evidence of the existence of)
professional liability insurance adequate in Landlord’s reasonable judgment. Tenant’s preliminary
plan, whether prepared by an architect or engineer selected by Landlord or by Tenant’s architect
or engineer, shall provide sufficient information to permit working drawings and cost estimate to
be prepared. Upon completion of Tenant’s remodeling work, Tenant shall provide Landlord, at
Tenant’s expense, with “as-built” plans of the Demised Premises. If the Demised Premises as
reflected on Tenant’s plans are not in compliance with applicable building and fire codes, or do
not comply with all requirements of the Americans with Disabilities Act (“ADA”), then Tenant’s
plans shall not be, nor shall they be deemed to be, acceptable to Landlord. Landlord’s approval of
Tenant’s plans or work does not constitute certification by Landlord that said plans or work meet
the applicable requirements of any building or fire codes, laws or regulations, or the ADA, nor
shall it impose any liability whatsoever upon Landlord.

     3.2 Possession. If Landlord shall be unable to tender possession of the Demised
Premises on the Commencement Date set forth in Section 1.2 by reason of: (a) the holding over or
retention of possession of any tenant or occupant; or (b) for any other reason beyond the control of
Landlord, Landlord shall not be subject to any liability for the failure to tender possession on
said date. Under such circumstances the Base Annual Rent and Additional Rent reserved and
covenanted to be paid herein shall not commence until possession of the Demised Premises is
tendered to Tenant. No such failure to tender possession on the Commencement Date set forth in
Section 1.2 shall in any other respect affect the validity of this Lease or the obligations of
Tenant hereunder. In the event the actual Commencement Date does not occur within three (3) months
of the date this Lease is fully executed and delivered by Landlord and Tenant, then either party,
without further liability to the other, shall have the right to terminate this Lease upon two (2)
months prior written notice to the other party hereto. If permission is given to Tenant to enter
into possession of the Demised Premises prior to the date specified as the Commencement Date,
Tenant covenants and agrees that such occupancy shall be deemed to be subject to all of the terms,
covenants, conditions and provisions of this Lease.

     3.3 Permits. Tenant shall be responsible for obtaining at Tenant’s sole cost and
expense, the construction and occupancy permits for the Demised Premises if any. Tenant shall be
responsible for obtaining any other permits or licenses necessary for its lawful occupancy of the
Demised Premises. Tenant shall provide Landlord with a copy of all such permits and licenses.
Landlord shall cooperate with Tenant to procure all necessary permits from government authorities.

     3.4 Demised Premises. Landlord shall have the right to change the location (provided
however Tenant shall not be relocated to the first (1st) floor of the Building) and
configuration of the Demised Premises at any time but not more than once during the Lease Term,
subject to the following terms and conditions: (a) subsequent to the Commencement Date, Landlord
shall provide Tenant not less than ninety (90) days advance written notice of the date Tenant must
vacate the Demised Premises; (b) Landlord shall provide Tenant with Substitute space of similar
nature and size elsewhere in the Building (the “Substitute Premises”) the Substitute Premises shall
have a similar window line as the Demised Premises; (c) Landlord shall at Landlord’s expense remove
Tenant’s Property from the Demised Premises and reinstall them in the Substitute Premises, and
redecorate the Substitute Premises in a manner substantially similar to the manner in which the
Demised Premises were decorated; and (d) upon receipt of paid invoices, Landlord shall reimburse
Tenant for the reasonable costs it incurs for new stationery, business cards and signage, if any,
comparable to those previously used by Tenant that it requires, directly as a result of Landlord’s
relocation of the Demised Premises. Landlord shall use reasonable efforts to minimize the
disruption to Tenant’s business, but in no event shall Landlord be liable for any loss of business
or other damages to or expenses of Tenant, except for any physical damage to Tenant’s Property
incurred during the move. Within ten (10) days after Landlord submits an amendment of this Lease or
a replacement lease indicating the location and configuration of the Substitute Premises, Tenant
shall execute such amendment or lease, as applicable, and deliver it to Landlord, failing which
Tenant hereby irrevocably appoints Landlord as its special attorney-in-fact to execute such
amendment or lease, as applicable, the foregoing power of attorney being deemed to be coupled with
an interest.

	4.	 	SUBLETTING AND ASSIGNMENT

     4.1 Consent. Without the prior written consent of Landlord, not to be unreasonably
withheld or delayed in accordance with Section 4.5, Tenant will not sublet the Demised Premises or
any part thereof or transfer possession or occupancy thereof to any person, firm or entity, or
transfer or assign this Lease, and no subletting or assignment hereof shall be effected by
operation of law or in any Other manner, such as the transfer of all or substantially all of
Tenant’s assets or voting control of Tenant’s stock, partnership interest or other equity, without
such prior written consent of Landlord, except as provided in Section 4.8 below. If Tenant is a
partnership, then any sale, conveyance, or other transfer of, or the grant of a security interest
in, or any partnership interest, or any dissolution of Tenant, or any act which will result in a
potential future change in control, or a withdrawal or change, whether voluntary, involuntary or
by operation of law, of a

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partner or partners owning a controlling interest in Tenant, shall be deemed a voluntary
assignment of this Lease. If Tenant is a corporation, then any sale, conveyance, or other transfer
of, or grant of a security interest in any controlling shares of stock, dissolution, merger,
consolidation or other reorganization of Tenant, or any sale or transfer of a controlling interest
of its capital stock, or any act which will result in a potential future change in control, or a
withdrawal or change, whether voluntary, involuntary or by operation of law, of a shareholder or
shareholders owning a controlling interest in Tenant, shall be deemed a voluntary assignment of
this Lease. All permitted subletting and assignments of the Demised Premises and this Lease shall
be subject to the provisions of this Lease, including but not limited to Section 4.3. No assignment
shall be made except for the entire Demised Premises and Tenant further agrees that any permitted
assignment of this Lease or subletting of the Demised Premises may be conditioned upon payment by
Tenant of consideration and the delivery of such additional guarantees, collateral and/or other
security as determined by Landlord. Any subletting or assignment consented to by Landlord, to be
effective, shall be evidenced in writing in a form acceptable to Landlord. Consent by Landlord to
any assignment or subletting by Tenant shall not operate as a waiver of the necessity for
obtaining Landlord’s consent in writing to any subsequent assignment or subletting. The collection
or acceptance of rent from any such assignee, subtenant or other occupant shall not constitute a
waiver of or release of Tenant from any covenant or obligation contained in this Lease, nor shall
such acceptance of rent be deemed to create any right to the Demised Premises in such assignee,
subtenant or other occupant, nor any legal or other relationship between the Landlord and any such
assignee, subtenant or other occupant. Landlord’s acceptance of any name for listing on the
Building directory shall not be deemed, nor will it substitute for, Landlord’s consent as required
by this Lease, to each sublease, assignment and any other occupancy of the Demised Premises, In
the event that Tenant defaults under this Lease in the payment of Base Annual Rent or Additional
Rent, Tenant hereby assigns to Landlord the rent and other sums due from any subtenant, assignee
or other occupant and hereby authorizes each such subtenant, assignee and other occupant to pay
said rent and other sums directly to Landlord upon demand. Any transfer of this Lease or the
Demised Premises, or any transfer of any interest in Tenant restricted pursuant to this Section
4.1, without the prior written consent of Landlord pursuant to this Section 4.1 shall be void. By
taking a transfer of this Lease by assignment, transfer or interest in Tenant, or by any other
manner described in this Section 4.1, or otherwise with Landlord’s consent to the transfer, the
transferee shall be bound by all provisions of this Lease, which shall be binding upon the
transferee as if the transferee had signed this Lease in lieu of the original Tenant named herein.
Provided Tenant first obtains the written consent of Landlord to such sublease or assignment as
required by Section 4 and further provided that Tenant is not in default of any of the terms or
conditions of this Lease on the date each rent payment is due pursuant to such sublease or
assignment, then notwithstanding Section 4.3, only Fifty Percent (50%) of any rent and other
consideration accruing to Tenant as a result of each such sublease or assignment which is in
excess of the pro rated portion of Base Annual Rent and Additional Rent then being paid by Tenant
for the Demised Premises or portion Thereof being sublet pursuant to said sublease or assignment
shall be paid by Tenant to Landlord monthly as Additional Rent.

     4.2 Recapture of Premises. In the event Tenant desires to sublet the Demised Premises
or assign this Lease or effect the transfer of any interest in this Lease or in Tenant restricted
pursuant to Section 4.1, Tenant shall give to Landlord written notice of Tenant’s intended
subtenant, assignee or transferee in order to secure Landlord’s written consent in accordance with
Section 4.1. Within forty-five (45) days of receipt of said notice, Landlord shall have the right,
at its option: (i) to terminate this Lease by giving Tenant not less than thirty (30) days notice
if Tenant’s notice states the Tenant’s desire to assign this Lease or sublet more than fifty
percent (50%) of the Demised Premises or effect a restricted transfer of an interest in this Lease
or in Tenant; or (ii) if Tenant’s notice states the Tenant’s desire to Sublet a portion of the
Demised Premises, to terminate this Lease and simultaneously to enter into a new lease with Tenant
for that portion of the Demised Premises Tenant may desire to retain upon the same terms, covenants
and conditions as then set forth in this Lease, prorated based upon the space retained by Tenant. If
Landlord exercises its right to terminate this Lease pursuant to clauses (i) or (ii) above, Tenant
agrees that Landlord shall have access to all or any portion of the Demised Premises sixty (60)
days prior to the effective termination date for remodeling or redecorating purposes. Tenant shall
promptly execute such lease amendments and other documents as Landlord may require to effectuate
the terms and intent of this Section 4.2

     4.3 Excess Rent and Other Consideration. Any rent and other consideration accruing to
Tenant as the result of any sublease or any assignment of this Lease (other than with regard to a
Permitted Transfer), which is in excess of the pro rata share of Base Annual Rent and Additional
Rent then being paid by Tenant for all or a portion of the Demised Premises being sublet or
assigned, shall be paid by Tenant to Landlord monthly as Additional Rent. Any consideration
accruing to Tenant as the result of any transfer of interest in Tenant restricted pursuant to
Section 4.1 (and not including a Permitted Transfer), which is paid or deemed paid in regard to the
value of this Lease and which is in excess of the pro rata share of the Base Annual Rent and
Additional Rent which would have been paid by Tenant during the Lease Term for such space, shall
be paid by Tenant to Landlord promptly as Additional Rent.

     4.4 Tenant Liability. In the event of any subletting of the Demised Premises or
assignment of this Lease by Tenant or transfer of an interest in this Lease or in Tenant, Tenant
shall remain liable to Landlord for payment of the Base Annual Rent and Additional Rent stipulated
herein and all other covenants and conditions contained herein. No subletting of the Demised
Premises or assignment of this Lease or transfer of an interest in this Lease or in Tenant shall
operate to release, discharge or otherwise affect the liability of any guarantors, co-signers or
other parties liable to Landlord pursuant to the terms of any guaranty or otherwise for the
obligations of Tenant under this Lease.

     4.5 Reasonable Standards of Consent. Tenant acknowledges that Landlord, in considering
whether to grant or withhold consent required of Landlord pursuant to this Section 4, shall be
entitled to apply any or all of the following criteria:

          (a) The Financial strength of proposed subtenant/assignee/transferee must be acceptable to
Landlord in Landlord’s reasonable discretion based on adequate current and historical financial
information given by Tenant. Landlord shall be entitled to receive, and Tenant shall deliver or
cause others to deliver, such guarantees, collateral and other security as Landlord shall request
in conjunction with any prospective sublease, assignment or other transfer. Failure to provide such
financial information, guarantees, collateral and other security shall be grounds for Landlord to
withhold or deny consent;

          (b) The proposed subtenant/assignee/transferee must have a good reputation in the business
community and must be creditworthy;

          (c) Use of the Demised Premises by the proposed subtenant/assignee/transferee must be
permitted by this Lease;

          (d) Use of the Demised Premises by the proposed subtenant/assignee/transferee shall not
violate or create any potential violation of any laws and must be in keeping with the character of the Building and the Complex;

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          (e) Use of the Demised Premises by the proposed subtenant/assignee/transferee shall not
violate, or cause Landlord to violate, any other leases, agreements or mortgages affecting (i) the
Demised Premises, the Building, the Complex or the land related to such improvements, or (ii) the
Landlord, Landlord’s Agent or other tenants, whether such leases, agreements or mortgages were
entered into prior or subsequent to this Lease;

          (f) The proposed use shall be compatible with all other uses within the Building or Complex
and the proposed use or user shall not cause a diminution in the reputation of the Building, the
Complex, Landlord, Landlord’s Agent or other tenants;

          (g) The proposed subtenant/assignee/transferee shall have no right to further sublet the
subleased premises, nor to further assign this Lease, nor to further transfer any interest in such
proposed subtenant/assignee/transferee;

          (h) In the event Tenant is in default, consent may be withheld irrespective of whether these
other criteria are met by the proposed subtenant/assignee/transferee.

     4.6 Other Transfers. Notwithstanding anything herein to the contrary, Tenant shall
not pledge, assign, transfer, encumber or otherwise convey its interest in the Demised Premises
conditionally or as security for any obligations of Tenant to any third party, or otherwise. Any
such transfer in violation of this provision shall be void.

     4.7 Rights on Default. In the event Tenant defaults under this Lease, in addition to
the rights and remedies of Landlord outlined in Section 12, Landlord, at its option, may elect to
recognize any sublease between Tenant and any subtenant, or any agreement by which Tenant has
granted any leasehold estate or interest in the Demised Premises, as a direct lease or agreement
between Landlord and such subtenant or other grantee, upon written notice to Tenant and such
subtenant or other grantee, without releasing or affecting the liability of Tenant to Landlord
under this Lease, and Tenant shall be deemed to have assigned its interest in such sublease or
other agreement to Landlord (without the need for executing any further documentation evidencing
same) and such subtenant or other grantee shall attorn to and recognize the rights of Landlord
under such sublease or other agreement, as the case may be. Notwithstanding Tenant’s consent or
acquiescence in the termination of this Lease and/or Tenant’s voluntary surrender of the Demised
Premises (or any portion thereof), Landlord may consider any sublease or other agreement
transferring a leasehold estate or interest in the Demised Premises, and/or any right to use or
possess the Demised Premises (or any portion thereof) by any subtenant or other grantee, terminated
as of the date Landlord terminates this Lease and/or Tenant’s right to possession of the Demised
Premises, it being the intention of the parties that any leasehold estate or other interest in the
Demised Premises shall be subject to the terms and conditions of this Lease, including all rights
and remedies of Landlord outlined herein, notwithstanding anything to the contrary contained in
such sublease or other agreement.

     4.8 Permitted Transfers.

          (a) Tenant shall have the right, without obtaining Landlord’s prior written consent, but only
with prior notice to Landlord, to (i) assign the Lease or sublet the Demised Premises to a
corporation to which all or substantially all of the assets of Tenant are sold, or (ii) transfer
stock in Tenant to and from employees of Tenant whether pursuant to an employee stock option plan
or otherwise, or (iii) to sell stock in the Tenant through public offerings, private placements or
similar transactions, or (iv) assign the Lease or sublet the Demised Premises to any parent
corporation of Tenant, or to any subsidiary of Tenant or any parent corporation of Tenant, or (v)
assign the Lease or sublet the Demised Premises to any entity which may as the result of merger or
consolidation succeed to the business carried on by Tenant. Tenant acknowledges and agrees that
any assignment or sublease entered into pursuant to this Section 4.8 shall not operate or be
construed as a waiver or release of Tenant from liability for the performance of any covenant or
obligation to be performed by Tenant under this Lease, nor shall the collection or acceptance of
rent from any assignee, subtenant or occupant constitute a waiver or release of Tenant from any of
its liabilities or obligations under this Lease. Notwithstanding the foregoing, the notice
requirement set forth in 4.8(c) shall only apply to the transfers in Sections 4.8(a)(i), (iii),
(iv) and (v).

          (b) Definition: The transactions permitted pursuant to Section 4.8(a) are herein
referred to as the “Permitted Transfers”, and the parties with whom Tenant is permitted to make
such Permitted Transfers are herein referred to as “Permitted Transferees”.

          (c)
Notice. Tenant shall deliver written notice of the Permitted Transfers set forth in
Sections 4.8(a)(i), (iii), (iv) and (v) above to Landlord with copies of documents evidencing
Permitted Transfers within twenty (20) days of the effective date of such Permitted Transfer
provided there are no legal reasons which would prohibit Tenant from providing said prior notice.
In no event shall Tenant be permitted to use a series of one or more Permitted Transfers solely
for the purpose of “spinning-off’ this Lease to an independent third party that would not
otherwise be a permitted Transferee, As an example of the foregoing, Tenant shall not assign this
Lease to an affiliate corporation whose assets consist solely of this Lease and the rights granted
herein and thereafter sell the stock of such affiliate corporation to an independent third party,
with the intended result being to defeat the purpose of this Section by the transfer of this Lease
to an independent third party by means of what would otherwise be two (2) separate Permitted
Transfers.

5. SERVICES AND UTILITIES

     5.1 Building Standard Services and Utilities. Subject to the limitations set forth in
Section 5.3 below, Landlord shall furnish sufficient electric current for lighting and office
equipment such as typewriters, calculators, office copiers and printers, desktop personal computers
and word processors and similar items. Landlord shall also furnish water for lavatory and drinking
purposes, lavatory supplies, fluorescent tube replacements, automatically operated elevator
service, landscaping and snow removal, interior and exterior window cleaning and nightly cleaning
service in accordance with Landlord’s prevailing practices (as set forth in Exhibit D attached
hereto), as they may be modified from time to time, except that Landlord shall not be responsible
for cleaning Tenant’s kitchens, private bathrooms, rugs, carpeting (except vacuuming) and drapes.
Landlord shall have no liability for and expressly disclaims any responsibility for the
engineering, design, installation, provision of or maintenance of Tenant’s telecommunications and
data transmission systems and the inside wire associated therewith. Landlord further agrees to
furnish beating and cooling during the appropriate seasons of the year, between the hours and on
the days set forth in Section 1.7 exclusive of legal public holidays as defined in section 6103(a)
and (c) of Title 5 of the United States Code, as it may hereafter be amended. For purposes hereof,
the following are the legal public holidays for the Building; New Year’s Day, Martin Luther King,
Jr., Day, Inauguration Day, Presidents’ Day, Memorial Day (observed), Independence Day, Labor Day,
Columbus Day (observed), Veterans’ Day (observed), Thanksgiving Day and Christmas Day.
All of the aforesaid services shall be provided without cost to Tenant except as such expenses may
be included in calculating Additional Rent pursuant to the provisions of Sections 2.2 and 2.3,
Landlord shall not be liable for failure to furnish, or for suspension or delay in furnishing, any
of such services if such failure, suspension or delay is caused by breakdown, maintenance or repair
work, strike, riot, civil commotion, governmental regulations, emergency periods due to weather or
any other cause or reason whatever beyond the reasonable control of Landlord. Failure, suspension,
delay or interruption of services shall not result in any abatement of Base Annual Rent or
Additional Rent, be deemed an eviction or breach of this Lease (including any express or implied covenant of quiet enjoyment), or relieve Tenant of performance of
Tenant’s obligations under this Lease unless the Demised Premises are rendered untenantable by
such failure, suspension, delay or interruption of services for ten (10) consecutive business days
due to Landlord’s negligence or willful misconduct, in which event Tenant may abate paying Base
Annual Rent from said eleventh (11th) business day until such service is restored.

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     5.2 Overtime Services. Should Tenant require heating and cooling services beyond the
hours and/or days stipulated in Section 1.7, upon receipt of at least 24 hours prior written notice
from Tenant, Landlord will furnish such additional service at the then-prevailing hourly rates for
both utility services and personnel as established by Landlord from time to time; provided,
further, that there will be a minimum charge of four (4) hours each time overtime services are
required.

     5.3 Excessive Usage.

          (a) Equipment Restrictions. Tenant will not install or operate in the Demised Premises
any heavy duty electrical equipment or machinery or any other equipment which consumes
excess gas (where applicable), excess water, excess sewer services or excess electricity as defined
in Section 5.3(b) below, without first obtaining prior written consent of Landlord. Landlord may,
among other things, require as a condition to its consent for the installation of such equipment or
machinery that Tenant pay as Additional Rent the costs for excess consumption of such utilities
that may be occasioned by the operation of said equipment or machinery. Landlord may make periodic
inspections of the Demised Premises at reasonable times to determine that Tenant’s equipment and
machinery comply with the provisions of this Section and Section 5.4.

          (b) Excess Electrical Usage. The consumption of electricity, including lighting, in
excess of five (5) watts per square foot for any portion of the Demised Premises shall be deemed
excessive. Additionally, any individual piece of electrically operated machinery or equipment
having a name plate rating in excess of two (2) kilowatts shall also be deemed as requiring excess
electric current.

          (c) Additional Utility Costs. Landlord shall have the right to either require that one
or more separate meters be installed to record the consumption or use of electricity or other
utilities, or cause a reputable independent engineer to survey and determine the quantity of such
utilities consumed by such excessive use. In the event that Tenant is consuming excess electricity,
the cost of any such survey and meters and of installation, maintenance and repair thereof shall be
paid for by Tenant. Tenant agrees to pay Landlord (or the utility company, if direct service is
provided by the utility company), promptly upon demand therefor, for all such excess consumption
and demand as shown by said meters, or a flat monthly charge determined by the survey, as
applicable, at the rates charged for such excess service by the local public utility company. If
Tenant’s cost of excess such utilities based on meter readings is to be paid to Landlord, Tenant
shall pay a service charge related thereto in an amount Landlord shall reasonably determine.

     5.4 Excessive Heat Generation. Landlord shall not be liable for its failure to
maintain comfortable atmospheric conditions in all or any portion of the Demised Premises due to
heat generated by over-occupancy of the Demised Premises or by any equipment, machinery or
additional lighting installed by Tenant (with or without Landlord’s consent) that exceeds design
capabilities for the Building. If Tenant desires additional cooling to offset excessive heat
generated by such over-occupancy, equipment, machinery or additional lighting, Tenant shall pay for
auxiliary cooling equipment and the operating, maintenance, repair and replacement costs of such
equipment, including without limitation electricity, gas, oil and water. If Tenant does not desire
such auxiliary cooling equipment, Tenant shall pay for excess electrical consumption by the
existing cooling system.

     5.5 Building Security. Any security system or other security measures (collectively,
the “Security System”) that Landlord may undertake for protection of the Demised Premises, the
Building and/or Complex (including any parking garages or areas) are for the protection of the
physical structures only and shall not be relied upon by Tenant, its agents, employees or invitees
to protect Tenant, Tenant’s Property and Leasehold Improvements or Tenant’s employees, invitees or
their property. Tenant shall not do anything to circumvent or allow others to circumvent any
Security System. Landlord shall not be liable for any failure of any Security System to operate or
for any breach or circumvention of the Security System by others, and Landlord makes no
representations or warranties concerning the installation, performance and monitoring of any
Security System, or that it will detect or avert the occurrences which any such Security System is
intended or expected to detect or avert.

     5.6 Roof and Auxiliary Spaces. Tenant shall not use the roof, roof utility closets or
other auxiliary spaces in the Building for antennas, condenser coolers, telecommunications and/or
data transmission equipment or any other type of equipment or for any other purpose without the
prior written consent of Landlord, which consent may be conditioned upon the terms of a separate
written agreement and the payment by Tenant of separate consideration for the use of such space.

     5.7 Trash Removal. Landlord shall provide for trash collection and removal from the
Demised Premises, the Building and the Complex. Tenant covenants and agrees, at its sole cost and
expense, to comply with all present and future laws, orders and regulations of the federal, state,
county, municipal and local governments, departments, commissions, agencies and boards regarding
the collection, sorting, separation and recycling of trash. Landlord reserves the right to refuse
to collect or accept from Tenant any trash that is not separated and sorted as required by law and
directed by Landlord, and if not separated and sorted as required by law, to require Tenant to
arrange for such collection at Tenant’s sole cost and expense, utilizing a contractor satisfactory
to Landlord. Tenant shall pay all costs, expenses, fines, penalties and damages that may be imposed
on Landlord or Tenant by reason of Tenant’s failure to comply with the provisions of this Section,
and Tenant, at Tenant’s Sole Cost and expense, shall indemnify, defend and hold Landlord harmless
from and against any actions, claims and suits (including legal fees and expenses) arising from
such noncompliance, utilizing counsel reasonably satisfactory to Landlord.

6. USE AND UPKEEP OF PREMISES

     6.1 Use. Tenant shall Use and occupy the Demised Premises only for the purposes
specified in Section 1.8 and for no other purpose whatsoever, and shall comply, and cause its
employees, agents, contractors, invitees and other users of the Demised Premises to comply, with
all applicable federal, stare and local laws, statutes, ordinances and regulations, including, but
not limited to, the ADA, zoning regulations, and smoking regulations. Landlord represents that, as
of the date of this Lease, the Demised Premises are in material compliance with the ADA and
applicable building laws and regulations required at the time the Building was constructed. Any
variation or deviation from the specific use expressly set forth in Section 1.8 shall be deemed a
default of this Lease. Tenant shall pay before delinquency any business, rent and other tax and fee
that is now or hereafter assessed or imposed upon Tenant’s use or occupancy of the Demised Premises,
the conduct of Tenant’s business in the Demised Premises or Tenant’s Property. If any such tax or
fee is enacted or altered so that such tax or fee is imposed upon Landlord so that Landlord is
responsible for collection or payment thereof, then Tenant shall promptly pay the amount of such
tax or fee directly to the taxing authority, or if previously paid by Landlord, to Landlord upon
demand.

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     6.2 Illegal and Prohibited Uses. Tenant will not use or permit the Demised
Premises or any part thereof to be used for any disorderly, unlawful or extra hazardous purpose and
will not manufacture anything therein. Tenant will not use or permit the Demised Premises to be
used for any purposes that interfere with the use and enjoyment by other tenants of the Building or
Complex or, in Landlord’s opinion, impair the reputation or character of the Building, Complex,
Landlord or Landlord’s Agent. Tenant shall immediately refrain from and discontinue such use after
receipt of written notice from Landlord.

     6.3 Insurance Rating. Tenant will not do or permit anything to be done in the Demised
Premises, the Building or the Complex or bring or keep anything therein which shall in any way
increase the rate of fire or other insurance on said Building or the Complex, or on the property
kept therein, or conflict (or permit any condition to exist which would conflict) with applicable
fire laws or regulations, or with any insurance policy upon said Building or Complex or any part
thereof, or with any statute, rules or regulations enacted or established by any appropriate
governmental authority. Tenant shall be responsible for any increase in insurance costs with
respect to the Building or Complex if the increases were caused by its actions or failure to act.

     6.4 Alterations.

          (a) Approval Required. Tenant shall not make any alterations, installations,
changes, replacements, repairs, additions or improvements in or to (or which interfere with) the
structural elements of the Building or the Demised Premises, or the Systems (hereinafter defined),
without the prior written consent of Landlord, which consent may be granted or withheld in
Landlord’s sole and absolute discretion. Tenant shall not make any non-structural, non-System or
cosmetic alterations, changes, replacements, repairs, additions or improvements in or to the
Demised Premises or any part thereof, without the prior written consent of Landlord, which consent
shall not be unreasonably withheld. Notwithstanding the foregoing, Tenant shall have the right to
make Cosmetic Changes (as hereinafter defined) within the Demised Premises without requiring the
consent of Landlord but upon thirty (30) days prior written notice to Landlord. “Cosmetic Changes”
shall mean those minor, non-structural alterations of a decorative nature consistent with a
first-class office building for which a building permit is not required and which cost (including
installation) in the aggregate less than Ten Thousand Dollars ($10,000.00) per project or series of
related projects, such as painting, carpeting and hanging pictures. All Tenant plans and
specifications shall be submitted to Landlord for prior approval. All Tenant engineering plans and
specifications shall be prepared at Tenant’s expense by Landlord’s designated engineer. Landlord
may, among other things, condition its consent upon Tenant’s agreement that any construction
up-gradings required by any governmental authority as a result of Tenant’s work, either in the
Demised Premises or in any other part of the Building or Complex, will be paid for by Tenant in
advance. Tenant shall not install any equipment of any kind or nature whatsoever which will or may
necessitate any changes, replacements or additions to the water System, plumbing system, heating
system, ventilating system, air-conditioning system, supply, return or control systems, Landlord’s
data system(s), or the electrical system of the Demised Premises or the Building (collectively, the
“Systems”), nor install or use any air-conditioning unit, engine, boiler, generator, machinery,
heating unit, stove, water cooler, ventilator, radiator or any other similar apparatus, nor modify
or interfere with any of the Systems, without the prior written consent of the Landlord, which
consent may be granted or withheld in the Landlord’s sole and absolute discretion. Any auxiliary
air-conditioning equipment which Tenant may desire to install in the Demised Premises shall be
connected to the Building’s commercial condenser water system, if available, and Tenant shall pay
to Landlord such reasonable charges as established by Landlord from time to time for the use of the
Building’s commercial condenser water system. Tenant shall not modify or interfere with the Systems
without the prior written consent of Landlord, and then only as Landlord may direct. Landlord may
condition its consent upon Tenant’s payment of all costs to make such changes, replacements or
modifications. Tenant shall not design, configure, install, use or arrange for the design,
configuration, installation or use of its telecommunications and data transmission systems or
inside wire associated therewith in any manner that interferes with the existing telecommunications
and/or data transmission systems or inside wire associated therewith of Landlord or other tenants
in the Building. Landlord’s consent to any work by Tenant or approval of Tenant’s plans or
specifications shall not be deemed a certification that such work complies with applicable
building codes, laws or regulations, nor shall it impose any liability whatsoever upon Landlord.

          (b) Alteration Requirements. All of Tenant’s approved work shall be done in accordance
with Landlord’s Building Work Rules and Regulations (as promulgated and amended by Landlord from
time to time) and shall be done by duly qualified, licensed and bonded contractors in accordance
with all applicable laws, codes, ordinances, rules and regulations, and Tenant shall obtain (or
give) at its cost any required permits, licenses, registrations, notices, or inspections for
performance of its work. Prior to the commencement of such work Tenant must either deposit with
Landlord evidence of the existence of a bond deemed sufficient by Landlord against construction
liens, or obtain an executed waiver of lien from each contractor or vendor that will perform or
furnish to Tenant work, labor, services or materials for any alterations, installations,
replacements, additions or improvements in or to the Demised Premises. Notwithstanding the
aforesaid, if any mechanic’s or materialman’s lien shall at any time, whether before, during or
after the Lease Term, be filed against any part of the Building or other property of Landlord by
reason of work, labor, services or materials performed for or furnished to or on behalf of Tenant,
Tenant shall forthwith cause the lien to be released of record by being discharged or bonded off to
Landlord’s satisfaction within fifteen (15) days after being notified of the filing thereof. If
Tenant shall fail to cause such lien to be released of record within said fifteen (15) day period,
then, in addition to any other right or remedy of Landlord, Landlord may bond off or discharge the
lien by paying the amount claimed to be due. Any amount paid by Landlord, whether as bond premium
or payment of the lien amount, and all costs and expenses, including reasonable attorneys’ fees
incurred by Landlord in procuring the same and its release from the appropriate land records, shall
be due from Tenant to Landlord and shall be payable on the first day of the next following month,
or if the Lease Term has expired, upon demand.

          (c)
Removal of Leasehold Improvements and Tenant’s Property. All Leasehold Improvements within the Demised Premises
shall, subject to Landlord’s right to require Tenant to remove all or any portion of the
Leasehold Improvements and restore the Demised Premises to its condition as of the date this Lease is fully executed and delivered by
Landlord and Tenant, remain at the expiration or earlier
termination of the Lease Term without disturbance, molestation or injury. Should Landlord
elect that Leasehold Improvements be removed
upon the expiration or earlier termination of the Lease Term, and/or should Tenant fail to
remove all or any portion of Tenant’s Property in
accordance with the provisions of this Lease, Tenant hereby agrees that Landlord shall have
the right to cause all or any portion of the
Leasehold Improvements and/or Tenant’s Property to be removed at Tenant’s sole cost and
expense. Tenant hereby agrees to reimburse
Landlord for the cost of such removal together with the cost of repairing any damage
resulting therefrom, and the cost of restoring the
Demised Premises to its  condition as of the date this Lease is fully executed and delivered
by Landlord and Tenant. Approximately sixty
(60) days prior to Tenant’s scheduled vacation of the Demised Premises, Landlord and Tenant
shall meet to review what items shall be
removed and what items shall remain as Landlord may determine. Landlord shall provide its
estimate to Tenant of the costs of such removal
and the costs of any repairs to or restoration of the Demised Premises as herein provided, and
Tenant shall promptly deposit with Landlord a
sum equal to such estimated costs. In the event Tenant fails to remove the Leasehold
Improvements designated by Landlord for removal
prior to the expiration of the Lease Term and/or fails to remove Tenant’s Property as
aforesaid and/or fails to make such repairs and/or
restoration as aforesaid, Landlord shall cause the removal, repair and/or restoration to be
performed at Tenant’s sole expense, which expense
shall not be limited by the amount of the deposit referred to herein. Tenant shall provide for
the transfer or disposal of all items removed,
failing which Landlord is hereby authorized to dispose of same in any manner deemed
appropriate, including, but not limited to, disposal

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into the trash, without liability to Tenant, and at Tenant’s sole cost and expense, and Tenant
shall indemnify, defend and hold harmless Landlord, Landlord’s Agent and their respective
employees and agents from and against all claims, damages, costs and expenses, including
reasonable attorneys’ fees, arising from or in connection with the disposal of all or any items
removed by Landlord hereunder. In the event, for whatever reason, the parties do not meet to
review which items shall be removed and which items shall remain, and/or the Tenant, for whatever
reason, fails to deposit with the Landlord the deposit hereinabove stated, then the Landlord is
hereby authorized to proceed, as it deems appropriate, with such removal and disposition of
property, and repair and/or restoration, without liability to Tenant and at Tenant’s sole cost
and expense. Notwithstanding anything contained herein to the contrary, the parties acknowledge
that Tenant is accepting the Demised Premises in “AS IS” condition, that no Leasehold Improvements
have been constructed for Tenant’s occupancy by Landlord. Notwithstanding anything in the
foregoing to the contrary, Landlord shall not require the removal of Tenant’s initial improvements
(other than cabling installed in the Demised Premises by Tenant) nor any subsequent improvements
or alterations unless Tenant was notified by Landlord of the need for such removal at the time
Landlord provides its consent or approval to Tenant for such improvement or alteration.

          (d)
Compliance with Laws. In the event that during the Lease Term either Landlord or
Tenant shall be required by the order or decree of any court, or any other governmental authority,
or by law, code or ordinance (including but not limited to the ADA), to repair, alter, remove,
reconstruct, or improve any part of the Demised Premises or of the Building, then Tenant agrees, at
its sole cost and expense, to comply with such requirements imposed on the Demised Premises or
Tenant and shall perform, at its expense, or Tenant shall permit Landlord to perform, at Tenant’s
expense, such repairs, alterations, removals, reconstructions, or improvements and Landlord agrees
to be responsible for compliance with requirements regarding the common areas of the Building.
Within ten (10) days after receipt, Tenant shall advise Landlord in writing, and provide the
Landlord with copies of (as applicable), (i) any notices alleging violation of any law, code or
ordinance (including the ADA) relating to any portion of the Demised Premises or the Building,
(ii) any claims made or threatened in writing regarding noncompliance with any law, code or
ordinance and relating to any portion of the Building or of the Demised Promises, or (iii) any
governmental or regulatory actions or investigations instituted or threatened regarding
noncompliance with any law, code or ordinance and relating to any portion of the Building or the
Demised Premises. No such order or decree or the compliance required therewith shall have any
effect whatsoever on the obligations or covenants of Tenant herein contained. Tenant hereby waives
all claims for damages or abatement of Base Annual Rent and Additional Rent because of such
repairing, alteration, removal, reconstruction, or improvement.

     6.5 Maintenance by Landlord.

          (a) Landlord Repairs and Maintenance. Except to the extent that Tenant is required
to maintain and repair pursuant to Sections 5.4, 6.4, 6.7, 6.8,
6.10, 6.11, 9 and 21, Landlord shall
maintain and repair all public or common areas located within the Building, including external
landscaping, walkways and parking areas, and, except to the above extent, Landlord shall make
repairs to structural roofs, walls and building standard heating, air conditioning, plumbing and
electrical systems and equipment. Except as otherwise expressly provided in this Lease, such
maintenance shall be provided without cost to Tenant, except that (i) such expenses may be
included in calculating the Additional Rent pursuant to the provisions of Sections 2.2 and 2.3;
and (ii) if such expenses are incurred by Landlord in making repairs attributable to acts or
omissions of Tenant or Tenant’s employees, agents, contractors or invitees, then Tenant shall
reimburse Landlord for all such expenses within ten (10) days after Landlord submits a bill for
such costs to Tenant. Tenant hereby waives all claims for damages or abatement of Base Annual Rent
and Additional Rent because of such repairing, alteration, removal, reconstruction, or
improvement.

          (b) Use of Demised Premises by Landlord. Landlord reserves the right to erect, use,
maintain, repair and replace all pipes, ducts, conduits, wiring, fluids, gases, components, and
similar materials and structures in and through the Demised Premises, including any changes,
additions or replacements as Landlord may from time to time make thereto. Landlord may install any
and all materials, equipment, pipes, ducts, conduits, wires, and related fluids, gases, components
and mechanical equipment serving other portions, tenants and occupants of the Building, in,
through, under or above the Demised Premises that Landlord deems desirable and shall have the
right to locate, both vertically and horizontally, utility lines, wiring, air ducts, flues, duct
shafts, drains, sprinkler mains and valves, and such other facilities within the Demised Premises
as may be deemed necessary by engineering design and/or code and/or other legal requirements and
to repair, alter, replace or remove these items. These shall be located so as to cause minimum
interference with Tenant’s use of the Demised Premises and shall, if possible, be located above
Tenant’s suspended ceiling, if any, or as close to the concrete slab as possible, below the floor,
along column lines or in storage areas. Landlord shall have the right to remove or abate any
hazardous materials located in the Demised Premises and Tenant shall fully cooperate with Landlord
in this regard. Landlord’s right to locate facilities within the Demised Premises shall include
facilities required by tenants or occupants in levels above or below the Demised Premises as well
as on the same level as the Demised Premises. None of the above conduct by Landlord shall be
deemed to constitute an interference with Tenant’s quiet enjoyment or an actual or constructive
eviction of Tenant. Subject to the other applicable terms and provisions expressly provided in
this Lease, Tenant shall be entitled to no abatement of Base Annual Rent or Additional Rent
whatsoever on account of such installation, location, construction, use, entry, removal, repair,
maintenance or other conduct as aforesaid. With respect to Landlord’s use of the Demised Premises
as allowed by this Section 6.5(b), in each instance Landlord shall use reasonable efforts to
minimize material interference with Tenant’s normal business operations in the Demised Premises.

     6.6 Signs and Publications. No sign, advertisement or notice shall be inscribed,
painted or affixed on any part of the outside of the Building, or in the common areas of the
Building, or inside the Demised Premises where it may be visible from the public areas of the
Building, except on the directories and doors of offices, and then only in such size, color, method
of attachment and style as Landlord shall approve. Landlord shall have the right to prohibit any
signage or publication of Tenant on the Demised Premises which in Landlord’s opinion tends to
impair the reputation or character of the Building, Complex, Landlord or Landlord’s Agent. Tenant
shall refrain from and discontinue such signage or publication upon receipt of written notice from
Landlord, but in no event later than one (1) day after receipt of such notice. Landlord shall list,
at Landlord’s expense, the name of Tenant (and any permitted subtenants and assignees) in the
Building lobby directory and shall provide Building standard signage on one suite entry door.

     6.7 Excessive Floor Load. Landlord shall have the right to prescribe the weight and
method of installation of safes, computer equipment, and other heavy fixtures or equipment. Tenant
will not install in the Demised Premises any item of Tenant’s Property or fixtures that will place
a load upon the floor exceeding the designed floor load capacity of the floor and the Building.
Landlord may prescribe the placement and positioning of all such objects within the Demised
Premises and/or Building, and, if necessary, such objects shall be placed upon platforms, plates or
footings of such size as Landlord shall prescribe. All damage done to the Building or the Demised
Premises by installing or removing a safe or any other article of Tenant’s Property or fixtures, or
due to its being in the Demised Premises, shall be repaired at the expense of Tenant.

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     6.8 Moving and Deliveries.

          (a) Prohibitions/Notices. Moving in or out of the Building is prohibited on days and
hours specified in Section 1.7, Tenant shall only use freight elevators and loading areas, if
provided in the Building, for all moving and deliveries. Tenant shall provide Landlord with
forty-eight (48) hours advance written notice of any move and obtain Landlord’s approval therefor
in order to facilitate scheduling use of freight elevators and loading areas; provided however that
any delay caused by Landlord’s withholding approval shall not constitute a holdover under this
Lease.

          (b) Coordination with Landlord. No freight, furniture or other bulky matter of any
description shall be received into the Building or carried in the elevators, except as authorized
by Landlord, such authorization not to be unreasonably withheld. All moving of furniture, material
and equipment shall be under the direct control and supervision of Landlord, who shall, however,
not be responsible for any damage to or charges for moving same. There shall be no charge to Tenant
for such Landlord supervision during normal business hours. Deliveries from lobby and freight areas
requiring use of hand carts shall be restricted to freight elevators. All hand carts shall be
equipped with rubber tires and side guards. Any control exercised by Landlord hereunder shall be
deemed solely for the benefit of Landlord and the Building, and shall not be deemed to make any of
Tenant’s employees, agents or contractors the agent or servant of Landlord. Tenant shall promptly
remove from the public areas in or adjacent to said Building any of Tenant’s property delivered or
deposited there.

          (c) Moving Damages. Any and all damage or injury to the Demised Premises or the
Building caused by moving the property of Tenant into or out of the Demised Premises shall be
repaired at the sole cost of Tenant. In conjunction with the foregoing, Tenant shall indemnify,
defend and hold Landlord harmless with respect to any and all damages and injuries to the Demised
Premises or the Building, and with respect to any property damage and injury to others. Without
releasing Tenant from any liability hereunder, Tenant shall cooperate with Landlord to identify
delivery contractors and movers causing damage to the Building or Demised Premises or causing
property damage or injury to others.

     6.9 Rules and Regulations. Tenant shall, and shall ensure that Tenant’s agents,
employees, invitees and guests, faithfully keep, observe and perform the Building Rules and
Regulations set forth in Exhibit C, attached hereto and made a part hereof, and such amendments,
modifications and additions thereto as Landlord may reasonably promulgate from time to time, unless
waived in writing by Landlord. Any other such rules and regulations shall not substantially
interfere with the intended use of the Demised Premises, but Tenant acknowledges that the Building
Rules and Regulations, which, in Landlord’s judgment, are needed for the general well-being,
operation and maintenance of the Demised Premises, the Building and the Complex, together with
their appurtenances, are reasonable. Landlord shall have the right to specifically enforce all
Building Rules and Regulations. In addition to any other remedy provided for herein, Landlord
shall have the right to collect from Tenant a fine of $ 100 per incident for each violation of said
Building Rules and Regulations which is not cured within three (3) days after written notice to
Tenant. Nothing contained in this Lease shall be construed to impose upon Landlord any duty or
obligation to enforce such Building Rules and Regulations, or the terms, conditions or covenants
contained in any other lease, as against any other tenant, and Landlord shall not be liable to
Tenant for violation of the same by any other tenant, its employees, agents, invitees, licensees,
customers, clients, family members or guests. Further, it shall be in Landlord’s reasonable
judgment as to whether Tenant is in compliance with the Building Rules and Regulations. Landlord
agrees to enforce the Building Rules and Regulations in a non-discriminatory manner.

     6.10 Tenant Maintenance and Condition of Demised Premises Upon Surrender. At all times
during the Lease Term, Tenant will keep the Demised Premises and the Leasehold Improvements and
Tenant’s Property therein in good order and condition, will suffer no waste or injury to the
Demised Premises and Leasehold Improvements, and will, subject to the provisions of Section 6.4(c),
at the expiration or other termination of the Lease Term, surrender and deliver up the Demised
Premises and Leasehold Improvements in like good order and condition as they shall be at the
Commencement Date, ordinary wear and tear and, subject to the provisions of Section 9, damage by
casualty excepted.

     6.11 Tenant Property and Leasehold Improvements. Maintenance and repair of Tenant’s
Property and any Leasehold Improvements within or related to the Demised Premises shall be the
sole responsibility of Tenant, and Landlord shall have no obligation in connection therewith.
Notwithstanding anything herein to the contrary, and subject to the provisions of Sections 6.4 and
12.8 pertaining to removal from the Demised Premises, Tenant shall have no right to remove from the
Demised Premises any of Tenant’s Property and/or Leasehold Improvements upon and during the
continuation of any default by Tenant under this Lease.

     6.12 Landlord’s Right to Perform Tenant’s Duties. In the event that repairs required
to be made by Tenant pursuant to this Lease become necessary by reason of Tenant’s failure to
maintain the Demised Premises, Tenant’s Property and Leasehold Improvements in good order and
condition and in compliance with all applicable laws, orders and regulations, Landlord may, but
shall not be obligated to, make repairs at Tenant’s expense. Within ten (10) days after Landlord
renders a bill for the cost of said repairs, Tenant shall reimburse Landlord.

     6.13 OFAC Compliance.

          (a) Tenant represents and warrants that: (i) Tenant and each person or entity owning an
interest in Tenant is (x) not currently identified on the Specially Designated Nationals and
Blocked Persons List maintained by the Office of Foreign Assets Control, Department of the Treasury
(“OFAC”) and/or on any other similar list maintained by OFAC pursuant to any authorizing statute,
executive order or regulation (collectively, the “List”) and (y) not a person or entity with whom a
citizen of the United States is prohibited to engage in transactions by any trade embargo, economic
sanction, or other prohibition of United States law, regulation, or Executive Order of the
President of the United States; (ii) none of the funds or other assets of Tenant constitute
property of, or are beneficially owned, directly or indirectly, by any Embargoed Person (as
hereinafter defined); (iii) no Embargoed Person has any interest of any nature whatsoever in Tenant
(whether directly or indirectly); (iv) none of the funds of Tenant have been derived from any
unlawful activity with the result that the investment in Tenant is prohibited by law or that the
Lease is in violation of law; and (v) Tenant has implemented procedures, and will consistently
apply those procedures, to ensure the foregoing representations and warranties remain true and
correct at all times. The term “Embargoed Person” means any person, entity or government subject to
trade restrictions under U.S. law, including but not limited to, the International Emergency
Economic Powers Act, 50 U.S.C. §1701 et  seq., The Trading with the Enemy Act, 50 U.S.C, App,
1 et  esq., and any Executive Orders or regulations promulgated thereunder with the result that the
investment in Tenant is prohibited by law or Tenant is in violation of law.

          (b) Tenant covenants and agrees: (i) to comply with all requirements of law relating to money
laundering, anti-terrorism, trade embargos and economic sanctions, now or hereafter in effect; (ii)
to immediately notify Landlord in writing if any of the representations, warranties or covenants
set forth in this paragraph or the preceding paragraph are no longer true or have been breached or
if Tenant has a reasonable basis to believe that they may no longer be true or have been breached;
(iii) not to use funds from any “Prohibited Person” (for the purposes of this Section 6.13 (b)(iii) a “Prohibited Person” is a person whose assets are
blocked or with whom transactions are otherwise restricted pursuant to the September 24, 2001
Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten
to Commit, or Support Terrorism) to make any payment due to Landlord under the Lease; and (iv) at
the request of Landlord, to provide such information as may be requested by Landlord to determine
Tenant’s compliance with the terms hereof.

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     (c) Tenant hereby acknowledges and agrees that Tenant’s inclusion on the List at any time
during the Lease Term shall be a material default of the Lease. Notwithstanding anything herein to
the contrary, Tenant shall not permit the Demised Premises or any portion thereof to be used or
occupied by any person or entity on the List or by any Embargoed Person (on a permanent, temporary
or transient basis), and any such use or occupancy of the Demised Premises by any such person or
entity shall be a material default of the Lease.

7. ACCESS

     7.1 Landlord’s Access. Landlord, Landlord’s Agent, and their agents and employees,
shall have the right to enter the Demised Premises at all reasonable times following not less than
twenty-four (24) hours notice except in the case of an emergency in which no notice shall be
required; (a) to make inspections or to make such repairs and maintenance to the Demised Premises
or repairs and maintenance to other premises as Landlord may deem necessary; (b) to exhibit the
Demised Premises to prospective tenants during the last six (6) months of the Lease Term; and (c)
for any purpose whatsoever relating to the safety, protection or preservation of the persons or
property of the other tenants, the public, the Demised Premises, the Building, the Complex or
other surrounding properties provided however, that in each instance, Landlord shall endeavor not
to disrupt materially Tenant’s normal business operations at the Demised Premises.

     7.2 Restricted Access. No additional locks, other devices or systems which would
restrict access to the Demised Premises shall be placed upon any doors without the prior consent of
Landlord. Landlord’s consent to installation of anti-crime warning devices or security systems
shall not be unreasonably withheld; provided Landlord shall not be required to give such consent
unless Tenant provides Landlord with a means of access to the Demised Premises for the purposes
outlined in Section 7.1 above. Unless access to the Demised Premises is provided during the hours
when cleaning service is normally rendered, Landlord shall not be responsible for providing such
service to the Demised Premises or to those portions thereof which are inaccessible during said
hours. Such inability by Landlord to provide cleaning services to inaccessible areas shall not
entitle Tenant to any adjustment in Base Annual Rent, Additional Rent or other sums due hereunder.

     7.3 Tenant’s Access. Subject to the provisions of Sections 5.2 and 5.5, Tenant,
its employees and agents shall have access to the Demised Premises, via at least one (1) operable
elevator (except in emergencies), twenty-four (24) hours per day, 365 days per year, and, for the
purpose of access to the Demised Premises only, shall have the right in common with all other
tenants, Landlord and Landlord’s agents and employees to use public corridors, elevators and
lobbies. Landlord may at any time and from time to time during the Lease Term exclude and restrain
any person from access, use or occupancy of any or all mechanical and auxiliary spaces, roofs,
public corridors, elevators and lobbies, excepting, however, Tenant and other tenants of Landlord
and bona fide invitees of either who make use of said public facilities in accordance with the rules
and regulations established by Landlord from time to time with respect thereto, Landlord may at
any time and from time to time close all or any portion of said public facilities to make repairs
or changes, to prevent a dedication to any person or the public, and to do and perform such other
acts in and to said public facilities as in the exercise of good business judgment Landlord shall
determine to be advisable. It shall be the duty of Tenant to keep all of said public facilities
free and clear of any obstructions created or permitted by Tenant or resulting from Tenant’s
operation. In order to protect the integrity of telephone service in the Building, Landlord may, at
its option, supervise or restrict Tenant’s access to any or all equipment rooms, inside wire space
and/or conduits or the demarcation point.

8. LIABILITY

     8.1 Tenant’s Property. All of Tenant’s Property, the Leasehold Improvements and the
personal property of Tenant’s employees, agents, contractors, visitors and invitees in the Demised
Premises or in the Building shall be at their sole risk. Landlord, Landlord’s Agent, and their
respective agents and employees shall not be liable for any damage to Tenant’s Property; provided,
however, the foregoing provision shall not apply (a) if the loss was caused by the negligence of
Landlord, Landlord’s Agent or their agents or employees, and (b) the Tenant has not otherwise
waived and released its claims pursuant to Section 8.5(f).

     8.2 Criminal Acts of Third Parties. Landlord, Landlord’s Agent and their respective
agents and employees shall not be liable in any manner to Tenant, its agents, employees, invitees
or visitors for any injury or damage to Tenant, Tenant’s agents, employees, invitees or visitors,
or their property, caused by the criminal or intentional misconduct of third parties or of Tenant,
Tenant’s employees, agents, invitees or visitors on or about the Demised Premises, Building and/or
Complex (including any parking garages and parking areas) unless caused by the gross negligence or
willful misconduct of Landlord or its agents. Except as set forth above, all claims against
Landlord. Landlord’s Agent and their respective agents and employees for any such damage or injury
are hereby expressly waived by Tenant, and Tenant hereby agrees to hold harmless, defend and
indemnify Landlord, Landlord’s Agent and their respective agents and employees from all such claims
and/or damages and the expenses of defending all claims made by Tenant’s employees, agents,
invitees, or visitors arising out of such acts.

     8.3 Public Liability. Landlord, Landlord’s Agent and their respective agents and
employees assume no liability or responsibility whatsoever with respect to the conduct and
operation of the business to be conducted upon the Demised Premises, Landlord, Landlord’s Agent and
their respective agents and employees shall not be liable for any accident or injury to any person
or persons or property in or about the Demised Premises which are caused by the conduct and
operation of said business or by virtue of equipment or property of Tenant in said Demised
Premises. Tenant agrees to hold Landlord, Landlord’s Agent and their respective agents and
employees harmless against all such claims, and indemnify and defend Landlord, Landlord’s Agent and
their respective agents and employees from all injuries and damages and the expenses of defending
such claims.

     8.4 Construction on Contiguous Property. Unless caused by the gross negligence or
willful misconduct, Landlord, Landlord’s Agent and their respective agents and employees shall not
be liable for damages, nor shall this Lease or any Base Annual Rent, Additional Rent or other sums
due hereunder be affected, for conditions arising or resulting from construction within or around
the Demised Premises or Building or Complex or on contiguous or neighboring properties and which
affect the Complex, the Building and/or the Demised Premises.

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     8.5 Tenant Insurance.

          (a) Liability Insurance. During the Lease Term, Tenant at its sole cost shall maintain
public liability and property damage insurance (“Commercial General Liability”) which includes
coverage for bodily injury, personal injury and death, property damage, advertising injury,
completed operations and products coverage, if required and appropriate for the business conducted
by Tenant in the Demised Premises with at least a single combined liability and property damage
limit of $5,000,000.00 insuring against all liability of Tenant and its authorized representatives
arising out of or in connection with Tenant’s use or occupancy of the Demised Premises and the
business conducted therein. Landlord and Landlord’s Agent shall be named as additional insureds. In
addition to the foregoing, Tenant shall maintain, at its expense, during the term of this Lease and
any renewal terms the following insurance coverage:

               (i) Architectural & Engineering (“A &E”) professional liability insurance to indemnify Tenant and
Landlord from any and all claims for damages due to a breach of professional standards by the
Tenant or Tenant subcontractors arising out of their duties. Such insurance shall: a) provide
protection in an amount equal to the full limits maintained from time to time by Tenant in the
normal course of business, but in no event shall coverage be in an amount of less than
$3,000,000.00; b) be written with an insurer having an A.M. Best rating of “A-(VIII)” or better.

               (ii) The aforementioned insurance coverage maintained by Tenant shall be primary insurance with
respect to Landlord, its officers and employees. Any insurance or self insurance maintained by
Landlord shall be in excess and non-contributing to Tenant’s insurance.

          (b) Fire and Casualty Insurance. During the Lease Term, Tenant at its cost shall maintain
fire and extended coverage insurance on all Tenant’s contents of the Demised Premises, including
Tenant’s Property, in an amount sufficient so that no coinsurance penalty will be applied in case
of loss.

          (c) Increases in Coverage. If required of all similarly situated tenants in the Building,
Tenant shall increase its insurance coverage as required if in the reasonable opinion of the
mortgagee on the Building, Landlord or Landlord’s insurance agent such insurance coverage at that
time is not adequate and such increase shall be in amounts as are customary in other similar
buildings in the State or District in which the Building is located.

          (d) Policy Requirements. All insurance required under this Lease shall be issued by
insurance companies authorized to do business in the jurisdiction where the Building is located.
Such companies shall have a policyholder rating of at least “A” and be assigned a financial size
category of at least “Class XII” as rated in the most recent edition of “Best’s Key Rating Guide”
for insurance companies. If at any time during the Lease Term the rating of any of Tenant’s
insurance carriers is reduced below the rating required pursuant to the terms hereof, Tenant shall
promptly replace the insurance coverage(s) maintained with such carrier with coverage(s) from a
carrier whose rating complies with the foregoing requirements. If the Best’s Key Rating Guide is
discontinued or revised without substitution of a comparable rating system, Landlord shall
reasonably determine its satisfaction with the insurance company issuing Tenant’s policies. Each
policy shall contain an endorsement requiring thirty (30) days written notice from the insurance
company to Landlord before cancellation or any change decreasing coverage, scope or amount of such
policy and an endorsement naming Landlord and Landlord’s Agent as additional insureds. Certificates
of insurance evidencing all coverages specified in this Lease shall be furnished by Tenant and
Tenant’s contractors to Landlord upon return of this Lease, fully executed. Current active
certificates of insurance shall be similarly submitted as required to document continuous coverage
as specified herein. These certificates shall contain a provision that the insurance coverages
afforded under the policies shall not be materially modified or cancelled until at least thirty
(30) days prior written notice of intent to so modify or cancel had been delivered to Landlord.
Certificates of insurance evidencing Commercial General Liability or Excess and Umbrella Liability,
shall name Landlord and Landlord’s Agent as “Additional Insureds”. Certificates of insurance
evidencing Property damage shall designate Landlord as “Loss Payee” as Landlord’s interest may
appear. Tenants and contractors must each maintain separate liability coverage to the full minimum
limits required.

          (e) No Limitation of Liability. Notwithstanding the fact that any liability may be covered
by insurance, liability shall in no way be limited by the amount of insurance recovery or the
amount of insurance in force or required by any provisions of this Lease.

          (f) Waiver of Subrogation. Notwithstanding anything to the contrary contained herein,
Landlord and Tenant hereby mutually waive and release their respective rights of recovery against
each other for any loss of its property (in excess of a reasonable deductible amount) capable of
being insured against by fire and extended coverage insurance or any insurance policy providing
property damage coverage, whether carried or not. Each party shall apply to its insurer to obtain
said waiver and obtain any special endorsement, if required by its insurer to evidence compliance
with the aforementioned waiver, and shall bear the cost therefor.

          (g) Business Interruption. Landlord, Landlord’s Agent and their respective agents and
employees shall have no liability or
responsibility for any loss, cost, damage or expense arising out of or due to any interruption of
business (regardless of the cause therefor),
increased or additional cost of operation of business or other costs or expenses, whether similar or
dissimilar, which are capable of being
insured against under business interruption insurance, whether or not carried by Tenant.

     8.6 Incident Reports. Tenant shall promptly report to Landlord’s Agent all accidents and
incidents of which it is has direct knowledge occurring on or about the Demised Premises, the
Building and/or the Complex which involve or relate to the security and safety of persons and/or
property.

     8.7 Landlord’s Insurance.

          At all times during the term of this Lease and during such other time that Tenant occupies the
Demised Premises or any part thereof, Landlord shall at its cost and expense, but nevertheless to
be included in Operating Expenses, obtain and maintain (or cause to be obtained and maintained)
insurance policies providing at least the following coverages:

          (a) Comprehensive general liability insurance (including automobile liability) on a per occurrence
basis with a combined single limit of One Million Dollars ($1,000,000.00) per occurrence and
endorsed to insure the contractual liability assumed by Landlord and covering Landlord as insured.

          (b) All risk property damage insurance (including theft) covering Landlord’s real and personal
property in the Building in a minimum amount that is commercially reasonable for first-class office
buildings in the Washington, D.C. metropolitan area.

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9. DAMAGE

     9.1 Damages Caused by Tenant. Subject to the provisions of Sections 8.5(f) and 9.2, in the
event of damage to the Demised Premises or other portions of the Building caused by the acts or
omissions of Tenant, its agents, employees, invitees or visitors, the Landlord may, but shall not
be obligated to, repair such damage at the expense of Tenant, or, at Landlord’s option, such
damages shall be repaired by Tenant, at Tenant’s expense, with Landlord’s approval in accordance
with Section 6.4. At Landlord’s option and subject in each instance to the provisions of Section
8.5(f), Tenant shall either (a) pay to Landlord the estimated cost of such repairs and/or
maintenance within ten (10) days of Tenant’s receipt of Landlord’s estimate, or (b) upon completion
of such repairs and/or maintenance by Landlord, pay to Landlord the actual cost of such repairs
and/or maintenance (or the difference between the actual cost and the estimated costs previously
paid by Tenant) within ten (10) days of receipt of invoice from Landlord. Landlord’s recovery shall
not be limited to the diminution in the value of the Demised Premises or leasehold notwithstanding
that such repairs and maintenance may occur prior to the expiration of the Lease Term. This
provision shall be construed as an additional remedy granted to Landlord and not in limitation of
any other rights and remedies which Landlord has or may have in said circumstances.

     9.2 Fire or Casualty Damage. In the event of damage or destruction of the Demised Premises
or a portion thereof by fire or any other casualty, then, except as otherwise provided in Section
9.3, this Lease shall not be terminated, but damage to the Demised Premises, including demising
partitions and doors, shall be promptly and fully repaired and restored as the case may be by
Landlord at its own cost and expense. Due allowance, however, shall be given for reasonable time
required for adjustment and settlement of insurance claims, and for such other delays as may result
from government restrictions, and controls on construction, if any, and for strikes, national
emergencies and other conditions beyond the control of Landlord. Restoration by Landlord shall not
include replacement of Tenant’s Property. Tenant shall, at its expense, repair, restore and replace
Tenant’s Property. Tenant’s restoration, replacement and repair work shall comply with Section 6
hereof and Tenant shall maintain adequate insurance on all such replacements, restoration and
property pursuant to Section 8.5.

     
9.3 Untenantability.

          (a) Restoration Requirements.

               (i) If the condition referred to in Section 9.2 is such that the Demised Premises are partially
damaged or destroyed to the extent that the Demised Premises are not accessible or it is not
commercially reasonable for Tenant to occupy the Demised Premises, and provided that the condition
was not due to the acts or omissions of Tenant, its agents, employees, invitees or visitors, then
during the period that Tenant is deprived of the use of the damaged portion of the Demised
Premises, Tenant shall be required to pay Base Annual Rent and Additional Rent covering only that
part of the Demised Premises that Tenant is able to occupy, based on the ratio between the square
foot area remaining that can be occupied and the total square foot area of the entire Demised
Premises covered by this Lease. Any unpaid or prepaid installment of Base Annual Rent and
Additional Rent for the month in which the condition referred to in Section 9.2 occurs shall be
prorated.

               (ii) (1) If the condition referred to in Section 9.2 is such so as to make the entire Demised
Premises untenantable or inaccessible and provided that the condition was not due to the acts or
omissions of Tenant, its agents, employees, invitees or visitors, then, subject to the rights set
forth in Section 9.3(a)(ii)(2) below, the installment(s) of Base Annual Rent and Additional Rent
which Tenant is obligated to pay hereunder shall abate as of the date of the occurrence until the
restoration of the Demised Premises has been substantially completed by Landlord to the extent of
Landlord’s obligations as described in Section 9.2. Any unpaid or prepaid installment of Base
Annual Rent and Additional Rent for the month in which the condition referred to in Section 9.2
occurs shall be prorated.

               (2) In the event (x) the Demised Premises are substantially or totally destroyed by fire or other
casualty so as to be unrepairable within 120 days, (y) a substantial portion of the Building is
destroyed or damaged to such an extent that, in the sole judgment of Landlord, the Building cannot
be operated as a functional unit or an economically viable unit, or (z) the damage to the Demised
Premises and/or the Building is due to an uninsured risk or insurance proceeds are otherwise
unavailable to cover the expenses of restoration or repair of the damage (less any applicable
deductible), then Landlord shall have the unconditional right to cancel this Lease in its sole
discretion, in which case Base Annual Rent and Additional Rent shall be apportioned and paid to the
date of said fire or other casualty. If Landlord elects not to cancel this Lease, then Landlord
shall determine and notify Tenant in writing, within sixty (60) days following the fire or other
casualty, of the date by which the Demised Premises can be restored by Landlord in accordance with
the provisions of Section 9.2. If the date determined by Landlord as aforesaid for completion of
restoration of the Demised Premises is more than one hundred twenty (120) days after such fire or
other casualty, then Tenant shall have the right, to be exercised by giving written notice to
Landlord within ten (10) business days following receipt of such notice from Landlord, to cancel
and terminate this Lease. In the event the date by which Landlord determines it can complete
restoration of the Demised Premises as herein provided is less than 120 days following such fire or
other casualty, or Tenant fails to terminate this Lease as herein provided following notification
from Landlord that completion of restoration will require more than 120 days, then this Lease shall
remain in full force and effect and Landlord shall commence restoration of the Demised Premises to
the extent of Landlord’s obligations as described in Section 9.2. Due allowance, however, shall be
given for reasonable time required for adjustment and settlement of insurance claims, for Landlord
to reasonably be able to determine the time necessary for completion of the restoration and for
other such delays as may result from government restrictions, and controls on construction, if any,
and for strikes, national emergencies and other conditions beyond the control of Landlord. Any
delays as a result of the foregoing shall operate to postpone Landlord’s obligation to complete
restoration of the Demised Premises by one day for each day of any such delay. Tenant shall
commence any restoration to be performed by Tenant as required in Section 9.2 and Tenant shall
reoccupy the Demised Premises when restored.

               (iii) Except as expressly provided in this Section 9.3, no compensation, or claim, or diminution
of Base Annual Rent or Additional Rent will be allowed or paid by Landlord, by reason of
inconvenience, annoyance, or injury to business, arising from any fire or other casualty suffered
by Tenant or the necessity of repairing or restoring the Demised Premises or any portion of the
Building.

          (b) Casualty Near Expiration of Lease Term. In addition to any other right of Landlord or
Tenant to terminate this Lease pursuant to the provisions of this Section 9, in the event the
Demised Premises are damaged in whole or in part by fire or other casualty during the last twelve
(12) months of the Lease Term, then Landlord or Tenant, upon ten (10) days prior written notice to
the other given within sixty (60) days of the date of the fire or casualty, may terminate this
Lease, in which case the Base Annual Rent and Additional Rent shall be apportioned and paid to the
date of said fire or other casualty; provided, however, Tenant shall have no right to terminate
this Lease hereunder if prior to receipt of Tenant’s notice Landlord has commenced to repair or
restore the Demised Premises.

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10. CONDEMNATION

     10.1 Landlord’s Right to Award. Tenant agrees that if any of the Demised Premises or
the Building shall be taken or condemned for public or quasi-public use or purpose by any competent
authority. Tenant shall have no claim against Landlord and shall not have any claim or right to any
portion of the amount that may be awarded as damages or paid as a result of any such condemnation.
All rights of Tenant to damages therefor, if any, are hereby assigned by Tenant to Landlord. If (a)
the whole or a substantial part of the Demised Premises or the Building is taken or condemned or if
(b) less than a substantial portion of the Building or the Demised Premises is taken or condemned
and the remainder of either in Landlord’s opinion can not be operated as a functional unit or as an
economically viable unit, the Lease Term shall cease and terminate from the date of such
governmental taking or condemnation and Landlord shall notify Tenant of the termination of this
Lease effective as of the date of such governmental taking or condemnation. In the event of any
termination of this Lease by reason of any taking or condemnation. Tenant shall have no claim
against Landlord or Landlord’s Agent for the value of any unexpired portion of the Lease Term. If
less than a substantial part of the Demised Premises or of the Building is taken or condemned by
any governmental authority for public or quasi-public use or purpose and the remainder of both in
Landlord’s opinion can be operated as a functional unit or as an economically viable unit, the rent
shall be equitably adjusted on the date when title vests in such governmental authority and the
Lease shall otherwise continue in full force and effect. For the purposes of this Section 10, a
substantial part of the Demised Premises shall be considered to have been taken if more than fifty
percent (50%) of the Demised Premises are unusable by Tenant.

     10.2 Tenant’s Right to File Claim. Nothing in Section 10.1 shall preclude Tenant
from filing a separate claim against the condemning authority for the value of its Leasehold
Improvements not then depreciated (excluding those Leasehold Improvements paid for by Landlord) and
relocation expenses, provided that any award to Tenant will not result in a diminution of any award
to Landlord.

11. BANKRUPTCY

     11.1 Events of Bankruptcy. The following shall be Events of Bankruptcy under this Lease:

          (a) Tenant’s becoming insolvent, as that term is defined in Title 11 of the United States
Code, entitled Bankruptcy, 11 U.S.C. Sec. 101 et seq. (the “Bankruptcy Code”), or under the
insolvency laws of any State, District, Commonwealth or Territory of the United States (“Insolvency
Laws”);

          (b) The appointment of a receiver or custodian for any or all of Tenant’s Property or assets,
or the institution of a foreclosure action upon any of Tenant’s real or personal property;

          (c) The filing of a voluntary petition under the provisions of the Bankruptcy Code or
Insolvency Laws;

          (d) The filing of an involuntary petition against Tenant as the subject debtor under the
Bankruptcy Code or Insolvency Laws, which is either not dismissed within sixty (60) days of filing,
or results in the issuance of an order for relief against the debtor, whichever is earlier; or

          (e) Tenant’s making or consenting to an assignment for the benefit of creditors or a common
law composition of creditors.

     11.2 Landlord’s Remedies.

          (a) Termination of Lease. Upon occurrence of an Event of Bankruptcy, Landlord shall
have the right to terminate this Lease by giving written notice to Tenant; provided, however, that
this right to terminate shall have no effect while a case in which Tenant is the subject debtor
under the Bankruptcy Code is pending, unless Tenant or its Trustee is unable to comply with the
provisions of Sections 11.2(d) and (c) below. At all other times this Lease shall automatically
cease and terminate, and Tenant shall be immediately obligated to quit the Demised Premises upon
the giving of notice pursuant to this Section 11.2(a). Any other notice to quit, or notice of
Landlord’s intention to re-enter is hereby expressly waived. If Landlord elects to terminate this
Lease, everything contained in this Lease on the part of Landlord to be done and performed shall
cease without prejudice, subject, however, to the rights of Landlord to recover from Tenant all
Bass Annual Rent and Additional Rent and any other sums accrued up to the time of termination or
recovery of possession by Landlord, whichever is later, and any other monetary damages sustained by
Landlord.

          (b) Suit for Possession. Upon termination of this Lease pursuant to Section 11.2(a),
Landlord may proceed to recover possession of the Demised Premises under and by virtue of the
provisions of the laws of any applicable jurisdiction, or by such other proceedings, including
reentry and possession, as may be applicable, or by direct order from any Court having jurisdiction
over Tenant/Debtor, including any Bankruptcy Court.

          (c) Non-Exclusive Remedies. Without regard to any action by Landlord as authorized by
Sections 11.2(a) and (b) above. Landlord may at its discretion exercise all the additional
provisions set forth below in Section 12.

          (d) Assumption or Assignment by Trustee. In the event Tenant becomes the
subject debtor in a case pending under the Bankruptcy Code, Landlord’s right to terminate this
Lease pursuant to Section 11.2(a) shall be subject to the rights of the Trustee in Bankruptcy to
assume or assign this Lease. In addition to all other objections Landlord may raise to assumption
and/or assignment, and in addition to all other requirements of any Bankruptcy Court and the
Bankruptcy Code, the Trustee shall not have the right to assume or assign this Lease unless the
Trustee (i) has timely performed all Lease obligations of the Tenant/Debtor arising from and after
the filing of any voluntary bankruptcy petition by Tenant or, in the case of an involuntary
petition, the date of entry of the Order for Relief, (ii) promptly cures all defaults under this
Lease, (iii) promptly compensates Landlord for monetary damages incurred as a result of such
default, and (iv) provides adequate assurance of future performance on the part of Tenant or on the
part of the assignee of Tenant or the Trustee.

          (e) Adequate Assurance of Future Performance. Landlord and Tenant hereby agree in
advance that adequate assurance of future performance, as that term is used in Section 11.2(d)
above, shall mean that all of the following minimum criteria must be met; (i) Tenant’s gross
revenues in the ordinary course of business during the thirty (30) day period immediately preceding
the initiation of the case under the Bankruptcy Code must be at least two (2) times greater than
the next installment of Base Annual Rent and Additional Rant due under this Lease; (ii) both the
average and median of Tenant’s gross revenues in the ordinary course of business during the six (6)
month period immediately preceding the initiation of the case under the Bankruptcy Code must be at
least two (2) times greater than the next six (6) installments of Base Annual Rent and Additional
Rent due under this Lease; (iii) Tenant must pay (and continue to pay on a timely basis throughout
the Lease Term) Base Annual Rent, Additional Rent and all other sums payable by Tenant hereunder in
advance and as a condition precedent to the performance of Landlord’s obligations hereunder; (iv)
the Trustee must agree that Tenant’s business shall be conducted in a first class manner, and that
no liquidating sales, auctions, or other non-first class business operations shall be conducted on
or about the Demised Premises, Building and/or Complex; (v) the Trustee must agree that the use of
the Demised Premises as stated in this Lease will remain unchanged and that no prohibited use
shall be permitted; and (vi) the Trustee must agree that the assumption or assignment of this
Lease will not violate or affect the rights of other tenants in the Building and/or Complex.

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          (f) Failure to Provide Adequate Assurance. In the event the Trustee or Tenant
is unable to (i) comply with the requirements of Section 11.2(d) above, or (ii) meet the criteria
and obligations imposed by Section 11.2(e) above, Tenant agrees in advance that ii has not met its
burden to provide adequate assurance of future performance, and this Lease may be terminated by
Landlord in accordance with Section 11.2(a) above.

     11.3 Guarantors. For purposes of this Section 11, any action or adjudication by or on
behalf of, or against, or with respect to the property or affairs of, any guarantor or guarantors
(if any) of this Lease, or any of them, which, if taken by, against or with respect to Tenant,
Tenant’s Property or affairs, would entitle Landlord to exercise any remedy specified herein, may
be treated, at Landlord’s sole option and discretion, as though it were taken by, against or with
respect to the Tenant.

     11.4 Damages. In the event of cancellation and termination of this Lease pursuant to
Section 11.2 above, Landlord shall, notwithstanding any other provisions of this Lease to the
contrary, be entitled to promptly recover damages from Tenant determined in accordance with the
provisions set forth in Section 12.2 of this Lease as provided for in the case of default by
Tenant.

12. DEFAULTS AND REMEDIES

     12.1 Default. If any one or more of the following events occur, said event shall he
deemed a default of this Lease:

          (a) Intentionally deleted;

          (b) Tenant’s failure to accept possession of the Demised Premises when tendered by Landlord.

          (c) Tenant’s failure to pay any installment of Base Annual Rent, Additional Rent or other sum
required to be paid by Tenant when the same shall be due and payable, all without demand unless
demand is necessary under the express terms of this Lease (in which case a default shall be deemed
to occur if such payment is not made strictly within the time period provided for such payment
following the demand);

          (d) Tenant’s failure to perform or observe any other term, covenant or condition of this
Lease;

          (e) Any event expressly designated or deemed a default elsewhere in this Lease;

          (f) Any execution, levy, attachment or other legal process of law shall occur upon Tenant’s
Property, Tenant’s interest in this Lease or the Demised Premises;

          (g) Tenant’s abandonment or surrender of the Demised Premises prior to the expiration of the
Lease Term and the suspension of rent payments as the same may become due and payable; and/or

          (h) Tenant’s committing or permitting waste to occur to the Demised Premises.

          In the event that Tenant defaults in the payment of Base Annual Rent, Additional Rent or any
other sum required to be paid by Tenant, or if Tenant defaults in the performance of or compliance
with any other covenant, condition, agreement, rule or regulation herein contained, Landlord shall
give Tenant written notice of such default. If Tenant fails to cure any default in the payment of
Base Annual Rent, Additional Rent or any other sum required to be paid by Tenant with in ten (10)
days after the effective date of such notice, or fails to cure any other default within twenty
(20) days after the effective date of such notice (or if such other default is of such nature that
it cannot be completely cured within said twenty (20) days, if Tenant fails to commence to cure
within said twenty (20) days and thereafter proceed with reasonable diligence and in good faith to
complete the cure), then Landlord shall be entitled to all rights and remedies available to
Landlord pursuant to Section 12 in the event of Tenant’s default. Nevertheless, in the event
Tenant defaults in the payment of Base Annual Rent Additional Rent or any other sum required to be
paid by Tenant or if Tenant otherwise defaults In the performance of or compliance with any other
covenant, condition, agreement, rule or regulation herein contained, two (2) times in any twelve
(12) month period, Landlord shall not be required during the remainder of the Lease Term to send
notice of any default hereunder before proceeding with its remedies under Section 12. Tenant
acknowledges that the purpose of the preceding sentence is to prevent repetitive defaults by
Tenant under this Lease, which work a hardship upon Landlord and deprive Landlord of the timely
performance by Tenant of its obligations hereunder this Lease.

     12.2 Remedies. In each and every such event set forth in Section 12.1 above, from the
date of such default or, if applicable, the expiration of Tenant’s cure period, if any pursuant to Section 12.1 above, and at all times
thereafter, at the option of Landlord, Tenant’s right of possession shall thereupon cease and terminate. Landlord shall be entitled to all rights
and remedies now or later allowed at law or in equity, all of which shall be cumulative to the extent that the exercise of any one or more
rights or remedies shall not be deemed to constitute a waiver of the Landlord’s right to exercise any one or more other rights and
remedies herein provided or provided at law or in equity. Landlord shall be entitled to obtain possession of the Demised Premises whether or not
Landlord elects to terminate this Lease, and to re-enter the same without demand of rent or demand of possession of the Demised Premises
and may forthwith proceed to recover possession of the Demised Premises by any lawful means or process of law whether or not
Landlord elects to terminate this Lease, any farther notice to quit being hereby expressly waived by Tenant. In the event of such
re-entry by process of law or otherwise, Tenant nevertheless agrees to remain liable for all Base Annual Rent, Additional Rent and other sums
due under this Lease, and shall pay the same as and when it accrues and is payable hereunder. Landlord may (but shall not be obligated to)
declare the entire balance (or any portion thereof) of Base Annual Rent, Additional Rent and all other sums payable by Tenant hereunder
for the remainder of the Lease Term to be immediately due and payable in full, which shall be recoverable pursuant to Section 1 2.4
below. Tenant further agrees to remain liable for any and all damage, deficiency, and loss of Base Annual Rent, Additional Rent and other sums
herein specified, and all other damages which Landlord may sustain by such re-entry, including reasonable attorneys’ fees and costs.
If wider the provisions hereof, a seven (7) days summons or other applicable summary process shall be served, and a compromise or settlement
thereof shall be made, such action shall not constitute a waiver of any breach of any covenant, term, condition or agreement herein
contained.

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     12.3 Landlord’s Right to Relet. Should this Lease be terminated before the
expiration of the Lease Term, by reason of Tenant’s default as provided in Sections 11 or 12, or if
Tenant shall abandon the Demised Premises before the expiration or termination of the Lease Term
and without paying the rent due as the same may become due and payable (whether or not Landlord
elects to terminate this Lease), the Demised Premises may be relet by Landlord, on Tenant’s behalf
or for the account of Landlord, as Landlord so chooses, for such rent and upon such terms as are
reasonable under the circumstances. If the full rent reserved under this Lease (and any of the
costs, expenses or damages indicated below) shall not be realized by Landlord, Tenant shall be
liable for all damages sustained by Landlord, including, without limitation, deficiency in Base
Annual Rent, Additional Rent, unamortized Landlord Concessions (hereinafter defined), reasonable
attorneys’ fees, other collection costs, brokerage fees, expenses incurred by Landlord to remove
Tenant’s Property and (at Landlord’s option) Leasehold Improvements, and expenses of placing the
Demised Premises in first-class rentable condition. Landlord, in putting the Demised Premises in
good order or preparing the same for reletting may, at Landlord’s option, make such alterations,
repairs or replacements in or relating to the Demised Premises as Landlord, in Landlord’s sole
judgment, considers advisable and necessary for the purpose of reletting the Demised Premises, and
the making of such alterations, repairs or replacements shall not operate or be construed to
release Tenant from liability hereunder as aforesaid. Landlord shall in no event be charged with
any obligation to mitigate its damages nor shall Landlord be liable in any way whatsoever for
failure to relet the Demised Premises, or in the event that the Demised Premises are relet, for
failure to collect the rent thereof under such reletting. For the purpose of calculating Landlord’s
damages as set forth in Section 12.4 below, if the Building has other available space at the time
of such Lease termination or Tenant’s abandonment or vacating of the Demised Premises, or anytime
thereafter, the Demised Premises shall be deemed the last space rented in the Building even though
the Demised Premises may be re-rented by Landlord prior to such other vacant space. In no event
shall Tenant be entitled to receive any excess, if any, of rent (if any) collected over the sums
payable by Tenant to Landlord hereunder. Notwithstanding the foregoing, upon termination of this
Lease pursuant to Sections 12.2 or 12.3, Landlord shall make an effort to re-let the Demised
Premises at prevailing market rates, provided, however, that it shall not be obligated: (i) to do
so in preference to other vacant space within the Building; (ii) to re-let the Demised Premises for
any use other than as office use or to any person or entity which does not have net worth
reasonably acceptable to Landlord or which would (in Landlord’s judgment) adversely affect the
tenant mix in the Building; or (iii) to market the Demised Premises in a manner different than it
markets other available space in the Building.

12.4 Recovery of Damages.

          (a) Quantification of Damages. Any damage, deficiency, loss of Base Annual Rent,
Additional Rent or other sums payable by Tenant hereunder, unamortized Landlord Concessions as
described hereinafter, and all other damages may be recovered by Landlord, at Landlord’s option,
upon default by Tenant, in separate actions, from time to time, as said damage shall have
periodically accrued, or, at Landlord’s option, may be deferred until the expiration of the Lease
Term (in which event Tenant hereby agrees that the cause of action shall not be deemed to have
accrued until the date of expiration of said Lease Term), or, at Landlord’s option, in a single
action in the event Landlord shall have declared the entire balance of Base Annual Rent, Additional
Rent and other sums due under this Lease immediately due and payable pursuant to Section  12.2. In
the event Landlord shall have declared the entire balance of Base Annual Rent, Additional Rent and
other sums due under this Lease immediately due and payable, then in lieu of the Base Annual Rent
and Additional Rent which would have been payable for the period after the date of any judgment
obtained in any action by Landlord against Tenant to recover damages, Tenant shall pay a sum
representing liquidated damages, and not penalty, in an amount equal to the excess of (i) the sum
of the Base Annual Rent and Additional Rent provided for in this Lease for the unexpired portion of
the Lease Term after the date of judgment discounted at a rate of three percent (3%) per annum to
present value, over (ii) the rental value of the Demised Premises, at the time of termination of
this Lease, for the unexpired portion of the Lease Term, discounted at a rate of three percent (3%)
per annum to present value. In determining the rental value of the Demised Premises, the rent
realized by any reletting accomplished or accepted by Landlord within a reasonable time after
termination of this Lease, shall be deemed, prima facie, to be the rental value. In addition to all
of the rights of the Landlord to recover damages herein provided, Tenant shall immediately
reimburse Landlord for, and Landlord may recover, the unamortized portion of all contributions and
other concessions (hereinafter “Landlord Concessions”), if any, provided by Landlord to Tenant as
an inducement to enter into this Lease and any amendment, modification or extension hereof and/or pursuant to the
terms of this Lease or any amendment, modification or extension hereof, including, but not limited
to, (i) any abatements or waivers of Base Annual Rent, Additional Rent or other sums due under this
Lease, (ii) costs incurred by Landlord in making the Demised Premises ready for Tenant’s occupancy,
including the cost of the Construction Improvements, any monetary contribution by Landlord for any
Leasehold Improvements and any other contributions by Landlord with respect to any construction
within or relating to the Demised Premises, (iii) moving expenses, (iv) brokerage fees, (v)
allowances for telephone and computer systems and other office equipment and supplies, (vi) design,
architectural and engineering fees and expenses, and (vii) any other direct or indirect expenses
incurred by Landlord in conjunction with obtaining and/or entering into this Lease and any
amendment, modification and extension hereof, and placing and/or retaining Tenant in possession of
the Demised Premises. For purposes hereof, the amount of any Landlord Concessions provided in
connection with the initial Lease Term shall be deemed to be amortized (using a straight-line
method) on a monthly basis over the initial Lease Term (excluding any extension or renewal terms)
in which Tenant is required to pay all or any portion of any installment of Base Annual Rent under
the terms of this Lease. The amount of any Landlord Concessions provided in
connection with any
amendment or modification of this Lease during the initial Lease Term shall be deemed to be
amortized (using a straight-line method) on a monthly basis over the remaining months in the
initial Lease Term (excluding any extension or renewal terms) in which Tenant is required to pay
all or any portion of any installment of Base Annual Rent under the terms of this Lease. The amount
of any Landlord Concessions provided in connection with any renewal or extension of the Lease Term
shall be deemed to be amortized (using a straight-line method) on a monthly basis over the months
in the extension period (excluding any subsequent extension or renewal terms) in which Tenant is
required to pay all or any portion of any installment of Base Annual Rent under the terms of said
extension or renewal of the Lease Term.

          (b) Non-Exclusive Rights. The provisions contained in this Section 12.4 shall be in
addition to and shall not prevent the enforcement of any claim Landlord may have against Tenant for
anticipatory breach of the unexpired Lease Term. All rights and remedies of Landlord under this
Lease shall be cumulative and shall not be exclusive of any other rights and remedies provided to
Landlord under applicable law. In the event Tenant becomes the subject debtor in a case under the
Bankruptcy Code, the provisions of this Section 12.4 may be limited by the limitations of damage
provisions of the Bankruptcy Code.

     12.5 Waiver. If under the provisions hereof Landlord shall institute proceedings and a
compromise or settlement thereof shall be made, the same shall not constitute a waiver of any
agreement, covenant, condition, rule or regulation herein contained nor of any of Landlord’s rights
hereunder. No waiver by Landlord of any breach of any agreement, covenant, condition, rule or
regulation herein contained, on one or more occasions, shall operate as a waiver of such agreement,
covenant, condition, rule or regulation itself, or of any subsequent breach thereof. No provision
of this Lease shall be deemed to have been waived by Landlord unless such waiver shall be in
writing signed by Landlord. Receipt and acceptance by Landlord of any Base Annual Rent, Additional
Rent or other charges, or the performance of any obligation by Tenant hereunder, with knowledge of
the breach of any agreement, covenant, condition, rule or regulation of this Lease by Tenant shall
not be deemed a waiver of such breach. Failure of Landlord to enforce any of the rules and
regulations against Tenant or any other tenant in the Building or Complex shall not be deemed a
waiver of any such rule or regulation. No payment by Tenant or receipt by Landlord of a lesser amount than the Base Annual Rent and Additional Rent herein
stipulated shall be binding upon Landlord, nor shall the same be deemed to be other than on
account of the stipulated Base Annual Rent and Additional Rent. No endorsement or statement on any
check, letter or other transmittal accompanying any check or payment of Base Annual Rent,
Additional Rent or other sum due from Tenant shall be deemed a settlement of a legal dispute or an
accord and satisfaction, and Landlord may accept such check or payment without prejudice to
Landlord’s right to recover the balance of such Base Annual Rent, Additional Rent and other sums
or to pursue any other remedy provided in this Lease. Landlord’s consent to, or approval of, any
act by Tenant requiring Landlord’s consent or approval shall not be deemed to waive or render
unnecessary Landlord’s consent to or approval of any subsequent act by Tenant.

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     12.6 Anticipatory Repudiation. If, prior to the Commencement Date or the
first day of any extension or renewal period set forth in an extension or renewal option validly
exercised by Tenant hereunder, Tenant notifies Landlord of or otherwise unequivocally demonstrates
an intention to repudiate this Lease or breach any obligation of Tenant hereunder, Landlord may, at
its option, consider such anticipatory repudiation a breach and material default of this Lease. In
addition to any other remedies available to it hereunder or at law or in equity, Landlord may
retain all Base Annual Rent, Additional Rent and other sums paid by Tenant hereunder, including any
security deposit, if any, to be applied to damages of Landlord incurred as a result of such
repudiation, including, without limitation, all damages and remedies reserved to Landlord in this
Section 12 or elsewhere in this Lease, as applicable. It is agreed between the parties that for the
purpose of calculating Landlord’s damages, if the Building has other available space at the time of
or subsequent to Tenant’s breach, the Demised Premises covered by this Lease shall be deemed the
last space rented in the Building even though the Demised Premises may be re-rented prior to such
other vacant space.

          (b) Intentionally Deleted.

     12.7 Tenant Abandonment of Demised Premises.

          (a) Abandonment. If the Demised Premises or a substantial portion thereof shall be
deserted or vacated by Tenant for thirty (30) consecutive days or more and Tenant shall be
delinquent in the payment of any Base Annual Rent, Additional Rent or other sums due under this
Lease, Landlord may deem the Tenant to have abandoned the Demised Premises, notwithstanding the
fact that Tenant may have left all or some part of Tenant’s Property thereon. Landlord may consider
Tenant in default under this Lease and may pursue all remedies available to it under this
Lease or otherwise as may be available in equity or at law.

          (b) Landlord Right to Enter and to Relet. If Tenant abandons the Demised Premises as
set forth in subsection (a) above, Landlord may, at its option, enter into the Demised Premises
without being liable for any prosecution therefor or for damages by reason thereof. In addition to
any other remedy elsewhere provided in this Section 12 or at law or in equity, Landlord, as agent
of Tenant, may relet the whole or any part of the Demised Premises for the whole or any part of the
then unexpired Lease Term. For the purposes of such reletting, Landlord may make any alterations
or modifications of the Demised Premises considered desirable in its sole judgment.

     12.8 Tenant’s Property. Tenant shall not remove any of Tenant’s Property from the
Demised Premises without the prior written consent of Landlord, other than in the ordinary course
of Tenant’s business. In the event of a default under this Lease, Tenant shall not, under any
circumstances, remove Tenant’s Property from the Demised Premises and Landlord may (but shall not
be obligated to) keep Tenant’ s Property in place (and require Tenant to return or replace Tenant’s
Property to the extent Tenant removes same in violation of the terms of this Lease) and use, or
permit another occupant of the Demised Premises, Building and/or Complex to use, Tenant’s Property
during the remainder of the Lease Term (whether or not Landlord elects to terminate this Lease for
such default) at no cost, expense or liability to Landlord or such occupant. If Tenant abandons the
Demised Premises as defined in Section 12.7(a) above or otherwise vacates the Demised Premises or
otherwise defaults under this Lease, any property that Tenant leaves within or related to the
Demised Premises shall be deemed to have been abandoned and, without liability to Tenant, may be
disposed of in the trash or retained by Landlord as the property of Landlord or disposed of at
public or private sale, or placed at the use of another occupant in the Building or the Complex or
any subsequent occupant in the Demised Premises, as Landlord sees fit in its sole discretion, all
at no cost or expense to Landlord or such other person permitted to use all or a portion of
Tenant’s Property hereunder, or Landlord may store Tenant’s Property at a location selected by
Landlord in its sole discretion at Tenant’s sole cost and expense. The proceeds of any public or
private sale of Tenant’s Property shall be applied by Landlord against (i) the expenses of Landlord
for removal, storage or sale of the property; (ii) the arrears of Base Annual Rent, Additional Rent
or other sums then or thereafter payable under this Lease; and (iii) any other damages to which
Landlord may be entitled hereunder. At Landlord’s option, at any time during the Lease Term after
default by Tenant, Landlord may require Tenant to forthwith remove Tenant’s Property from the
Demised Premises. If Tenant abandons the Demised Premises, as defined above, Landlord may transfer
any of Tenant’s Property to creditors of Tenant, on presentation of evidence of a claim valid on
its face of ownership or of a security interest in any of Tenant’s Property abandoned in the
Demised Premises or the Building, and Landlord may recover any costs incurred by Landlord in doing
so, all without incurring any liability to Tenant.

     12.9 Intentionally Deleted.

     12.10 Injunctive Relief. In the event of a breach by Tenant of any of the covenants
or provisions hereof, Landlord shall have the right of injunction and the right to invoke any
remedy allowed at law or in equity as if re-entry, summary proceedings and other remedies were
not herein provided; and in such event Landlord shall be entitled to recover from
Tenant any and all reasonable expenses as Landlord may incur in connection with its efforts
to secure such injunctive relief or other remedy at law or in equity, including all costs and
reasonable attorneys’ fees.

     12.11 Independent Covenants. If Landlord shall commence any proceeding based upon
non-payment of Base Annual Rent, Additional Rent or any other sums of any kind to which Landlord
may be entitled or which it may claim hereunder, Tenant will not interpose any counterclaim,
set-off, recoupment or other defense of any nature or description in any such proceeding. The
parties hereto specifically agree that Tenant’s covenants to pay Base Annual Rent, Additional Rent
and any other sums required hereunder are independent of all other covenants and agreements of
Landlord herein contained; provided, however, that this shall not be construed as a waiver of
Tenant’s right to assert such a claim in any separate action brought by Tenant. Tenant further
waives any right or defense which it may have to claim a merger.

     12.12 Waiver of Redemption. Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant being evicted or
dispossessed for any cause, or in the event of Landlord obtaining possession or a judgment for or
other right to possession of the Demised Premises and/or Tenant’s Property by reason of the
violation by Tenant of any of the covenants and conditions of this Lease, or otherwise.

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13. SUBORDINATION

     
13.1 Subordination. This Lease is subject and subordinate to all ground or underlying
leases and to all mortgages and/or deeds of trust and/or other security interests (individually and
collectively “mortgage”) which may now or hereafter affect the real property of which the Demised
Premises form a part, including all renewals, modifications, consolidations, replacements and
extensions thereof. This clause shall be self-operative and no further instrument of subordination
shall be required to effect this subordination. Notwithstanding the foregoing, in confirmation of
such subordination, Tenant shall at Landlord’s request execute and deliver to Landlord within ten
(10) business days after Landlord’s request, any requisite or appropriate certificate,
subordination agreement or other document that may be reasonably requested by Landlord or any other
party requiring such certificate, subordination agreement or document. If Tenant fails to execute
such certificate, subordination agreement or other document requested by Landlord or other party
within said ten (10) day period, the same shall be deemed a default under the Lease and Landlord
may avail itself of its remedies hereunder. Tenant by such failure irrevocably constitutes and
appoints Landlord as its special attorney-in-fact to execute such certificate, subordination
agreement or other document on Tenant’s behalf, the foregoing power-of-attorney being deemed to be
coupled with an interest. Notwithstanding the foregoing, any lessor under any ground or underlying
lease and the party secured by any mortgage affecting the real property of which the Demised
Premises are a part, or any renewal, modification, consolidation, replacement or extension thereof,
shall have the right to recognize this Lease and, in the event of any cancellation or termination
of such ground or underlying lease, or any foreclosure under any mortgage, or any sale of the real
property at foreclosure sale, or any transfer of the real property by a deed in lieu of
foreclosure this Lease shall continue in full force and effect at the option of the lessor under
such ground or underlying lease or, as applicable, the party secured by such mortgage, or the
purchaser at any foreclosure sale, or the party taking the real property under a deed in lieu of
foreclosure, such party being hereby authorized by Tenant to exercise such option to cancel or
continue this Lease in such party’s reasonable or unreasonable discretion. Tenant hereby consents
to the right of such party to effect the survival of this Lease. Tenant agrees that neither the
cancellation nor termination of any ground or underlying lease, nor the foreclosure under any
mortgage, nor the sale at foreclosure, nor the transfer by a deed in lieu of foreclosure, shall, by
operation of law or otherwise, result in cancellation or termination of this Lease or the
obligations of Tenant hereunder, except in the sole option of the party herein granted such option,
which option may be exercised in said party’s reasonable or unreasonable discretion.

     13.2 Estoppel Certificates. Tenant shall execute and return within ten (10) business
days any certificate that Landlord may request from time to time, stating that this Lease is
unmodified and in full force and effect, or in full force and effect as modified, and stating the
modification. The certificate also shall state (a) the amount of the monthly installment of Base
Annual Rent and Additional Rent and the dates to which such rent has been paid in advance: (b) the
amount of any security deposit or prepaid rent; (c) that to the best of Tenant’s knowledge, there
is no present default on the part of Landlord nor is there in existence any condition, event, act
or omission which with the giving of notice and/or the passage of time will constitute a default on
the part of Landlord, or attach a memorandum stating in detail the factual circumstances of such
default and/or the basis under the Lease for such default; (d) that to the best of Tenant’s
knowledge, Tenant has no right to set-off or recoupment and no defense or counterclaim against
enforcement of its obligations under this Lease; (e) that Tenant has no other written notice of any
sale, transfer or assignment of this Lease or of the rentals; (f) that all Construction
Improvements (if any) and other work and improvements required of Landlord has been completed and
that the Construction Improvements and other work and improvements are complete and satisfactory or
otherwise describing the state thereof, to the best of Tenant’s knowledge; (g) that Tenant is in
full and complete possession of the Demised Premises or describing any subleases or assignments, as
applicable; (h) the date on which Tenant’s rental obligations commenced (excluding any periods of
abatement) and the date to which such rent has been paid; (i) that Tenant has not advanced any
amounts to or on behalf of Landlord which have not been reimbursed, or the amounts so advanced and
outstanding; (j) that Tenant understands that this Lease has been collaterally assigned to
Landlord’s mortgagee as security for a loan to Landlord; (k) that Base Annual Rent and Additional
Rent may not be prepaid more than one (1) month in advance without the prior written approval of
Landlord’s mortgagee; and (1) such other items as Landlord may reasonably request and which do not
have an adverse impact upon Tenant’s rights under this Lease. Failure to deliver the certificate
within the aforesaid ten (10) business day period shall be conclusive upon Tenant for the benefit
of Landlord and any successor to or mortgagee or assignee of Landlord that this Lease is in full
force and effect and has not been modified except as may be represented by the party requesting the
certificate. If Tenant fails to deliver the certificate within the aforesaid ten (10) business day
period, the same shall be deemed to be a default under the Lease and Landlord may avail itself of
its remedies hereunder.

     
13.3 Attornment. Tenant covenants and agrees that, in the event any ground lessor, lessor of
any underlying lease or subsequent purchasor of the Building so requests or in the event of any
foreclosure under any mortgage, or any renewal, modification, consolidation, replacement or
extension thereof, or in the event of a sale at foreclosure, or in the event of any acceptance of
any deed in lieu of foreclosure, which may now or hereafter affect the real property of which the
Demised Premises are a part. Tenant shall attorn to any ground lessor, lessor of any underlying
lease or subsequent purchaser of the Building or to the party secured by such mortgage, or any
renewal, modification, consolidation, replacement or extension thereof, and to any purchaser at
any foreclosure sale or party taking a deed in lieu of foreclosure, and at the sole option of such
party, which option may be exercised in said party’s reasonable or unreasonable discretion, this
Lease shall continue as a direct lease between Tenant herein and such landlord or its successor.
In any case, such landlord or successor under such ground or underlying lease or such secured
party or purchaser at foreclosure sale or party taking a deed in lieu of foreclosure shall not be
bound by any prepayment on the part of Tenant of the Base Annual Rent or Additional Rent for more
than one month in advance, so that Base Annual Rent and Additional Rent shall be payable under
this Lease in accordance with its terms, from the date of the termination or transfer of the
ground or underlying lease or the foreclosure under such mortgage, or the data of foreclosure sale
or transfer by deed in lieu of foreclosure, as if such prepayment had not been made. Further, such
landlord or successor in interest shall not be liable for damages for any act or omission of
Landlord or any prior landlord or be subject to any recoupments, offsets, counterclaims or
defenses which Tenant may have against Landlord or any prior landlord. Tenant shall, upon request
of such landlord or successor landlord, execute and deliver an instrument or instruments
confirming Tenant’s attornment.

13.4 Mortgage Rights.

          
(a) Mortgagee Requirements. Tenant shall, at its own expense, comply with all
reasonable notices of Landlord’s mortgagee or other financial institution providing funds which
are secured by a mortgage placed on the whole or any part of the real property of which the
Demised Premises are a part, respecting all matters of occupancy, use, condition or maintenance of
the Demised Premises, provided the same shall not unreasonably interfere with the conduct of
Tenant’s business nor materially limit or affect the rights of the parties under this Lease,
Tenant shall, if so directed by Landlord’s mortgagee or such other financial institution in
writing, pay all Base Annual Rent, Additional Rent and other sums owed to Landlord directly to
such mortgagee or other financial institution. Notwithstanding acceptance and execution of this
Lease by the parties hereto, the terms hereof shall be automatically deemed modified, if so
required, for the purpose of complying with or fulfilling the reasonable requirements of any
mortgagee or trustee named or secured by a mortgage that may now or hereafter be placed upon or
secured by the real property of which the Demised Premises are a part or any part thereof, or any
other financial institution providing funds to finance or refinance the real property of which the Demised Premises
are a part; provided, however, that such modification(s) shall not be in material derogation or
diminution of any of the rights of the parties hereunder, nor materially increase any of the
obligations or liabilities of the parties hereunder.

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(b) Notices to Mortgagee. Tenant agrees to give Landlord’s mortgagee and any trustee
named or secured by a mortgage a copy of any notice of default served upon Landlord by Tenant,
provided that prior to such notice Tenant has been notified in writing (by way of Notice of
Assignment of Rents and Leases, or otherwise) of the names and addresses of such mortgagees and
trustees. Notice shall be provided to the mortgagees and trustees in the manner prescribed in
Section 24. Tenant further agrees that if Landlord shall have failed to cure such default within
the cure period provided in this Lease, if any, then the mortgagees and trustees shall have an
additional thirty (30) days within which to cure such default, or if such default cannot be cured
within that time, then such additional time as may be necessary if within such thirty (30) days
such mortgagee or trustee has commenced and is diligently pursuing the remedies necessary to cure
such default (including, but not limited to, commencement of foreclosure proceedings if necessary
to effect such cure), in which event Tenant shall not pursue its remedies while such cure is being
diligently pursued.

14. TENANT’S HOLDOVER

     14.1 With Landlord Consent. If Tenant continues, with the knowledge and written
consent of Landlord obtained at least thirty (30) days prior to the expiration of the Lease Term,
to remain in the Demised Premises after the expiration of the Lease Term, then Tenant shall, by
virtue of said holdover agreement, become a tenant from month-to-month at the rent stipulated by
Landlord in said consent, or if none is stipulated, at the monthly rate of Base Annual Rent and
Additional Rent last payable under this Lease (adjusted in accordance with the provisions of this
Lease as if the holdover period were originally included herein), commencing said monthly tenancy
with the first day next following the end of the Lease Term. All other terms and conditions of this
Lease shall apply to any holdover period(s). Tenant shall give to Landlord at least thirty (30)
days written notice of any intention to quit the Demised Premises. Tenant shall be entitled to
thirty (30) days written notice from Landlord to quit the Demised Premises, except in the event of
nonpayment of the monthly installment of Base Annual Rent and/or Additional Rent in advance or of
the breach of any other covenant, term or condition of this Lease by Tenant, in which event Tenant
shall not be entitled to any notice to quit, the usual thirty (30) days notice to quit being hereby
expressly waived by Tenant.

     14.2 Without Landlord Consent. In the event that Tenant, without the written consent
of Landlord, shall hold over beyond the expiration of the Lease Term, then Tenant hereby waives all
notice to quit and agrees to pay to Landlord for the period that Tenant is in possession after the
expiration of this Lease, a monthly charge which is One Hundred Fifty Percent (150%) of the total
monthly installment of Base Annual Rent and Additional Rent in effect during the last month of the
Lease Term. Tenant expressly agrees to reimburse, defend, indemnify and hold Landlord and
Landlord’s Agent harmless from all loss and damages, direct and consequential, which Landlord or
Landlord’s Agent may incur in connection with or in defense of claims by other persons or entities
against Landlord. Landlord’s Agent or otherwise arising out of the holding over by Tenant,
including without limitation reasonable attorneys’ fees which may be incurred by Landlord or
Landlord’s Agent in defense of such claims. Acceptance of Base Annual Rent, Additional Rent or any
other sums due from Tenant hereunder or the performance by Tenant of its obligations hereunder
subsequent to the expiration of the Lease Term, shall not constitute consent to any holding over.
Landlord shall have the right to apply all payments received after the expiration date of the Lease
Term toward payment for use and occupancy of the Demised Premises subsequent to the expiration of
the Lease Term and toward any other sums owed by Tenant to Landlord, regardless of how such
payment(s) may be designated by Tenant. Landlord, at its option, may forthwith re-enter and take
possession of the Demised Premises without process, or by any legal process in force.
Notwithstanding the foregoing, if Tenant holds over, without Landlord’s written consent, due to
acts of God, riot, or war, then such holdover shall be at the total monthly installment of Base
Annual Rent and Additional Rent applicable to the last month of the Lease Term (adjusted in
accordance with the provisions of this Lease as if the holdover period were originally included
herein), for the duration of the condition (but not to exceed ten (10) days), but such continued
occupancy shall not create any renewal of the term of this Lease nor shall it create a tenancy from
year-to-year, month-to-month, or otherwise, and Tenant shall be liable for and shall indemnify,
defend and hold harmless Landlord and Landlord’s Agent against any loss and damages suffered by
Landlord or Landlord’s Agent as described above. Any holdover period during which the Landlord and
Tenant are negotiating the terms and conditions of any holdover tenancy, new lease or other matter,
and/or for which Landlord and Tenant have failed to reach an agreement as to the rent to be paid
during such holdover period, shall conclusively be deemed to be a holdover without the consent of
Landlord for the purpose of determining the rental to be paid and the obligations to be performed
by Tenant during such period.

15. SECURITY DEPOSIT

          Tenant shall deposit with Landlord or Landlord’s Agent simultaneously with the execution of
this Lease, the amount stipulated in Section 1.6 in the form of a letter of credit as a security
deposit. Provided Tenant is not in default in the payment of Base Annual Rent. Additional Rent or
any other charges due Landlord, and further provided the Demised Premises are left in good
condition, reasonable wear and tear excepted, as described in Section 6.10, said deposit (which
shall not bear interest to Tenant) shall be returned to Tenant within sixty (60) days after the
termination of this Lease. Notwithstanding the foregoing, the full or partial return by Landlord
to Tenant of the security deposit shall at no time be deemed to constitute a waiver by Landlord of
any of Tenant’s obligations under this Lease, nor an acknowledgment by Landlord that any such
obligations are limited to the amount, if any, of the security deposit retained by Landlord. If
Tenant is in default or is otherwise indebted to Landlord hereunder or if the Demised Premises are
not left in good condition, or if Tenant has Failed or refused to remove Tenant’s Property after
Landlord’s request to do so, then the security deposit shall be applied to the extent available on
account of sums due Landlord or the cost of repairing damages to the Demised Premises or to remove
Tenant’s Property. In the event the funds deposited with Landlord as security are applied during
the Lease Term on account of sums due Landlord or to the cost of repairing damages or removing
Tenant’s Property, then Tenant shall, within fifteen (15) days after demand by Landlord, deposit
with the Landlord additional funds to restore the security deposit to its original amount. In the
event of the sale or transfer of Landlord’s interest in the Building, Landlord shall have the
right to transfer the security deposit to such purchaser or transferee and Landlord shall provide
Tenant written notice thereof, in which event Tenant shall  look only to the new landlord for the
return of the security deposit and Landlord shall thereupon be released from all liability to
Tenant for the return of such security deposit.

16. QUIET ENJOYMENT

          So long as Tenant shall observe and perform the covenants and agreements binding on Tenant
hereunder, Tenant shall at all times during the term herein granted, peacefully and quietly have
and enjoy possession of the Demised Premises without any encumbrance or hindrance by, from or
through Landlord, except as provided for elsewhere under this Lease. Nothing in this Section shall
prevent Landlord from performing alterations, improvements or repairs on other portions of the
Building not leased to Tenant or from performing alterations, improvements or repairs within the
Demised Premises in accordance with the provisions of this Lease, nor shall performance of
alterations, improvements or repairs by Landlord, Landlord’s Agent or any other tenant of the
Building be construed as a breach of this covenant by Landlord provided however, that in each instance Landlord shall endeavor not to materially disrupt
Tenant’s normal business operations at the Demised Premises.

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17. SUCCESSORS

          All rights, remedies and liabilities herein given to or imposed upon either of the parties
hereto, shall extend to their respective heirs, executors, administrators, personal
representatives, successors and assigns. This provision shall not be deemed to grant Tenant any
right to assign this Lease or to sublet the Demised Premises.

18. WAIVER OF JURY TRIAL

          Landlord and Tenant (and any guarantors and other parties with liability for the performance
of any or all of Tenants obligations hereunder, as well as any subtenants, assignees and licensees
of Tenant) hereby waive trial by jury in any action, proceeding or counterclaim brought by either
of the parties hereto against the other or in respect of any matter whatsoever arising out of or in
any way connected with this Lease, the relationship of Landlord and Tenant hereunder, Tenant’s use
or occupancy of the Demised Premises, and/or any claim of injury or damage. Tenant (and any
guarantors and other parties with liability for the performance of any or all of Tenant’s
obligations hereunder, as well as any subtenants, assignees and licensees of Tenant) hereby agrees
to submit to the personal jurisdiction of any court of competent jurisdiction within the state in
which the Demised Premises is located.

19. LIMITATION OF LANDLORD’S LIABILITY; NOTICE

     19.1 Landlord’s Consent. Notwithstanding anything to the contrary contained in this
Lease, if any provision of this Lease expressly or impliedly obligates Landlord not to unreasonably
withhold its consent or approval, an action for declaratory judgment or specific performance will
be Tenant’s sole right and remedy in any dispute as to whether Landlord has breached such
obligation or is required to give consent or approval. In no event shall Landlord be liable for
damages for any withholding of, any delay in providing, or the conditioning of, any consent or
approval.

     19.2 Individual Liability. Tenant acknowledges and agrees that the liability of
Landlord with respect to any claim arising out of, related to, or under this Lease shall be limited
solely to its interest in the Building which shall be deemed to include proceeds actually received
by Landlord for any sale of the Building (net all expenses of sale), insurance or condemnation
proceeds (subject to the rights of any mortgagees or other parties in interest), and rental income
from the Building (net of all expenses). No personal judgment shall lie against the Landlord nor
any partner of a partnership constituting Landlord (if Landlord is a partnership) nor any
shareholder of Landlord (if Landlord is a corporation), and none of the same will be personally
liable with respect to any claim arising out of or related to this Lease. If the Landlord is a
partnership, any deficit capital account of any partner and any partner’s obligation to Contribute
capital shall not be deemed an asset of the partnership. In the event of sale or other transfer of
the Landlord’s interest in the Demised Premises and/or Building, Landlord shall thereupon and
without further act by either party be deemed released from all liability and obligations hereunder
arising out of any act or omission relating to the Demised Premises, the Building or this Lease,
occurring subsequent to the sale or Other transfer. The provisions hereof shall inure to the
benefit of Landlord’s successors and assigns, including any mortgagee or trustee under a deed of
trust. The foregoing provisions are not intended to relieve Landlord from the performance of any of
Landlord’s obligations under this Lease, but only to limit the personal liability of Landlord, and
its partners or shareholders, as the case may be; nor shall the foregoing be deemed to limit
Tenant’s rights pursuant to this Lease to obtain injunctive relief or specific performance with
respect to any obligations of Landlord hereunder.

     19.3 Notice In Event of Landlord’s Default. Notwithstanding anything to the contrary
in this Lease, in no event shall Landlord be deemed to be in default in the performance of any
covenant, condition or agreement herein contained unless Tenant shall have given Landlord written
notice of such default, and Landlord shall have failed to cure such default within thirty (30).days
after such notice (or if such default is of such nature that it cannot be completely cured within
said thirty (30) days, if Landlord fails to commence to cure within said thirty (30) days and
thereafter proceed with reasonable diligence and in good faith to effect such cure),

20. AUTHORITY

          Landlord and Tenant hereby covenant each for itself, that each has the full right, power and
authority to enter into this Lease upon the terms and conditions herein set forth. If Tenant signs
as a corporation, each of the persons executing this Lease on behalf of Tenant does hereby
covenant and warrant that Tenant is and shall be throughout the Lease Term, a duly authorized and
existing corporation, qualified to do business in the jurisdiction in which the Demised Premises
are located and is in good standing, that the corporation has full right and authority to enter
into this Lease, and that each of the persons signing on behalf of the corporation were authorized
to do so. If Tenant signs as a partnership, each of the persons executing this Lease on behalf of
Tenant does hereby covenant and warrant that Tenant is a duly formed and validity existing
partnership, qualified to do business in the jurisdiction in which the Demised Premises are
located, and is in good standing, that the partnership has full right and authority to enter into
this Lease, and that each of the persons signing on behalf of the partnership were authorized to
do so.

21. TENANT’S RESPONSIBILITY REGARDING HAZARDOUS SUBSTANCES

     21.1 Hazardous Substances. The term “Hazardous Substances”, as used in this Lease,
shall include, without limitation, (a) “hazardous wastes”, as defined by the Resource Conservation
and Recovery Act of 1976 as amended from time to time, (b) “hazardous substances”, as defined by
the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended from
time to time, (c) “toxic substances”, as defined by the Toxic Substances Control Act, as amended
from time to time, (d) “hazardous materials”, as defined by the Hazardous Materials Transportation
Act, as amended from time to time, (e) oil or other petroleum products, (f) any substance whose
presence could be detrimental to the Building, its occupants or visitors, or the environment, (g)
substances requiring special handling, (h) flammables, explosives, radioactive materials,
asbestos, polychlorinated biphenyls (PCBs), chlorofluorocarbons, chemicals known to cause cancer
or reproductive toxicity, pollutants and contaminants, (i) any infectious and/or hazardous
medical waste as the same may be determined from time to time, and (j) any other substances
declared to be hazardous or toxic under Laws (hereinafter defined) now or hereafter enacted or
promulgated by any Authorities (hereinafter defined).

          21.2
Tenant’s Restrictions. Tenant shall not cause or permit to occur (it being
understood that the phrase “permit to occur” as used in this Section shall not impose upon Tenant any obligation to remove Hazardous Substances existing
on, under or about the Demised Promises, the Building or the Complex as of the Commencement Date which were introduced by anyone
other than Tenant, its agents, employees, contractors or invitees):

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          (a) Violations. Any violation of any federal, state and local laws, ordinances,
regulations, directives, orders, notices and
requirements now or hereafter enacted or promulgated regulating the use, generation, storage,
handling, transportation, or disposal of
Hazardous Substances (“Laws”), now or hereafter enacted, related to environmental conditions
on, under, or about the Demised Premises,
the Building and/or the Complex, or arising from Tenant’s use or occupancy of the Demised
Premises, Tenant’s Property, or Leasehold
Improvements, including, but not limited to, soil and ground water conditions; and/or

          (b) Use. The use, generation, release, manufacture, refining, production, processing,
storage, or disposal of any Hazardous
Substances in violation of any Laws on, under, or about the Demised Premises, the Building
and/or the Complex, or the transportation to or
from the Demised Premises of any Hazardous Substances, without the prior written consent of
Landlord, such consent to be granted or
withheld in Landlord’s sole and absolute discretion, and, if granted, Tenant’s activities
shall be in strict compliance with all Laws.

     21.3 Affirmative Obligations.

          (a) Compliance with Laws. Tenant shall, at Tenant’s own expense, comply with all Laws
affecting its use and occupancy of the Demised Premises. Tenant shall, at Tenant’s own expense,
make all submissions to, provide all information required by, and comply with all requirements of
all federal, state and local governmental and regulatory authorities (the “Authorities”) under the
Laws. Tenant shall promptly provide Landlord with a copy of all such submissions and information
requests.

          (b) Clean-Up Plans. Should any Authority or any third party demand that a removal or
clean-up plan be prepared and that a removal or clean-up be undertaken because of any deposit,
spill, discharge, release, misuse, prohibition on continued use, act or failure to act with respect
to any Hazardous Substances relating to, occurring on or arising out of Tenant’s use or occupancy
of the Demised Premises, Tenant’s Property or Leasehold Improvements, then Tenant shall, at
Tenant’s own expense, prepare and submit the required plans and all related bonds and other
financial assurances, and Tenant shall carry out all such removal and clean-up plans within the
time limits set by any Authority or other party. Tenant and Landlord shall promptly provide the
other with copies of notices received from any Authority or third party, and of all removal and
clean-up plans, bonds, and related matters.

          (c) Information Requests. Tenant shall promptly provide all Information regarding the
use, generation, storage, transportation or
disposal of Hazardous Substances that is required hereunder or is requested by Landlord. If
Tenant fails to fulfill any duty imposed under
this Section 21 within a reasonable time (or any shorter period of time if so required by any
Authority), Landlord may (but shall not be
obligated to) do so and all costs associated therewith shall be immediately due and payable to
Landlord, together with interest thereon
calculated at the rate of eighteen percent (18%) per annum. In such case, Tenant shall
cooperate with Landlord in order to prepare all
documents Landlord deems necessary or appropriate to determine the applicability of the Laws
to the Demised Premises, Tenant’s use
thereof and Tenant’s Property and Leasehold Improvements, and for compliance therewith, and
Tenant shall execute all documents promptly
upon Landlord’s request. No such action by Landlord and no attempt made by Landlord to
mitigate damages under any Laws shall
constitute a waiver of any of Tenant’s obligations under this Section 21.

     21.4 Tenant’s Indemnity. Tenant shall indemnify, defend, and hold harmless Landlord,
Landlord’s Agent, and their respective
officers, directors, beneficiaries, shareholders, partners, agents and employees from all
fines, suits, procedures, claims and actions of every
kind, and all costs associated therewith (including attorneys’ and consultants’ fees) arising
out of or in any way connected with any deposit,
spill, discharge, release, misuse, prohibition or continued use, act or failure to act, with
respect to any Hazardous Substances or other failure
to comply with the Laws which arise at any time from Tenant’s use or occupancy of the Demised
Premises or Tenant’s Property or the
Leasehold Improvements, or from Tenant’s failure to provide all information, make all
submissions, and take all steps required by all
Authorities under the Laws and all other related laws.

     21.5 Survival of Obligations. Tenant’s obligations and liabilities under this Section
21, and the obligations of all guarantors and other parties with liability for the performance of
any or all of Tenant’s obligations hereunder, shall survive the expiration or earlier termination
of this Lease.

     21.6 Landlord’s Representation. Landlord represents that, to its actual knowledge
based on the knowledge of Nicole Luhn, Property Manager, as of February 12, 2007, Landlord is not
in receipt of any notice of violation notice regarding Hazardous Substances that affects the
Demised Premises or the Building.

22. JOINT AND SEVERAL LIABILITY

          In the event that two or more individuals, corporations, partnerships or other business
associations (or any combination of two or more thereof) shall sign this Lease as Tenant or
guarantee this Lease as guarantors or are otherwise liable for the performance of any or all of
Tenant’s or any guarantor’s obligations, the liability of each such individual, corporation,
partnership or other business association to pay Base Annual Rent, Additional Rent and any other
sums due hereunder and to perform all or any other obligations hereunder shall be deemed to be
joint and several. In like manner, in the event that the Tenant named in this Lease shall be a
partnership or other business association, the members of which are by virtue of statute or
general law subject to personal liability, then, and in that event, the liability of each such
member shall be deemed to be joint and several. Notwithstanding any other provisions hereof, or of
any rule or provisions of law, the failure or refusal by Landlord to proceed, in the event of a
breach or default by Tenant, against all the individuals, corporations, partnerships or other
business associations comprising the Tenant (or any combination of two or more thereof) or against
Tenant or against one or more of the guarantors or other parties with liability for the
performance of any or all of Tenant’s or any guarantor’s obligations, shall not be deemed to be a
release or waiver of any rights which Landlord may possess against such other individuals,
corporations, partnerships or other business associations not so proceeded against, nor shall the
granting by Landlord of a release of, or execution of a covenant not to sue, any one or more of
the individuals, corporations, partnerships, or other business associations comprising the Tenant
(or any combination of two or more thereof) or the guarantors or other parties with liability for
the performance of any or all of Tenant’s or any guarantor’s obligations, constitute a release or
waiver, in whole or in part, of any rights which Landlord may possess against such other
individuals, corporations, partnerships, or associations not so released or granted a covenant not
to sue.

23. DEFINITIONS

     23.1 Pronouns. Feminine or neuter pronouns shall be substituted for those of the
masculine form, and the plural shall be substituted for the singular number, in any place or
places herein in which the context may require such substitution or substitutions. Landlord and
Tenant herein for convenience have been referred to in the neuter form.

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     23.2 Demised Premises. Wherever the word “premises” or the phrase “demised
premises” is used in this Lease, it shall refer to the Demised Premises described in Section 1.1,
unless the context clearly requires otherwise.

     23.3 Lease Term. Wherever the phrase “Lease Term” or the phrase “term of this Lease”
is used in this Lease, it shall refer to the Lease Term described in Section 1.2(a) and any
extensions and renewals thereof validly and timely exercised by Tenant, unless the context clearly
requires otherwise.

     23.4 Tenant’s Property. “Tenant’s Property” shall be defined to mean all of Tenant’s
personal property, including, but not limited to, all goods, wares, merchandise, inventory,
furniture, machinery, equipment, telecommunications and data transmission systems (and all their
components exclusive of wiring), business records, accounts receivables and other personal property
of Tenant in or about the Demised Premises or that may be placed or kept therein during the Lease
Term but specifically excluding Tenant’s trade fixtures and intellectual property.

     23.5 Leasehold Improvements. “Leasehold Improvements” shall be defined to mean all
improvements installed or constructed within the Demised Premises whether by or on behalf of either
Landlord or Tenant (exclusive of Tenant’s trade fixtures), and as repaired, replaced, altered or
improved from time to time during the Lease Term, including without limitation, any partitions,
wall coverings, floors, floor coverings, ceilings, lighting fixtures, and telephone, computer
and/or data system wiring or other improvements.

     23.6 Calendar Year. Calendar Year (sometimes appearing as ‘calendar year’) shall be
defined as each annual period from January 1 through the immediately following December 31.

     23.7 Construction Improvements. The improvements to be constructed by Landlord in the
Demised Premises are hereinafter referred to as the “Construction Improvements”.

24. NOTICE TO PARTIES

     24.1 Addresses for Notices. All notices required or desired to be given hereunder by
either party to the other shall be in writing and personally delivered or given by overnight
express delivery service or by certified or registered mail (delivery and/or postage charges
prepaid) and addressed as specified in Section 1.9. Either party may, by like written
notice, designate a new address to which such notices shall be directed.

     24.2 Effective Date of Notice. Notices personally delivered shall be deemed effective
upon delivery; notices sent by certified or registered mail shall be deemed effective upon the
earlier of (i) the date of receipt or rejection by the addressee, or (ii) three (3) days following
the date of mailing (excluding Sundays and holidays on which mail is not delivered by the United
States Postal Service). Notwithstanding the foregoing, any notice pertaining to a change of address
of a party shall be deemed effective only upon receipt or rejection by the party to whom such
notice is sent.

25. NOTICE TO MORTGAGEES

          In addition to any notices required by Section 13.4, if any mortgagee shall notify Tenant
that it is the holder of a mortgage affecting the Demised Premises and that it is requesting
Tenant to provide the mortgagee with copies of notices sent by Tenant to Landlord, no notice,
request or demand thereafter sent by Tenant to Landlord shall be effective unless and until a copy
of the same shall also be sent to such mortgagee in the manner prescribed in Section 24 and to
such address as such mortgagee or trustee shall designate.

26. SPECIAL PROVISIONS AND CONFLICTS; EXHIBITS

     26.1 Incorporation in Lease. It is agreed and understood that any Exhibits and
Special Provisions referred to in Sections 1.10 and 1.11, respectively, and attached hereto, form
an integral part of this Lease and are hereby incorporated by reference.

     26.2 Conflicts. If there is a conflict between a Special Provision hereto and the
Exhibits, Specific Provisions or General Provisions of this Lease, the Special Provision shall
govern. If there is a conflict between a Specific Provision and the Exhibits or General Provisions
of this Lease, the Specific Provision shall govern. If there is a conflict between the Exhibits
and the General Provisions, the Exhibits shall govern.

27. CAPTIONS

          All section and paragraph captions herein are for the convenience of the parties only, and
neither limit nor amplify the provisions of this Lease.

28. ENTIRE AGREEMENT; MODIFICATION

          This Lease, all Exhibits, and the Specific and Special Provisions incorporated herein by
reference are intended by the parties as a final expression of their agreement and a complete and
exclusive statement of the terms thereof, all negotiations, considerations and representations
between the parties having been incorporated herein. No course of prior dealings between the
parties or their officers, partners, employees, agents or affiliates shall be relevant
admissible to supplement, explain or vary any of the terms of this Lease, the Exhibits and the
Specific and Special Provisions. Acceptance of, or acquiescence in, a course of performance
rendered under this or any prior agreement between the parties, their agents or their affiliates
shall not be relevant or admissible to determine the meaning of any of the terms of this Lease,
the Exhibits and the Specific and Special Provisions. Tenant hereby acknowledges that Landlord,
Landlord’s Agent and their respective agents and employees made no representations, warranties,
understandings or agreements pertaining to the condition of the Building or the Demised Premises,
or otherwise, which have induced Tenant to execute, or have been relied upon by Tenant in the
execution of this Lease, other than those specifically set forth herein. This Lease can be
modified only by a writing signed by both parties hereto. The language of this Lease shall in all
cases be construed as a whole and according to its fair meaning, and not strictly for or against
either Landlord or Tenant. The interpretation or construction of this Lease shall be unaffected by
any argument or claim, whether or not justified, that this Lease has been prepared, wholly or in
substantial part, by or on behalf of Landlord or Tenant. Tenant acknowledges that it has had, or
has had the opportunity to have, legal counsel of Tenant’s choice to negotiate on behalf of
(and/or explain to) Tenant the provisions of this Lease. Any consent or approval required or
desired of Landlord, or any decision under this Lease committed to the discretion of Landlord
hereunder, may be withheld, delayed, conditioned or exercised by Landlord in its sole,
absolute and arbitrary discretion unless the provision of this Lease requiring such consent or
approval, or decision under this Lease committed to the discretion of

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Landlord, expressly states that Landlord shall not withhold, delay, condition or exercise such
consent, approval or discretion unreasonably or words to similar effect.

29. GOVERNING LAW; SEVERABILITY

          This Lease shall be governed by and construed in accordance with the laws of the jurisdiction
within which the Building is located. The unenforceability, invalidity, or illegality of any
provision herein shall not render any other provision herein unenforceable, invalid, or illegal.

30. BINDING EFFECT OF LEASE

          The submission of an unsigned copy of this document to Tenant for examination or
signature shall not constitute an option, reservation or offer to lease space in the Building. This
Lease shall become effective and binding only upon execution and delivery by both Landlord and
Tenant, and shall be enforceable in accordance with its terms from and after the date this Lease is
fully executed and delivered by Landlord and Tenant.

31. FORCE MAJEURE

          If Landlord is in any way delayed or prevented from performing any obligation due to fire, act
of God, governmental act or failure to act, labor dispute, inability to procure materials or any
cause beyond Landlord’s reasonable control (whether similar or dissimilar to the foregoing named
events), then the time for performance of such obligation shall be excused for the period of such
delay or prevention and extended for a period equal to the period of such delay or prevention.

32. RECORDATION

          Neither this Lease nor a memorandum hereof shall be recorded by Tenant. Any violation of this
Section shall be a default hereunder and Tenant agrees to pay all costs and expenses, including
attorneys’ fees, necessary to remove this Lease or any memorandum hereof from record. Tenant
irrevocably constitutes and appoints Landlord as its special attorney-in-fact to prepare, execute
and record such instrument(s), the foregoing power of attorney being deemed to be coupled with an
interest.

33. TIME OF ESSENCE

          Tenant acknowledges that time is of the essence in its performance of any and all
obligations, terms and provisions of this Lease.

34. BROKERS AND COMMISSIONS

          Landlord and Tenant each hereby represent and warrant that, in connection with this Lease,
each did not retain, consult or deal with any broker or real estate agent, salesperson or finder
(other than Cushman and Wakefield and Charles E. Smith Real Estate Services L.P.), and there is no
commission, charge, or other compensation due on account thereof in regard thereto, excepting only
Cushman and Wakefield, and Charles E. Smith Real Estate Services L.P., both of whose commissions
are the responsibility of Landlord. Each party hereto shall indemnify and hold harmless the other
(and Tenant shall also indemnify and hold harmless Charles E. Smith Real Estate Services, L.P.)
against and from any claims for brokerage or other commissions by reason of a breach of the
indemnifying party’s foregoing representation and warranty. Tenant shall pay, or upon demand
reimburse Landlord and Charles E. Smith Real Estate Services L.P. for all costs and expenses,
including reasonable attorneys’ fees, necessary to remove from record any lien filed against the
rents payable pursuant to this Lease and/or against the Demised Premises and/or the Building, by
reason of a breach by Tenant of the foregoing representation and warranty. The rights,
obligations, warranties and representations in this Section shall survive the expiration or sooner
termination of the Lease Term.

35. RELATIONSHIP OF LANDLORD AND TENANT

          Nothing in this Lease shall be interpreted or construed as creating any partnership, joint
venture, agency or any other relationship between the parties, other than that of landlord and
tenant.

SPECIAL PROVISIONS

36. ACCEPTANCE OF SPACE

          Tenant accepts the Demised Premises in its “as is” condition and, except as otherwise
provided herein and provided Landlord has theretofore delivered the Demised Premises to Tenant,
shall be obligated for the payment of Base Annual Rent and Additional Rent pursuant to Sections
1.3 and 1.5 on the Rent Start Date, regardless of any time required to construct, alter or
redecorate the Demised Premises to Tenant’s requirements.

37. PARKING

          Landlord agrees to arrange for twelve (12) permits for unreserved garage parking adjacent to,
the Building for Tenant or Tenant’s employees. The cost of such parking permits shall be billed to
Tenant or its employees and the payment of the then prevailing monthly rate for such service shall
be due each month, subject to the forfeiture of such parking privilege for non-payment.

38. EXECUTION OF DOCUMENT

          In the event that Tenant does not execute and return this document by the close of
business on March 16, 2007, then Landlord may market the subject space to others without further
notice to Tenant.

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EXHIBIT A

DEMISED PREMISES FLOOR PLAN

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EXHIBIT B

BUILDING WORK RULES & REGULATIONS

Vornado/Charles E. Smith

Construction Work Rules and Requirements

For

TWO DEMOCRACY PLAZA

6707 Democracy Boulevard

Bethesda, Maryland 20817

POLICY

The Construction Work Rules and Requirements establish a specific standard of performance to
which all contractors, consultants and vendors working in the Building must comply, whether
contracted with the Landlord or by the Tenant. No additional enforcement notifications will be
given. Any party deviating from the Construction Work Rules and Requirements shall be subject to
removal from the Building and/or subject to monetary damages. This document shall by attachment or
reference, become a part of the project construction documents.

PROJECT AUTHORITY

These Construction Work Rules & Regulations are access and construction rules to be followed by
contractors, designers and vendors who require access to the Building or who will design.

Any references to Charles E. Smith Commercial Realty (“CESCR”) or Building Management refer to
CESCR’s Tenant Construction Manager, to CESCR’s Property Manager or a designated CESCR’s building
engineering staff member.

Contractor means general contractor, construction manager and/or its subcontractors and/or
suppliers performing construction or related work in the Building either directly for the Building
Owner, CESCR or Tenant.

CESCR will inspect the construction on a periodic basis. The Contractor shall not perform work
that conflicts with the Construction Rules and Requirements, Contract Documents without approval
by CESCR.

Information concerning the Building’s Operation (i.e. Building Manager, normal business hours,
etc.) is listed on the attached Building Information Sheet.

ADDITIONAL EXHIBITS

	 	•	 	Building Information Sheet
	 
	 	•	 	Lien Waiver and Release for Progress Payments
	 
	 	•	 	Lien Waiver and Release for Final Payment
	 
	 	•	 	FM Global Red Tag Permit

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Building Information Sheet

A. GENERAL BUILDING INFORMATION/WORK PRACTICES

	1.	 	ACCESS — The Contractor must provide CESCR with notification two (2) business days prior to
needing access to an occupied area, CESCR will notify the Tenant and then provide direction to
the Contractor. The Contractor will only be allowed access to the floors and/or suites
on and in which they are working. Access to adjacent suites and to other floors in the
Building is prohibited without CESCR’s prior approval. Hauling, delivering or working in the
main building lobby is prohibited at any time. Working in these areas will not be allowed
during normal business hours without prior approval form CESCR.
	 
	2.	 	HOURS OF OPERATIONS — See attached BUILDING INFORMATION SHEET
	 
	3.	 	AFTER HOUR AUTHORIZATION — All requests for authorization to perform after hours work that
affect the building systems and equipment will be sent in writing to CESCR at least one (1)
business day in advance. No-call in requests for authorization will be accepted. Use the
attached form for all requests. If after-hours work require that CESCR provide supervision or
personnel to monitor building systems, at CESCR’s sole discretion, then all cost associated
with said personnel shall be borne by the Contractor
	 
	4.	 	DELIVERIES — The Contractor shall coordinate and schedule all deliveries through the CESCR
representative with a minimum of 48 hours notice. Contractor shall be responsible for
scheduling both loading dock and freight elevators. Only rubber-wheeled dollies and cars may
be used for the deliveries to prevent surface damage. No wooden or metal pallet or skids arc
permitted within the building, except in designated loading docks.
	 
	5.	 	LOADING DOCK — Use of the loading dock must be coordinated with CESCR.
	 
	6.	 	ELEVATORS — The designated freight elevator is the only elevator to be used for moving
materials and construction personnel and shall be properly protected with temporary plywood
protection and elevator pads. Use of freight elevator must be coordinated with CESCR.
Contractors shall not use passenger elevators, without prior approval of CESCR.
	 
	7.	 	RESTROOMS  —  Restroom use by Contractor personnel is restricted to the floor on which work
less being performed or as designated by CESCR. The Contractor must clean existing restrooms
as part of the final clean up and make repairs if damaged by Contractor. Restrooms on
multi-tenant floors shall be cleaned daily by the Contractor during construction.
	 
	8.	 	UTILITIES — CESCR will generally supply limited utility services/usage for the project,
including basic electricity and plumbing. Specific concerns regarding utilities must be
submitted to CESCR prior to contract execution.
	 
	9.	 	STORAGE/VACANT SPACE — When available CESCR will generally provide storage space for the
Contractor to stage equipment, materials and a field office. However, the Contractor may need
to provide off-site storage when Project requirements dictate. The use of vacant space
storage is prohibited.
	 
	10.	 	SIGNAGE — The Contractor shall provide and install at its cost any and all temporary
construction, directional and informational signage as may be required by the CESCR
representative. All signage shall be approved by the CESCR representative prior to posting.
	 
	11.	 	PARKING — General parking is not provided for contractors, vendors and their respective
employees.
	 
	12.	 	NO SMOKING — No Smoking is allowed within the building and parking garages and is expressly
prohibited in Tenant’s Demised Premises.
	 
	13.	 	FOOD — Food and related such debris shall not be left in the suite under construction or
anywhere else in the Building at any time and shall be disposed of by contractor on a
daily basis in appropriate trash receptacles. No eating or coffee breaks are
allowed in public areas or occupied tenant space. The only approved area for eating
or coffee breaks is within the contracted work area (if not occupied) or space designated by
CESCR.
	 
	14.	 	OSHA SIGNAGE & BARRICADES — The Contractor is responsible for ensuring job site safety. This
includes safety for the work force as well as anyone entering the construction area. The
Contractor shall provide protection, barricades and signage as required to ensure the safety
of their personnel, CESCR employees, building tenants, visitors, etc. and shall strictly
comply with OSHA minimum standards.
	 
	15.	 	24 HOUR EMERGENCY CONTACT — Vornado, Charles E. Smith Tenant Service Center, (703) 769-1250.
	 
	16.	 	HAZARDOUS MATERIAL DELIVERIES — Before any hazardous materials are utilized or delivered
into the Building, Contractor shall notify and seek the approval in writing from CESCR. All
required paperwork must be submitted, in advance, to CESCR, Storage locations and the method
of storage will be approved in writing by CESCR. in advance of delivery. Contractor is
responsible for providing information (Material Safety Data Sheets) to workers regarding all
hazardous or suspected hazardous materials and substances used or introduced by the
Contractors, including their potential hazards. At the conclusion of the work requiring
hazardous materials, the hazard materials shall be removed from the property.
	 
	17.	 	HAZARDOUS MATERIALS — The building may or may not contain hazardous materials. Contractor
shall contact the Property Manager to obtain a copy of the Hazardous Materials O&M plan and
shall follow the procedures outlined in the plan.
	 
	18.	 	ODOR & NOISE — No activities causing odor, excessive noise, vibrations etc. (i.e., core
drilling, drilling, shooting track, spray painting, any paint using an oil base or lacquer,
etc.) will be performed during the hours of operation of the building when tenants are
occupying the building without the prior approval of the Landlord. After-hours work will be
allowed with CESCR’s consent and prior notification, which shall not be unreasonably withheld, conditioned or delayed. The Contractor shall verify in
advance that after-hours work can be done. The Contractor shall notify CESCR two (2) business days prior to commencing any work which may
cause objectionable noise or odors so that  management can notify surrounding tenants in an
appropriate amount of time, even if work is performed after regular business hours. The
Contractor is responsible for controlling and for keeping noise levels to a minimum. Voices,
machinery, tools and radios heard in the common areas or in adjacent occupied spaces will not
be allowed, and all such activities will be suspended at the direction of CESCR at its sole
reasonable discretion. When contractors are working above an occupied suite, ladders must be
picked up to be moved or proper noise dampening padding should be attached to the feet of the
ladder.

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	19.	 	DAMAGES — The Contractor will be financially responsible for damages arising
out of loss of Building services, including loss of utility services, elevator services, etc.,
due to its actions and the actions of its subcontractors. Any damage caused to the property or
building by the Contractor, including but not limited to the doors and freight elevators will
be repaired by the Contractor as directed by CESCR. CESCR reserves the right to remedy the
defects at the Contractor’s expense if the work is not acceptably corrected within one week of
written notification.
	 
	20.	 	PROTECTION OF COMMON AREA FINISHES — Contractor shall protect all finishes including but not
limited to elevator doors, frames and cabs, flooring, wall surfaces, doors, door fames,
hardware with durable materials during demolition and during the movement of materials to the
space under construction. Carpeted areas shall be protected until such time as the
construction and movement of materials has been fully completed. Method of protection to be
approved by CESCR. Walk off mats are to be provided at public corridor side of entrance doors.
During Construction, Contractor shall raise any venetian blinds or mini blinds and protect
existing draperies or other window treatments, including solar film, so as not to soil or
damage them. Glass suite entry doors and windows will be covered with paper to prevent
tenants from seeing construction work.
	 
	21.	 	INSTALLATION OF COMMON AREA FINISHES — The Contractor shall coordinate the timing and
installation of common area finishes with CESCR and due respect shall be given to the
convenience of tenants on the floor for multi tenanted floors.
	 
	22.	 	KEYS & LOCKS — Whenever it is deemed necessary by Tenant or CESCR to temporarily issue any
key to the contractor, the contractor will be responsible for controlling possession and use
of same until returned daily to the issuing party. All suite entry doors and doors leading to
the common areas of the building must comply with established building standard
specifications. Lockset specification to be verified by CESCR. Contractor must lock all doors
to the suite at the end of the workday including suite entry and balcony doors.
	 
	23.	 	TRASH & DEBRIS — The Contractor must provide for the daily removal of all trash and debris
created during the Course of construction. All contractors must schedule the delivery of trash containers with CESCR and obtain all required
local government permits. Containers set on asphalt should first be placed on plywood to protect
the Surface from damage. At no time are the Building trash compactors and/or dumpsters to be used
by the Contractor; CESCR assumes no responsibility for the Contractor’s trash containers. Trash
shall be contained within the Contractor’s trash containers and emptied on a regular basis and
never allowed to overflow or otherwise remain outside of the required container. All areas the
contractor or its subcontractors work in must be kept clean on a daily basis. The cleaning of
construction tools and equipment will be confined only to the janitor closet. All janitorial,
electrical and telephone closets utilized by construction should be kept clean throughout the work
period and clean and free from construction debris after the construction is complete. No paints,
thinners, or hazardous material will be poured down the drain. The Contractor must leave the
constructed space completely clean, including but not limited to the cleaning of the inside of all
exterior windows and sills, all interior windows and sill, window blinds or drapes, all light
fixture lenses, all HVAC grills, cabinets and sinks. The Contractor must also vacuum the floor,
including edge vacuuming, as a part of its work. Contractor must keep trash and debris out of
window ledges that are visible to passing motorists. The Contractor shall maintain cleanliness
throughout the Building, Tenant’s demised premises and any areas accessed by Contactor. Construction
materials and debris is not permitted in the common areas or access corridors. CESCR reserves the
right to remove any such items and dispose at its discretion. Blocking of hallways, exits,
elevator lobbies, electrical closets or loading docks is not permitted. All carpets are to be
protected and kept clean at all times, ESPECIALLY CARPET IN COMMON LOBBIES AND CORRIDORS,
Contractor will be required to reimburse CESCR for a thorough carpet cleaning and or replacement
at the completion of the construction job, if such cleaning or replacement is deemed necessary in
the sole judgment of CESCR.
	 
	24.	 	SLAB PENETRATIONS — For all Slab penetrations required for new work, the slab shall be
either x-rayed or ground penetrating radar shall be used to locate reinforcing bars,
post-tensioning cables, piping, conduits, etc. prior to any penetration of the slab. All
components shall be clearly marked on the slab surface prior to drilling, coring, etc.
Contractor shall not cut reinforcing bars, cables, etc., without prior authorization from the
CESCR and shall immediately repair any damage caused by slab penetrations in violation of
this paragraph. All slab penetrations shall be fire Stopped. Contractor to verify approval
with CESCR’s structural engineer prior to proceeding.

B. BUILDING SYSTEMS

GENERAL

	 	1.	 	EXISTING BUILDING EQUIPMENT AND FIXTURES — Contactor shall be responsible for document the
condition of any existing building equipment or fixture prior to the start of any work and
shall be responsible for repairing any existing building equipment and fixtures damaged by the
Contractor or its subcontractors. Contractor must notify CESCR immediately of damage or
discovery of existing damage. All missing and/or damaged thermostats must be brought to the
building owner’s attention prior the start of all work in the space. Protection of all drains
is required to prevent clogging and Contractor is responsible for the cleaning of all drains
which have become clogged during construction.
	 
	 	2.	 	NEW EQUIPMENT — All new, existing and relocated equipment and devices shall be easily
accessible (i.e., not permanently blocked by new or existing construction). Any sub-meters,
whether electric, gas or water, if required, must be a VT2 or Enner-comm ECD 3000 meter with
the RS485 communication card manufactured by Global Power Products,
www.globalpowerproducts.com. Emon Deamon meters are not permissible.

HVAC:

	 	1.	 	SERVICING OF MECHANICAL/ELECTRICAL EQUIPMENT — N o walls shall be installed over or in front
of so as to inhibit the access to an induction unit, VAV or Other HVAC distribution device.
The unit shall be relocated and an additional unit shall be installed on the opposite side of
the wall. No walls shall be constructed across a ceiling light fixture so as to
inhibit changing of lamps or Servicing the light fixtures when necessary.
	 
	 	2.	 	DUCT WORK: All duct work shall conform to a minimum SMACNA standard; existing duct work shall be
evaluated and reused whenever possible. All installations shall conform to prevailing code
requirement in term of gauge of metal and fire damper. Contractor shall be responsible for
resealing and insulating duct work as necessary to meet code.
	 
	 	3.	 	CONDENSATE DRAIN LINES — Condensate drain liens from tenant A/C units must be piped
to a suitable drain per Code and not to a sink. Units shall be equipped with a high level
condensate lock-out or be equipped with a monitored high condensate level alarm.
	 
	 	4.	 	ISOLATION VALVES — Proper isolation valves shall be installed on all tenant A/C units, new
plumbing fixtures, appliance or other equipment, to facilitate maintenance and also to allow
the item to be removed without interfering with the building operation.

30

 

	 	5.	 	PIPING — All supply piping for sinks, kitchen units, and condensate lines on packaged A/C units,
should be copper or other material permitted by applicable code. All waste lines shall be cast
iron, (use of pvc or plastic pipe in plenum ceilings is prohibited). All existing water supply
lines, waste lines and vent lines that will not be re-used shall be removed back to the source/wet
stack and properly capped. All penetrations in slabs or rated walls shall be firestopped.
	 
	 	6.	 	HVAC — HVAC units within the construction area will be turned off during the construction
period or protected to prevent dust or debris from entering. Continuous protection and
filtration of HVAC return air to include but not be limited to covering main HVAC return
with filter material. In the event Contractor fails to provide filiter, material at the return
air duct Contractor will reimburse Landlord for filter changes and evaporator cleaning at the
end of the project. A preliminary inspection of the HVAC work in progress shall be scheduled
through CBSCR prior to the installation or re-installation of the ceiling grid. Contractors
are not to sit or stand on building equipment. Contractor will clean induction units/fan coil
units post construction. Units and unit covets ate to be painted while covers are removed.
Covers are not to be caulked.
	 
	 	7.	 	THERMOSTATS — Installation or relocation of all thermostats, diffusers, mechanical systems or
energy management systems are subject to CESCR’s review. The Contractor shall coordinate
installation of thermostats and switches with furniture plans to ensure clear access.
Contractor must use the building’s Control Contractor to perform Work and tie it into the
existing energy management system.
	 
	 	8.	 	AIR BALANCE — Contractor shall calibrate all thermostats prior to performing any Air
Balance. Contractor shall balance supply/return air using CESCR’s preferred contractor as
noted in the attached building information sheet. Two copies of the Air Balance Report must be
forwarded to CESCR. All diffuses will be balanced within 10% of design criteria.
	 
	 	9.	 	SLAB PENETRATIONS. For all slab penetrations required for new work, the slab shall be either
x-rayed or ground penetrating radar shall be used to locate reinforcing bars, post-tensioning
cables, piping, cables, etc. prior to any penetration of the slab. All components shall be
clearly marked on the slab surface prior to drilling, coring, etc. Contractor shall not cut
reinforcing bars, cables, etc., without prior authorization from the CESCR and shall
immediately repair any damage Caused by slab penetrations in violation of this paragraph. All
slab penetrations shall be fire stopped. Contractor to verify approval with CESCR’s
structural engineer prior to proceeding.
	 
	 	10.	 	HOT WORK — Hot work includes work that produces sparks, heat or uses an open flame. Many
rooftop repairs on roofing, drains, HVAC and signs involve hot work. Other hot work examples
include cutting, welding, brazing, soldering, grinding and the thawing of pipe. Prior to
proceeding with hot work, Contractor must evaluate all other alternatives and choose a safer
option such as bolting, hydraulic shears or reciprocal saw, mechanical clamps, threaded pipe
or tube connections, non-torch applied roofing systems and filing.
	 
	 	 	 	If no alternative exists except for hot work, Contractor must:

	 	•	 	Pre-screen all subcontractors, review their safety and loss records and confirm that they
carry the contract required insurance coverages and limits
	 
	 	•	 	Select a fire safety supervisor to coordinate hot work operations and monitor safety
	 
	 	•	 	Notify CESCR through the use of the attached Hot Work Permit
	 
	 	•	 	Follow the precaution checklist on the attached Hot Work Permit to ensure hot -work is
effectively managed throughout the process.

ELECTRICAL

	 	1.	 	ELECTRICAL WORK — During demolition, the electrical contractor is to separate any circuits
that would feed more than one tenant. All existing conduits, feeders and electrical
equipment, water supply and waste lines that will not be re-used shall be removed back to its
source/wet stack (NOT left in the ceiling and NOT terminated at a junction box). Electrical
panel schedules must be completely replaced and dated, identifying all new circuits. All new
panel schedules shall be typewritten. Doors to suite, equipment and eclectical rooms shall
not be left open When the Contractor is not present. No door shall be propped open or the
closer arm detached. Any electrical closet that is open with  the panel exposed must have
qualified Contractor personnel present at all times with appropriate OSHA warning
signage prominently displayed.
	 
	 	2.	 	CONDUIT — The Contractor must identify any conduit to be removed or relocated as a part of the
work.
	 
	 	3.	 	WIRING — No contractor shall lay wiring on ceiling grid. All wiring, including
communications, shall be laid in wire ways, or strapped or wire tied to the deck above in
compliance with the applicable code. Under no circumstance may wire be strapped to sprinkler
piping or other building piping, conduit or ductwork. No wiring of any kind shall penetrate
fire dampers or air transfers. A13 penetrations in rated walls shall be firestopped,
Appropriate permits and inspections are required from the local jurisdictions. All wiring must
be identified and tagged at both ends.
	 
	 	4.	 	LIGHTING — The lamps in all fluorescent fixtures shall follow the Building Standard in color and
wattage unless previously approved by CESCR.
	 
	 	5.	 	SLAB PENETRATIONS- For all slab penetrations required for new work, the slab shall be either
x-rayed or ground penetrating radar shall be used to locate reinforcing bars, post-tensioning cables, piping, conduits, etc. prior to
any penetration of the slab. All components shall be clearly marked on the slab surface prior to
drilling, coring, etc. Contractor shall not cut reinforcing bars, cables, etc., without prior
authorization from the CFSCR shall immediately repair any damage caused by slab penetrations in
violation of this paragraph. All slab penetrations shall be fire stopped. Contractor to verify
approval with CESCR’s structural engineer prior to proceeding.

LIFE SAFETY

	 	1.	 	BUILDING LIFE SAFETY SYSTEMS — Contractor shall protect all Life safety devices during
demolition and during the movement of materials to the space under construction. Fire
alarm pull stations shall be protected against accidental activation and smoke detectors shall be protected daily to prevent contamination. Method of
protection to be approved by CESCR. All work, including demolition, on Building Life Safety
Systems (smoke detectors, sprinklers, fire pull stations, fire doors) will be competed by a
contractor approved by CESCR and be monitored by the Building Engineer. All tie-ins to the
fire alarm panel shall be completed by CESCR’s preferred contractor as identified in the
attached Building Information Sheet. Prior to occupancy and during the fire marshal
inspections and “ring down” the Contractor will demonstrate to the Building Engineer’s
satisfaction that the Life Safety systems are functioning properly. Contractor shall provide
keys, two (2) sets of operational manuals and instructional training to the building staff on
the Operation of new fire panels or control devices. All work that may activate, deactivate or
alter any smoke detector(s), fire door(s), Sprinklers, electronics, fire protection, life
safety or security systems shall require prior written notification to CESCR using the
attached FM Global Red Tag Permit. Such work shall not commence until approval has
been obtained for both timing and scope of work. Failure to receive authorization before
commencing this work shall result in a $500.00 fine in addition to any fee, penalty, or fine
assessed by jurisdictional authority.

31

 

C. PROJECT ADMINISTRATION & REQUIREMENTS

	1.	 	PRE-JOB WALK-THROUGH — A pre-job walk-through shall be arranged by the Contractor with CESCR
to familiarize all parties with the existing conditions of the elevators, common area, etc.
On-site staging areas will be identified by CESCR during this walk through. Progress meetings
will be held at the discretion of CESCR depending on the scope of work/size of project. The
Contractor will be responsible for generating minutes from progress meetings and schedule
updates.
	 
	2.	 	PERMIT, SCHEDULE, INSPECTIONS & CONTRACTOR LIST — A copy of the construction permit, the
construction schedule and a list of subcontractors shall be submitted to CESCR prior to
construction; to the extent applicable and in accordance with local governmental laws,
regulations and ordinances, however, the initial construction permit may consist of a
temporary stud or temporary work permit prior to the issuance of a building permit. During
construction, copies of all inspection approvals shall be submitted to CESCR. At the
completion of construction, copies of all final approvals shall be submitted to CESCR.
	 
	3.	 	CONTRACTOR APPROVAL — All contractors and subcontractors must be approved by CESCR prior to work
commencement.
	 
	4.	 	SUBCONTRACTORS — The Contractor shall be held responsible for its subcontractors’ actions in
all cases. CESCR will not be responsible for directing subcontractors or liable for any acts
or omissions of a subcontractor in the event some direction is given in the absence of the
Contractor, as in the case of an emergency.
	 
	5.	 	DAMAGES — The Contractor will be financially responsible for damages arising out of loss of
Building services, including loss of utility services, elevator services, etc., due to its
actions and the actions of its subcontractors. Any damage caused to the property or building by
the Contractor, including but not limited to the doors and freight elevators will be repaired
by the Contractor as directed by CESCR. CESCR reserves the right to remedy the defects at the
Contractor’s expense if the work is not acceptably corrected within one week of written
notification.
	 
	6.	 	PROFESSIONAL CONDUCT — Professional behavior is required at all times. Appearance and
professionalism are important to our customer, visitors and tenants when Contractors and their
employees are within the building. Congregations in public areas reflect unfavorably on the
entire job, CESCR, and the contracting firm. There is to be no Congregating in public areas
especially entrances within the building or the building’s premises. Meetings, lunches and
breaks are to be within the contracted work areas. Serious offenses which will result in
immediate dismissal from the premises or closing down of the job include:

	 	•	 	Drinking or drug use while on the property, or showing up at the property under the influence of
alcohol or drugs.
	 
	 	•	 	Possessing or consuming drugs or illegal substances while on the property.
	 
	 	•	 	Possessing or using firearms or other weapons on the property.
	 
	 	•	 	Violating Local, State or Federal Statutes or Regulations while on the property.
	 
	 	•	 	Physically or verbally harassing or abusing any individual who works in or visits the building.
	 
	 	•	 	Duplicating any keys or illegal entrance into any restricted space within the property.
	 
	 	•	 	Gambling
	 
	 	•	 	Sleeping on the job.
	 
	 	•	 	Behaving in a disorderly manner.
	 
	 	•	 	Playing of radios to be heard in the common areas or any occupied tenant space.
	 
	 	•	 	Use of foul and/or vulgar language of gestures.
	 
	 	•	 	Clothing or language that is offensive or vulgar.

	7.	 	CHANGE ORDERS — CESCR must give written approval for all activities and changes that may
result in a cost to the Building Owner or CESCR prior to the cost being incurred. Claims for
additional costs for activities or changes not previously approved by CESCR will be
disqualified and rejected without payment.
	 
	8.	 	INSURANCE — Before commencing the alterations and at all times during construction, the
contractor shall maintain all necessary insurance as indicated below, and provide Owner with
certificates evidencing the required coverage before work is begun. Such insurance shall
specifically name the Building Owner, CESCR and the Tenant as additional insured with respect
to the work to be performed. Additional Insured Entities will be provided by CESCR
representatives.

	 	•	 	Workers Compensation as required by all applicable Federal, State and Maritime or other laws,
including Employer’s Liability Insurance with a limit of at least: $100,000.00
	 
	 	•	 	Comprehensive General Liability Insurance for bodily injury and property damage with single
combined limit of $1,000,000,00 including independent contractor’s liability coverage,
completed operations liability coverage, and contractual liability coverage.
	 
	 	•	 	Comprehensive Automobile Liability Insurance including non-ownership and hired car coverage
with a single combined limit of $300,000.00

32

 

	9.	 	PAYMENTS — Contractor submit requests for payment in accordance with the Contract
Document. All progress and the final payment requests are to be submitted to CESCR with a
signed Lien Waiver using the attached form(s), covenanting that no
mechanic’s liens shall be filed by them or by their subcontractors against the demised premises or the building on
account of any work done or material furnished by the contractor or subcontractors. Such
lien waivers shall specifically name the Building Owner and the real property address as
the entity with respect to the work to be performed
	 

	10.	 	PUNCH LIST — The Contractor shall notify CESCR at least two (2) business days in
advance of substantial completion of construction or as required in the Tenant’s lease. A
walk-through will be conducted and punch list items must be completed within ten (10)
business days. Final Payment will be held until all punch list work has been completed.
	 

	11.	 	AS-BUILT DRAWINGS — Contractor shall provide CESCR with the field set of construction
documents including all field notes and original set of permit plans. Two sets of As-Builts
on CAD (.dwg format) on CD ROM. The as builts shall note the following;

	 	•	 	Label each drawing “As-built set” along right edge of sheet
	 
	 	•	 	Label each drawing w/ GC names and date lower sight-hand comer
	 
	 	•	 	Clearly mark all as-built conditions on each sheet
	 
	 	•	 	Include Approved Sprinkler shop drawings, hydraulic calculations, head counts
	 
	 	•	 	Include Approved Fire Alarm shop drawings, product info and sequence of operations

	12.	 	PROJECT CLOSE-OUT — In addition to the above, Contractor shall provide three (3) bound
copies of the PROJECT MANUAL. Project Manuals will include the following:

	 	•	 	Table of Contents — organized by CSI divisions
	 
	 	•	 	Letter from GC declaring substantial completion
	 
	 	•	 	Executed copies of AIA Certificate of Substantial Completion
	 
	 	•	 	Copy of punch list with completion dates
	 
	 	•	 	Final Project Directory
	 
	 	•	 	Final Project Schedule
	 
	 	•	 	Final Submittal Log with approved submittals
	 
	 	•	 	Final CCD Log
	 
	 	•	 	Final As-built Finish Schedule
	 
	 	•	 	 Original or copy of Building Permit and Trade Permits
	 
	 	•	 	Original or copy of all intermediate and final inspections
	 
	 	•	 	Summary of Product Data and Warranties noting warranty period
	 
	 	•	 	Copies of all operations and maintenance information for pertinent equipment
	 
	 	•	 	Original or copy of Occupancy Permit
	 
	 	•	 	Copy of contractor reviews and engineer approved certified Air Balance
Report confirming the HVAC system has been balanced within 10% of design criteria or
as specified on the contract documents.
	 
	 	•	 	Copies of all required, disposal and/or recycling records
	 
	 	•	 	Accepted Transmittal of required Attic Stock of materials
	 
	 	•	 	Copy of final requisition and final change order log
	 
	 	•	 	Notarized copies of GC final release of liens on CESCR form-see attached

	13.	 	CERTIFICATE OF OCCUPANCY — If the Contractor is required to obtain a Cettificate of
Occupancy, the original shall be forwarded to CESCR.

I hereby agree with the terms and conditions set forth above in the Building Work Rules & Regulations:

	 	 	 	 	 	 	 
	CONTRACTOR:

	 	 	 	CHARLES E. SMITH COMMERCIAL REALTY:	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

(signature)

	 	 
	 	 

(signature)
	 	 
	 
	 	 	 	 	 	 
	 

(title)

	 	 
	 	 

(title)
	 	 
	 
	 	 	 	 	 	 
	 

(date)

	 	 
	 	 

(date)
	 	 

33

 

WAIVER AND RELEASE OF LIEN UPON PROGRESS PAYMENT

OWNER:
GENERAL CONTRACTOR:

PROJECT NAME:

                                        

          The undersigned, in consideration of the sum of $                    , hereby waives and releases its lien and
right to claim a lien for labor, services, or materials furnished through                                          (date of this waiver) to                     on
the job of                                          (Owner) to the following property:                               
        (Name and Address of Project).
This waiver and release does not cover any retention or labor, services or materials furnished
after the date specified.

          
Any and all contractors, subcontractors, laborers, suppliers and material men that have
provided labor, materials of services to the undersigned for use or incorporation into the
construction of the improvements or alterations to the Building or Demised Premises have been paid
and satisfied in full, and there are no outstanding claims of any nature arising out of, or
related to, the undersigned’s  activities on, or improvements to, the Building or Demised Premises.

          This Waiver and Release of Lien constitutes a representation by the undersigned signatory, for
and on behalf of the firm or company listed below, that the payment referenced above, once
received, constitutes full and complete payment for all work performed, and all costs or expenses
incurred (including, but not limited to, costs for supervision, field office overhead, home office
overhead, interest on capital, profit, and general conditions costs) relative to the work or
improvements in the Building or Demised Premises as of the date of this Waiver and Release of Lien,
except for the payment of retainage. The undersigned hereby specifically waives, quitclaims and
releases any claim for damages due to delay, hindrance, interference, acceleration,
inefficiencies or extra work, or any other claim of any kind it may have against the Owner, the
Owner’s lender, any tenant of Owner, the General Contractor (if this Waiver and Release of Lien is
signed by a subcontractor or supplier), or any other person or entity with a legal or equitable
interest in the Building or Demised Premises, as of the date of this Waiver and Release of Lien,
except as Follows:                                         

          This Waiver and Release of Lien is specifically made for the benefit of the Owner and the
Owner’s lender, any tenant and lender of any tenant, and any other person or entity with a legal
or equitable interest in the Building or Demised Premises, The amount of money set forth as due and
owing in the immediately preceding Waiver and Release of Lien
dated                     ,
20   , has been received, and is deemed paid in full.

          In Witness Whereof, the undersigned signatory, acting for and on behalf of the firm or
company listed below and all of its laborers, subcontractors, and suppliers, has placed his hand
and seal this           day of
                    , 20   .

34

 

FINAL LIEN WAIVER AND AFFIDAVIT

	 	 	 	 	 
	Contractor/Subcontractor:
	 	 

	 	 
	 
	 	 	 	 
	S.S. or Federal Tax ID:

	 
	 
	 	 
	 
	 	 	 	 
	Owner:

	 	 

	 	 
	 
	 	 	 	 
	Original Contract Amount:

	 	 

	 	 
	 
	 	 	 	 
	Approved Change Orders:

	 	 

	 	 
	 
	 	 	 	 
	Adjusted Contract Amount:

	 	 

	 	 
	 
	 	 	 	 
	Completed To Date:

	 	 

	 	 
	 
	 	 	 	 
	Retention:

	 	 

	 	 
	 
	 	 	 	 
	Total Earned: (Less Retention)

	 	 

	 	 
	 
	 	 	 	 
	Previous Payments:

	 	 

	 	 
	 
	 	 	 	 
	Current Payment:

	 	 

	 	 
	 
	 	 	 	 
	Contract Balance:

	 	 

	 	 

The UNDERSIGNED being duly sworn states that he is the                      of                                  
                            , which has a contract with                                         
                                        
for work and/or materials for. the real property located in the Country of                                          State of                     
                     and more particularly described as follows:                                          (the “Property”).

The UNDERSIGNED, for and in consideration of receipt of the sum of $                                                             and
 other good and valuable
consideration, the receipt of which is hereby acknowledged, does hereby waive and release its lien
and right to claim a lien for labor, service a or materials furnished in favor of                                          and each and every party making a loan on the
Property or insuring title thereto, any and all lien rights upon said land and improvements thereon, and on monies or other consideration due
or to became due on account of labor or services, materials, fixtures or apparatus heretofore
furnished or which may be furnished at any time hereafter.

The UNDERSIGNED respectfully warrants that the contract status set forth above is accurate, and no other sums are claimed, The undersigned represents that he has not assigned his claims for
payment, nor his right to perfect a lien against the Property, and has the right to execute this
Lien Waiver and Affidavit on behalf of                                          as its authorized                       
                  . All laborers, subcontractors, and
suppliers employed by the undersigned have been paid all sums
previously due, and shall be paid all current sums due out of this payment. None of such laborers, subcontractors, suppliers or materialmen is or will be entitled to claim or
assert any claim against the Property or the improvements thereon for labor or materials furnished to or for the account of the undersigned.

Executed this       day of                      , 200___.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	WITNESS	 	 	 	Contractor/Supplier/Sub-Contractors	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 

	 	 
	 

	 	 	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 

Signed and sworn to before me this                                          day of                      , 200___.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	Notary Public	 	 
	 
	 	 	 	 	 	 	 	 
	My Commission Expires:
	 	 	 	 	 	 	 	 

35

 

TWO DEMOCRACY PLAZA

6707 Democracy Boulevard Bethesda,

Maryland 20817

AFTER HOUR AUTHORIZATION REQUEST

	 	 	 	 	 
	Requested By:

	 	 

	 	 
	 
	 	 	 	 
	Company:

	 	 

	 	 
	 
	 	 	 	 
	Phone Number:

	 	 

	 	 
	 
	 	 	 	 
	Work Start Date:

	 	 

	 	 
	 
	 	 	 	 
	Work Hours:

	 	 

	 	 
	 
	 	 	 	 
	Date of Issue:

	 	 

	 	 
	 
	 	 	 	 
	Expiration Date:

	 	 

	 	 
	 
	 	 	 	 
	Issued By:

	 	 

	 	 
	 
	 	 	 	 
	 	 	 
	Description:
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	Floor:

	 	 

	 	 
	 
	 	 	 	 
	Location:

	 	 

	 	 
	 
	 	 	 	 
	Summary of Work:
	 
	 
	 
	 
	 
	 	 	 
	 
	 
	 	 	 
	 
	 
	 	 	 
	 
	 
	 
	 
	 
	 
	 
	Contractor Signature:

	 	X
 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	CESCR Use:

	 	 

	 	 
	 
	 	 	 	 
	CESCR SIGNATURE:

	 	X
 

	 	 

36

 

EXHIBIT C
BUILDINGS RULES AND REGULATIONS

	1.	 	Tenant shall not obstruct or interfere with the rights of other tenants of the Building or
the Complex, or of persons having business in the Building or the Complex, or in any way
injure or annoy such tenants or persons. Tenant will not Conduct any activity within the
Demised Premises which will create excessive traffic or noise anywhere in the Building or the
Complex. Tenant shall not bring or keep within the Building any animal, bicycle, motorcycle,
or type of vehicle except as required by law.
	 
	2.	 	Tenant shall promptly report to Landlord’s Agent all accidents and incidents occurring on or
about the Demised Premises, the Building and/or the Complex which involve or relate to the
security and safety of persons and/or property.
	 
	3.	 	Tenant shall use and occupy the Demised Premises only for the purposes specified in Section
1.8 of the Lease and for no other purpose whatsoever, and shall comply, and cause its
employees, agents, contractors, invitees and other users of the Demised Premises to comply,
with applicable zoning and other municipal regulations, including but not limited to smoking
regulations. Canvassing, soliciting and peddling in the Building or anywhere in the Complex
are prohibited, and Tenant shall cooperate to prevent such activities.
	 
	4.	 	All office equipment and any other device of any electrical or mechanical nature shall be
placed by Tenant in the Demised Premises in settings approved by Landlord, so as to absorb or
prevent any vibration, noise, or annoyance. Tenant shall not construct, maintain, use or
Operate within the Demised Premises or elsewhere in the Building or outside of the Building any
equipment or machinery which produces music, sound or noise, which is audible beyond the
Demised Premises. Tenant shall not cause objectionable noises, vibrations or odors within the Building.
	 
	5.	 	Tenant shall not deposit any trash, refuse, cigarettes, or other substances of any kind
within or out of the Building, except in the refuse containers provided therefor. No material
shall be placed in the trash boxes or receptacles if such material is of such nature that it
may not be disposed of in the ordinary and customary manner of removing and disposing of
office building trash and garbage without being in violation of the Lease or any law or
ordinance governing such disposal. Tenant shall be charged the cost of removal for any items
left by Tenant that cannot be so removed. All garbage and refuse disposal shall be made only
through entry ways and elevators provided for such purposes and at such times as Landlord
shall designate. Tenant shall not introduce into the Building any substance which might add an
undue burden to the cleaning or maintenance of the Demised Premises or the Building. Tenant
shall exercise its best efforts to keep the sidewalks, entrances, passages, courts, lobby
areas, garages or parking areas, elevators, escalators, stairways, vestibules, public
corridors and halls in and about the Building (hereinafter “Common Areas”) clean and free from Tenant’s rubbish. Tenant shall not cause any
unnecessary labor by reason of Tenant’s carelessness or indifferencs in the preservation of good order and cleanliness.
	 
	6.	 	Tenant shall use the Common Areas only as a means of ingress and egress, and Tenant shall
permit no loitering by Tenant’s agents, employees, visitors or invitees upon Common Areas or
elsewhere within the Building. Tenant shall comply, and cause its employees, agents,
contractors, invitees with other users of the Demised Premises to comply, with all rules and
regulations adopted by Landlord governing the use of the Common Areas. The Common Areas and
roof of the Building are not for the use of the general public, and Landlord shall in all
cases retain the right to control of prevent access thereto by all persons whose presence, in
the judgment of Landlord, shall be prejudicial to the safety, character, reputation or
interests of the Building and its tenants. Tenant shall not enter or install equipment in
the mechanical rooms, air conditioning rooms, electrical closets, janitorial closets, or
similar areas or go upon the roof of the Building without the prior written consent of
Landlord. Tenant shall not install any radio or television antenna, loudspeaker, or other
device on the roof or exterior walls of the Building. Tenant shall not, nor shall Tenant’s
agents, employees or contractors, enter or install equipment in or at the equipment room(s) or
closet(s), inside telecommunications and/or data transmission wire space and/or conducts or
the telephone wire demarcation point in the Building without Landlord’s prior consent.
	 
	7.	 	Without limitation upon any of the provisions of the Lease, Tenant shall not mark, paint,
drill into, cut, string wires within, or in any way deface any part of the Building, without
the prior written consent of Landlord, and as Landlord may direct. Upon removal of any wall
decorations or installations or floor coverings by Tenant, any damage to the walls or floors
shall be repaired by Tenant at Tenant’s sole cost and expense. Tenant shall not lay linoleum
or similar floor coverings so that the same shall come into direct contact with the floor of
the Demised Premises and, if linoleum or other similar floor covering is to be used, an
interlining of builder’s deadening felt shall be first affixed to the floor, by a paste or
other materials soluble in water. The use of cement or other similar adhesive material is
expressly prohibited. Floor distribution boxes for electric and telephone wires must remain accessible at all times.
	 
	8.	 	Tenant shall not install or permit the installation of any awnings, shades, mylar films or
sunfilters on windows. Tenant shall cooperate with Landlord in obtaining maximum effectiveness
of the cooling system of the Building by closing drapes and other window coverings when the
sun’s rays fall upon windows of the Demised Premises. Tenant shall not obstruct, alter or in
any way impair the efficient operation of the Systems, nor shall Tenant tamper with or change
the setting of any thermostat or temperature control valves in the Building (this is not
applicable in VAV buildings), Tenant shall not cover induction units.

Exh. C-1

37

 

	9.	 	Tenant shall not use the washrooms, restrooms and plumbing fixtures of the Building, and
appurtenances thereto, for any purpose other than the purpose for which they were constructed,
and Tenant shall not deposit any sweepings, rubbish, rags, or toxic or flammable products, or
other improper substances, therein. Tenant shall not waste water by interfering or tampering
with the faucets or otherwise. If Tenant or Tenant’s employees, agents, contractors, jobbers,
licensees, invitees, guests or visitors cause any damage to such washrooms, restrooms, plumbing
fixtures or appurtenances, such damage shall be repaired at Tenant’s expense, and Landlord shall not be responsible therefor.
	 
	10.	 	Subject to applicable fire or other safety regulations, all doors opening onto Common Areas
and all doors upon the perimeter of the Demised Premises shall be kept closed and, during
non-business hours, locked, except when in use for ingress or egress. If Tenant uses
the Demised Premises after regular business hours or on non-business days, Tenant shall lock
any entrance doors to the Building or to the Demised Premises used by Tenant immediately after
using such doors. Tenant shall cooperate with energy conservation by limiting use of lights to
areas occupied during non-business hours.
	 
	11.	 	Employees of Landlord shall not receive or carry messages for or to Tenant or any other
person, nor contract with nor tender free or paid services to Tenant or Tenant’s employees,
contractors, jobbers, agents, invitees, licensees, guests or visitors. In the event that any
of Landlord’s employees perform any such services, such employees shall be deemed to be the
agents of Tenant regardless of whether or how payment is arranged for such services, and
Tenant hereby indemnifies and holds Landlord harmless from any and all liability in connection
with any such services and any associated injury or damage to property or injury or death to persons resulting therefrom.
	 
	12.	 	All keys to the exterior doors of the Demised Premises shall be obtained by Tenant from
Landlord, and Tenant shall pay to Landlord a reasonable deposit determined by Landlord from
time to time for such keys. Tenant shall not make duplicate copies of such keys. Tenant shall,
upon the termination of its tenancy, provide Landlord with the combinations to all combination
locks on safes, safe cabinets, and other key-controlled mechanisms therein, whether or not
such keys were furnished to Tenant by Landlord. In the event of the loss of any key furnished
to Tenant by Landlord, Tenant shall pay to Landlord the cost of replacing the same or of
changing the lock or locks opened by such lost key if Landlord shall deem it necessary to make
such a change. The word “key” as used herein shall refer to keys, keycards, and all such means
of obtaining access through restricted access systems.
	 
	13.	 	No signs, advertisements or notes shall be painted or affixed on or to any windows, doors or
other parts of the Building visible from the exterior (other than as expressly permitted by
the terms of the Lease), or to any Common Area or public area of the Building.
	 
	14.	 	Landlord will provide and maintain a directory board for the Building, in the main lobby of
the Building, and no other directories shall be allowed.
	 
	15.	 	All contractors, contractors’ representatives and installation technicians tendering any
service to Tenant shall be referred by Tenant to Landlord for Landlord’s supervision, approval
and control before the performance of any contractual service. This provision shall apply to all work performed in the Building.
	 
	16.	 	After initial occupancy, movement in or out of the Building of furniture or office equipment,
or dispatch or receipt by Tenant of any bulky material, merchandise or material which requires
use of elevators shall be restricted to the use of freight elevators only. Absolutely no carts
or dollies are allowed through the main entrances or on passenger elevators. All items not
hand carried must be delivered via the appropriate loading dock and freight elevator, if any.
	 
	17.	 	No portion of the Demised Premises shall at any time be used or occupied as sleeping or
lodging quarters.
	 
	18.	 	Landlord shall have the power to prescribe the weight and position of safes and other heavy
equipment, which shall in all cases, to distribute weight, stand on supporting devices
approved by Landlord. All damages done to the Building by taking in or putting out any
property of Tenant, or done by Tenant’s Property while in the Building, shall be repaired at the expense of Tenant.
	 
	19.	 	For purposes hereof, the terms “Landlord”, “Landlord’s Agent”, “Tenant”, “Complex”,
“Building”, “Demised Premises”, “Tenant’s Property” and “Systems” are defined in the Lease to
which these rules and regulations are attached. Wherever these terms appear in the rules and
regulations they shall have the same meaning as defined in the Lease.
	 
	20.	 	These Rules and Regulations are in addition to, and shall not be construed to in any way
modify or amend, in whole or in part, the agreements, covenants, conditions and provisions of
any lease of any premises in the Building.

Exh. C-2

38

 

EXHIBIT D

MINIMUM CLEANING SERVICES BY LANDLORD

	A.	 	DAILY - Monday through Friday, except legal holidays.

	 	1.	 	Empty waste baskets, clean ashtrays.
	 
	 	2.	 	Dust accessible areas of desk tops.
	 
	 	3.	 	Vacuum carpet in all areas of the Demised Premises.
	 
	 	4.	 	Mop spillages on tile floors.
	 
	 	5.	 	Clean lavatories and replace supplies.
	 
	 	6.	 	Dust and mop kitchens within the Demised Premises, provided that Tenant shall be
responsible for the cleaning of any dishes, glasses or utensils in the kitchen areas.
Tenant shall maintain any coffee pots and utensils located in the Demised Premises.

	B.	 	WEEKLY

	 	1.	 	Dust accessible areas of furniture, convectors and other furnishings.
	 
	 	2.	 	Clean glass in doors and partitions.

	C.	 	MONTHLY

	 	1.	 	Mop and buff tile floors.
	 
	 	2.	 	Dust Venetian blinds, window frames and exterior of lighting fixtures.
	 
	 	3.	 	Spot clean walls.
	 
	 	4.	 	Clean telephones.

	D.	 	QUARTERLY

	 	1.	 	Clean and refinish tile floors where necessary.
	 
	 	2.	 	Clean baseboards.

	E.	 	SEMI-ANNUALLY

	 	1.	 	Wash windows.

	F.	 	ANNUALLY

	 	1.	 	Wash light fixtures and lenses.
	 
	 	2.	 	Clean Venetian blinds.

			
	NOTE:	 	Cleaners will not move papers or other materials from surfaces to be cleaned, dusted or
vacuumed. Trash not in wastebaskets should be clearly marked “TRASH”. Cleaning of private kitchens and baths is the responsibility of the Tenant.

39

 

EXHIBIT E

FORM OF LETTER OF CREDIT

                        , 200   

Second Rock Spring Park Limited Partnership

c/o Charles E. Smith Real Estate Services L.P.

2345 Crystal Drive, Suite 1000

Arlington, Virginia 22202

Attn: Division Counsel

Dear Sir(s):

          We hereby issue in your favor our irrevocable letter of credit for account of Micromet, Inc.
for the sum of U.S.D. $                     which is effective immediately and expiring at our close of
business                                         , available against your or your transferee’s sight draft(s) drawn on us accompanied by a signed statement purportedly signed on behalf of Second Rock Spring Park Limited Partnership or its
transferee reading as follows:

“Beneficiary is entitled to draw the sum of U.S.D. $                     under [Bank which is a
member of the                      Clearinghouse Association] Letter of Credit No.                      in
accordance with the provisions of the Agreement of Lease between Second Rock Spring Park
Limited Partnership, as landlord, and Micromet, Inc., as tenant.”

     This letter of credit is transferable in its entirety, provided that a signed and completed
transfer form satisfactory to the Bank is received. Applicant shall be accountable for all transfer
charges.

          It is a condition of this Letter of Credit that if shall be deemed automatically extended,
without an amendment, for additional period(s) of one (1) year from the present or any future
expiration date hereof, unless at least forty-five (45) days prior to such date, we notify you in
writing, by registered mail or courier, that we elect not to consider this letter of credit
renewed for any such additional period(s). Notwithstanding the foregoing, this Letter of Credit
shall not be extended beyond [insert final maturity date here].

          We hereby agree that drafts drawn in accordance with the terms stipulated herein will be duly
honored upon presentation and delivery of documents as specified if presented to [Bank which is a
member of the Clearinghouse Association and its address] on or before [at least one year from
the date of issue and the last day of the month], or any automatically extended date as hereinabove set forth.
Partial draws shall be permitted hereunder.

          Except so far as is otherwise stated, this irrevocable letter of credit is subject to the
Uniform Custom and Practice for Documentary Credits (1993 Revisions) International Chamber of
Commerce Publication Number 500.

Very truly yours,

          [An Authorized Officer of the Bank]

40

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