Document:

<PAGE>

                                                                   Exhibit 10.17
                                   APPENDIX A
                                       TO
                             PARTICIPATION AGREEMENT

        I.      Interpretation. In each Operative Document, unless a clear
contrary intention appears:

        (a)     any term defined below by reference to another instrument or
document shall continue to have the meaning ascribed thereto whether or not such
other instrument or document remains in effect;

        (b)     words importing the singular, where appropriate, include the
plural and vice versa;

        (c)     words importing a gender include any gender;

        (d)     a reference in any Operative Document to a part, clause,
section, exhibit or schedule without further description is a reference to a
part, clause and section of, and exhibit and schedule to, such Operative
Document;

        (e)     a reference to any statute, regulation, proclamation, ordinance
or law includes all statutes, regulations, proclamations, ordinances or laws
amending, supplementing, supplanting, varying, consolidating or replacing it,
and a reference to a statute includes all regulations, proclamations and
ordinances issued or otherwise applicable under that statute;

        (f)     a reference to a document includes, unless the context thereof
otherwise requires, any amendment or supplement to, or replacement or novation
of, that document;

        (g)     a reference to a party to a document includes that party's
successors and permitted assigns;

        (h)     a reference to "including" means including without limiting the
generality of any description preceding such term and for purposes hereof a
general statement followed by or referable to an enumeration of specific matters
shall not be limited to matters similar to those specifically mentioned; and

        (i)     the word "until," when used in the context of a date for
payment, means until (but excluding) such date for payment.

        II.     Legal Representation of the Parties. The Operative Documents
were negotiated by the parties with the benefit of legal representation and any
rule of construction or interpretation otherwise requiring the Operative
Documents to be construed or interpreted against any party shall not apply to
any construction or interpretation hereof or thereof.

        III.    Accounting Terms. All accounting terms not specifically defined
otherwise herein shall have the meaning customarily given in accordance with
GAAP, and all financial

<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

computations hereunder shall be computed, unless specifically provided otherwise
herein, in accordance with GAAP.

        IV.     Defined Terms. Terms defined herein have the respective
meanings indicated below when used in each Operative Document.

        "A Loan" means a Loan made by a Lender as part of an Advance, comprising
of such Lender's Conduit Share of the A Percentage of such Advance.

        "A Loan Agreement" means the A Loan Agreement, dated as of the
Documentation Date, among Lessor, Eagle, the Administrator and the Liquidity
Providers.

        "A Loan Maturity Date" means November 7, 2006 or such earlier date on
which the A Loans become due pursuant to the A Loan Agreement.

        "A Notes" is defined in Section 2.3 of the A Loan Agreement.

        "A Notes Margin" means (a) 0.45% per annum whenever the Liquid
Collateral has Properly Margined Collateral Coverage, and (b) 0.55% per annum
otherwise.

        "A Percentage" means 84.0%.

        "A Loan Termination Date" is defined in Section 2.1(b) of the Loan
Agreement.

        "ABR" means, for any period, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/100th of 1%) equal to the lesser of (a) the
Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in
effect one day prior to such day plus 1/2 of 1%. For purposes hereof: "Prime
Rate" means the rate of interest per annum publicly announced from time to time
by Fleet National Bank as its prime rate in effect at its principal office at
100 Federal Street, Boston, Massachusetts 02110 (the Prime Rate not being
intended to be the lowest rate of interest charged by Fleet National Bank in
connection with extensions of credit to debtors); and "Federal Funds Effective
Rate" means, for any day, the weighted average of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published on such day or, if such day is not a
Business Day, on the next preceding Business Day, by the Federal Reserve Bank of
New York, or, if such rate is not so published for any day which is a Business
Day, the average of the quotations for the day of such transactions received by
the Administrative Agent from three federal funds brokers of recognized standing
selected by it. If for any reason the Administrative Agent shall have determined
(which determination shall be conclusive absent manifest error) that it is
unable to ascertain the Federal Funds Effective Rate for any reason, including
the inability or failure of the Administrative Agent to obtain sufficient
quotations in accordance with the terms thereof, the ABR shall be determined
without regard to clause (b) of the first sentence of this definition, as
appropriate, until the circumstances giving rise to such inability no longer
exist. Any change in the ABR due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.

                                       2
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "ABR Investor Contribution" means an Investor Contribution accruing held
at a rate determined by reference to the ABR.

        "ABR Loan" means a Loan which is bearing interest at a rate of interest
determined by reference to the ABR.

        "Account" means the Account (Fleet National Bank) or the Account (First
Union) or both.

        "Account Agreements" means with respect to the Account (Fleet National
Bank), the Capital Focus Investment Account Agreement, dated November 7, 2001
between Fleet National Bank and HGSI, and with respect to the Account (First
Union), the Institutional Investment Management Agreement, dated November 7,
2001 between HGSI and First Union.

        "Account (First Union)" means the special purpose, segregated account
(Account No. 8025494048, ABA No. 053000219) established by First Union and
maintained by the First Union Collateral Agent for the benefit of First Union,
and the Participants; the operation of the Account (First Union) shall be
governed by the First Union Liquid Collateral Agreement and the Account
Agreement.

        "Account (Fleet National Bank)"means the special purpose, segregated
account (Account No. 0006529470, ABA No.011500010) established by Fleet National
Bank and maintained by the Fleet National Bank Collateral Agent for the benefit
of Fleet National Bank, and the Participants; the operation of the Account
(Fleet National Bank) shall be governed by the Fleet National Bank Liquid
Collateral Agreement.

        "Additional Collateral Delivery Date" is defined in Section 2.1 of the
Liquid Collateral Agreements.

        "Address" means, subject to the right of the party in question to change
its Address in accordance with the terms of the Operative Documents:

                (a)     with respect to Lessor Wells Fargo Bank Northwest, N.A.,
        with a copy to Mayer, Brown & Platt, 1675 Broadway, New York, New York
        10019, Attention: Barry K. Gassman, Esq.

                (b)     with respect to Lessee, Steven C. Mayer, Senior Vice
        President and CFO, HGSI, 9410 Key West Avenue, Rockville, MD 20850, with
        copy to James H. Davis, Esq., Senior Vice President and General Counsel,
        HGSI.

        with respect to the Agents, the address provided by the applicable Agent
to the other parties to any Operative Document as its address for notices.

        "Adjacent Site" means the land described on Schedule VIII to the
Participation Agreement.

        "Adjusted Market Value (Item)" means with respect to each Permitted
Investment that constitutes Liquid Collateral on any date that the securities in
an Account are marked-to-market,

                                       3
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

the product of the Fair Market Value of the Permitted Investment on such date
multiplied by the percentage in the table below under the column marked "Advance
Rate to Maintain Properly Margined Liquid Collateral" opposite the type of
investment into which such Permitted Investment falls.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------
       Types of Permitted Investments         Advance Rate to Maintain Properly
                                                 Margined Liquid Collateral
----------------------------------------------------------------------------------
<S>                                                          <C>
         U.S. Treasury Obligations                           90%
----------------------------------------------------------------------------------
             Money Market Funds                              90%
----------------------------------------------------------------------------------
           Repurchase Obligations                            90%
----------------------------------------------------------------------------------
         Mortgage Backed Securities                          80%
----------------------------------------------------------------------------------
          Asset Backed Securities                            80%
----------------------------------------------------------------------------------
     Negotiable Certificates of Deposit                      80%
----------------------------------------------------------------------------------
 Commercial Paper rated A-1, P-1 or better                   80%
----------------------------------------------------------------------------------
          U.S. Agency Obligations                            80%
----------------------------------------------------------------------------------
 Taxable Municipal Bonds (Moody's Aaa down
   through A3; S & P AAA down through A-)                    80%
----------------------------------------------------------------------------------
 Bonds (Moody's Aaa down through A3; S & P
            AAA down through A-)                             70%
----------------------------------------------------------------------------------
              Bank Obligations                               80%
----------------------------------------------------------------------------------
</TABLE>

        "Adjusted Market Value" means, with respect to Properly Margined Liquid
Collateral, the sum of the Adjusted Market Value (Item) of each Permitted
Investment constituting Properly Margined Liquid Collateral in respect of an
Account on each date such Liquid Collateral is marked-to-market in accordance
with the Participation Agreement.

        "Administrative Agent" means Fleet National Bank, in its capacity as
administrative agent under the Operative Documents.

        "Administrative Agent Fee Letter" means the fee letter dated the
Documentation Date between HGSI and the Administrative Agent.

        "Administrator" means Fleet Securities, Inc., in its capacity as
administrator of Eagle.

        "Advance" means (i) an advance of funds by the Lenders and the Investors
to Lessor pursuant to Section 2.2 of the Participation Agreement, and (ii) an
advance of funds by Lessor to Construction Agent pursuant to Section 2.2 of the
Participation Agreement, as applicable.

        "Advance Date" means the date on which any Advance is made.

                                       4
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Advance Request" means any request for an Advance made by Lessee as
Construction Agent for Lessor to the Investors and the Lenders, substantially in
the form of Exhibit A to the Participation Agreement.

        "Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with, such Person. For
purposes of this definition, the term "control" (including the correlative
meanings of the terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise, provided (but without limiting the foregoing) that no
pledge of voting securities of any Person without the current right to exercise
voting rights with respect thereto shall by itself be deemed to constitute
control over such Person.

        "Agent" means any of the Administrative Agent, the Administrator, the
Liquidity Agent, and the Collateral Agents, and "Agents" means, collectively,
the Administrative Agent, the Administrator, the Liquidity Agent and the
Collateral Agents.

        "Aggregate Available Commitments" means, as of any date of
determination, the sum of (i) without duplication, the Available Commitments of
the Liquidity Providers under the Loan Agreement, and (ii) the Available
Commitments of the Investors.

        "Aggregate Commitments" means the sum of (i) without duplication, the
Commitment Amounts of the Liquidity Providers under the Loan Agreement, and (ii)
the Commitment Amount of the Investors.

        "Allocable Portion" means, with respect to the calculation of the
amounts distributable by Administrative Agent pursuant to:

                (a)     Section 10.3(b) of the Participation Agreement, a
        fraction (i) the numerator of which equals (A) in the event that Lessee
        exercises its Purchase Option with respect to only the Traville
        Facility, the Traville Lease Balance, or (B) in the event that Lessee
        exercises its Purchase Option with respect to only the Manufacturing
        Facility, the Manufacturing Lease Balance, and (ii) the denominator of
        which equals the Lease Balance;

                (b)     Section 10.4(b) of the Participation Agreement, a
        fraction (i) the numerator of which equals (A) in the event that either
        the Traville Construction Period Maximum Guaranty Amount, the Traville
        Residual Value Guaranty Amount or the Traville Lease Balance is being
        distributed pursuant thereto, the Traville Lease Balance, or (B) in the
        event that either the Manufacturing Construction Period Maximum Guaranty
        Amount, the Manufacturing Residual Value Guaranty Amount or the
        Manufacturing Lease Balance is being distributed pursuant thereto, the
        Manufacturing Lease Balance, and (ii) the denominator of which equals
        the Lease Balance; or

                (c)     Section 10.5(b) of the Participation Agreement, a
        fraction (i) the numerator of which equals (A) in the event that only
        the Traville Facility is sold under Section 7.1 of the Lease, the
        Traville Lease Balance, or (B) in the event that only the Manufacturing

                                       5
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        Facility is sold under Section 7.1 of the Lease, the Manufacturing Lease
        Balance, and (ii) the denominator of which equals the Lease Balance.

        "Alterations" means, with respect to the Properties, alterations,
additions, improvements, modifications and additions to the Properties.

        "Applicable Laws" means all existing and future applicable laws, rules,
regulations, statutes, treaties, codes, ordinances, permits, certificates,
orders and licenses of and interpretations by, any Governmental Authority, and
applicable judgments, decrees, injunctions, writs, orders or like action of any
court, arbitrator or other administrative, judicial or quasi-judicial tribunal
or agency of competent jurisdiction (including Environmental Laws and other laws
pertaining to health, safety or the environment and those pertaining to the
construction, use or occupancy of the Properties) and any restrictive covenant
or deed restriction or easement of record affecting the Properties, and any
requirements of applicable insurance companies or insurance regulatory agencies.
To the extent Lessee or any other party obtains an exemption, variance or
similar exception to any Applicable Laws for or in connection with the
Properties, including any zoning or building ordinances or regulations, then
Applicable Laws shall be construed to mean Applicable Laws as so applicable to
the Properties.

        "Appraisal" means an appraisals, prepared by the Appraiser, of the Land
and Improvements on an as-built basis, to be delivered pursuant to Section
4.1(s) and 4.3(q) of the Participation Agreement.

        "Appraised Value" is defined in Section 23(b) of the Ground Lease.

        "Appraiser" means Integra Realty Resources, Inc. or such other Person as
may be selected by Lessor and is reasonably acceptable to Lessee.

        "Approved Construction Budget" means, as applicable, the Approved
Manufacturing Construction Budget and/or the Approved Traville Construction
Budget.

        "Approved Manufacturing Construction Budget" is defined in Section
2.4(a)(i) of the Construction Agency Agreement.

        "Approved Manufacturing Construction Schedule" is defined in Section
2.4(a)(i) of the Construction Agency Agreement.

        "Approved Manufacturing Plans and Specifications" is defined in Section
2.4(a)(i) of the Construction Agency Agreement.

        "Approved Traville Construction Budget" is defined in Section 2.4(b)(i)
of the Construction Agency Agreement.

        "Approved Traville Construction Schedule" is defined in Section
2.4(b)(i) of the Construction Agency Agreement.

        "Approved Traville Plans and Specifications" is defined in Section
2.4(b)(i) of the Construction Agency Agreement.

                                       6
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Appurtenant Rights" means (i) all agreements, easements, rights of way
or use, rights of ingress or egress, privileges, appurtenances, tenements,
hereditaments and other rights and benefits at any time belonging or pertaining
to the Land or the Improvements, including the use of any streets, ways, alleys,
vaults or strips of land adjoining, abutting, adjacent or contiguous to the Land
and (ii) all permits, licenses and rights, whether or not of record, appurtenant
to the Land.

        "Arranger" means BancBoston Leasing Investments Inc.

        "As-Built Appraisal" means, as applicable, the Traville As-Built
Appraisal and/or the Manufacturing As-Built Appraisal.

        "Asset Backed Securities" means asset backed securities rated AAA by S&P
and Aaa by Moody's.

        "Assignee Bank" has the meaning assigned to such term in each Liquidity
Agreement.

        "Assignment and Acceptance" means any assignment and acceptance
delivered pursuant to Section 8.1.1(a) of the Participation Agreement.

        "Assignment of Lease" means the Lessor Assignment of Lease.

        "Authority" means any applicable foreign, federal, state, county,
municipal or other government, quasi-government or regulatory authority, agency,
board, body, commission, instrumentality, court or tribunal, or any political
subdivision of any thereof, or arbitrator or panel of arbitrators.

        "Authorized Officer" means with respect to HGSI in any capacity, any of
HGSI's Chief Executive Officer, Chief Financial Officer or General Counsel.

        "Available Commitment" means (a) as to each Liquidity Provider, such
Liquidity Provider's daily average Liquidity Commitment (as defined in the
Liquidity Agreement) reduced by the sum of the amount of (i) the aggregate daily
average principal amount of all outstanding Facility Loans made by such
Liquidity Provider and (ii) the daily average aggregate principal amount of all
outstanding Conduit Loans, and (b) as to each Investor, such Investor's daily
average Commitment Amount reduced by its then daily average Investor Amount.

        "B Loan" means a Loan made by a Lender as part of an Advance, comprising
such Lender's Conduit Share of the B Percentage of such Advance.

        "B Loan Agreement" means the B Loan Agreement, dated as of the
Documentation Date, among Lessor, Eagle, the Administrator and the Liquidity
Providers.

        "B Loan Maturity Date" means November 7, 2008 or such earlier date on
which the B Loans becomes due pursuant to the B Loan Agreement.

        "B Notes" is defined in Section 2.3 of the B Loan Agreement.

                                       7
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "B Notes Margin" means (a) 0.45% per annum whenever the Liquid
Collateral has Properly Margined Collateral Coverage, and (b) 0.55% per annum
otherwise.

        "B Loan Termination Date" is defined in Section 2.1(b) of the Loan
Agreement.

        "B Percentage" means 12%.

        "Balancing Deposit" is defined in Section 5.6(c) of the Construction
Agency Agreement.

        "Bank Obligations" means bank notes and banker's acceptances the obligor
of which has an unsecured long-term debt rating of at least A by S&P and A2 by
Moody's and has a commercial paper rating of at least A-1 by S&P and P-1 by
Moody's.

        "Bankruptcy Code" means the Bankruptcy Reform Act of 1978.

        "Bankruptcy Default" means, with respect to Lessee, an Insolvency Event
without regard to the cure or grace periods provided therein.

        "Base Rent" means the rent payable pursuant to Section 3.1 of the Lease.

        "Beneficial Owner" means the Trust, as beneficial owner of the Ground
Lessee.

        "Benefit Arrangement" means at any time an employee benefit plan within
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan
and which is maintained or otherwise contributed to by any member of the ERISA
Group.

        "Board of Directors" means, with respect to a corporation, either the
board of directors or any duly authorized committee of that board of directors
which, pursuant to the by-laws of such corporation, has the same authority as
that board of directors as to the matter at issue.

        "Borrower" means, with respect to each Loan Agreement, Lessor.

        "Borrowing" is defined in the Liquidity Agreement.

        "Break Costs" means an amount equal to the amount, if any, required to
compensate any Lessor Hedging Agreement Counterparty for any additional losses
(including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or funds acquired by such Lessor
Hedging Agreement Counterparty to fund its obligations under the Lessor Hedging
Agreements) it may reasonably incur under a Lessor Hedging Agreement or any
other interest rate swap, cap, collar or lock agreement or similar agreement to
which Lessor and such Lessor Hedging Agreement Counterparty is a party; such
amount shall include any amounts payable in connection with an "Early
Termination Date" (as defined in the ISDA Form multi-currency cross-border)
under any Lessor Hedging Agreement. A statement as to the amount of such loss,
cost or expense, prepared in good faith and in reasonable detail and submitted
by such Lessor Hedging Agreement Counterparty, as the case may be, to the
Lessee, shall be presumed correct and binding on Lessee absent demonstrable
error.

                                       8
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Business Day" means (a) any day other than a Saturday, Sunday or other
day on which commercial banks in Boston, Massachusetts, Charlotte, North
Carolina, New York, New York or Baltimore, Maryland are authorized or required
by law to close, and (b) in the case of a Eurodollar Loan, any day on which
dealings in U.S. dollar deposits are carried on in the interbank Eurodollar
market and on which commercial banks are open for domestic and international
business in Boston, Massachusetts, Charlotte, North Carolina and London.

        "Capitalizable Transaction Costs" means all Transaction Costs other than
Non-Capitalizable Transaction Costs.

        "Capitalized Lease Obligation" means, with respect to any Person, at the
time any determination thereof is to be made, the amount of the liability in
respect of a lease that would at such time be so required to be capitalized on
the balance sheet of such Person as lessee thereof in accordance with GAAP.

        "Cash Burn Amount" means for any period, the amount by which the sum
(without duplication) for HGSI and its Subsidiaries on a consolidated basis of
the following amounts is less than $0:

        (i)     Consolidated Net Income for such period; plus

        (ii)    the amount which, in the determination of Consolidated Net
Income for such period, has been deducted for depreciation and amortization
(including, without limitation, amortization of goodwill and other intangibles);

plus

        (iii)   the non-cash charges which, in the determination of Consolidated
Net Income for such period, have been deducted in calculating "purchased
in-process research and development expenses"; plus

        (iv)    the non-cash charges which, in the determination of Consolidated
Net Income for such period, has been deducted as debt conversion expense or
other similar non-cash charges; plus

        (v)     other similar non-cash charges described in clauses (iii) and
(iv)

        all as determined in accordance with GAAP.

        "Cash Collateral Test Date" means the last day of each Fiscal Quarter;
provided, however, that if at the end of any Fiscal Quarter the aggregate amount
of all Unrestricted Cash and Marketable Securities of HGSI and its Subsidiaries
on a consolidated basis is less than three hundred million dollars
($300,000,000) for the period of four consecutive Fiscal Quarters then ended,
then at all times thereafter, "Cash Collateral Test Date" shall mean the last
day of each calendar month.

        "Cash Equivalents" means (a) Government Obligations having maturities of
not more than one year from the date of acquisition, (b) certificates of deposit
of any commercial bank

                                       9
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

incorporated under the laws of the United States, or any state, territory or
commonwealth thereof, of recognized standing having capital and unimpaired
surplus in excess of $500,000,000 and whose short-term commercial paper rating
at the time of acquisition is at least A-1 or the equivalent by Standard &
Poor's Corporation or at least P-1 or the equivalent by Moody's Investors
Services, Inc. (any such bank, an "Approved Bank"), which certificates of
deposit have maturities of not more than one year from the date of acquisition,
(c) repurchase obligations with a term of not more than 31 days for underlying
securities of the types described in clauses (a), (b) and (d) of this definition
entered into with any Approved Bank which (i) is secured by a fully perfected
security interest in any obligation of the type described in any of clauses (a),
(b) and (d), and (ii) has a market value at the time such repurchase agreement
is entered into of not less than 100% of the repurchase obligation of such
Lender (or other commercial banking institution) thereunder, (d) commercial
paper or financial company paper issued by any person incorporated under the
laws of the United States, or any state thereof, and rated at least A-1 or the
equivalent by Standard & Poor's Corporation or at least P-1 or the equivalent by
Moody's Investors Services, Inc., and in each case maturing not more than 9
months from the date of acquisition and not issued by HGSI or any Affiliate, and
(e) investments in money market funds that are registered under the Investment
Company Act of 1940, which have assets of at least $100,000,000 and at least 95%
of whose assets consist of investments or other obligations of the type
described in clauses (a) through (d) above and as to which withdrawals are
permitted at least every 30 days.

        "Casualty" means an event of damage or casualty relating to all or part
of the Properties that does not constitute an Event of Loss.

        "Claims" means liabilities, obligations, damages, losses, demands,
penalties, interest, fines, claims, actions, suits, judgments, settlements,
utility charges, costs, fees, expenses and disbursements (including, without
limitation, reasonable, actually-incurred legal fees and expenses and costs of
investigation) of any kind and nature whatsoever.

        "Code" means the Internal Revenue Code of 1986.

        "Collateral" is defined in the Granting Clause Second of the Security
Agreement.

        "Collateral Agent" means the Fleet National Bank Collateral Agent and
the First Union Collateral Agent.

        "Commercial Paper Account" means the special purpose segregated trust
account established at the corporate trust office of Eagle, and which at all
times shall be maintained in Eagle's corporate trust department and which shall
never be considered a general deposit account and as such shall not be available
for set-off or garnishment by the creditors of Eagle; such account entitled
"EagleFunding Corporation Commercial Paper Account."

        "Commercial Paper Documents" means, collectively, the commercial paper
notes issued by Eagle and the agreements entered into by Eagle in connection
with its commercial paper program.

                                       10
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Commercial Paper Notes" means the short-term promissory notes issued by
the Conduit as the source of funding for the funding and maintenance by the
Conduit of the Loans made under the Loan Agreement.

        "Commitment" means (a) with respect to each Liquidity Provider its
obligation (i) to make loans under the Liquidity Agreement to Eagle or (ii) to
make Facility Loans under the Loan Agreement to the Lessor, and (b) with respect
to each Investor, its obligation to make Investor Contributions to the Lessor
under Section 2.2.2 of the Participation Agreement.

        "Commitment Amount" means (a) with respect to each Liquidity Provider's
Commitment to make advances under the related Liquidity Agreement, the amount
such Liquidity Provider is committed to fund under the Liquidity Agreement; (b)
with respect to each Liquidity Provider's Commitment to make Facility Loans
under the Loan Agreement, the amount set forth opposite such Liquidity
Provider's name on Schedule II to the Participation Agreement; and (c) with
respect to each Investor, the amount set forth opposite its name on Schedule II
to the Participation Agreement.

        "Commitment Period" means the period from and including the
Documentation Date to the date immediately preceding the Construction Period
Termination Date or such earlier date on which the Commitments of all
Participants shall terminate as provided in the Operative Documents.

        "Completion Date" means, with respect to a Property, the date
Substantial Completion occurs for such Property.

        "Compliance Certificate" means a certificate executed by an authorized
officer of HGSI substantially in the form of Exhibit E to the Participation
Agreement.

        "Concentration Limits" means

                (a)     there are no limits as to U.S. Treasury Obligations or
        U.S. Agency Obligations.

                (b)     no Permitted Investment may be transferred to an Account
        if at the time of transfer and at all times thereafter the aggregate
        amount of Liquid Collateral issued by the same issuer or Issuer Group
        exceeds or would exceed, after such transfer, 5% of the Adjusted Fair
        Market Value or Fair Market Value, as applicable, of the Liquid
        Collateral (including the Permitted Investments to be transferred) in
        respect of an Account, excepting U.S. Government Obligations that may
        constitute Liquid Collateral.

                (c)     no securities issued by a United States bank, other
        United States regulated depository institution and United States
        insurance company may be transferred to an Account if at the time of
        transfer and at all times thereafter the aggregate amount of bank and
        insurance company securities, including, for example, negotiable
        certificates of deposit, commercial paper, bankers acceptances or medium
        or long-term securities, exceeds or would exceed, after such transfer,
        80% of the Adjusted Market Value or Fair Market Value of the Liquid
        Collateral (including the Permitted Investments to be

                                       11
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        transferred) in respect of an Account at the time the additional Liquid
        Collateral is to be transferred thereto and at all times thereafter;

provided that with respect to each Account, the respective Collateral Agent and
HGSI may agree in writing to other or no "Concentration Limits"

        "Condemnation" means any condemnation, requisition or other taking or
sale of the use, occupancy or title to the Properties or any part thereof in, by
or on account of any eminent domain proceeding or other action by any
Governmental Authority or other Person under the power of eminent domain or
otherwise or any transfer in lieu of or in anticipation thereof, that does not
constitute an Event of Loss.

        "Conduit" means Eagle.

        "Conduit A Loan" is defined in Section 2.1(a) of the A Loan Agreement.

        "Conduit A Note" is defined in Section 2.3(a) of the A Loan Agreement.

        "Conduit B Loan" is defined in Section 2.1(a) of the B Loan Agreement.

        "Conduit B Note" is defined in Section 2.3(a) of the B Loan Agreement.

        "Conduit Fee Letter" means the letter dated the Documentation Date
between Administrative Agent and the Conduit.

        "Conduit Loan" means a Conduit A Loan and/or a Conduit B Loan, as
applicable.

        "Conduit Loan Documents" means, collectively, the Loan Agreement, the
Notes and the Security Documents.

        "Conduit Loan Event of Default" is defined in Section 6.1 of the Loan
Agreement.

        "Conduit to Liquidity Provider Fee Letter" means the letter dated the
Documentation Date between the Conduit and the Liquidity Provider(s).

        "Connecticut Statutory Trust Act" means the Connecticut Statutory Trust
Act, Conn. Gen. Stat Sections 34-500 to 34-547 (2001).

        "Connecticut Certificate of Trust" means the certificate of trust with
respect to the Trust, filed with the Office of the Secretary of State of
Connecticut in accordance with Section 34-503(a) of the Connecticut Statutory
Trust Act.

        "Consolidated Net Income" means with respect to any specified Person for
any period, the aggregate of the Net Income of such specified Person and its
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP. "Net Income" of any Person shall mean the net income (loss) of such
Person, determined in accordance with GAAP.

        "Construction" means the construction and installation of all
Improvements contemplated by the Plans and Specifications.

                                       12
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Construction Agency Agreement" means the Construction Agency Agreement,
dated as of the Documentation Date, between Lessor and Construction Agent.

        "Construction Agency Default" means any condition, event or act which,
with notice or lapse of time or both, would become a Construction Agency Event
of Default.

        "Construction Agency Event of Default" is defined in Section 5.1.1 of
the Construction Agency Agreement.

        "Construction Agency Person" means Lessee, Construction Agent, the Prime
Contractor, the Architect, the General Contractor, any other contractor or
subcontractor or other Person directly or indirectly performing work or
providing services or materials on the Property, or relating to the Construction
or the Properties, through and including the period ending on the Completion
Date (regardless of when such Person commenced performing such work or providing
such services or materials, including any period prior to the Documentation
Date), and all of their respective officers, directors, shareholders, partners,
employees, agents, consultants (on the Properties), service-providers (on the
Properties), successors and assigns, and any Person controlled by any of the
foregoing.

        "Construction Agent" means Lessee, as construction agent under the
Construction Agency Agreement.

        "Construction Breakage Costs" means any costs or expenses incurred by
Lessor, the Administrator, the Administrative Agent or any Participant in
connection with the termination of any of the Construction Documents following
the occurrence of a Construction Agency Agreement Event of Default.

        "Construction Budget" means, as applicable, the Approved Traville
Construction Budget and/or the Approved Manufacturing Construction Budget, as
each may be amended from time to time in accordance with the Construction Agency
Agreement.

        "Construction Consultant" means Inspection And Valuation International,
Inc. appointed by the lessor or such other Person as may be selected by Lessor
and reasonably acceptable to Lessee.

        "Construction Documents" is defined in Section 2.4(c) of the
Construction Agency Agreement.

        "Construction Materials" means, as applicable, the Traville Construction
Materials and/or the Manufacturing Construction Materials, as each may be
amended from time to time in accordance with the Construction Agency Agreement.

        "Construction Period" means, with respect to a Property, the period
commencing on the Initial Advance Date and ending on the Construction Period
Termination Date applicable to such Property.

        "Construction Period Accrued Interest" means all interest, including any
interest at the Overdue Rate, accrued but unpaid under the Loan Agreement prior
to the last day of the

                                       13
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

Construction Period; provided that interest accruing with respect to any portion
of the Lease Balance attributable to a Property that has become subject to the
Lease before termination of the Construction Period shall not constitute
"Construction Period Accrued Interest". Construction Period Accrued Interest is
not overdue to the extent that there exist Available Commitments of the
Liquidity Providers.

        "Construction Period Accrued Yield" means, with respect to the Investor
Amount, all Yield accruing on such Investor Amount during and for any Interest
Period ending prior to the last day of the Construction Period; provided that
Yield accruing with respect to any portion of the Lease Balance attributable to
a Property that has become subject to the Lease before termination of the
Construction Period shall not constitute "Construction Period Accrued Yield".

        "Construction Period Fees" means any Fees payable out of proceeds of
Advances prior to the Lease Commencement Date.

        "Construction Period Indemnitee" means each Agent in its capacity as
agent under the Operative Documents, each Participant, the Trustee, the
Administrator, each Program Support Provider, the Arranger and each of their
respective employees, officers, directors, agents, successors, and assigns;
provided, however, that in no event shall any Lessee Person be a Construction
Period Indemnitee.

        "Construction Period Maximum Guaranty Amount" means, at any date of
determination, the sum of (i) 89.9% of the then Eligible Accrued Project Costs,
plus (ii) 100% of all Land Costs minus (iii) the Present Value, as of such date
of determination, of any unconditional obligations of Construction Agent payable
during the Construction Period that are not reimbursable by Lessor under the
Operative Documents.

        "Construction Period Termination Date" means (a) with respect to the
Traville Facility, the earlier of (i) the Lease Commencement Date applicable to
such Property and (ii) December 31, 2003; and (b) with respect to the
Manufacturing Facility, the earlier of (i) the Lease Commencement Date
applicable to such Property and (ii) March 30, 2004.

        "Construction Schedule" means, as applicable the Approved Traville
Construction Schedule and/or the Approved Manufacturing Construction Schedule,
as each may be amended from time to time in accordance with the Construction
Agency Agreement.

        "Contingent Liability" means any agreement, undertaking or arrangement
by which any Person guarantees, endorses or otherwise becomes or is contingently
liable upon (by direct or indirect agreement, contingent or otherwise, to
provide funds for payment, to supply funds to, or otherwise to invest in, a
debtor, or otherwise to assure a creditor against loss) the indebtedness,
obligation or any other liability of any other Person (other than by
endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability shall
(subject to any limitation set forth therein) be deemed to be the outstanding
principal amount of the debt, obligation or other liability guaranteed thereby.

        "Contract Rents" is defined in Section 2(c) of the Assignment of Lease
and Rents.

                                       14
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Contractor" means Gilbane Building Company.

        "Contracts" is defined in Section 2(c) of the Assignment of Lease and
Rents.

        "Control" means (including the correlative meanings of the terms
"controlled by" and "under common control with"), as used with respect to any
Person, the possession directly or indirectly, of the power to direct or cause
the direction of the management policies of such Person, whether through the
ownership of voting securities or by contract or otherwise, provided (but
without limiting the foregoing) that no pledge of voting securities of any
Person without the current right to exercise voting rights with respect thereto
shall by itself be deemed to constitute control over such Person.

        "Corporate Trust Department" is defined in Section 2.5 of the Trust
Agreement.

        "Covered Amount" means all costs, expenses or other losses incurred by
Lessor in connection with Lessor's obligation to indemnify each Construction
Period Indemnitee under Section 9.1.3 of the Participation Agreement without
regard to amounts not paid pursuant to the agreement of each Construction Period
Indemnitee to limit the recourse of each such Person for payment or discharge of
the indemnification obligations created under Section 9.1.3(iii) of the
Participation Agreement, such Covered Amounts to be paid by Lessee pursuant to
its indemnification obligations.

        "Covered Assets" means the Eagle Covered Assets.

        "CP Rate" for any Interest Period for any Conduit Loans means, to the
extent such Conduit funds such Conduit Loans for such Interest Period by issuing
Commercial Paper Notes, the per annum rate equivalent to the "weighted average
cost" (as defined below) related to the issuances of Commercial Paper Notes that
are allocated, in whole or in part, by Conduit or the Administrator to fund or
maintain such Conduit Loans (and which may also be allocated in part to the
funding of other Conduit Loans hereunder or of other assets of the Conduit);
provided, however, that if any component of such rate is a discount rate, in
calculating the "CP Rate" for such Conduit Loans for such Interest Period, such
Conduit shall for such component use the rate resulting from converting such
discount rate to an interest bearing equivalent rate per annum. As used in this
definition, Conduit's "weighted average cost" shall consist of (w) the actual
interest rate (or discount) paid to purchasers of Conduit's Commercial Paper
Notes, together with the Dealer Fee, to the extent allocated, in whole or in
part, to Conduit's Commercial Paper Notes by Conduit or Administrator, (x)
certain documentation and transaction costs associated with the issuance of such
Commercial Paper Notes in an amount not to exceed 0.005% per annum, (y) any
incremental carrying costs incurred with respect to Commercial Paper Notes
maturing on dates other than those on which corresponding funds are received by
the Conduit and (z) other borrowings by the Conduit, including borrowings to
fund small or odd dollar amounts that are not easily accommodated in the
commercial paper market.

        "Curable Defaults" is defined in Section 16(B) of the Ground Lease.

        "Custodian" is defined in the Preamble to the Custody Agreement.

                                       15
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Custody Agreements" means, collectively, the Fleet National Bank
Custody Agreement and the First Union Custody Agreement.

        "Dealer Fee" means with respect to Eagle, the dealer or placement agent
fees or commissions incurred by Eagle in connection with its issuance of
Commercial Paper Notes.

        "Deeds of Trust" means, collectively, the Lessee Deed of Trust and
Lessor Deed of Trust.

        "Deeds of Trust Amendment" means the amendment to the Deeds of Trust
necessary to included the Manufacturing Facility Site in the Deeds of Trust.

        "Deed of Trust Property" is defined in the Granting Clause of each Deed
of Trust.

        "Default Completion Costs" means any and all costs of any kind or
description incurred by any Participant or Lessor in completing the construction
of the Improvements following a Construction Agency Event of Default in excess
of those set forth in the applicable Approved Construction Budget, including,
without limitation, costs of removal and restoration of defective work, shut
down and startup costs for any party under any of the Construction Documents,
redesign, rebidding, repermitting and other costs incurred in connection with
any revision of the Approved Plans and Specifications, construction supervision
costs, carry during any period of delay in the completion of the Improvements
beyond the Outside Completion Date, legal fees incurred in connection with the
negotiation, enforcement, termination or any other action or proceeding in
connection with any of the Construction Documents or any of the foregoing.

        "Default Notice" is defined in Section 15 of the Ground Lease.

        "Determination Date" is defined in Section 3 of the Ground Lease.

        "Directing Party" means in connection with (i) the declaration of an
Event of Default, and acceleration or termination of either the Construction
Agency Agreement, Loan Agreement or the Lease, as applicable, any Liquidity
Provider or any Investor or combination of any of the foregoing acting
separately or jointly (it being understood that no Participant or Participants
may rescind an instruction to declare an Event of Default and accelerate or
terminate either the Construction Agency Agreement, Loan Agreement or the
Lease); (ii) each Collateral Agent may independently exercise remedies with
respect to its related Liquid Collateral, regardless of a contrary determination
by the other Collateral Agent; (iii) the exercise of all other remedies under
either the Construction Agency Agreement, Loan Agreement, the Lease, or any
Security Document, the affirmative vote of the Majority Banks; (iv) the
amendment or modification of any Operative Document, the Majority Banks, except
any amendment or modification that only affects Fleet National Bank or First
Union and each of their respective Affiliates, Fleet National Bank, with respect
to matters affecting Fleet National Bank and its Affiliates only, and First
Union, with respect to matters affecting First Union and its Affiliates only;
and (v) all other matters requiring the consent, approval or decision of Lessor
or the Participants, in accordance with Section 12.5 of the Participation
Agreement.

        "Documentation Date" is defined in Section 2.1(a) of the Participation
Agreement.

        "Dollars" and "$" means dollars in lawful currency of the United States
of America.

                                       16
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Drawn Rate" means the Eurodollar Rate plus if the Lessee Obligations
are secured on a Properly Margined Collateral Coverage basis, 45 basis points
per annum, and in all other circumstances, 55 basis points per annum.

        "DTC" means The Depository Trust Company.

        "Eagle" means EagleFunding Capital Corporation, a Delaware corporation.

        "Eagle Covered Assets" is defined in Schedule 1 to the Liquidity
Agreement.

        "Eligible Accrued Project Costs" means, as of any date of determination,
the aggregate amount of Improvement Costs accrued, including Construction Period
Accrued Interest and following a Construction Agency Event of Default and any
net periodic payments payable or paid under a Lessor Hedging Agreement; any
Default Completion Costs which may become payable, or which are incurred, at any
time prior to the Completion Date, as well as costs incurred subsequent thereto
for Final Completion Work, whether or not paid, but excluding (i) all Yield
which is capitalized during the Commitment Period pursuant to the Operative
Documents and (ii) Non-Capitalizable Transaction Costs.

        "Eligible Assignee" means a bank or other financial institution or other
entity with a combined capital, surplus and undivided profits of at least
$100,000,000 and whose commercial paper is rated A-1 by S&P and P-1 by Moody's.

        "Environmental Audit" means a Phase One Environmental Site Assessment
(the scope and performance of which meets or exceeds ASTM Standard Practice
E1527-93 Standard Practice for Environmental Site Assessments: Phase One
Environmental Site Assessment Process (or the most recent version thereof)) of
the Properties.

        "Environmental Damages" has the meaning specified in Section 9.6(d) of
the Lease.

        "Environmental Laws" means and include the Resource Conservation and
Recovery Act of 1976, (RCRA) 42 U.S.C. Sections 6901-6987, as amended by the
Hazardous and Solid Waste Amendments of 1984, the Comprehensive Environmental
Response, Compensation and Liability Act, as amended by the Superfund Amendments
and Reauthorization Act of 1986, 42 U.S.C. Sections 9601- 9657, (CERCLA), the
Hazardous Materials Transportation Act of 1975, 49 U.S.C. Sections 1801-1812,
the Toxic Substances Control Act, 15 U.S.C. Sections 2601-2671, the Clean Air
Act, 42 U.S.C. Sections 7401 et seq., the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Sections 136 et seq. and all similar federal, state
and local environmental laws, ordinances, rules, orders, statutes, decrees,
judgments, injunctions, codes and regulations or sources of legal liabilities,
and any other federal, state or local laws, ordinances, rules, codes and
regulations or sources of legal liabilities relating to the environment, the
impact or affect of Hazardous Materials on natural resources or the regulation
or control of or imposing liability or standards of conduct concerning Hazardous
Materials or the investigation, clean-up or other remediation of the Properties
(including any requirements imposed by common law), or regulating or restricting
the transfer of real property because of the presence of Hazardous Materials, as
any of the foregoing are from time to time amended, supplemented or supplanted.

        "Environmental Report" is defined in Section 12.2 of the Lease.

                                       17
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Environmental Requirements" means all Environmental Laws that are
applicable to the Site, the Construction and any Person connected therewith.

        "Equipment" means the equipment listed on Schedule VII to the
Participation Agreement.

        "Equity Percentage" means 4.0%.

        "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time or any successor Federal statute.

        "ERISA Affiliates" means any trade or business (whether or not
incorporated) under common control with HGSI within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes
of provisions relating to Section 412 of the Code).

        "ERISA Group" means HGSI, and all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with HGSI, are treated as a single employer under
Section 414 of the Code.

        "Eurodollar Investor Contribution" means an Investor Contribution
accruing yield, at all times during an Interest Period applicable to such
Investor Contribution, at a fixed rate determined by reference to the Eurodollar
Rate.

        "Eurodollar Loan" means a Loan bearing interest, at all times during an
Interest Period applicable to such Loan, at a fixed rate of interest determined
by reference to the Eurodollar Rate or an Investor Amount bearing Yield, at all
times during the Interest Period applicable thereto, by reference to the
Eurodollar Rate.

        "Eurodollar Rate" means, for any Interest Period, the rate per annum
equal to (a) the London interbank offered rate (rounded upwards, if necessary,
to the next higher 1/100th of 1%) which appears on the Dow Jones & Company, Inc.
Telerate Page 3750, British Bankers Association Interest Settlement Rates as of
11:00 a.m. (London time) for deposits in Dollars on the day two (2) Business
Days prior to the first day of such Interest Period in an amount approximately
equal to the principal amount of the Loan or Investor Amount, as applicable, to
which such Interest Period is to apply and for a period corresponding as nearly
as possible to such Interest Period, (b) if no such rate appears on Telerate
Page 3750, the rate per annum equal to the arithmetic mean (rounded upwards, if
necessary, to the next higher 1/32nd of 1%) of the London interbank offered
rates which appears on the Reuters screen LIBO page on such day for deposits in
Dollars in an amount approximately equal to the principal amount of the Loan or
Investor Amount, as applicable, to which such Interest Period is to apply and
for a period corresponding as nearly as possible to such Interest Period, (c) if
neither clause (a) or clause (b) above is applicable, the rate per annum as
agreed to by the parties to the Loan, or (d) if such rate is not agreed to by
the parties pursuant to clause (c) two (2) Business Days prior to the first day
of such Interest Period, the average rate per annum then being paid by Fleet
National Bank and First Union in the London interbank market for deposits in
Dollars in an amount approximately equal to the principal amount of the Loan or
Investor Amount, as applicable.

                                       18
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Event of Default" means (a) a Lease Event of Default under the Lease,
(b) a Conduit Loan Event of Default or (c) a Construction Agency Agreement Event
of Default.

        "Event of Loss" means with respect to a Property (x) the actual or
constructive loss of all or substantially all of either or both of the Traville
Facility and the Manufacturing Facility or damage thereto which is uneconomical
or impractical to repair, (y) the taking by condemnation of title to all or
substantially all of either or both of the Traville Facility and the
Manufacturing Facility, or such portion thereof that makes use of the balance
uneconomic or impractical for Lessee, or (z) the taking by condemnation of the
use of all or substantially all of either or both the Traville Facility and the
Manufacturing Facility, or such portion thereof that makes use of the balance
uneconomic or impractical for Lessee, for a continuous period equal to or in
excess of one (1) year or the remaining Lease Term (if the remaining Lease Term
is less than one year).

        "Excepted Rights" means, as to any Participant, the exclusive right of
such Participant to (i) retain all Excluded Amounts owing to it and (ii) to
demand, collect or commence any action in equity or at law to obtain such
payments and to enforce any judgment with respect thereto.

        "Excess Funds" means with respect to Eagle, (i) prior to an Event of
Default, all funds not required after giving effect to all amounts on deposit in
the Commercial Paper Account, to pay or provide for the payment of all
Commercial Paper Notes of such Conduit maturing on the date of such
determination or that have previously matured but remain unpaid and (ii) after
the occurrence of an Event of Default, means all funds not required to pay or
provide for the payment of all outstanding Commercial Paper Notes of Eagle or
Commercial Paper Notes of Eagle that have previously matured but remain unpaid.

        "Excluded Amounts" means:

                (a)     all indemnity payments and expenses to which any
        Indemnitee is entitled pursuant to the Operative Documents;

                (b)     any amounts payable under any Operative Document to
        reimburse Lessor, any Agent or any other Participant (including the
        reasonable expenses of any such Person incurred in connection with any
        such payment) for performing any of the obligations of Lessee under and
        as permitted by any Operative Document;

                (c)     any insurance proceeds (or payments with respect to
        risks self-insured or policy deductibles) under liability policies
        payable to Lessor, any Agent or any other Participant (or any such
        Person's successors, assigns, agents, trustees, officers, directors or
        employees);

                (d)     any insurance proceeds under policies maintained by
        Lessor, any Agent or any other Participant and not required to be
        maintained by Lessee under the Lease;

                (e)     any amount payable by Lessee pursuant to Section 4.2(b)
        of the Participation Agreement, whether or not such amounts are or can
        be characterized as a Supplemental Rent;

                                       19
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

                (f)     any right, title or interest of Lessor as counterparty
        under any Lessor Hedging Agreement; and

                (g)     any payments of interest or Yield on payments referred
        to in clauses (a) through (e) above.

        "Facility A Loan" is defined in Section 2.1(b) of the A Loan Agreement.

        "Facility A Note" is defined in Section 2.3(b) of the A Loan Agreement.

        "Facility B Loan" is defined in Section 2.1(b) of the B Loan Agreement.

        "Facility B Note" is defined in Section 2.3(b) of the B Loan Agreement.

        "Facility Loan" means a Facility A Loan and/or a Facility B Loan.

        "Fair Market Rent" is defined in Section 3 of the Ground Lease.

        "Fair Market Value" means, (a) with respect to any Property, the amount,
which in any event shall not be less than zero, that would be paid in cash in an
arm's-length transaction between an informed and willing purchaser and an
informed and willing seller, neither of whom is under any compulsion to purchase
or sell, respectively, for the ownership of such Property, as set forth in an
applicable Appraisal and (b) with respect to any Liquid Collateral, the closing
bid price of each item of Liquid Collateral on the day the Liquid Collateral is
marked-to-market, plus in the case of Liquid Collateral issued on a coupon
basis, accrued and unpaid interest and yield thereon until such date, except
that with respect to items of Liquid Collateral that will mature within 90 days
of the determination date, the amortized amount of such item on such date. The
Fair Market Value of any Property shall be determined based on the assumption
that, except for purposes of Sections 7.1, 14.1(b) and 18.2(h) of the Lease or
otherwise expressly set forth in the Operative Documents, such Property is in
the condition and state of repair required under Section 9 of the Lease and
Lessee is in compliance with the other requirements of the Operative Documents
applicable to such Property and that the Property is free and clear of all
Liens.

        "Fee Letters" means collectively, the Administrative Agent Fee Letter,
the Conduit Fee Letter, the First Union Fee Letter and the Conduit to Liquidity
Provider Fee Letter.

        "Fees" means any amounts payable to any Agent or Eagle pursuant to
Section 9.10 of the Participation Agreement.

        "Final Completion Work" means any work that, subsequent to Substantial
Completion of a Property, needs to be performed to achieve completion of the
Improvements on such Property in accordance with the applicable Plans and
Specifications.

        "Final Payment Date" is defined in Section 18.2(e) of the Lease.

        "Financing Statements" means, collectively, the Ground Lessor Financing
Statements, the Lessee Financing Statements, the Lessor Financing Statements and
the Ground Lessee Financing Statements.

                                       20
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "First Union" means First Union National Bank.

        "First Union Collateral Agent" means First Union National Bank.

        "First Union Custodian" is defined in the preamble of the First Union
Custody Agreement.

        "First Union Custody Agreement" means the First Union Custody Agreement,
dated as of the Documentation Date, among Lessee, Lessor, the First Union
Collateral Agent, the First Union Custodian and the Beneficiaries listed on
Schedule I thereto.

        "First Union Fee Letter" means a letter dated the Documentation Date
between Administrative Agent and First Union.

        "First Union Investor" is defined in the preamble of the Participation
Agreement.

        "First Union Liquid Collateral" is defined in Section 2.1(a)(i) of the
First Union Liquid Collateral Agreement.

        "First Union Liquid Collateral Agreement" means the First Union Liquid
Collateral Agreement, dated as of the Documentation Date, among Lessee, Lessor
and the First Union Collateral Agent.

        "First Union Liquidity Provider" is defined in the preamble of the
Participation Agreement.

        "Fiscal Quarter" means each of Lessee's four fiscal reporting periods
ending, respectively, on March 31, June 30, September 30 and December 31 of each
year or such other fiscal quarters as then correspond to HGSI's fiscal year.

        "Fixtures" is defined in the Granting Clause of each Deed of Trust.

        "Fleet Investor" is defined in the preamble of the Participation
Agreement.

        "Fleet Liquidity Provider" is defined in the preamble of the
Participation Agreement.

        "Fleet National Bank Collateral Agent" means Fleet National Bank.

        "Fleet National Bank Custodian" is defined in the preamble of the Fleet
National Bank Custody Agreement.

        "Fleet National Bank Custody Agreement" means the Fleet National Bank
Custody Agreement, dated as of the Documentation Date, among Lessee, Lessor, the
Fleet National Bank Collateral Agent, the Fleet National Bank Custodian and the
Beneficiaries listed on Schedule I thereto.

        "Fleet National Bank Liquid Collateral" is defined in Section 2.1(a)(i)
of the Fleet National Bank Liquid Collateral Agreement.

                                       21
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Fleet National Bank Liquid Collateral Agreement" means the Fleet
National Bank Liquid Collateral Agreement, dated as of the Documentation Date,
among Lessee, Lessor and the Fleet National Bank Collateral Agent.

        "Fleet National Bank Security Documents" means the Fleet National Bank
Liquid Collateral Agreement and the Security Documents.

        "Force Majeure Event" means, with respect to Construction, any event
(the existence of which at the construction commencement date was not known, or
would not reasonably have been expected to be discovered through the exercise of
commercially reasonable due diligence, by Lessee or Construction Agent, as
applicable, taking into account the contemplated use of the Land and the
Construction) beyond the control of any such Person, including, but not limited
to, general strikes (but not any strike or other job action involving employees
of Construction Agent or any Construction Agency Person or Lessee), acts of God,
government activities directly interfering with the work of construction of the
Improvements, any general inability to obtain labor or materials, civil
commotion and enemy action; but excluding in all cases any event, cause or
condition that results from a breach by Lessee, Construction Agent or any
Construction Agency Person of its obligations, representations or warranties
under the Operative Documents or any other agreements to which it is a party,
from any Construction Agency Person's financial condition or failure to pay or
any event, cause or condition which could have been avoided or which could be
remedied or mitigated through the exercise of commercially reasonable efforts or
the commercially reasonable expenditure of funds (which expenditure of funds, in
the case of such an event, cause or condition arising on or after the Initial
Advance Date, would have been covered by funds available under the applicable
Construction Budget or Other Available Amounts) or other commercially reasonable
action, election or arrangement which would correct or resolve the impact of
such event on the Construction.

        "Full Recourse Event of Default" means any of the following:

                (i)     a Construction Agency Event of Default arising in whole
        or in part as a consequence of any fraudulent act or omission of any
        Construction Agency Person in connection with the negotiation,
        execution, delivery, consummation and/or performance of any Operative
        Document or the Construction Documents;

                (ii)    a Construction Agency Event of Default arising in whole
        or in part as a consequence of the misapplication of any Advance or any
        portion thereof or any other funds made available to, or on behalf of,
        Construction Agent or any other Construction Agency Person under any
        Operative Document;

                (iii)   a Construction Agency Event of Default arising as a
        consequence of an Insolvency Event with respect to Construction Agent;
        or

                (iv)    any Construction Agency Person shall willfully breach
        any of its respective obligations, covenants, representations or
        warranties under any Operative Document, the Construction Documents or
        any other contractual agreement or Governmental Approval relating to any
        Site or the Construction thereon.

                                       22
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "GAAP" means United States generally accepted accounting principles in
effect from time to time consistently applied.

        "General Contractor" means a general contractor, developer or
construction manager engaged by Construction Agent for the construction of
Improvements.

        "General Cost Balance" means, as of any time of determination, the
aggregate of all amounts advanced to Lessee on or before such time of
determination pursuant to Section 2.2 of the Participation Agreement which (i)
were allocated under the heading "General Costs" on Schedule 1 to the applicable
Advance Requests and (ii) as of such time of determination, have not yet been
repaid by Lessee in accordance with the terms of the Operative Documents.

        "General Counsel" is defined in section 4.1(w) of the Participation
Agreement.

        "Government Obligations" means readily marketable direct full faith and
credit obligations of the United States of America or obligations
unconditionally guaranteed by the full faith and credit of the United States of
America.

        "Governmental Action" means all permits, authorizations, registrations,
consents, approvals, waivers, exceptions, variances, orders, judgments, decrees,
licenses, exemptions, publications, filings, notices to and declarations of or
with, or required by, any Governmental Authority, or required by any Applicable
Laws, and shall include, without limitation, all citings, environmental and
operating permits and licenses that are required for the use, occupancy, zoning
and operation of the Properties.

        "Governmental Authority" means any federal, state, county, municipal or
other governmental or regulatory authority, agency, board, body, commission,
instrumentality, court or quasi-governmental authority.

        "Gross Sales Proceeds" means Net Sales Proceeds plus all Remarketing
Sale Expenses.

        "Ground Lease" means that certain Ground Lease, dated as of the
Documentation Date, between HGSI, as Landlord, and the Trust, as Tenant, in
respect of the Land, as the same may be amended in accordance with the terms
thereof.

        "Ground Lease Event of Default" is defined in Section 15(a) of the
Ground Lease.

        "Ground Lease Purchase Option" is defined in Section 23(b) of the Ground
Lease.

        "Ground Lease Rent" is defined in Section 3 of the Ground Lease.

        "Ground Lessee" means the Trust.

        "Ground Lessor" means Traville LLC as the Landlord under the Ground
Lease.

        "Ground Lessor Financing Statements" means UCC-1 financing statements
made by Ground Lessor, as debtor, in favor of Lessor, as secured party,
appropriately completed and

                                       23
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

executed for filing with the offices listed in Part D of Schedule III to the
Participation Agreement in order to protect Lessor's interest under the Security
Agreement.

        "Hazardous Condition" means any condition that violates or threatens to
violate, or that results in or threatens noncompliance with, any Environmental
Law.

        "Hazardous Material" means any substance, waste or material which is
toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic,
mutagenic or otherwise hazardous, including petroleum, its derivatives,
by-products and other hydrocarbons and friable asbestos and is or becomes
regulated by any Governmental Authority, including any agency, department,
commission, board or instrumentality of the United States, the State of Maryland
or any political subdivision thereof.

        "Hedging Obligations" means, with respect to any Person, all liabilities
of such Person under interest rate or currency swap agreements, interest or
exchange rate cap agreements and interest or exchange rate collar agreements,
and all other agreements or arrangements designed to protect such Person against
fluctuations in interest rates, currency exchange rates or commodity prices.

        "HGSI" means Human Genome Sciences, Inc., a Delaware corporation.

        "Improvement Costs" means the costs incurred in the construction and
development of the Improvements including Soft Costs.

        "Improvements" means the Traville Improvements, the Manufacturing
Facility Improvements, the Traville Land Improvements and the Manufacturing
Facility Land Improvements.

        "In Balance" means, with respect to any Site at any time of
determination thereof: (1) the undisbursed portions of the applicable Approved
Construction Budget with respect to such Property, together with Other Available
Amounts related to such Property, shall be sufficient to complete construction
of the Improvements in accordance with the terms and conditions of the
Construction Agency Agreement prior to the applicable Outside Completion Date,
and (2) the undisbursed portion of each item described in the applicable
Approved Construction Budget, as such amounts may be adjusted pursuant to the
Construction Agency Agreement (including the contingency reserve in the
applicable Approved Construction Budget, to the extent such contingency funds
have not theretofore been set aside by Construction Agent for the payment of
overruns in other cost categories and Other Available Amounts) shall be
sufficient to complete the Construction of each such item in accordance with the
terms and conditions of the Construction Agency Agreement prior to the Outside
Completion Date.

        "Increased Costs" is defined in Section 9.7 of the Participation
Agreement.

        "Indebtedness" of any Person means, without duplication:

                (a)     all obligations of such Person for borrowed money and
        all obligations of such Person evidenced by bonds, debentures, notes or
        other similar instruments;

                                       24
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

                (b)     all obligations, contingent or otherwise, relative to
        the face amount of all letters of credit, whether or not drawn, and
        banker's acceptances issued for the account of such Person other than
        letters of credit or banker's acceptances that support obligations of
        such Person in respect of accounts payable, trade payments and other
        short-term trade related obligations;

                (c)     all obligations of such Person as lessee under leases
        which have been or should be, in accordance with GAAP, recorded as
        Capitalized Lease Obligations; and

                (d)     all Contingent Liabilities of such Person recorded in
        the financial statements (including the notes thereto) of such person
        and its consolidated subsidiaries in respect of any of the foregoing.

For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture characterized as a
partnership for commercial law purposes in which such Person is a general
partner or a joint venturer. The amount of Indebtedness of any Person at any
date shall be the outstanding balance at such date of all unconditional
obligations as described above and the maximum liability of any such Contingent
Liabilities at such date.

        "Indemnitee" means Lessor, each Investor, Eagle, each Liquidity
Provider, each Agent, Securities Intermediary, the Administrator, each Program
Support Provider, Arranger, each Lessor Hedging Agreement Counterparty and the
respective successors, permitted assigns, permitted transferees, invitees,
trustees, contractors, servants, employees, officers, directors, shareholders,
partners, participants, representatives and agents of the foregoing Persons;
provided, however, that in no event shall Lessee or any Affiliate of Lessee be
an Indemnitee.

        "Initial Advance Date" is defined in Section 2.1(b) of the Participation
Agreement.

        "Insolvency Event" means, with respect to any Person, any event pursuant
to which such Person makes an assignment of or for the benefit of creditors,
files a case or petition in bankruptcy, petitions or applies to any tribunal for
the appointment of a custodian, receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) for it or for a substantial part of its
property, commences any case or proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect, consents or acquiesces in
the filing of any such petition, application, proceeding or appointment of or
taking possession by the custodian, receiver, liquidator, assignee, trustee or
sequestrator (or other similar official) of such Person or any substantial part
of its property, or admits its inability to pay its debts generally as they
become due, or authorizes any of the foregoing to be done or taken on behalf of
such Person, or any case or petition in bankruptcy or under any other insolvency
law is commenced against such Person and results in an order for relief or is
not dismissed within 90 days after such commencement.

        "Instituting Party" is defined in Section 6.4 of the Participation
Agreement.

        "Insurance Consultant" means Robert M. Currey & Associates or such other
Person as may be selected by Lessor and reasonably acceptable to Lessee.

                                       25
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Insurance Requirements" means all terms and conditions of any insurance
policy either required by the Lease to be maintained by Lessee or required by
the Construction Agency Agreement to be maintained by Construction Agent, and
all requirements of the issuer of any such policy.

        "Interest Period" means, (a) with respect to any Loan or any Investor
Amount bearing interest or Yield by reference to either the Eurodollar Rate or
the ABR, all or any portion of the period from and including the Initial Advance
Date to but excluding the next succeeding Scheduled Payment Date and thereafter
from and including a Scheduled Payment Date to but excluding the next succeeding
Scheduled Payment Date during which such Loan or Investor Amount bears interest
by reference to such rate; and (b) with respect to any Loan bearing interest at
the CP Rate, all or a portion of the period from and including the Initial
Advance Date to but excluding the 1st day of the next succeeding calendar month
and thereafter from and including the 1st day of each calendar month to but
excluding the 1st day of the next succeeding calendar month, provided that with
respect to the final Scheduled Payment Date, the Interest Period for Loans
bearing interest at the CP Rate shall commence on the first day of the Interest
Period for which interest has not been paid and end on, but exclude the final
Scheduled Payment Date.

        "Inventory" is defined in the Granting Clause Second of the Security
Agreement.

        "Investment Company Act" means the Investment Company Act of 1940, as
amended, together with the rules and regulations promulgated thereunder.

        "Investment Grade" means a rating of "BBB-" (or higher) by S&P and a
rating of "Baa3" (or higher) by Moody's.

        "Investor Amount" means at any time the amount of the Investor
Contributions owed to an Investor as evidenced by an Investor Certificate, less
any repayments thereon.

        "Investor Base Rent" means, for each Scheduled Payment Date, an amount
equal to the Yield accrued on the Investor Amount at the Yield Rate during the
Interest Period ending on such date.

        "Investor Certificate" means, for each Investor, a certificate
substantially in the form of Exhibit A to the Trust Agreement, evidencing the
equity interest of such Investor in the Trust.

        "Investor Certificate Participant" is defined in Section 3.8(g) of the
Trust Agreement.

        "Investor Certificate Register" is defined in Section 3.8(a) of the
Trust Agreement.

        "Investor Contribution" is defined in Section 2.2.2 of the Participation
Agreement.

        "Investor Maturity Date" means November 7, 2008.

        "Investors" means, collectively, the Persons named as Investors in the
Participation Agreement and each other assignee or successor thereof.

        "Issuer" means Eagle.

                                       26
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Issuer Group" means any member of the same affiliated group for
purposes of GAAP.

        "Land" means, collectively, each of the Sites.

        "Land Agreement" is defined in Section 9.8 of the Lease.

        "Land Costs" means all costs of acquisition of the Manufacturing
        Facility Site. "Land Improvement Costs" means the aggregate amounts
        advanced by Lessor to fund the costs of the
Manufacturing Facility Land Improvements.

        "Land Improvements" means, as applicable the Traville Land Improvements
and/or the Manufacturing Facility Land Improvements.

        "Landlord" means Traville LLC, as Ground Lessor under the Ground Lease.

        "Lease" means the Lease Agreement, dated as of the Documentation Date,
between Lessor, as lessor, and Lessee, as lessee, in respect of the Properties.

        "Lease Balance" means, at any time of determination, the sum of (a) the
Traville Lease Balance plus (b) the Manufacturing Lease Balance. For the
avoidance of doubt the Lease Balance shall at all times equal the sum of (a) the
then outstanding principal balance of all Notes plus (b) the then outstanding
total Investor Amounts.

        "Lease Commencement Date" means, with respect to a Property, the date on
which Substantial Completion has occurred as to such Property.

        "Lease Default" means any condition, event or act which, with notice or
lapse of time or both, would become a Lease Event of Default.

        "Lease Event of Default" has the meaning specified in Section 18.1 of
the Lease.

        "Lease Term" means, with respect to each Property, the period commencing
on and including the Lease Commencement Date and ending on the Lease Term
Expiration Date.

        "Lease Term Expiration Date" means the fifth (5th) anniversary of the
last Lease Commencement Date with respect to the Properties, but not to extend
beyond seven (7) years from the Documentation Date, or such earlier date if the
Lease is so terminated pursuant thereto.

        "Leasehold Deed of Trust" is defined in Section 16 of the Ground Lease.

        "Leasehold Deed of Trust" is defined in Section 16 of the Ground Lease.

        "Lease Rents" is defined in Section 2(a) of the Assignment of Lease and
Rents.

        "Legal Requirements" means all Federal, state, county, municipal and
other governmental statutes, laws, rules, orders, regulations, ordinances,
judgments, decrees and injunctions affecting the Property or any portion thereof
or the use or alteration thereof, whether now or hereafter enacted and in force,
including any that require repairs, modifications or

                                       27
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

alterations in or to the Property or any portion thereof or in any way limit the
use and enjoyment thereof and any that may relate to Environmental Laws, and all
permits, certificates of occupancy, licenses, authorizations and regulations
relating thereto, and all covenants, agreements, restrictions and encumbrances
contained in any instruments which are either of record or known to Lessee
affecting the Property or any portion thereof.

        "Lender" means Eagle or any Liquidity Provider and "Lenders" refers to
all of the foregoing persons.

        "Lessee" means HGSI.

        "Lessee Assignment of Lease" means the Assignment of Lease, dated the
Documentation Date, from Lessee, as assignor, to Lessor, as assignee.

        "Lessee Collateral" means all of Lessee's right, title and interest in
and to each of the following, however arising and whether now existing or
hereafter acquired or arising:

                (a)     Pledged Liquid Collateral;

                (b)     the Properties and Related Equipment; and

                (c)     all products (other than products produced in the
Improvement), excess successions, subleases, rents, issues, profits, returns,
income and proceeds of and from any or all of such Lessee Collateral (including
proceeds which constitute property of the type described in clause (a) above,
and to the extent not otherwise included, all payments under insurance (whether
or not Lessor is the loss payee hereof) or any indemnity, warranty or guarantee
payable by reason of loss or damage to or otherwise with respect to any of the
foregoing.

        "Lessee Deed of Trust" means the Deed of Trust and Security Agreement,
dated the Documentation Date, made by Lessee as mortgagor, in favor of Lessor,
as mortgagee.

        "Lessee Financing Statements" means UCC-1 financing statements made by
Lessee, as debtor, in favor of Lessor, as secured party, appropriately completed
and executed for filing with the offices listed in Part A of Schedule III to the
Participation Agreement in order to protect Lessor's interest under the Security
Agreement.

        "Lessee Obligations" means all obligations of the Lessee under the
Operative Documents.

        "Lessee Operative Document" means the Participation Agreement and each
other Operative Document to which HGSI in any capacity is a party.

        "Lessee Person" means Lessee or any affiliate in its capacity as owner,
Construction Agent, or any Affiliate or successors and assigns of the foregoing,
and all of their respective officers, directors, shareholders, partners,
employees, agents, consultants (on the Property), service-providers (on the
Property), and any other Person under the supervision of any of the foregoing
pursuant to a written contract or otherwise.

                                       28
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Lessee's Incremental Borrowing Rate" means the rate used by Lessee in
calculating the 90% cost recovery test under FASB 13.

        "Lessee's Property" has the meaning given such term in Section 8.3 of
the Lease.

        "Lessor" means the Trust.

        "Lessor Assignment of Lease" means the Assignment of Lease, dated the
Documentation Date, from Lessor, as assignor, to the Administrative Agent, as
assignee.

        "Lessor Deed of Trust" means the Deed of Trust and Security Agreement,
dated the Documentation Date, made by Lessor as mortgagor, in favor of
Administrative Agent, as mortgagee.

        "Lessor Financing Statements" means UCC-1 financing statements made by
Lessor, as debtor, in favor of the Administrative Agent, as secured party,
appropriately completed and executed for filing with the offices listed in Part
B of Schedule III to the Participation Agreement in order to protect the Ground
Lessee's interest under the Security Agreement.

        "Lessor Hedging Agreement" is defined in Section 6.12 of the
Participation Agreement.

        "Lessor Hedging Agreement Counterparty" means the counterparty (other
than Lessor) under any Lessor Hedging Agreement.

        "Lessor Insurance Consultant" means RM Currey & Associates.

        "Lessor Liens" means Liens on or against the Properties or the Lease or
any payment of Rent (a) which result from any act of, or any Claim against,
Lessor, any owner of a direct or indirect interest in Lessor, unrelated to its
interest in the Properties or the transaction, or which result from any
violation by Lessor of any of the terms of the Operative Documents or (b) which
result from Liens in favor of any taxing authority by reason of any Tax owed by
Lessor, any owner of a direct or indirect interest in Lessor, except that Lessor
Liens shall not include any Lien resulting from any Tax for which Lessee is
obligated to indemnify Lessor.

        "Lessor's Interests" means all of the rights and interests in and to the
Properties including the estate demised to Ground Lessee pursuant to or under
the Ground Lease.

        "Lien" means any Deed of Trust, deed of trust, pledge, security
interest, encumbrance, lien, easement, servitude or charge of any kind,
including any irrevocable license, conditional sale or other title retention
agreement, any lease in the nature thereof, or any other right of or arrangement
with any creditor to have its claim satisfied out of any specified property or
asset with the proceeds therefrom prior to the satisfaction of the claims of the
general creditors of the owner thereof, whether or not filed or recorded, or the
filing of, or agreement to execute as "debtor", any financing or continuation
statement under the UCC of any jurisdiction or any federal, state or local lien
imposed pursuant to any Environmental Law.

        "Liquid Collateral" means Permitted Investments with a scheduled
maturity date of not more than seven (7) years from the date of purchase, except
for corporate bonds rated lower than

                                       29
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

A by S&P or A2 by Moody's which must have a scheduled maturity date not to
exceed five (5) years from the date of purchase.

        "Liquid Collateral Agreements" means the Fleet National Bank Liquid
Collateral Agreement and the First Union Liquid Collateral Agreement.

        "Liquidity Agent" means Fleet National Bank.

        "Liquidity Agreement" means the Liquidity Agreement, dated as of the
Documentation Date, among Eagle, the Liquidity Providers, Fleet National Bank,
as Liquidity Agent, and the Liquidity Agreement Collateral Agent.

        "Liquidity Agreement Collateral Agent" means Bankers Trust Company.

        "Liquidity Fee" means a fully earned fee when and as paid, payable in
arrears on each Scheduled Payment Date on or prior to the Termination Date (as
defined in the Liquidity Agreement) in an amount equal to either (a) 0.20% per
annum of the excess of (i) the sum of the daily average outstanding principal
balance of each of the Conduit Loans over (ii) the sum of the daily average
outstanding principal balance of the fundings made by each of the Liquidity
Providers to the Conduit in the event that and so long as the Liquid Collateral
in such Liquidity Provider's related Account constitutes Properly Margined
Liquid Collateral, or (b) 0.25% per annum of the excess of (i) the sum of the
daily average outstanding principal balance of each of the Conduit Loans over
(ii) the sum of the daily average outstanding principal balance of the fundings
made by each of the Liquidity Providers to the Conduit in the event that and so
long as the Liquid Collateral in such Liquidity Provider's related Account
constitutes Non-Properly Margined Liquid Collateral.

        "Liquidity Provider" means each financial institution party to the
Liquidity Agreement as a Liquidity Provider; the initial Liquidity Providers are
Fleet National Bank and First Union.

        "Liquidity Provider Share" means with respect to Fleet National Bank,
55.787%, and with respect to First Union, 44.213%. In the event that any
Liquidity Provider transfers any of its interests in the Facility Loans, such
Liquidity Provider's Liquidity Provider Share shall be reduced by the same
percentage as the percentage of such Liquidity Provider's interest transferred
thereby, and the transfee's Liquidity Provider Share shall be increased by the
same percent.

        "Loan Agreement" means, collectively, the A Loan Agreement and the B
Loan Agreement.

        "Loan Base Rent" means on each Scheduled Payment Date, an amount equal
to the aggregate interest due and payable on such date on Loans pursuant to the
Loan Agreement.

        "Loan Documents" means the Loan Agreement, the Notes and the Security
Documents.

        "Loan Percentage" means 96.0%.

        "Loans" means the Conduit Loans and/or the Facility Loans, as
applicable.

                                       30
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Majority Banks" means one or more Liquidity Providers and Investors
whose aggregate Commitment(s) comprise at least 66-2/3% of the Total Commitment,
or, if the Commitments of the Liquidity Providers and Investors are terminated,
of the outstanding Facility Loans and Investor Amounts.

        "Manufacturing As-Built Appraisal" is defined in Section 4.3(q) of the
Participation Agreement.

        "Manufacturing Construction Materials" is defined in the Recital D of
the Construction Agency Agreement.

        "Manufacturing Construction Period Maximum Guaranty Amount" means an
amount equal to the product of (a) a fraction (i) the numerator of which equals
the Manufacturing Lease Balance, and (ii) the denominator of which equals the
Lease Balance, and (b) the Construction Period Maximum Guaranty Amount.

        "Manufacturing Facility" means the Manufacturing Facility Improvements
and the Manufacturing Facility Site.

        "Manufacturing Facility Improvements" means the buildings, structures,
improvements and fixtures and Related Equipment now or hereafter situated or
located on the Manufacturing Facility Site, including the roads, parking lots
and structures, electrical equipment, power plants, storage tanks, air
conditioning systems, emergency systems, access ways, sidewalks, recreational
areas, vehicle control facilities, landscaping, and utility and service systems
used or procured for use in connection with the operation and maintenance of
such buildings and structures, but excluding Lessee's Property.

        "Manufacturing Facility Land Improvements" means all work necessary in
connection with the development of the Manufacturing Facility Site, including
excavation; roads and roadways; curbs; gutters; storm drains; flood control
ditches and causeways; sidewalks; joint trenches for power, gas, sewer, domestic
water and irrigation; sanitary tie-ins; reparcelization and subdivisions;
traffic mitigation improvements; grading (including obtaining any necessary
slope easement rights from adjacent land owners and installation and proper
compaction, reinforcement, and seeding of such slopes); and other land
improvements, in each case to the extent the costs of construction of which are
allocable to the Manufacturing Facility Site under generally accepted accounting
principles, consistently applied by Lessee.

        "Manufacturing Facility Site" means the land described in Exhibit A-2 to
the Lease, and all Appurtenant Rights relating to the foregoing.

        "Manufacturing Facility Site Purchase Advance" means the Advance to fund
the Land Costs.

        "Manufacturing Facility Site Purchase Date" is defined in Section 2.1(d)
of the Participation Agreement.

        "Manufacturing Facility Supplement" is defined in Section 2.3 of the
Construction Agency Agreement.

                                       31
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Manufacturing Lease Balance" means, at any time of determination, the
aggregate of all amounts advanced to Lessee prior to such time of determination
pursuant to Section 2.2 of the Participation Agreement which (i) are
appropriately allocable to the Manufacturing Facility in accordance with Section
2.2.6(b) and (c) of the Participation Agreement and (ii) as of such time of
determination, have not yet been repaid by Lessee in accordance with the terms
of the Operative Documents.

        "Manufacturing Residual Value Guaranty Amount" means 87.743% of the then
outstanding Manufacturing Lease Balance.

        "Marketable Securities" means all securities regularly traded on a
national securities exchange that are reflected on the balance sheet of HGSI and
its consolidated subsidiaries in accordance with GAAP.

        "Material Adverse Effect" means any change or changes, effect or effects
or condition or conditions that individually or in the aggregate are materially
adverse to (i) the ability of Lessee or Construction Agent to perform its
obligations under the Operative Documents to which it is a party or to lease the
Properties under the Lease, (ii) the validity or enforceability of any of the
Operative Documents or any rights or remedies under any thereof, (iii) the
status, priority or perfection of the Administrative Agent's or any Collateral
Agent's Lien on any collateral or (iv) the value or condition of any Property.

        "Material Construction Documents" means the contracts identified on
Schedule I to the Participation Agreement.

        "Material Lease Default" means any Lease Default described in Section
18.1(d) of the Lease.

        "Maturity Date" means, if the Construction Agency Agreement is
terminated pursuant to Article V thereof, the day of termination of the
Construction Agency Agreement; otherwise, the last day of the Lease Term.

        "Mediation Cost" is defined in Section 9.2(d) of the Lease.

        "Memorandum of Ground Lease" means the Memorandum of Ground Lease, dated
the Documentation Date, between the Ground Lessee and Lessor.

        "Memorandum of Lease" means the Memorandum of Lease dated the
Documentation Date between Lessor and Lessee.

        "Money Market Funds" means any regulated investment company of
recognized standing shares of which are marketable with more than one billion
dollars in assets that has had a historically constant dollar net asset value
and has been in business more than five years, and whose performance is easily
tracked.

        "Monthly Report" means the Monthly Report delivered pursuant to Section
6.1(b)(i) of the Participation Agreement.

                                       32
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Moody's" means Moody's Investors Service, Inc., or any successor
thereto.

        "Mortgage Affidavit" is defined in section 4.1(w) of the Participation
Agreement.

        "Mortgage Backed Securities" means any sequential, targeted or planned
amortization mortgage-backed U.S. Agency Obligation rated at the time when
pledged to the applicable Account and at all times thereafter Aaa by Moody's and
AAA by S&P.

        "Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.

        "Negotiable Certificates of Deposit" means negotiable certificates of
deposit traded on the secondary market of any commercial bank incorporated under
the laws of the United States, or any state thereof, of recognized standing
whose short-term commercial paper rating at the time the securities are pledged
to the applicable Account and at all times thereafter is at least A-1 by S&P and
at least P-1 by Moody's and whose long-term unsecured debt rating at the time
the negotiable certificates of deposit are pledged to the Account and at all
times thereafter is at least A by S&P and A2 by Moody's.

        "Net Casualty Proceeds" means the compensation and/or insurance payments
net of the expenses of collecting such amounts received by Administrative Agent,
Lessor or Lessee in respect of the Properties by reason of and on account of an
Event of Loss described in clause (x) of the definition thereof or a Casualty.

        "Net Condemnation Proceeds" means any award or compensation net of the
expenses of collecting such amounts received by Administrative Agent, Lessor or
Lessee in respect of the Properties by reason of and on account of an Event of
Loss described in clause (y) or (z) of the definition thereof or a Condemnation.

        "Net Proceeds" means Net Casualty Proceeds and Net Condemnation
Proceeds.

        "Net Sales Proceeds" means Gross Sale Proceeds less costs and expenses
to be paid pursuant to Section 10.5, clause first of the Participation
Agreement.

        "Non-Capitalizable Transaction Costs" means the Transaction Costs listed
on Schedule VI of the Participation Agreement.

        "Non-Consenting Liquidity Provider" is defined in Section 8.5 of the
Participation Agreement.

        "Non-Consenting Participant" is defined in Section 8.5(a) of the
Participation Agreement.

        "Non-Curable Defaults" is defined in Section 16(B) of the Ground Lease.

                                       33
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Noneligible Accrued Amounts" means the Yield, Fees and Transaction
Costs which, are payable directly to any Participant if such Participant or an
Affiliate of such Participant is also an Investor; provided, however, that in no
event shall "Noneligible Accrued Amounts" include (x) Transaction Costs payable
to any agent, representative or outside counsel of any Participant if such
Person is not considered an Affiliate of an Investor, (y) any Program Fees or
(z) premiums or proceeds from residual value insurance.

        "Non-Properly Margined Liquid Collateral" means Liquid Collateral
credited to an Account that (i) satisfies the Concentration Limits but (ii) is
not otherwise Properly Margined Liquid Collateral.

        "Non-Public Company" means a Person that at the time of determination is
not obligated to register any class of securities pursuant to Section 12 or
Section 15 of the Securities and Exchange Act of 1934, as amended.

        "Nonrelated Construction Event" means any act or omission occurring
prior to the Lease Commencement Date (i) to the extent such act or omission is
attributable to a Person who is not a Construction Agency Person, or (ii) that
would not constitute a breach by Lessee or Construction Agent, of any of their
respective obligations under any of the Operative Documents and for which
Construction Agent does not otherwise have responsibility under the Construction
Agency Agreement.

        "Nonseverable" shall describe an Alteration or part of an Alteration
which cannot be readily removed from a Property without causing damage (other
than that of a de minimis nature) to the Property.

        "Non-U.S. Person" means any Person which is, or under United States tax
law is treated as, other than (i) a citizen or resident of the United States or
(ii) a corporation, partnership or limited liability company created or
organized in the United States or under the law of the United States or of any
state in the United States or the District of Columbia.

        "Notes" means A Notes and the B Notes.

        "Notice of Alteration" is defined in Section 9.2(d) of the Lease.

        "Notice of Objection" is defined in Section 9.2(d) of the Lease.

        "Obligor" means Lessee or any of its respective Affiliates.

        "Officer's Certificate" (i) of a Person (other than Lessee) means a
certificate signed by the Chairman of the Board of Directors or the President or
any Executive Vice President or any Senior Vice President or any other Vice
President of such Person signing with the Treasurer or any Assistant Treasurer
or the Controller or any Assistant Controller, Cashier, Assistant Cashier or the
Secretary or any Assistant Secretary (or in the case of the Trustee, any
Financial Services Officer) of such Person, or by any Vice President who is also
Controller, Treasurer or Cashier signing alone and (ii) in respect of Lessee
means a certificate signed by any officer of Lessee or HGSI.

                                       34
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Operative Documents" means, collectively, the following: (a) the
Participation Agreement, (b) the Construction Agency Agreement, (c) the Lease,
(d) the Ground Lease, (e) the Memorandum of Lease, (f) the Memorandum of Ground
Lease, (g) the Loan Agreement, (h) the Notes, (i) the Investor Certificates, (j)
the Security Documents, (k) the Trust Agreement, and (l) the Fee Letters, (m)
the Liquidity Agreement, (n) the Account Agreements and (o) any Lessor Hedging
Agreements.

        "Original Payment" is defined in Section 9.4(b) of the Participation
Agreement.

        "Other Available Amounts" means any insurance proceeds available under
related insurance policies maintained by or on behalf of Lessee, Lessor or
Construction Agent, letter of credit proceeds, proceeds under surety bonds, and
similar proceeds consisting of available cash which are payable to Lessee,
Lessor or Construction Agent in settlement of a Claim or for use in the
Construction of the Improvements.

        "Other Lease Rents" is defined in Section 2(b) of the Assignment of
Lease and Rents.

        "Other Leases" is defined in Section 2(b) of the Assignment of Lease and
Rents.

        "Outside Completion Date" means in respect to the Traville Facility
December 31, 2003 and in respect to the Manufacturing Facility March 31, 2004.

        "Overall Transaction" means the transactions contemplated by the
Operative Documents.

        "Overdue Rate" means, with respect to any Loan or Investor Amount then
outstanding, the lesser of (a) the highest interest rate permitted by Applicable
Law and (b) the sum of (i) 2% plus (ii) the interest rate applicable to such
Loan or the Yield Rate applicable to such Investor Contribution, as the case may
be.

        "Participant Collateral" is defined in Granting Clause Second of the
Security Agreement.

        "Participants" means collectively, the Liquidity Providers, the
Investors and Eagle.

        "Participation Agreement" means the Participation Agreement dated as of
the Documentation Date, among the Trust, the Trustee, Human Genome Sciences,
Inc. as Lessee and Construction Agent, Traville LLC, as Ground Lessor,
BancBoston Leasing Investments Inc. and First Union as Investors, Eagle, the
Administrator, Fleet National Bank and First Union as Liquidity Providers, Fleet
National Bank and First Union as Collateral Agents, the Administrative Agent and
the Liquidity Agent.

        "Payment Office" means the offices of the Administrative Agent as set
forth on Schedule II to the Participation Agreement or such other office as the
Administrative Agent may designate in writing to Lessee, Lessor, the other
Agents, the Conduit and the Liquidity Providers.

        "PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.

                                       35
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Percentage Share" or "Investor's Percentage Share" for each Investor
means (a) prior to the second Lease Commencement Date, the Commitment of any
Investor as a percentage of the aggregate Commitments of all the Investors; and
(b) on or after the second Lease Commencement Date, the Investor Contribution of
an Investor as a percentage of the aggregate Investor Contributions of all the
Investors.

        "Permitted Contest" means actions taken by a Person to test, challenge,
contest, appeal or request of a proceeding for review in good faith, by
appropriate proceedings timely initiated and diligently prosecuted, the
legality, validity or applicability to the Property or any interest therein of
any Person of: (a) any Applicable Law; (b) any provision of a Land Agreement;
(c) any term or condition of, or any revocation or amendment of, or other
proceeding relating to, any authorization or other consent, approval or other
action by any Governmental Authority; or (d) any Lien or Tax; provided that the
initiation and prosecution of such contest would not result in (i) an imminent
risk of sale, forfeiture or loss of the Lien created by the Operative Documents
or the right, title or interest of Lessor in or to the Property or any portion
thereof or interruption of all or any portion of the Rent, Lease Balance, or any
other amount payable under the Operative Documents by reason of attachment or
other Lien, (ii) a risk of criminal liability being imposed upon any
Participant, (iii) the enjoinment of or interference with the use, possession or
disposition of the Properties in a material respect ,or (iv) materially and
adversely affect the Fair Market Value, use or remaining useful life of the
Property or any portion thereof or the continued economic operation thereof; and
provided, further, that in any event adequate reserves in accordance with GAAP
are maintained by such Person against any adverse determination of such contest.

        "Permitted Investments" means,

                the following investments, in each case payable in Dollars and
        payable in the United States of America: (a) U.S. Treasury Obligations
        and U.S. Agency Obligations, (b) commercial paper notes with a rating of
        P-1 or higher by Moody's and a rating of A-1 or higher by S&P, (c) notes
        or debentures issued or guaranteed by a state or political subdivision
        of a state rated at the time when pledged to the applicable Account and
        at all times thereafter at least A3 or higher by Moody's and A- or
        higher by S&P (separately or collectively, "Municipal Bonds"), (d) any
        unsecured long-term debt obligations (other than Municipal Bonds) rated
        at the time when pledged to the applicable Account and at all times
        thereafter at least A3 or higher by Moody's and A- or higher by S&P
        (separately or collectively, "Bonds"), (e) any asset-backed securities
        rated at the time when pledged to the applicable Account and at all
        times thereafter Aaa by Moody's and AAA by S&P, (separately or
        collectively, "Asset Backed Securities") (f) Money Market Funds, (g)
        Repurchase Obligations, (h) Mortgage Backed Securities, (i) Negotiable
        Certificates of Deposit, and (j) Bank Obligations. Permitted Investments
        shall include those investments for which the Collateral Agent or an
        Affiliate of the Collateral Agent provides services, provided that such
        investments meet the criteria of any of (a)-(j) above. If a Permitted
        Investment is rated only by S&P or Moody's, such single rating shall be
        applicable.

        "Permitted Liens" means:

                                       36
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

                (a)     Liens created pursuant to the Operative Documents and
        the respective rights and interests of Lessee, Lessor, the Ground Lessor
        and any Participant and their respective permitted transferees and
        assignees, as provided in the Operative Documents,

                (b)     Lessor Liens,

                (c)     Liens for Taxes either not yet due or being contested in
        compliance with Section 9.5 of the Lease,

                (d)     materialmen's, mechanics', workers', repairmen's,
        employees' or other like Liens on Lessee's interest in the Properties
        for amounts either not yet due or being contested in compliance with
        Section 9.5 of the Lease,

                (e)     Liens arising out of judgments or awards with respect to
        which at the time an appeal or proceeding for review is being prosecuted
        in good faith and either which have been bonded or for the payment of
        which adequate reserves shall have been provided as required by GAAP or
        other appropriate provisions have been made, so long as such proceedings
        have the effect of staying the execution of such judgments or awards and
        are being contested pursuant to Section 9.5 of the Lease,

                (f)     easements, rights of way, reservations, servitudes and
        rights of others against the Properties which (x) are listed on Schedule
        B to the Title Policy or (y) are granted pursuant to Section 8.4 of the
        Lease, and

                (g)     the rights of any assignee, lessee, or sublessee under
        assignments, leases and subleases expressly permitted by the Lease.

        "Person" means an individual, corporation, partnership, joint venture,
limited liability company, limited liability partnership, association,
joint-stock company, trust (including any beneficial owner thereof),
unincorporated organization, Authority or other legal entity.

        "Personality" is defined in Section 4 of the Ground Lease.

        "Petitioned Party" is defined in Section 6.4 of the Participation
Agreement.

        "Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Code and either (i) is
maintained, or contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (ii) has at any time within the preceding five
years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a
member of the ERISA Group.

        "Plans and Specifications" means, as applicable, the Approved Traville
Plans and Specifications and/or the Approved Manufacturing Plans and
Specifications, as each may be amended from time to time in accordance with the
Construction Agency Agreement.

                                       37
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Pledged Liquid Collateral" means collectively the First Union Liquid
Collateral and the Fleet National Bank Liquid Collateral.

        "Prescribed Forms" means duly executed and filed form(s) or
statement(s), and in such number of copies, which may, from time to time, be
prescribed by law and which, pursuant to applicable provisions of (a) an income
tax treaty between the United States and the country of residence of the
Participant providing the form(s) or statement(s), (b) the Code, or (c) any
applicable rule or regulation under the Code, permit Lessee to make payments
under any Operative Document free of deduction or withholding of United States
Tax.

        "Present Value" means the value at the date of determination of a
specified amount payable in the future discounted at Lessee's Incremental
Borrowing Rate.

        "Prime Contractor" means one or more Persons who shall, with the prior
written consent of Lessor, have been designated by Lessee to act as a prime
contractor for purposes of the Construction.

        "Principal Component" means with respect to any Commercial Paper Note
(a) in the case of a Commercial Paper Note issued on a discount basis, the
amount of proceeds received by the Conduit upon the sale thereof prior to the
payment of any dealer fee or other fees or expenses paid with respect thereto
and (b) in the case of a Commercial Paper Note issued on an interest-bearing
basis, the principal amount thereof.

        "Pro Rata Portion" with respect to any Liquidity Provider means the
ratio, expressed as a percentage, of (i) such Liquidity Provider's Commitment
Amount divided by (ii) the aggregate Commitment Amounts of all of the Liquidity
Providers related to the same Conduit.

        "Proceeding" is defined in Section 6.4 of the Participation Agreement.

        "Program Fee" means 15 basis points per annum.

        "Program Support Provider" with respect to any Conduit means each Person
providing liquidity or credit enhancement to such Conduit (including the
Liquidity Providers), whether in the form of a liquidity asset purchase
agreement, loan agreement, letter of credit, surety bond, cash collateral
deposit or otherwise, and each administrator, servicing agent, collateral agent
or sub-administrator for such Conduit.

        "Properly Margined Collateral Coverage" means Liquid Collateral the Fair
Market Value of which is adjusted in accordance with the definition of Adjusted
Market Value (Item), and maintained in accordance with the Concentration Limits
and other terms set forth in the Operative Documents.

        "Properly Margined Liquid Collateral" means Liquid Collateral the amount
of which is determined on the basis of Properly Margined Collateral Coverage.

        "Property" means either the Traville Facility or the Manufacturing
Facility, and "Properties" means the Traville Facility and the Manufacturing
Facility, collectively.

                                       38
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Property Costs" means Land Costs (excluding the cost of acquiring the
Traville Site), Land Improvement Costs, Improvement Costs, Transaction Costs and
all other fees and expenses during the Construction Period which the Trust
expressly agrees to pay under the Operative Documents.

        "Purchase Date" is defined in Section 5.1(a) of the Lease.

        "Purchase Option" is defined in Section 5.1(a) of the Lease.

        "Purchase Period" is defined in Section 23(b) of the Ground Lease.

        "Rating Agencies" means S&P and/or Moody's.

        "Receivables" is defined in the Granting Clause Second of the Security
Agreement.

        "Related Contracts" is defined in the Granting Clause Second of the
Security Agreement.

        "Related Equipment" is defined in the Granting Clause of the Deed of
Trust.

        "Release" means the release, deposit, disposal or leak of any Hazardous
Material into or upon or under any land or water or air, or otherwise into the
environment, including by means of burial, disposal, discharge, emission,
injection, spillage, leakage, seepage, leaching, dumping, pumping, pouring,
escaping, emptying, placement and the like.

        "Release Portion" is defined in Section 13.1 of the Lease.

        "Release Request" is defined in Section 13.1 of the Lease.

        "Remarketing Option" is defined in Section 7.1 of the Lease.

        "Remarketing Sales Expense" means all charges, costs and expenses of
Lessor, Lessee and the Participants in connection with each sale pursuant to the
Remarketing Option.

        "Remedial Work" is defined in Section 9.6(b) of the Lease.

        "Renewal Date" is defined in Schedule 2 of each Liquidity Agreement.

        "Renewal Option" is defined in Section 8.5(a) of the Participation
Agreement.

        "Renewal Option Effective Date" is defined in Section 8.5(a) of the
Participation Agreement.

        "Renewal Option Request" is defined in Section 8.5(a) of the
Participation Agreement.

        "Renewal Option Response Date" is defined in Section 8.5(a) of the
Participation Agreement.

        "Renewal Term" is defined in Section 8.5 (a)(i) of the Participation
Agreement.

                                       39
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Rent" means Base Rent and Supplemental Rent, collectively.

        "Replacement Participant" is defined in Section 8.5(b) of the
Participation Agreement.

        "Repurchase Obligations" means repurchase obligations with a term of not
more than 31 days for underlying debt securities that are rated AAA by S&P and
Aaa by Moody's, and/or that are U.S. Treasury Obligations and/or U.S. Agency
Obligations which in each case are secured by a fully perfected security
interest in 102% of such underlying securities.

        "Required Liquid Collateral Amount" means, on any determination date
with respect to the Fleet National Bank Liquid Collateral or the First Union
Liquid Collateral, an amount equal to the sum of (a) the product of (i) one
hundred two percent (102%) and (ii) the product of (A) the applicable Liquidity
Provider Share determined as of the Documentation Date, (B) the Loan Percentage
and (C) the Lease Balance, including without duplication, capitalized interest
and Yield and (b) the product of (i) the applicable Investor's Percentage Share
determined as of the Documentation Date, (ii) the Equity Percentage and (iii)
the Lease Balance, including without duplication, capitalized interest and
Yield.

        "Residual Value Guaranty Amount" means the aggregate of Traville
Residual Value Guaranty Amount and the Manufacturing Residual Value Guaranty
Amount.

        "Responsible Officer" means, with respect to the subject matter of any
covenant, agreement or obligation of any party contained in any Operative
Agreement, the President, or any Vice President, Assistant Vice President, Trust
Officer or other officer, who in the normal performance of his or her
operational responsibility would have knowledge of such matters and the
requirements with respect thereto.

        "S&P" means Standard & Poor's, a division of The McGraw-Hill Companies,
Inc., or any successor thereto.

        "Sale Date" is defined in Section 7.1(b) of the Lease.

        "Scheduled Payment Date" means, as to any Loan or Investor Amount, the
twenty-first (21st) day of each month or if such twenty-first day is not a
Business Day, the immediately succeeding Business Day and the Maturity Date and
the Lease Term Expiration Date.

        "SEC" means the United States Securities and Exchange Commission.

        "Secured Lessee Obligations" is defined in Granting Clause First of the
Security Agreement.

        "Secured Lessor Obligations" is defined in Granting Clause Second of the
Security Agreement.

        "Secured Parties" means each party to the Security Agreement other than
Lessee.

                                       40
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Secured Parties (Eagle)" means each Eagle Liquidity Provider, the
holders from time to time of the Commercial Paper Notes of Eagle, the Liquidity
Agreement Collateral Agent, the Administrator and each Program Support Provider
for Eagle.

        "Securities Act" means the Securities Act of 1933.

        "Securities Exchange Act" means the Securities Exchange Act of 1934.

        "Security Agreement" means that certain Security Agreement, dated as of
the Documentation Date, pursuant to which Eagle assigns to the Liquidity
Agreement Collateral Agent for the benefit of the Liquidity Providers all of
Eagle's interest in the Operative Documents.

        "Security Agreement (Eagle)" means the Security Agreement, dated as of
the Documentation Date, among Lessee, Lessor, the Participants and the
Administrative Agent, pursuant to which (a) Lessee assigns to the Administrative
Agent for the benefit of Lessor, the Lessee Collateral and (b) Lessor assigns to
the Administrative Agent for the benefit of the Participants, the Participant
Collateral.

        "Security Documents" means, collectively, the Deeds of Trust, the
Assignment of Lease, the Security Agreement and the Financing Statements, the
Liquid Collateral Agreements, and all other security documents hereafter
delivered to the Administrative Agent granting a Lien on any asset or assets of
any Person (i) to secure the obligations and liabilities of Lessee under the
Lease and other Operative Documents or (ii) to secure the obligations and
liabilities of Lessor under the Loan Agreement and/or under any of the other
Operative Documents.

        "Sell Date" is defined in Section 23(a) of the Ground Lease.

        "Senior Debt" means of any Person and its consolidated Subsidiaries as
of the determination date the outstanding principal amount of Indebtedness less
Indebtedness that is expressly subordinated in right of payment.

        "Senior Debt Ratio" means, at the end of any Fiscal Quarter, subject to
Article III of Appendix A, the ratio of

                (a)     the aggregate amount of cash, Cash Equivalents and
        Marketable Securities of HGSI and its Subsidiaries on a consolidated
        basis at such time;

        to

                (b)     the sum of total Senior Debt and Synthetic Lease
        Obligations of HGSI and its Subsidiaries on a consolidated basis
        outstanding at such time.

        "Significant Condemnation" is defined in Section 14 of the Ground Lease.

        "Site" means either the Traville Site or the Manufacturing Facility
Site, as the context may require.

                                       41
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Site Assessment" is defined in Section 12.2 of the Lease.

        "Soft Costs" means all costs of whatever kind or nature, of performing
the Improvements (other than the purchase price for the Land and Lessee's costs
in connection with the acquisition of the Land, such as the cost of title
insurance), Capitalizable Transaction Costs, engineering costs for Improvements,
costs of architects, engineers and other consultants and experts with respect to
the Construction and fees and expenses incurred in obtaining Governmental
Actions, and sums expended by Lessee prior to the date hereof properly allocated
to or otherwise included in the foregoing.

        "Structuring Fee" means a fully-earned and non-refundable fee paid in
consideration of structuring the transactions contemplated in the Participation
Agreement, as follows: (a) with respect to the Fleet Investor and the Fleet
Liquidity Provider, as set forth in the Administrative Agent Fee Letter, and (b)
with respect to First Union National Bank, as set forth in the First Union Fee
Letter.

        "Sublease" is defined in Section 16.1 of the Lease.

        "Subsidiary" means of any specified Person, (i) a corporation, a
majority of whose Capital Stock with voting power, under ordinary circumstances,
to elect directors is, directly or indirectly, at the date of determination
thereof owned by such Person or by such Person and a Subsidiary or Subsidiaries
of such Person or by a Subsidiary or Subsidiaries of such Person or (ii) any
other Person (other than a corporation) in which such Person or such Person and
a Subsidiary or Subsidiaries of such Person has, directly or indirectly, at the
date of determination thereof, at least majority ownership interest.

        "Substantial Completion" means, with respect to the Improvements to be
constructed on the Traville Site and the Manufacturing Facility Site, as the
context may require substantial completion of the Traville Facility Improvements
or the Manufacturing Facility Improvements, as applicable, in accordance with
the applicable Plans and Specifications and the issuance by the appropriate
Governmental Authority of a certificate of occupancy.

        "Supplemental Rent" means all legal, accounting, administrative and
other operating expenses and taxes incurred by Lessor or Ground Lessee (other
than Base Rent), any and all amounts, liabilities and obligations other than
Base Rent which Lessee assumes or agrees or is otherwise obligated to pay under
the Lease or any other Operative Document or any Lessor Hedging Agreement
(whether or not designated as Supplemental Rent) to, or for the benefit of,
Lessor, the Administrative Agent, any Lessor Hedging Agreement Counterparty or
any other party, including, without limitation, rent, including interest
measured by the Overdue Rate, and all other amounts payable under the Ground
Lease, the Lease Balance, Fees, Break Costs and indemnities and damages for
breach of any covenants, representations, warranties or agreements, and all
other costs associated with the condition, use or operation, maintenance,
management and utilities relating to the Properties.

        "Synthetic Lease Obligation" means, with respect to any Person that is a
lessee under a lease of the type referred to as a synthetic lease that is
characterized as an operating lease in accordance with GAAP, the outstanding
"lease balance" or other similar amount; i.e., the

                                       42
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

outstanding principal amount of any notes of the lessor outstanding with respect
to the property under lease plus the equity investment made with respect to such
lease, plus, without duplication, the "lease balance", subject to the
limitations set fort in Schedule IX of the Participation Agreement, with respect
to the synthetic leases described in Schedule IX to the Participation Agreement.

        "Taxes" means any and all present or future liabilities, losses,
expenses and costs of any kind whatsoever that are fees (including without
limitation, license fees, documentation fees and registration fees), taxes
(including without limitation, property, ad valorem, real estate, income, gross
or net income, gross or net receipts, sales, use, value added, franchise,
business, transfer, capital property (tangible and intangible), municipal
assessments, excise and stamp taxes and sewer and water rents), levies, imposts,
duties, charges, assessments or withholdings, together with any penalties, fines
or interest thereon or addition thereto (any of the foregoing being referred to
herein individually as a "Tax").

        "Tax Indemnitee" means each of Lessor, any Agent, any Participant,
employees, officers, directors, shareholders, members, partners, participants,
and agents of the foregoing Persons and each of their respective successors,
transferees and assigns permitted under the terms of the Operative Documents.

        "Tenant" means the Trust as Ground Lessee under the Ground Lease.

        "Title Policy" means the title insurance commitment issued by
Commonwealth Land Title Insurance Company in respect of the Properties within
the five (5) Business Day period prior to the Documentation Date.

        "Total Commitment" means, at any time, the aggregate amount of the
Commitments of all Liquidity Providers under the Liquidity Agreement at such
time and of all Investors under the Participation Agreement at such time.

        "Transaction Costs" means

                (a)     the fees and expenses of the Appraiser;

                (b)     the reasonable fees and expenses of (i) Mayer, Brown &
        Platt, (ii) Moore & Van Allen and (iii) Day, Berry & Howard, special
        Connecticut counsel to the Trust and the Trust Company, incurred in
        connection with the negotiation, documentation and consummation of the
        Overall Transaction;

                (c)     the upfront fees and expenses of the Trust Company;

                (d)     any and all Taxes and fees incurred in recording,
        registering or filing any Operative Document or any other transaction
        document, any deed, declaration, Deed of Trust, security agreement,
        notice or financing statement with any public office, registry or
        governmental agency in connection with the transactions contemplated by
        the Operative Documents, unless the Operative Documents expressly
        provide that such Taxes or fees are required to be paid by a Person
        other than Lessee;

                                       43
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

                (e)     any title fees, premiums and escrow costs and other
        expenses relating to title insurance incurred in connection with the
        closings contemplated by the Operative Documents, and any expenses
        incurred by any Agent for analysis of the Improvement Costs and
        inspection of the Property in connection with the Advances;

                (f)     all expenses relating to all Environmental Audits and
        appraisals prepared from time to time under the Operative Documents;

                (g)     all fees relating to the Lessor Insurance Consultant and
        the Construction Consultant;

                (h)     the fees and expenses of Administrative Agent described
        in Section 9.10(a) of the Participation Agreement;

                (i)     [intentionally omitted];

                (j)     all lien search fees, recording taxes, charges or other
        expenses incurred in connection with the perfection of Liens and the
        consummation of each of the filings and recordings described in Section
        4.1(c) of the Participation Agreement;

                (k)     the Structuring Fee described in Section 9.10(b) of the
        Participation Agreement; and

                (l)     the fees and expenses payable to the Arranger and First
        Union National Bank in accordance with the Administrative Agent Fee
        Letter, and the First Union Fee Letter.

        "Traville As-Built Appraisal" is defined in Section 4.1(s) of the
Participation Agreement.

        "Traville Construction Materials" is defined in the Recital C of the
Construction Agency Agreement.

        "Traville Construction Period Maximum Guaranty Amount" means an amount
equal to the product of (a) a fraction (i) the numerator of which equals the
Traville Lease Balance, and (ii) the denominator of which equals the Lease
Balance, and (b) the Construction Period Maximum Guaranty Amount.

        "Traville Facility" means the Traville Improvements and the Traville
Site.

        "Traville Improvements" means the buildings, structures, improvements
and fixtures now or hereafter situated or located on the Traville Site,
including the roads, parking lots and structures, electrical equipment, power
plants, storage tanks, air conditioning systems, emergency systems, access ways,
sidewalks, recreational areas, vehicle control facilities, landscaping, and
utility and service systems used or procured for use in connection with the
operation and maintenance of such buildings and structures, but excluding
Lessee's Property.

        "Traville Land Improvements" means all work necessary in connection with
the development of the Traville Site, including excavation; roads and roadways;
curbs; gutters;

                                       44
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

storm drains; flood control ditches and causeways; sidewalks; joint trenches for
power, gas, sewer, domestic water and irrigation; sanitary tie-ins;
reparcelization and subdivisions; traffic mitigation improvements; grading
(including obtaining any necessary slope easement rights from adjacent land
owners and installation and proper compaction, reinforcement, and seeding of
such slopes); and other land improvements, in each case to the extent the costs
of construction of which are allocable to the Traville Site under generally
accepted accounting principles, consistently applied by Lessee.

        "Traville Lease Balance" means, at any time of determination, the
aggregate of all amounts advanced to Lessee prior to such time of determination
pursuant to Section 2.2 of the Participation Agreement which (i) are
appropriately allocable to the Traville Facility in accordance with Section
2.2.6(a) and (c) of the Participation Agreement and (ii) as of such time of
determination, have not yet been repaid by Lessee in accordance with the terms
of the Operative Documents, plus, without duplication, in the event that as of
such time of determination, Lessor shall not hold title to the Manufacturing
Facility Site (other than if Lessor shall not hold title to the Manufacturing
Facility Site as a result of Lessee's exercise of the Purchase Option or
Remarketing Option with respect to the Manufacturing Facility in accordance with
the terms of the Operative Documents), the Manufacturing Lease Balance.

        "Traville Residual Value Guaranty Amount" means 87.743% of the then
outstanding Traville Lease Balance.

        "Traville Site" means the land described in Exhibit A-1 to the Lease,
and all of the appurtenances, easements, restrictions, and rights of way
relating to the foregoing.

        "Trust" means Genome Statutory Trust 2001A, the Trust created by the
Trust Agreement.

        "Trust Agreement" means the Trust Agreement, dated as of the
Documentation Date between the Investors and Wells Fargo Bank Northwest, N.A.,
as the Trustee.

        "Trust Company" means Wells Fargo Bank Northwest, N.A., a national
banking association, in its individual capacity.

        "Trust Company Fee Letter" means the fee letter dated the Documentation
Date, between Trust Company and Lessee.

        "Trust Estate" means all estate, right, title and interest of the Trust
in, to and under the Trust Agreement and all of the other Operative Documents to
which it is a party, including any or all payments or proceeds received by the
Trust under Article X of the Participation Agreement, together with any other
moneys, proceeds or property at any time received by the Trust under or in
connection with the Operative Documents.

        "Trustee" means Wells Fargo Bank Northwest, N.A., not in its individual
capacity but solely in its trust capacity under the Trust Agreement, and any
co-trustee or successor appointed pursuant to the Trust Agreement.

        "UCC" means the Uniform Commercial Code of New York or any other
applicable jurisdiction.

                                       45
<PAGE>

                                                               APPENDIX A TO THE
                                                  PARTICIPATION AGREEMENT (HGSI)

        "Unguaranteed Residual Lease Balance" means at the date of
determination, the excess of the Lease Balance over the Residual Value Guaranty
Amount.

        "Unrestricted Cash, Cash Equivalents and Marketable Securities" means of
any Person, as of the date of determination, all cash, Cash Equivalents and
Marketable Securities of such Person and its consolidated Subsidiaries as of
such date which are not encumbered by any Lien or subject to any defeasance,
sinking fund, escrow or similar deposit arrangement pursuant to which such funds
are not subject to voluntary withdrawal by such Person and its consolidated
Subsidiaries or are set aside for a purpose other than use in such Person's or
its consolidated Subsidiary's current operation and which are not otherwise
required to be designated as restricted funds on such Person's consolidated
balance sheet in accordance with GAAP.

        "Unused Fee" means, with respect to each Investor and Conduit for the
benefit of the Liquidity Providers, a fully earned and non-refundable fee
payable in arrears on each Scheduled Payment Date on or prior to the
Construction Period Termination Dates for both Properties at a rate of 0.15% per
annum on the sum of the average daily amount of (x) with respect to each
Investor, each Investor's Available Commitment, and (y) with respect to the
Conduit, the aggregate Available Commitments of the Liquidity Providers.

        "U.S. Agency Obligations" means bonds, notes, debentures, obligations or
other evidence of indebtedness issued and/or guaranteed by Federal National Deed
of Trust Association, Federal Home Loan Deed of Trust Corporation, Government
National Deed of Trust Association or any other agency or instrumentality of the
U.S. of America, in each case supported by the direct or indirect full faith and
credit of the U.S. Government, as well as mortgaged backed securities issued by
any of the foregoing agencies.

        "U.S. Treasury Obligations" means securities issued or guaranteed by the
U.S. Government, including U.S. Treasury obligations and any other obligations
the timely payment of principal and interest of which are guaranteed by the U.S.
Government.

        "Yield" means, for each Interest Period, the amount accrued on the
Investor Amount outstanding from time to time at the Yield Rate.

        "Yield Rate" means for each Interest Period, the rate per annum equal to
the Eurodollar Rate for such Interest Period plus a margin of two hundred basis
points (2%) per annum; provided, however, that in the event (and for so long as)
Base Rent is determined by reference to the ABR as required pursuant to Section
9.8 of the Participation Agreement, then the Yield Rate shall be equal to the
ABR from time to time.

                                       46<PAGE>

Counterpart No. _____                                             EXECUTION COPY

                                                                   Exhibit 10.18

                                 LEASE AGREEMENT

                          Dated as of November 7, 2001

                                     between

                          GENOME STATUTORY TRUST 2001A,
                                   as Lessor,

                                       and

                          HUMAN GENOME SCIENCES, INC.,
                                    as Lessee

                             Manufacturing Property
                    Office Research and Development Property
                               Rockville, Maryland

<PAGE>

Counterpart No. ___

  LESSOR'S INTEREST UNDER THIS LEASE HAS BEEN ASSIGNED TO, AND IS SUBJECT TO A
  SECURITY INTEREST IN FAVOR OF, FLEET NATIONAL BANK, AS ADMINISTRATIVE AGENT,
PURSUANT TO AN ASSIGNMENT OF LEASE, DATED AS OF THE DATE HEREOF, BETWEEN LESSOR
AND SAID ADMINISTRATIVE AGENT. INFORMATION CONCERNING SUCH SECURITY INTEREST MAY
                  BE OBTAINED FROM SAID ADMINISTRATIVE AGENT.

THIS LEASE HAS BEEN EXECUTED IN EIGHT COUNTERPARTS, OF WHICH THIS IS COUNTERPART
NUMBER _____. SEE SECTION 23.16 HEREIN FOR INFORMATION CONCERNING THE RIGHTS OF
                THE HOLDERS OF THE VARIOUS COUNTERPARTS HEREOF.

<PAGE>

<TABLE>
<S>                                                                                        <C>
                                            ARTICLE I.
                                           DEFINITIONS

                                            ARTICLE II.
                                         LEASE OF PROPERTY

SECTION 2.1     Demise and Lease...............................................................1
SECTION 2.2     Nature of Lease................................................................1

                                           ARTICLE III.
                                               RENT

SECTION 3.1     Base Rent......................................................................2
SECTION 3.2     Supplemental Rent..............................................................2
SECTION 3.3     Method, Time of Payment........................................................2
SECTION 3.4     Late Payment...................................................................2

                                            ARTICLE IV.
                            NET LEASE; LESSEE'S ACCEPTANCE OF PROPERTY

SECTION 4.1     Net Lease; No Setoff; Etc......................................................3
SECTION 4.2     Waivers........................................................................4

                                            ARTICLE V.
                                     LESSEE'S PURCHASE OPTION

SECTION 5.1     Purchase Option................................................................4

                                            ARTICLE VI.
                                            TERMINATION

                                     [Intentionally omitted.]

                                           ARTICLE VII.
                  LESSEE'S DISPOSITION OF LESSOR'S INTERESTS AT LEASE EXPIRATION

SECTION 7.1     Disposition of Lessor's Interests and Distribution of Sale Proceeds............6
SECTION 7.2     Conditions to Lessee's Exercise of the Remarketing Option......................7

                                           ARTICLE VIII.
                                               LIENS

SECTION 8.1     Lessee Obligation to Discharge Liens...........................................8
SECTION 8.2     Lessor's Notice to Potential Lienors...........................................8
SECTION 8.3     Lessee's Right to Encumber Lessee's Property...................................8
SECTION 8.4     Granting of Easements..........................................................9
</TABLE>

                                               -i-

<PAGE>

<TABLE>
<S>                                                                                        <C>
                                            ARTICLE IX.
                         MAINTENANCE; ALTERATIONS; TAXES; LEGAL COMPLIANCE

SECTION 9.1     Maintenance and Repair; Utility Charges........................................9
SECTION 9.2     Alterations...................................................................10
SECTION 9.3     Title to Alterations..........................................................11
SECTION 9.4     Location......................................................................11
SECTION 9.5     Permitted Contests............................................................11
SECTION 9.6     Environmental Compliance......................................................12
SECTION 9.7     Compliance with Applicable Laws...............................................13
SECTION 9.8     Ground Sublease and Land Agreements Compliance................................13
SECTION 9.9     Lessee's Right to Enforce Warranties..........................................13
SECTION 9.10    Real Estate Taxes.............................................................13

                                            ARTICLE X.
                                    USE AND NAMING OF PROPERTY

SECTION 10.1    Use...........................................................................13
SECTION 10.2    Naming of the Properties......................................................13

                                            ARTICLE XI.
                                             INSURANCE

SECTION 11.1    Insurance.....................................................................14
SECTION 11.2    Risk of Loss..................................................................14

                                           ARTICLE XII.
                                RETURN OF LEASED PROPERTY TO LESSOR

SECTION 12.1    Nature of Return..............................................................14
SECTION 12.2    Site Assessment...............................................................15

                                           ARTICLE XIII.
                                           LAND RELEASE

SECTION 13.1    Land Release..................................................................15

                                           ARTICLE XIV.
                             LOSS DESTRUCTION, CONDEMNATION OR DAMAGE

SECTION 14.1    Event of Loss.................................................................15
SECTION 14.2    Application of Net Proceeds When Lease Continues; Repair and Restoration......16
SECTION 14.3    Application of Proceeds.......................................................17
SECTION 14.4    Application of Proceeds from a Temporary Taking...............................17
SECTION 14.5    Other Dispositions............................................................17
SECTION 14.6    Negotiations..................................................................17
</TABLE>

                                               -ii-

<PAGE>

<TABLE>
<S>                                                                                        <C>
                                            ARTICLE XV.
                                CONVEYANCE OF A PROPERTY TO LESSEE

SECTION 15.1    Terms of Conveyance...........................................................17
SECTION 15.2    Right of Lessee to Name Designee..............................................18
SECTION 15.3    Costs of Conveyance...........................................................18
SECTION 15.4    Preference Legal Opinion......................................................18

                                           ARTICLE XVI.
                                             SUBLEASE

SECTION 16.1    Subleasing Permitted; Lessee Remains Obligated................................18

                                           ARTICLE XVII.
                                            INSPECTION

SECTION 17.1    Inspection....................................................................19

                                          ARTICLE XVIII.
                                      LEASE EVENTS OF DEFAULT

SECTION 18.1    Defined.......................................................................19
SECTION 18.2    Remedies......................................................................21
SECTION 18.3    Proceeds of Sale; Deficiency..................................................23
SECTION 18.4    Grant and Foreclosure on Lessee's Estate......................................24
SECTION 18.5    Receipt of a Sufficient Discharge to Purchaser................................25
SECTION 18.6    Sale a Bar Against Lessee.....................................................25
SECTION 18.7    Liabilities to Become Due on Sale.............................................25
SECTION 18.8    Provisions Subject to Applicable Law..........................................26
SECTION 18.9    Survival of Lessee's Obligations..............................................26
SECTION 18.10   Remedies Cumulative; No Waiver; Consents......................................26
SECTION 18.11   Right to Perform Lessee's Obligations.........................................26

                                           ARTICLE XIX.
                                           HOLDING OVER

SECTION 19.1    Holding Over..................................................................27

                                            ARTICLE XX.
                                    GRANT OF SECURITY INTEREST

SECTION 20.1    Grant of Lien.................................................................27
SECTION 20.2    Assignment of Lease and Rents.................................................27

                                           ARTICLE XXI.
                                        COVENANTS OF LESSEE

SECTION 21.1    Assumption Upon Merger, Etc...................................................28
</TABLE>

                                              -iii-

<PAGE>

<TABLE>
<S>                                                                                        <C>
                                           ARTICLE XXII.
                                        COVENANTS OF LESSOR

SECTION 22.1    Quiet Enjoyment...............................................................29

                                          ARTICLE XXIII.
                                           MISCELLANEOUS

SECTION 23.1    Binding Effect; Successors and Assigns........................................29
SECTION 23.2    Notices.......................................................................29
SECTION 23.3    Severability..................................................................29
SECTION 23.4    Amendment; Complete Agreements................................................30
SECTION 23.5    Headings......................................................................30
SECTION 23.6    Counterparts..................................................................30
SECTION 23.7    Governing Law.................................................................30
SECTION 23.8    Apportionments................................................................30
SECTION 23.9    Priority......................................................................30
SECTION 23.10   No Joint Venture..............................................................30
SECTION 23.11   No Accord and Satisfaction....................................................30
SECTION 23.12   No Merger.....................................................................30
SECTION 23.13   Lessor Bankruptcy.............................................................31
SECTION 23.14   Abandonment...................................................................31
SECTION 23.15   Investments...................................................................31
SECTION 23.16   Counterparts; Deed of Trust; Notice...........................................31
SECTION 23.17   Further Assurances............................................................31
SECTION 23.18   No Merger of Title............................................................31
SECTION 23.19   Non-recourse..................................................................32
</TABLE>

Exhibit A-1  Description of Traville Site

Exhibit A-2  Description of Manufacturing Facility Site

                                               -iv-

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                LEASE AGREEMENT, dated as of November 7, 2001, between GENOME
STATUTORY TRUST 2001A, a Connecticut statutory business trust as lessor, and
HUMAN GENOME SCIENCES, INC., a Delaware corporation as lessee.

                In consideration of the mutual agreements herein contained and
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree as
follows:

                                   ARTICLE I.
                                   DEFINITIONS

                The capitalized terms used herein and not otherwise defined
shall have the meanings assigned thereto in Appendix A of the Participation
Agreement, dated as of the date hereof, among the parties hereto and, inter
alia, Traville LLC, as Ground Lessor, Wells Fargo Bank Northwest, N.A., as
Trustee, BancBoston Leasing Investments Inc. and First Union National Bank, as
Investors, EagleFunding Capital Corporation, as Lender, Fleet Securities, Inc.
as Administrator, Fleet National bank and First Union National Bank, as
Liquidity Providers, Fleet National Bank, as Fleet National Bank Collateral
Agent, First Union National Bank, as First Union Collateral Agent and Fleet
National Bank, as Administrative Agent and Liquidity Agent. In addition, the
rules of construction set forth in said Appendix A shall also be applicable to
this Lease.

                                   ARTICLE II.
                                LEASE OF PROPERTY

                SECTION 2.1 Demise and Lease. On the Lease Commencement Date for
a Property, Lessor hereby agrees to accept delivery of such Property and, as a
precondition for such acceptance, to simultaneously lease to Lessee for the
Lease Term, such Property and, in the case of the Traville Site, sublease such
Site for the Lease Term. Lessee hereby agrees to lease from Lessor for the Lease
Term, commencing on the related Lease Commencement Date, such Property and, in
the case of the Traville Site, sublease such Site for the Lease Term. The demise
and lease of each Property pursuant to this Article II shall include any
additional right, title or interest in each Property of Lessor which may at any
time be acquired by Lessor, the intent being that all right, title and interest
of Lessor in and to each Property during the Lease Term shall be demised and
leased hereunder.

                SECTION 2.2 Nature of Lease. The parties hereto intend that (i)
for financial accounting purposes with respect to Lessee, (A) Lessor will be
treated as the sublessor of the Traville Site under the Lease and the owner and
the lessor of the Improvements and the Manufacturing Facility Site and Lessee
will be treated as the lessee of the Manufacturing Facility Site and the
sublessee of the Traville Site under the Lease and the lessee of the
Improvements, and (B) the Investors will be deemed to have an equity investment
in Lessor, and (ii) for all federal and all state and local income tax purposes
and bankruptcy and commercial law purposes, (A) the Lease will be treated as a
financing arrangement, (B) Lessor, the Investors and the Lenders will be deemed
lenders making loans to Lessee in an amount equal to the sum of the Investor
Amounts and the outstanding principal amount of the Loans, which loans are
secured by the Liquid Collateral to the extent of the Lessor's interest therein
and each Property, (C) Lessee

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

will be treated as the owner of the Properties for tax purposes and will be
entitled to all tax benefits ordinarily available to an owner of property like
the Properties for such tax purposes and (D) the obligations of Lessee to pay
the Base Rent and any part of the Lease Balance shall be treated as payments of
interest and principal, respectively, for Federal and state income tax and
bankruptcy and commercial law purposes. Nevertheless, each party acknowledges
and agrees that no other party has made any representations or warranties to any
other party concerning the tax, accounting or legal characteristics of the
Operative Documents and that each party has obtained and relied upon such tax,
accounting and legal advice concerning the Operative Documents as it deems
appropriate. Lessor shall have a valid and binding security interest in and Lien
on the Liquid Collateral and each Property, free and clear of all Liens other
than Permitted Liens, as security for the obligations of Lessee under the
Operative Documents.

                                  ARTICLE III.
                                      RENT

                SECTION 3.1 Base Rent. Commencing on each Lease Commencement
Date with respect to each Property and on each Scheduled Payment Date,
throughout the Lease Term, Lessee shall pay to Lessor base rent ("Base Rent") in
an amount equal to the sum of (a) Loan Base Rent and (b) Investor Base Rent.

                SECTION 3.2 Supplemental Rent. Commencing on each Lease
Commencement Date, Lessee shall pay to Lessor, or to such other Person as shall
be entitled thereto in the manner contemplated herein, any and all Supplemental
Rent as the same shall become due and payable. In the event of Lessee's failure
to pay any Supplemental Rent, Lessor shall have all rights, powers and remedies
provided for herein or by law or in equity or otherwise in the case of
nonpayment of Base Rent.

                SECTION 3.3 Method, Time of Payment. Base Rent, and any
Supplemental Rent payable to Lessor shall be paid to the Administrative Agent as
designee for Lessor and its permitted assignees at such place and in such amount
in the contiguous continental United States as is specified in the Security
Agreement or as Administrative Agent (as such designee) shall specify in writing
to Lessee at least ten (10) Business Days prior to the due date therefor. Each
such payment of Rent shall be made by Lessee in funds consisting of lawful
currency of the United States of America which shall be immediately available at
the place of payment not later than 1:00 p.m. (New York time) on the date such
payment is due hereunder, and the Administrative Agent shall pay such funds on
the same date to the Person entitled thereto in accordance with Article X of the
Participation Agreement. Payments received following such time shall be deemed
received on the next succeeding Business Day unless Administrative Agent applies
such funds on such date in accordance with Article X of the Participation
Agreement.

                SECTION 3.4 Late Payment. If any portion of the Rent due to
Lessor or any Participant shall not be paid by Lessee on or before the date such
payment was due hereunder, Lessee shall pay interest thereon from (and
including) the date such payment was due hereunder to (but excluding) the date
of Lessor's receipt thereof at a rate per annum equal to the Overdue Rate.

                                      -2-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                   ARTICLE IV.
                   NET LEASE; LESSEE'S ACCEPTANCE OF PROPERTY

                SECTION 4.1 Net Lease; No Setoff; Etc. This Lease is a "triple"
net lease and, except to the extent otherwise expressly specified in this Lease,
it is agreed and intended that Base Rent, Supplemental Rent and any other
amounts payable hereunder by Lessee shall be paid without notice, demand,
counterclaim, setoff, deduction or defense and without abatement, suspension,
deferment, diminution or reduction, free from any charges, assessments,
impositions, withholdings, expenses or reductions, and that Lessee's obligation
to pay all such amounts, throughout the Term is absolute and unconditional. All
costs, expenses and obligations of every kind and nature whatsoever relating to
the Properties and the appurtenances thereto and the use and occupancy thereof
which may arise or become due and payable with respect to the period which ends
on the expiration or earlier termination of the Lease Term in accordance with
the provisions hereof (whether or not the same shall become payable during the
Lease Term or thereafter) shall be paid by Lessee except as otherwise expressly
provided herein or in another Operative Document. Lessee assumes the sole
responsibility for the condition, use, operation, maintenance, underletting and
management of each Property, and no Indemnitee shall have any responsibility in
respect thereof or any liability for damage to the property of Lessee, any
subtenant of Lessee or any other occupant of either Property on any account or
for any reason whatsoever other than by reason of, in the case of any particular
Indemnitee, such Indemnitee's willful misconduct or gross negligence. Except to
the extent otherwise expressly specified in this Lease, the obligations and
liabilities of Lessee hereunder shall in no way be released, discharged or
otherwise affected for any reason, including without limitation: (a) any defect
in the condition, merchantability, design, quality or fitness for use of either
Property or any part thereof, or the failure of either Property to comply with
all Applicable Laws, including any inability to occupy or use either Property by
reason of such noncompliance; (b) any damage to, removal, abandonment, salvage,
loss, scrapping or destruction of or any requisition or taking of either
Property or any part thereof; (c) any restriction, prevention or curtailment of
or interference with any use of either Property or any part thereof including
eviction; (d) any defect in title to or rights to either Property or any Lien on
such title or rights or on either Property; (e) any change, waiver, extension,
indulgence or other action or omission or breach in respect of any obligation or
liability of or by any Person; (f) any bankruptcy, insolvency, reorganization,
composition, adjustment, dissolution, liquidation or other like proceedings
relating to Lessee. Lessor or any other Person, or any action taken with respect
to this Lease by any trustee or receiver of Lessee or any other Person, or by
any court, in any such proceeding; (g) any claim, set off, defense or right that
Lessee has or might have against any Person, including without limitation
Lessor, the Administrative Agent (including in its individual capacity) or any
vendor, manufacturer, contractor of or for either Property; (h) any failure on
the part of Lessor or any other Person to perform or comply with any of the
terms of this Lease, any other Operative Document or of any other agreement,
whether or not related to the transactions contemplated by the Operative
Documents; (i) any invalidity, unenforceability, illegality or disaffirmance of
this Lease against or by Lessee or any provision hereof or any of the other
Operative Documents or any provision of any thereof; (j) the impossibility or
illegality of performance by Lessee or Lessor, or both; (k) any action by any
court, administrative agency or other Governmental Authority; (1) any change in
or violation of Applicable Laws; (m) any restriction, prevention or curtailment
of or interference with the construction on or use of either Property or any
part thereof; or (n) any other occurrence whatsoever, whether similar or
dissimilar to the foregoing,

                                      -3-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

whether or not Lessee shall have notice or knowledge of any of the foregoing.
Except as specifically set forth in this Lease, this Lease shall not be
cancelable by Lessee for any reason whatsoever and, except as expressly provided
in this Lease, Lessee, to the extent now or hereafter permitted by Applicable
Laws, waives all rights now or hereafter conferred by statute or otherwise to
quit, terminate or surrender this Lease.

                SECTION 4.2 Waivers. Each Property is demised and let by Lessor
"AS IS" in its present condition, subject to (a) the rights of any parties in
possession thereof, (b) the state of the title thereto existing at the time
Lessor acquired title to such Property, (c) any state of facts which an accurate
survey or physical inspection might show, (d) all Applicable Laws and (e) any
violations of Applicable Laws which may exist at the commencement of the Lease
Term. Lessee has examined each Property and Lessor's title thereto and has found
the same to be satisfactory. LESSOR HAS NOT MADE AND SHALL NOT BE DEEMED TO HAVE
MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, OR BE DEEMED TO HAVE
ANY LIABILITY WHATSOEVER, AS TO THE VALUE, HABITABILITY, COMPLIANCE WITH ANY
APPLICABLE PLANS AND SPECIFICATIONS FOR EITHER PROPERTY CONDITION, LOCATION,
USE, DESCRIPTION, MERCHANTABILITY, DESIGN, OPERATION, OR FITNESS FOR USE OF
EITHER PROPERTY (OR ANY PART THEREOF), OR AS TO LESSOR'S TITLE THERETO OR
OWNERSHIP THEREOF OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR
IMPLIED, WITH RESPECT TO EITHER PROPERTY (OR ANY PART THEREOF) AND LESSOR SHALL
NOT BE LIABLE FOR ANY LATENT, HIDDEN, OR PATENT DEFECT THEREIN, FOR ANY DEFECT
IN OR EXCEPTION TO TITLE THERETO, OR FOR THE FAILURE OF EITHER PROPERTY TO BE
CONSTRUCTED IN ACCORDANCE WITH THE APPLICABLE PLANS AND SPECIFICATIONS THEREFOR,
THE COMPLIANCE OF SUCH PLANS AND SPECIFICATIONS WITH APPLICABLE LAWS OR THE
FAILURE OF EITHER PROPERTY, OR ANY PART THEREOF, TO OTHERWISE COMPLY WITH ANY
APPLICABLE LAWS. It is agreed that Lessee has been afforded full opportunity to
inspect each Property, is satisfied with the results of its inspections of each
Property and is entering into this Lease solely on the basis of the results of
its own inspections and all risks incident to the matters discussed in the
preceding sentence. The provisions of this Section 4.2 have been negotiated, and
the foregoing provisions are intended to be a complete exclusion and negation of
any representations or warranties by Lessor, express or implied, with respect to
each Property, that may arise pursuant to the UCC or any other law now or
hereafter in effect, or otherwise.

                                   ARTICLE V.
                            LESSEE'S PURCHASE OPTION

                SECTION 5.1 Purchase Option.

                (a)     Subject to Section 5.1(e), Lessor hereby grants to
Lessee the exclusive and irrevocable option (the "Purchase Option") to purchase
either or both Properties and, with respect to the Traville Facility, Lessor's
interest in the Ground Lease, as of any date (the "Purchase Date") for (i) in
the event that Lessee exercises the Purchase Option with respect to only the
Traville Facility, the Traville Lease Balance, plus, without duplication, any
other amounts then due and owing under the Operative Documents, (ii) in the
event that Lessee exercises the Purchase Option with respect to only the
Manufacturing Facility, the

                                      -4-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

Manufacturing Lease Balance, plus, without duplication, any other amounts then
due and owing under the Operative Documents, or (iii) in the event that Lessee
exercises the Purchase Option with respect to both Properties, the Lease
Balance, plus, without duplication, any other amounts then due and owing under
the Operative Documents (less any amounts actually paid by Lessee under Section
8.1(b) of the Participation Agreement). Such purchase and sale shall be effected
in accordance with Article XV.

                (b)     The Purchase Option shall be exercisable by notice to
Lessor given not later than one hundred eighty (180) days prior to the Purchase
Date and in any event, unless Lessee shall have exercised the Remarketing Option
with respect to a Property on or before one hundred eighty (180) days prior to
the Lease Term Expiration Date, the Purchase Option shall be deemed exercised
with respect to such Property (in which event the Purchase Date shall be the
Lease Term Expiration Date); provided, however, in the event that Lessee shall
not have refinanced the A Loans in accordance with Section 6.11 of the
Participation Agreement on or before one hundred eighty (180) days prior to the
A Loan Maturity Date, Lessee shall have the same options with respect to the
Properties under this Section 5 and Section 7 as it would have had assuming the
A Loan Maturity Date is also the Lease Term Expiration Date and the Lease shall
expire on the A Loan Maturity Date.

                (c)     On the Purchase Date, Lessee shall pay to Lessor the
amounts set forth in clause (i), (ii) or (iii) of Section 5.1(a), as applicable,
as the purchase price for the purchased Property or Properties, as applicable
(plus all other applicable amounts owing in respect of Rent.

                (d)     Notwithstanding anything to the contrary set forth
herein, Lessee shall have the right to exercise the Purchase Option with respect
to all of the Properties (but not less than all) within five (5) Business Days
following the occurrence of any Lease Event of Default. Notwithstanding the
notice provisions of Section 5.1(b), in the event that Lessee elects to exercise
the Purchase Option within such five Business Day period following the
occurrence of a Lease Event of Default, Lessee's payment to Lessor of the
applicable amounts required pursuant to Section 5.1(a)(iii) on or prior to the
fifth Business Day following the occurrence of a Lease Event of Default shall
constitute sufficient notice. In the event that Lessee shall not pay to Lessor
the applicable amounts required pursuant to Section 5.1(a)(iii) on or prior to
the fifth Business Day following the occurrence of a Lease Event of Default or
in the event that Lessee provides Lessor with written notice of its intention
not to exercise the Purchase Option during such five day period, Lessee's
ability to exercise the Purchase Option shall terminate.

                (e)     Notwithstanding anything to the contrary set forth
herein, in the event that the Lease Commencement Date shall have not yet
occurred with respect to both Properties, Lessee may not exercise its Purchase
Option with respect to the Property covered by the Lease unless it concurrently
exercises its purchase option under Section 2.6(ix) of the Construction Agency
Agreement with respect to the other Property or the other Property previously
had been purchased by Construction Agent pursuant to Section 2.6(ix) of the
Construction Agency Agreement.

                                      -5-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                   ARTICLE VI
                                   TERMINATION

                            [Intentionally omitted.]

                                  ARTICLE VII.
         LESSEE'S DISPOSITION OF LESSOR'S INTERESTS AT LEASE EXPIRATION

                SECTION 7.1 Disposition of Lessor's Interests and Distribution
of Sale Proceeds. Subject to Section 7.2, Lessee, on written notice to Lessor
given not later than one hundred eighty (180) days prior to the Lease Term
Expiration Date, shall have the option (the "Remarketing Option") to cause a
sale of one or both of the Properties in accordance with the following terms:

                        (a)     Lessee shall act as non-exclusive agent (and may
        appoint qualified independent sales agents to work on its behalf) in
        connection with such sale and, in such capacity, shall use all
        commercially reasonable best efforts to solicit bids from bona fide
        third parties unrelated to Lessee, and its Affiliates or any Person with
        whom Lessee or any of its Affiliates has an understanding or arrangement
        pursuant to which Lessee or any of its Affiliates would use, possess or
        own all or a portion of either Property.

                        (b)     Lessee shall attempt to sell such Property or
        Properties, as applicable, to the Person submitting an all cash bid that
        will result in the highest Net Sale Proceeds, such sale to be effected
        on the third day immediately preceding the Lease Term Expiration Date or
        as soon as reasonably practicable thereafter (the date of sale being the
        "Sale Date"); provided that:

                                (i)     Lessee shall be required to obtain
                Lessor's approval of the sale of any Property pursuant to any
                such bid if a sale of such Property pursuant thereto would
                result in the Investors and Lenders not being fully reimbursed
                pursuant to Article X of the Participation Agreement for their
                Investor Contributions and the outstanding principal amount of
                the Loans;

                                (ii)    With respect to a proposed sale that
                Lessee wishes to consummate, Lessee shall provide Lessor with
                reasonable advance notice of the identity of the prospective
                purchaser, its relationship to any of the Participants and a
                copy of purchase agreement (including all exhibits and schedules
                thereto) for the proposed sale of such Property; and

                                (iii)   Lessee and its Affiliates shall have no
                right to submit bids for such Property, but a Participant or an
                Affiliate of one or more Participants may bid on such Property.

                        (c)     On the Sale Date, Lessee shall pay (i) the
        Traville Residual Value Guaranty Amount in the event that only the
        Traville Facility is sold on the Sale Date, together with any amounts,
        including Break Costs, payable under any Lessor Hedging Agreement with
        respect to the Traville Facility, plus Supplemental Rent due and
        payable, (ii) the Manufacturing Residual Value Guaranty Amount in the
        event that only the

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                                                          LEASE AGREEMENT (HGSI)

        Manufacturing Facility is sold on the Sale Date, together with any
        amounts, including Break Costs, payable under any Lessor Hedging
        Agreement with respect to the Manufacturing Facility, plus Supplemental
        Rent due and payable, or (iii) the aggregate Residual Value Guaranty
        Amount in the event that both Properties are sold on the Sale Date,
        together with any amounts, including Break Costs, payable under any
        Lessor Hedging Agreement, plus Supplemental Rent due and payable to the
        Administrative Agent and such amount, together with the proceeds of the
        sale of such Property or Properties, as applicable, shall be distributed
        in accordance with Article X of the Participation Agreement.

                        (d)     Omitted.

                        (e)     If either or both Properties are sold on or
        after the Lease Term Expiration Date, then (i) on or before such date,
        Lessee shall vacate such Property or Properties; (ii) on the Lease Term
        Expiration Date, Lessee shall pay to Lessor (A) the Traville Residual
        Value Guaranty Amount in the event that only the Traville Facility is
        sold pursuant to the Remarketing Option and all other amounts due and
        owing in respect of Rent (including Supplemental Rent) with respect to
        such Property, (B) the Manufacturing Residual Value Guaranty Amount in
        the event that only the Manufacturing Facility is sold pursuant to the
        Remarketing Option and all other amounts due and owing in respect of
        Rent (including Supplemental Rent) with respect to such Property, or (C)
        the full Residual Value Guaranty Amount in the event that both
        Properties are sold pursuant to the Remarketing Option and all other
        amounts due and owing in respect of Rent (including Supplemental Rent)
        with respect to both Properties; (iii) Lessor shall have the right to
        enter into leases for such Property or Properties, sell such Property or
        Properties or otherwise dispose of such Property or Properties and (iv)
        Lessee shall continue to act as non-exclusive sale agent for the
        marketing of such Property or Properties so long as such Property or
        Properties are not otherwise disposed of. Upon the sale of such Property
        or Properties, the Gross Sale Proceeds will be applied in accordance
        with Article X of the Participation Agreement.

                        (f)     Concurrently with the payments contemplated in
        Section 7.1 (c), after payments of all other amounts due and owing in
        respect of Rent, including Supplemental Rent through the payment date,
        this Lease shall terminate with respect to the Property or Properties,
        as applicable, sold pursuant to the Remarketing Option, and Lessor and
        Lessee shall (except as otherwise herein provided) have no further
        rights or obligations with respect to such Property or Properties, as
        applicable, under this Lease.

                SECTION 7.2 Conditions to Lessee's Exercise of the Remarketing
Option. Lessee's right to exercise the Remarketing Option and the consummation
of the sale of any Property on the Sale Date, as applicable, shall be subject to
the following conditions:

                (a)     on the Sale Date, such Property must be delivered by
Lessee in the condition required under Article XII;

                (b)     at least 60 days before the Sale Date, Lessee shall have
delivered the report required under Section 12.2;

                                      -7-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                (c)     as of the exercise of the Remarketing Option, the Final
Completion Work with respect to such Property and the restoration work required
to be performed under Section 9.2(d) (if any) shall have been completed;

                (d)     as of the exercise of the Remarketing Option, if there
remains to be performed hereunder any restoration work as a result of a Event of
Loss with respect to such Property, Lessee will be able, with the exercise of
reasonable diligence, to complete such work as of the Sale Date; and as of the
Sale Date, such work shall have been completed;

                (e)     as of the exercise of the Remarketing Option and the
Sale Date, there shall be no Lease Event of Default or Bankruptcy Default
continuing;

                (f)     as of the exercise of the Remarketing Option, there
shall be no default described in Section 18.1(c) or Section 18.1(e) that has
continued beyond 180 days after the giving of notice to Lessee by any
Participant or the Administrative Agent; and

                (g)     as of the Sale Date, Lessee shall have paid all amounts,
including Break Costs, payable under any Lessor Hedging Agreement and the other
Operative Documents.

If, after Lessee shall have given notice of its exercise of the Remarketing
Option in accordance with Section 7.1, any of the foregoing conditions (a)
through (g) is not satisfied on or prior to the Sale Date, then a Lease Event of
Default shall have occurred hereunder.

                                  ARTICLE VIII.
                                      LIENS

                SECTION 8.1 Lessee Obligation to Discharge Liens. Lessee shall
not directly or indirectly create, incur, assume or suffer to exist any Lien on
or with respect to either Property, the Alterations, the Rent, title thereto or
any interest therein, which arises for any reason, including all Liens which
arise out of the possession, use, occupancy, construction, repair or rebuilding
of either Property or by reason of labor or materials furnished or claimed to
have been furnished with respect to either Property, except Permitted Liens.
Lessee shall promptly, at its own expense, take such action as may be necessary
to discharge or eliminate any such Lien (other than Permitted Liens).

                SECTION 8.2 Lessor's Notice to Potential Lienors. Nothing
contained in this Lease shall be construed as constituting the consent or
request of Lessor, express or implied, to or for the performance by any
contractor, laborer, materialman, or vendor of any labor or services or for the
furnishing of any materials for any construction, alteration, addition, repair
or demolition of or to either Property or any part thereof, which would result
in any liability of Lessor for payment therefor. Notice is hereby given that
none of Lessor, the Investors nor the Lenders will be liable for any labor,
services or materials furnished or to be furnished to Lessee, or to anyone
holding an interest in either Property or any part thereof through or under
Lessee, and that no mechanics or other Liens for any such labor, services or
materials shall attach to or affect the interest of Lessor, the Investors or the
Lenders in and to either Property.

                SECTION 8.3 Lessee's Right to Encumber Lessee's Property. Lessee
may from time to time own, hold under lease from Persons other than Lessor and
encumber, grant security

                                      -8-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

interests in and otherwise hypothecate in favor of Persons other than Lessor
inventory, furnishings, furniture, trade fixtures, leasehold improvements,
equipment and other personal property located on or about either Property (and
not purchased from Advances) ("Lessee's Property"), which shall not be subject
to this Lease or to any Lien in favor of Lessor (including any such Lien as may
arise by operation of Applicable Laws). Lessor shall from time to time, upon the
reasonable request of Lessee, promptly acknowledge in writing to Lessee and
other Persons that Lessor does not own or have, and waives, any lien or other
right or interest in or to any of Lessee's Property.

                SECTION 8.4 Granting of Easements. Provided that no Lease Event
of Default or Bankruptcy Default is continuing, Lessor will join with Lessee
from time to time at the request of Lessee (and at Lessee's sole cost and
expense) to (i) subject to the terms of Article XIV, sell, assign, convey or
otherwise transfer an interest in either Property to any Person legally
empowered to take such interest under the power of eminent domain, (ii) grant
easements, licenses, rights of way and other rights and privileges in the nature
of easements, (iii) release existing easements and appurtenances which benefit
either Property, (iv) subject to the terms of Article XIV, dedicate or transfer
unimproved portions of either Property for road, highway or other public
purposes, (v) execute petitions to have either Property annexed to any municipal
corporation or utility district, (vi) execute any amendment, termination or
supplement of or to any Land Agreement, or a new Land Agreement, and (vii)
execute and deliver any instrument necessary or appropriate to make or confirm
such grants, releases or other actions described above in this Section 8.4 to
any Person; provided that Lessor shall not be required to take any such action,
and Lessee shall not effect any such action or grant, release, dedication,
transfer or amendment, unless Lessor shall have received a certificate of an
authorized officer of Lessee stating that such grant or release, or such
dedication, transfer or amendment, as the case may be, shall not adversely
affect the utility, economic useful life or residual value of the affected
Property or reduce the fair market value of the Traville Facility or
Manufacturing Facility below the Traville Lease Balance or Manufacturing Lease
Balance, respectively, and each Property shall comply with all Applicable Laws
after such grant or release, or such dedication, transfer or amendment, as the
case may be.

                                   ARTICLE IX.
                MAINTENANCE; ALTERATIONS; TAXES; LEGAL COMPLIANCE

                SECTION 9.1 Maintenance and Repair; Utility Charges.

                (a)     Lessee shall at all times, (i) maintain each Property
and all components thereof in good order, repair and condition, subject to
ordinary wear and tear and, as to the Traville Property, in the same manner as
other "Class A" office and/or laboratory buildings in the locale of the Traville
Property, (ii) except to the extent Section 9.5 shall apply, maintain each
Property in accordance with and otherwise comply with all Applicable Laws, and
(iii) make any and all repairs of each Property necessary or appropriate to keep
the same in the condition required by the preceding clauses (i) and (ii),
whether interior or exterior, structural or nonstructural, ordinary or
extraordinary, foreseen or unforeseen and regardless of whether the repair was
caused by a Casualty, breach of warranty, wear and tear or otherwise.

                                      -9-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                (b)     Lessor shall not be required to maintain, repair,
replace, alter, remove or rebuild all or any part of either Property, and Lessee
waives any right that it may now have or hereafter acquire to (i) require Lessor
to maintain, repair, replace, alter, remove or rebuild all or any part of either
Property or (ii) make repairs (whether or not at the expense of Lessor) pursuant
to any Applicable Laws, insurance requirements, contract, agreement or covenant
in effect at any time during the Lease Term.

                (c)     Lessee shall pay or cause to be paid all charges for
electricity, power, gas, oil, water, telephone, sanitary sewer and all other
rents and utilities used in or on either Property during the Lease Term. Lessee
shall be entitled to receive any credit or refund with respect to any utility
charge paid by Lessee and received by Lessor on account thereof, net of the
costs and expenses reasonably incurred by Lessor in obtaining such credit or
refund, and, upon receipt by Lessor thereof, such credit or refund shall be
promptly paid over to Lessee.

                SECTION 9.2 Alterations.

                (a)     Lessee may, without the consent of Lessor, at Lessee's
sole cost and expense, make Alterations to a Property, so long as, subject to
Section 9.2(d), such Alterations do not adversely effect the fair market value,
economic life, utility or residual value of such Property. Subject to the terms
of the foregoing proviso, Lessee shall have the right to change and/or seek
variances, exceptions and other exemptions in respect of the Applicable Laws
(including building and/or zoning laws, regulations and agreements) relating to
a Property or any portion thereof.

                (b)     Lessee shall make all Alterations to each Property
required so as to cause the same to comply with Applicable Laws, and the
limitations on Lessee's right to make Alterations contained in Section 9.2(a)
and Section 9.2(d) shall not be applicable to such Alterations, regardless of
their effect on the fair market value, economic life, utility or residual value
thereof.

                (c)     Lessee shall cause any Alterations to be done and
completed in a good and workmanlike manner, free from faults and defects, and in
compliance with all Applicable Laws. Lessee shall be responsible for the acts
and omissions of all of its employees and all other Persons performing any of
the Alterations.

                (d)     Upon Lessee's request (such request, a "Notice of
Alteration"), Lessor shall notify Lessee whether, in Lessor's judgment, an
Alteration proposed by Lessee would adversely effect the fair market value,
economic life, utility or residual value of the applicable Property. Each Notice
of Alteration shall be accompanied with reasonably detailed plans and
specifications. If Lessor in good faith determines that such Alterations would
adversely effect the fair market value, economic life, utility or residual value
of the applicable Property, Lessor shall give notice of its objection (a "Notice
of Objection") within fifteen (15) Business Days after Lessor's receipt of a
Notice of Alterations. If Lessor and Lessee cannot agree whether or not such
Alterations would adversely effect the fair market value, economic life, utility
or residual value of the applicable Property within fifteen (15) Business Days
after Lessee's receipt of a Notice of Objection, an Appraiser reasonably
acceptable to Lessor and Lessee shall resolve the dispute by appraising the
applicable property both with and without such Alterations. Lessee

                                      -10-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

shall pay any and all reasonable out-of-pocket costs, including reasonable
attorneys' fees (collectively "Mediation Costs") incurred by Lessor or Lessee in
connection with any such dispute between the parties. If Lessor shall prevail in
any such dispute, Lessee shall not proceed to make such Alterations, without the
prior written consent of Lessor.

                SECTION 9.3 Title to Alterations. Title to Alterations shall
immediately and without further act vest in Lessor and shall be deemed to
constitute a part of the applicable Property and be subject to this Lease in any
of the following cases:

                (a)     such Alteration shall be in replacement of or in
substitution for a portion of the applicable Property;

                (b)     such Alteration shall be required to be made pursuant to
the terms of Section 9.1(a) or Section 9.2(b);

                (c)     such Alteration shall be Nonseverable; and

                (d)     such Alteration shall be severable and paid for (i.e.,
with debt and/or equity) by Lessor.

Lessee shall, at Lessor's request, execute and deliver any deeds or assignments
reasonably necessary to evidence the vesting of title in and to such Alterations
in Lessor. If an Alteration is not within any of the categories set forth in
clauses (a) through (d) of this Section 9.3, then title to such Alteration, as
well as any item for which substitution or replacement is made as contemplated
in Section 9.3(a), shall vest in Lessee. So long as removal thereof shall not
result in the violation of any Applicable Laws or this Lease, all Alterations to
which title shall vest in Lessee as aforesaid may be removed at any time by
Lessee, provided that Lessee shall, at its expense, repair any material damage
to either Property caused by the removal of such Alteration and shall restore in
all material respects the affected portion of such Property in accordance with
Section 9.1(a).

                SECTION 9.4 Location. Lessee shall not remove, or permit to be
removed, the improvements and equipment comprising either Property or any part
thereof without the prior written consent of Lessor, except that Lessee or any
other Person may remove (a) any Alteration with respect to which title has
passed to or remained with Lessee in accordance with the provisions of Section
9.3, (b) any part of either Property constructed on a temporary basis for the
purpose of repair or maintenance thereof, (c) any part of either Property which
has been replaced by another part which has become subject to this Lease and the
Lien of the Deed of Trust; and (d) any part of either Property which in Lessee's
good faith judgment has become obsolete, whereupon upon written notice to Lessor
and the Administrative Agent such obsolete part shall cease to be subject to
this Lease and the Lien of the Deed of Trust; provided that Lessee repairs any
damage to either Property caused by such removal.

                SECTION 9.5 Permitted Contests. Provided no Lease Event of
Default or Bankruptcy Default is continuing, Lessee shall not be required to
comply with any Applicable Law or Land Agreement so long as it is engaged in a
Permitted Contest with respect thereto. At Lessee's expense, Lessor shall
cooperate fully with Lessee in connection with any such test, challenge, appeal
or proceeding and, at Lessee's request, will join in the proceedings or permit

                                      -11-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

the proceedings to be brought in Lessor's name. The terms of this Section 9.5
shall qualify each provision of this Lease that impose a compliance obligation
on Lessee (other than an obligation to any Indemnitee), regardless of whether
such provision shall expressly make reference to this Section 9.5.

                SECTION 9.6 Environmental Compliance.

                (a)     Lessee shall comply at all times with Environmental Laws
with respect to each Property, and no Hazardous Material shall be brought onto,
permitted to exist or remain at or upon, or stored, or disposed of from or used,
at either Property by Lessee or any of its employees, agents, independent
contractors, licensees, subtenants or invitees in violation of any Applicable
Laws, or in such manner as would result in any liability under any Applicable
Laws (with the exception of materials used or stored in connection with the
operation or maintenance of the property and in compliance with all
Environmental Laws). Lessee shall hold harmless, indemnify and defend the
Indemnitees from and against any Environmental Damages resulting from any breach
of the covenants set forth in this Section 9.6 and from all Environmental
Damages. Lessee's indemnification obligation hereinabove set forth shall survive
the expiration or earlier termination of this Lease.

                (b)     The indemnity contained in Section 9.6(a) shall
specifically include the direct obligation of Lessee to promptly perform any
investigatory and/or remedial or other activities required, ordered or
recommended by any Governmental Authority, or as otherwise necessary to avoid
injury or liability to any person or property, to prevent the spread of any
Hazardous Materials, or to provide for the continued safe operation of each
Property (the "Remedial Work"). Without waiving any of its rights pursuant to
the indemnity described in Section 9.6(a), upon failure of Lessee to perform the
Remedial Work in a reasonably prompt manner (subject to Lessee's rights under
Section 9.5). Lessor may, at its option and in its sole discretion, commence
such work itself in compliance with Environmental Laws, and Lessee shall pay all
reasonable costs thereby incurred.

                (c)     Without limiting Lessee's obligations under Section
9.6(a) or any other provision of this Lease, Lessee shall be solely and
completely responsible for responding to and complying with any administrative
notice, order, request or demand, or any third-party claim or demand relating to
the potential or actual presence of Hazardous Materials on either Property,
except where the contamination was caused solely by Lessor. The responsibility
conferred under this Section 9.6(c) includes responding to such orders on behalf
of Lessor and defending against any assertion of Lessor's financial
responsibility or individual duty to perform under such orders.

                (d)     "Environmental Damages" shall mean all claims, suits,
judgments, damages (including punitive damages), losses, penalties, fines,
liabilities (including, but not limited to, strict liability), encumbrances and
Liens, and any other costs and expenses, of any kind or nature whatsoever,
whether direct or indirect, joint or several, resulting from (i) any Hazardous
Material existing, released, or threatened to be released, on, in, under, or
near either Property, whether known or unknown and whether arising from historic
or threatened future releases of Hazardous Materials, or (ii) any violation or
alleged violation of any Environmental Law, in either case, including any
attorneys' fees, disbursements, consultants' fees and other costs resulting from
(A) investigation and defense of any alleged claim or demand by any third

                                      -12-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

party, (B) claims or directives, notices or requests of any Governmental
Authorities, whether or not the claims or directives, notices or requests are
groundless, false or fraudulent or ultimately defeated, (C) any settlements or
judgments to which Lessee is a party, and (D) rendering both Properties in
compliance with Applicable Laws.

                SECTION 9.7 Compliance with Applicable Laws. During the Lease
Term, at Lessee's expense, Lessee shall cause each Property to comply with all
Applicable Laws, whether or not such Applicable Laws shall necessitate
structural changes and/or improvements and/or interfere with the use and
enjoyment of such Property, subject to Section 9.5. Lessee shall also procure,
pay for and maintain all permits, licenses, approvals, certificates and other
authorizations necessary for the operation of its business at each Property from
time to time and its lawful use and occupancy of such Property in connection
therewith, subject to Section 9.5.

                SECTION 9.8 Ground Sublease and Land Agreements Compliance.
Subject to Section 9.5, Lessee shall comply with, and shall fully and promptly,
at its own cost and expense, perform all obligations of Lessor under the Ground
Lease and any restrictive covenant, deed restriction or easement of record, as
well as any environmental land use restriction recorded against the Land, to the
extent relating to either Property (collectively, "Land Agreements"), including
the payment of all amounts owed by Lessor thereunder. For so long as no Event of
Default shall have occurred and be continuing, Lessee may exercise all rights,
privileges and remedies available to Lessor under the Land Agreements.

                SECTION 9.9 Lessee's Right to Enforce Warranties. Provided no
Lease Event of Default or Bankruptcy Default shall have occurred and be
continuing, Lessee (including through its designees), at Lessee's expense, shall
have the right to assert all of Lessor's rights (if any) under any applicable
warranty and any other claim that Lessee or Lessor may have under any agreements
pertaining to the construction and/or modification of either Property, as well
as any other rights and claims that may exist by operation of law. Lessor agrees
to cooperate with Lessee, at Lessee's expense, in asserting such rights.

                SECTION 9.10 Real Estate Taxes. Subject to Lessee's right in
respect of Permitted Contests, Lessee shall pay all real estate ad valorem and
personal property taxes owed in respect of each Property or any portion thereof,
as well as any payments due under any agreement described in clause (f) of the
definition of Permitted Liens.

                                   ARTICLE X.
                           USE AND NAMING OF PROPERTY

                SECTION 10.1 Use. Each Property may be used for any lawful
purpose; provided, that Lessee shall not use or permit the use of either
Property in any manner that adversely effects the fair market value, economic
life, utility or residual value of such Property. Lessee shall not use or permit
the use of either Property or any part thereof for any purpose or in any manner
in violation of any Applicable Laws, subject to the terms of Section 9.5.

                SECTION 10.2 Naming of the Properties. Lessee shall have the
sole and exclusive right during the Lease Term, at any time and from time to
time, to select the name or names of each Property or any part thereof, as well
as the sole and exclusive right to determine

                                      -13-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

not to use any name in connection with one or more portions of either
Properties, as well as all rights in respect of signage for or in connection
with either Properties. Lessor shall not have or acquire any right or interest
with respect to any such name or names used at any time by Lessee.

                                   ARTICLE XI.
                                    INSURANCE

                SECTION 11.1 Insurance. On or before the Lease Commencement Date
for each Property, Lessee and the Administrative Agent (at the direction of the
Majority Banks) shall consult and agree upon insurance coverage (including
liability and property insurance) for each such Property. Failing mutual
agreement by the Lease Commencement with respect to a Property, Lessee shall
provide at the Lessee's expense insurance coverage (including liability and
property insurance) with respect to the Properties in amounts at least
commensurate with, and on terms no less favorable than, insurance carried by
other owners or lessees of similar real estate located on the Mid-Atlantic
region of the United States. Lessee shall, in the operation of each Property
subject hereto, comply with the applicable workers' compensation laws and
protect Lessor against any liability under such laws. Lessee shall furnish
Lessor and the Administrative Agent certificates showing the insurance required
under this Section 11.1 to be in effect and naming Lessor (and its beneficial
owners), the Investors, the Lenders, Administrative Agent and the Lessor Hedging
Agreement Counterparties as additional insureds and the property insurance
required hereunder shall contain a standard form mortgage endorsement in favor
of the Administrative Agent and shall name the Administrative Agent as sole loss
payee.

                SECTION 11.2 Risk of Loss. During the Lease Term for each
Property subject hereto, Lessee shall bear all risk of loss (including any
Casualty or Condemnation) with respect to such Property or any portion thereof.

                                  ARTICLE XII.
                       RETURN OF LEASED PROPERTY TO LESSOR

                SECTION 12.1 Nature of Return. Unless a Property is then being
transferred to Lessee or its designee pursuant to the Purchase Option, Lessee
shall, on the expiration or earlier termination of this Lease, and at its own
expense, return such Property to Lessor by surrendering the same into the
possession of Lessor: (a) free and clear of all Liens, except that Lessee shall
have no responsibility or liability in respect of: (i) Lessor Liens, (ii) the
Lien of the Deeds of Trust, (iii) Liens described in clause (a) of the
definition of Permitted Liens (other than rights and interests of Lessee under
the Operative Documents), and (iv) Liens described in clause (f) of the
definition of "Permitted Liens"; (b) the Final Completion Work shall have been
completed; and (c) in the condition required by this Lease. All Alterations the
title to which has not been vested in Lessor hereunder that is not removed by
Lessee at or prior to the expiration or earlier termination of this Lease shall
be deemed abandoned in place by Lessee and shall become the property of Lessor.
Lessee shall have no obligation to remove any Alterations (i) required (at the
time of installation in a Property or at the end of the Lease Term) by
Applicable Laws or insurance requirements or (ii) included in such Property at
the Lease Commencement Date. Except as required under Section 9.2(d) and as
permitted under Section 10.1, Lessee may not remove any Nonseverable
Alterations. Lessee shall assign to Lessor any and all assignable warranties,
licenses and permits relating to the property surrendered to Lessor which extend

                                      -14-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

beyond the expiration or earlier termination of this Lease, such assignment to
be without representation, warranty or recourse of any sort whatsoever.

                SECTION 12.2 Site Assessment. Not earlier than two hundred and
seventy (270) days and not later than one hundred and eighty (180) days prior to
the Lease Term Expiration Date, Lessee shall, at Lessee's expense, deliver to
Lessor an environmental site investigation and assessment (the "Site
Assessment") substantially conforming to the requirements of ASTM 1527-E Phase I
or any then successor thereto and Lessee shall cause to be performed by the
Lease Term Expiration Date such additional testing, reporting and remediation as
is reasonably and specifically recommended by such report (such report, together
with such additional report, if any, shall be collectively referred to as the
"Environmental Report"); provided that Lessee shall have no obligation to
conduct a Site Assessment or cause an Environmental Report to be prepared if
Lessee shall have exercised the Purchase Option.

                                  ARTICLE XIII.
                                  LAND RELEASE

                SECTION 13.1 Land Release. Provided that no Lease Event of
Default or Bankruptcy Default shall have occurred and be continuing, Lessee may
make a written request (a "Release Request") of Lessor, to enter into a
supplement or amendment to this Lease, changing the description of any Property
to exclude either a Modification which is not structurally integrated with the
existing Improvements or any unimproved portion of Land (a "Release Portion"),
and transferring such Release Portion to Lessee (or Lessee's designee) by
special or limited warranty deed (or like instrument), and Lessor will not
unreasonably withhold its consent to such Release Request, provided that such
Release Request (i) does not (x) materially impair the remaining useful life,
operation, utility or residual value of the applicable Property (or the
Improvements located or to be constructed thereon) to which such Release Request
relates, or (y) relate to a transfer the fair market value of which, when
aggregated with the fair market value of all transfers previously made pursuant
to Release Requests previously delivered hereunder, exceeds $5,000,000, (ii)
arises out of an arms-length sale to a non-affiliated party, and (iii) Lessor
has reasonable egress and ingress to the remaining Land or has been granted
appropriate easements ensuring access to such Property.

                                  ARTICLE XIV.
                    LOSS DESTRUCTION, CONDEMNATION OR DAMAGE

                SECTION 14.1 Event of Loss.

                (a)     If an Event of Loss shall occur, Lessee shall give
Lessor prompt written notice of such occurrence, and Lessee may elect one of the
following options (it being agreed that if Lessee shall fail to notify Lessor of
its election as between the following clauses (i) and (ii) within one hundred
and eighty (180) days after the occurrence of the Event of Loss, then Lessee
shall be deemed to have elected the option set forth in the following clause
(i)):

                                (i)     Lessee may elect to purchase the
                affected Property or Properties on a date occurring not less
                than ten (10) days after the date such election is made, for a
                purchase price equal to the sum of (A) Traville Lease

                                      -15-
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                                                          LEASE AGREEMENT (HGSI)

                Balance or the Manufacturing Lease Balance, as applicable, in
                the event that such Event of Loss affected only the Traville
                Facility or the Manufacturing Facility or the Lease Balance in
                the event that such Event of Loss affected both Properties, each
                determined as of such Payment Date, plus, without duplication,
                (B) all Rent (including, without limitation, all amounts,
                including Break Costs, payable under any Lessor Hedging
                Agreement) due and owing as of such Payment Date; or

                                (ii)    Lessee may restore and rebuild the
                affected Property or Properties so as to restore the same to
                their fair market value, utility, operation, residual value and
                remaining useful life immediately prior to such Event of Loss.

                (b)     All insurance proceeds or condemnation awards received
in respect of either Property shall be paid solely to Administrative Agent as
sole loss payee, unless the insurance proceeds are less than $1,000,000
(provided that any insurance proceeds paid to any Person other than
Administrative Agent shall be required to be applied in accordance with Sections
9.1(a) and 14.2). Lessee's failure to maintain insurance shall not relieve
Lessee of any of Lessee's obligations hereunder to restore the affected Property
or Properties following any Casualty or Condemnation.

                (c)     Nothing in this Article XIV shall be construed to
prevent Lessee from pursuing and collecting a condemnation award or other
compensation or settlement payment in respect of its loss and damages resulting
from any condemnation or taking.

                SECTION 14.2 Application of Net Proceeds When Lease Continues;
Repair and Restoration. Payments (except for payments under insurance policies
maintained by Lessor) received at any time by Lessor or Lessee from any
Governmental Authority, any insurer or any other Person with respect to (x) an
Event of Loss in a case in which this Lease will not terminate because Lessee
has elected Section 14.1(a)(ii) or (y) a Condemnation or Casualty shall be paid
to the Administrative Agent and Administrative Agent shall apply such proceeds
as follows:

                        (a)     first, to Lessee, as necessary, for the repair
                or restoration of the affected portions of the affected Property
                or Properties,

                        (b)     second, to Lessor, in reduction of the Traville
                Lease Balance or the Manufacturing Lease Balance, as applicable,
                in the event that such Event of Loss, Condemnation or Casualty
                affected only the Traville Facility or the Manufacturing
                Facility or the Lease Balance in the event that such Event of
                Loss, Condemnation or Casualty affected both Properties until
                the same has been reduced to zero,

                        (c)     third, to each Participant, in reduction of all
                other amounts then due and owing to such Participant under this
                Lease or any other Operative Document,

                        (d)     fourth, to each Lessor Hedging Agreement
                Counterparty to pay in full all amounts then due and payable to
                such Lessor Hedging Agreement Counterparty, including any Break
                Costs, under the Lessor Hedging Agreements with respect to the
                Property incurring such Event of Loss, Condemnation or Casualty,
                as applicable,

                        (e)     fifth, to Lessee.

                                      -16-
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                                                          LEASE AGREEMENT (HGSI)

                If, after a Casualty or Condemnation, or if, after an Event of
Loss, Lessee shall elect the option provided in Section 14.1(a)(ii), then this
Lease shall continue in full force and effect and Lessee shall, at Lessee's own
cost and expense and in accordance with the applicable provisions of Article IX,
proceed with reasonable diligence and promptness to carry out any necessary
demolition and to restore, repair, replace and/or rebuild the affected Property
or Properties in order to restore the same, to the extent it is reasonably
practicable, to the condition, utility and value of such Property or Properties
immediately prior to such Casualty or Condemnation or Event of Loss (assuming
such Property or Properties is maintained as required hereunder). All such
repair and restoration shall be effected by Lessee in compliance with the
requirements of Section 9.1.

                SECTION 14.3 Application of Proceeds. In case of a Condemnation
or Casualty or in the case of an Event of Loss that does not result in a
termination of this Lease in accordance with the above provisions of this
Article XIV, this Lease shall remain in full force and effect, without any
abatement or reduction of Base Rent.

                SECTION 14.4 Application of Proceeds from a Temporary Taking.
All Net Condemnation Proceeds from a temporary taking shall, to the extent
resulting from the taking of use during the Lease Term, be paid to Lessee, and
to the extent awarded with respect to use of a Property for any time period
after the expiration or termination of the Lease Term shall be paid as follows:
(a) if Lessee has elected to purchase the affected Property, to Lessee or its
designee or (b) if Lessee has not elected to purchase such Property, to Lessor
to be applied in accordance with Section 14.2(a) through (e).

                SECTION 14.5 Other Dispositions. Notwithstanding the foregoing
provisions of this Article XIV, so long as a Bankruptcy Default or Lease Event
of Default shall be continuing, any amount that would otherwise be payable to or
for the account of or that would otherwise be retained by, Lessee pursuant to
this Article XIV or Section 7.2 shall be paid to the Administrative Agent (or to
Lessor when the Indebtedness shall not be outstanding as security for the
obligations of Lessee under this Lease) and, at such time thereafter as the
Lease Event of Default shall have been waived in writing or no longer be
continuing, such amount shall be paid promptly in accordance with this Article
XIV.

                SECTION 14.6 Negotiations. In the event any part of either
Property becomes subject to Condemnation, Casualty or Event of Loss, Lessee
shall give notice thereof to Lessor promptly after Lessee has knowledge thereof
and Lessee shall control (and have the right to settle and compromise) the
negotiations with the relevant Governmental Authority or insurance carriers
unless a Lease Event of Default or Bankruptcy Default shall be continuing, in
which case Lessor (or if the Indebtedness is outstanding, the Administrative
Agent) may elect to control such negotiations.

                                   ARTICLE XV.
                       CONVEYANCE OF A PROPERTY TO LESSEE

                SECTION 15.1 Terms of Conveyance. Upon the purchase of Lessor's
Interests by Lessee with respect to either or both Properties, including
pursuant to Article V or Article XIV:

                                      -17-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                i.      with respect to the purchased Property or Properties, as
applicable, the Lease Term shall end, and the obligations of Lessee hereunder
(other than any obligations expressed herein as surviving the termination of
this Lease) shall terminate as of the date of such purchase, and

                ii.     Lessor shall convey to Lessee (or its designee) the
purchased Property or Properties, as applicable, and all rights, title and
interest of Lessor in and to the Net Proceeds (if any) applicable to such
purchased Property or Properties, with a warranty against Lessor's own acts and
otherwise "as is", except specifically, free and clear of all Lessor Liens
attributable to it (and the Lien of the Deed of Trust), but subject to any Liens
created pursuant to Section 9.8 or otherwise requested by or expressly consented
to by Lessee.

                SECTION 15.2 Right of Lessee to Name Designee. In any instance
in which this Lease provides that Lessee may purchase either or both Properties,
including pursuant to Article V, then Lessee shall have the right at any time
and from time to time to designate another Person as the purchaser of such
Property or Properties provided that Lessee may not convey the Purchase Option
itself and may not delegate its obligations in respect of the payment of the
Purchase Price.

                SECTION 15.3 Costs of Conveyance. Lessee shall pay all transfer
taxes, title insurance premiums, and other costs, fees and expenses incurred in
connection with any purchase in accordance with Article V or Article XIV,
including the recordation and filing charges for the satisfaction of the Deed of
Trust. Lessee shall pay the reasonable out-of-pocket costs and expenses of
Lessor and Lenders in connection with such purchase (including reasonable
attorneys' fees and expenses).

                SECTION 15.4 Preference Legal Opinion. If, as of the date on
which Lessee purchases Lessor's Interest with respect to either or both
Properties, there is a Lease Event of Default or an event that with the passage
of time would mature into a Lease Event of Default described Section 18.1(d),
then, as a condition to the closing on the Purchase Option unless waived by the
Participants, Lessee shall deliver to Lessor (a) an opinion of outside counsel
that the closing on the Purchase Option would not constitute a preference under
the Bankruptcy Code, provided that such opinion may assume (without independent
investigation) that the value of the Property or Properties purchased is equal
to or greater than the price paid to Lessor for such purchase, and (b) if the
opinion of counsel referred to in the immediately preceding clause (a) contains
the assumption described in the proviso contained in said clause (a), an
appraisal of the Property or Properties prepared by an independent appraiser
showing a fair market value thereof at least equal to the Traville Lease Balance
or the Manufacturing Lease Balance, as applicable, in the event that Lessee
exercised the Purchase Option with respect to only the Traville Facility or the
Manufacturing Facility or the Lease Balance in the event that Lessee exercised
the Purchase Option with respect to both Properties.

                                  ARTICLE XVI.
                                    SUBLEASE

                SECTION 16.1 Subleasing Permitted; Lessee Remains Obligated.
Provided no Lease Event of Default or Bankruptcy Default shall exist at the time
a sublease (a "Sublease") is

                                      -18-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

entered into, Lessee may sublease either or both Properties or any portion or
portions thereof with any Person (provided, that Lessee hereby covenants and
agrees that it shall not sublease the either or both Properties or any portion
or portions thereof to any Person that is not generally meeting its obligations
as they become due or is subject to a proceeding under applicable bankruptcy,
solvency or reorganization laws on the date of such sublease) upon written
notice to Lessor and the Agents; provided that each of the following conditions
are satisfied: (A) the obligations of Lessee under the Lease and in the other
Operative Documents shall continue in full force and effect notwithstanding such
sublease, (B) any sublease does not extend beyond the Lease Term, (C) the
sublease shall expressly provide for the surrender of the Property after
termination upon the occurrence of a Lease Event of Default and (D) the sublease
is expressly subject and subordinate to this Lease. Lessee acknowledges and
agrees that this Lease has been assigned as described on the cover page hereof.

                                 ARTICLE XVII.
                                   INSPECTION

                SECTION 17.1 Inspection. Lessor shall have the inspection rights
with respect to the Properties as set forth in the Participation Agreement.

                                 ARTICLE XVIII.
                             LEASE EVENTS OF DEFAULT

                SECTION 18.1 Defined. The following events shall constitute
"Lease Events of Default" (whether any such event shall be voluntary or in
voluntary or come about or be effected by operation of law or pursuant to or in
compliance with any judgment, decree or order of any court or any order, rule or
regulation of any Governmental Authority):

                (a)     Lessee shall fail to make any payment of Base Rent,
Traville Lease Balance, Manufacturing Lease Balance, the Lease Balance, Traville
Residual Value Guaranty Amount, Manufacturing Residual Value Guaranty Amount or
the Residual Value Guaranty Amount when due (Lessor will notify Lessee if such
payment is not received when due, but Lessor will have no liability to Lessee if
it fails to deliver such notice and the Lessor's failure to provide such notice
shall not affect whether the same is a Lease Event of Default hereunder);

                (b)     Lessee shall fail to make payment of any amount required
hereunder, other than any amount described in Section 18.1(a), and such failure
shall continue for a period of ten (10) days after notice of such failure to
Lessee from Lessor or the Administrative Agent;

                (c)     Lessee shall default in the due performance or
observance by it of any term, covenant, condition or agreement on its part to be
performed or observed under any Operative Document to which it is a party (not
otherwise specified in this Section 18.1) and such default shall have continued
unremedied for a period of at least thirty (30) days after receipt of notice by
Lessee from either Lessor or Administrative Agent; provided, however, that if
such default is capable of cure but cannot be cured by payment of money or
cannot be cured by diligent efforts within such thirty (30) day period but such
diligent efforts shall be properly commenced within the cure period and Lessee
is diligently pursuing, and shall continue to pursue diligently, remedy of such
failure, the cure period shall be extended for an additional

                                      -19-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

period of time as may be necessary to cure, not to exceed an additional one
hundred and twenty (120) days and not to extend beyond the Lease Term Expiration
Date;

                (d)     the commencement by Lessee of a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or Lessee shall have consented to the entry of an order for relief in an
involuntary case under any such law, or the failure of Lessee generally to pay
its debts as such debts become due (within the meaning of the Bankruptcy Code),
or the appointment of or taking possession by a receiver, liquidator or other
similar official for Lessee or a general assignment by Lessee for the benefit of
its creditors; or the filing against Lessee of an involuntary petition in
bankruptcy which results in an order for relief being entered or,
notwithstanding that an order for relief has not been entered, the petition is
not dismissed within ninety (90) days of the date of the filing of the petition,
or the filing under any law relating to bankruptcy, insolvency or relief of
debtors of any petition against Lessee for reorganization, composition,
extension or arrangement with creditors which either (i) results in a finding or
adjudication of insolvency of Lessee or (ii) is not dismissed within ninety (90)
days of the date of the filing of such petition;

                (e)     any representation, warranty or statement made or
restated by Lessee in this Lease or in any other Operative Document, or in any
statement or certificate delivered or required to be delivered pursuant hereto
or thereto, shall prove to be untrue in any material respect on the date as of
which made or restated, and (i) the circumstances rendering such representation
or warranty or statement incorrect shall not be remediable or, (ii) if such
representation or warranty or statement is remediable and Lessee is proceeding
diligently so to remedy, shall continue unremedied for thirty (30) days after
the earlier of: (x) the date on which written notice is delivered by Lessor or
Administrative Agent to Lessee specifying such circumstances and demanding that
they be remedied and (y) the date on which any Authorized Officer of Lessee has
actual knowledge of such incorrectness; provided, however, that if such default
is capable of cure but cannot be cured by payment of money or cannot be cured by
diligent efforts within such thirty (30) day period but such diligent efforts
shall be properly commenced within the cure period and Lessee is diligently
pursuing, and shall continue to pursue diligently, remedy of such failure, the
cure period shall be extended for an additional period of time as may be
necessary to cure, not to exceed an additional one hundred and twenty (120) days
and not to extend beyond the Lease Term Expiration Date.

                (f)     Lessee shall fail to maintain insurance required by
Section 11; provided that in the event that Lessee is otherwise in full
compliance with its obligations under Section 11, Lessee's failure to timely
deliver the certificates of insurance required by Section 11.1 shall not
constitute a Lease Event of Default unless such failure shall continue for a
period of ten (10) days after notice of such failure to Lessee from Lessor or
the Administrative Agent;

                (g)     the Lease Event of Default described in the last
sentence of Section 7.2 shall have occurred;

                (h)     the Facility Maturity Date (as defined in the Liquidity
Agreement), as the same may be modified or extended from time to time, with
respect to any one or more Liquidity Providers shall have occurred;

                                      -20-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                (i)     the Ground Lease shall terminate or shall cease to be in
effect by reason of a default by the Ground Lessor in its obligations
thereunder;

                (j)     Lessee shall default in the due performance and
observance of any of its obligations under Section 6.1(v), (w), (x), (y) or (aa)
of the Participation Agreement or Section 2.5(a)(i) or (ii) of either Liquid
Collateral Agreement;

                (k)     one or more judgments or orders for the payment of money
in the aggregate amount in excess of $10,000,000 shall be rendered against HGSI
or its Affiliates and such judgment or order shall continue unsatisfied or
unstayed for a period of sixty (60) days;

                (l)     any Lien granted under any Security Document shall, in
whole or in part, terminate, cease to be effective or lose its first priority
status, except as expressly contemplated by the Operative Documents or as the
result of an act or omission of Lessor or the Administrative Agent;

                (m)     An "event of default" shall occur in the payment when
due (subject to any applicable grace period), whether by acceleration or
otherwise, of any Indebtedness of HGSI or any of its Subsidiaries having a
principal amount, individually or in the aggregate, in excess of $10,000,000, or
a default shall occur in the performance or observance of any obligation or
condition with respect to such Indebtedness;

                (n)     A Construction Agency Event of Default shall have
occurred;

                (o)     Lessor's rights pursuant to either Liquid Collateral
Agreement to require Lessee to pledge additional Permitted Investments shall for
any reason cease to be a legal, valid and binding agreement with Lessee; or

                (p)     the Lien of either Liquid Collateral Agreement with
respect to the Liquid Collateral shall cease to constitute a first priority
perfected security interest (except as a result of a voluntary release by
Administrative Agent of any Liquid Collateral).

                SECTION 18.2 Remedies. Upon the occurrence of any Lease Event of
Default and at any time thereafter so long as the same shall be continuing,
Lessor may (subject to Section 18.2(h) and Section 18.2(i) below), at its
option, by notice to Lessee declare this Lease to be in default (and, if such
Lease Event of Default is described in Section 18.1(d), then this Lease shall
automatically be in default and no such declaration shall be required and the
terms of Section 18.2(i) shall be applicable) and do one or more of the
following as Lessor in its sole discretion shall determine:

                (a)     Lessor may, by notice to Lessee, rescind or terminate
this Lease as of the date specified in such notice; however, (i) no reletting,
reentry or taking of possession of either Property by Lessor will be construed
as an election on Lessor's part to terminate this Lease unless a written notice
of such intention is given to Lessee, (ii) notwithstanding any reletting,
reentry or taking of possession, Lessor may at any time thereafter elect to
terminate this Lease for a continuing Lease Event of Default, and (iii) no act
or thing done by Lessor or any of its agents, representatives or employees and
no agreement accepting a surrender of either Property shall be valid unless the
same be made in writing and executed by Lessor;

                                      -21-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                (b)     Lessor may (i) demand that Lessee, and Lessee shall upon
the written demand of Lessor, return the Properties promptly to Lessor in the
manner and condition required by, and otherwise in accordance with all of the
provisions of, Section 12.1 as if the Properties were being returned at the end
of the Lease Term, and Lessor shall not be liable for the reimbursement of
Lessee for any costs and expenses incurred by Lessee in connection therewith and
(ii) without prejudice to any other remedy which Lessor may have for possession
of the Properties, enter upon either or both Properties and (to the exclusion of
Lessee) take immediate possession of either or both Properties and expel or
remove Lessee and any other person who may be occupying either or both
Properties (subject to the terms of any nondisturbance agreements with Lessor in
favor of any subtenants), by summary proceedings or otherwise, all without
liability to Lessee for or by reason of such entry or taking of possession,
whether for the restoration of damage to property caused by such taking or
otherwise and, in addition to Lessor's other damages, Lessee shall be
responsible for the reasonable costs and expenses of reletting, including
brokers fees and the costs of any repairs made by Lessor. The provisions of this
Section 18.2(b) shall operate as a notice to quit and shall be deemed to satisfy
any other requirement or provisions of Applicable Laws which may require Lessor
to provide a notice to quit or of Lessor's intention to re-enter either or both
Properties and any such requirements or provisions are hereby waived by Lessee;

                (c)     Lessor may sell all or any part of the Lessee Collateral
at public or private sale, as Lessor may determine, free and clear of any rights
of Lessee and without any duty to account to Lessee with respect to such action
or inaction or any proceeds with respect thereto (except to the extent
contemplated in clause (ii) of the next succeeding sentence if Lessor shall
elect to exercise its rights thereunder), in which event Lessee's obligation to
pay Base Rent hereunder for periods commencing after the date of such sale shall
be terminated or proportionately reduced, as the case may be (except to the
extent that Base Rent is to be included in computations under Section 18.2(e) if
Lessor shall elect to exercise its rights thereunder). If Lessor shall have sold
all of the Lessee Collateral pursuant to the above terms of this Section
18.2(c), Lessor, in lieu of exercising its rights under Section 18.2(e), may, if
it shall so elect, demand that Lessee pay to Lessor, and Lessee shall pay to
Lessor, on the date of such sale, as liquidated damages for loss of a bargain
and not as a penalty (the parties agreeing that Lessor's actual damages would be
difficult to predict, but the liquidated damages described below represent a
reasonable approximation of such amount), in lieu of Base Rent due for periods
commencing after such date of sale, an amount equal to the excess (if any) of
(i) the Lease Balance, computed as of such date of sale, over (ii) the net
proceeds of such sale;

                (d)     Lessor may hold, keep idle or lease to others all or any
part of either or both Properties as Lessor in its sole discretion may
determine, free and clear of any rights of Lessee and without any duty to
account to Lessee with respect to such action or inaction or for any proceeds
with respect to such action or inaction, except that Lessee's obligation to pay
Base Rent from and after the occurrence of a Lease Event of Default shall be
reduced by the net proceeds, if any, received by Lessor from leasing either or
both Properties to any Person, or allowing any Person (other than Lessee) to use
either or both Properties for the same periods or any portion thereof;

                (e)     Lessor may, whether or not Lessor shall have exercised
or shall thereafter at any time exercise any of its rights under Section 18.2(b)
or 18.2(d), but only if one or both of

                                      -22-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

the Properties have not been sold under Section 18.2(c), demand, by written
notice to Lessee specifying a date (the "Final Payment Date") not earlier than
ten (10) days after the date of such notice, that Lessee pay to Lessor, and
Lessee shall pay to Lessor, on the Final Payment Date, as liquidated damages for
loss of a bargain and not as a penalty and in consideration of the transfer of
the applicable Property or Properties (the parties agreeing that Lessor's actual
damages would be difficult to predict, but the aforementioned liquidated damages
represent a reasonable approximation of such amount), an amount equal to the sum
of the then outstanding Lease Balance (after taking into account any amounts
received pursuant to this Section 18.2 that are applied in reduction of the
Lease Balance pursuant to the Operative Documents) and all Supplemental Rent
including all amounts payable under any Lessor Hedging Agreement including Break
Costs, then due and payable; upon payment of such sum, if the Lease Balance has
been reduced to zero Lessor shall convey to Lessee the Properties by special
warranty deed free and clear of all Lessor's Liens and the Lien of the Deed of
Trust and the other Operative Documents;

                (f)     Lessor may retain and apply against Lessor's damages all
sums which Lessor would, absent such Lease Event of Default, be required to pay
to, or turn over to, Lessee pursuant to the terms of this Lease; or

                (g)     Lessor may exercise any other right or remedy that may
be available to it under Applicable Laws or in equity, or proceed by appropriate
court action (legal or equitable) to enforce the terms hereof or to recover
damages for the breach hereof. Separate suits may be brought to collect any such
damages for any period or periods with respect to which rent shall have accrued,
and such suits shall not in any manner prejudice Lessor's right to collect any
such damages for any subsequent period, or Lessor may defer any such suit until
after the expiration of the Lease Term. in which event such suit shall be deemed
not to have accrued until the expiration of the Lease Term.

                (h)     [intentionally omitted]

                (i)     Upon the occurrence of the Lease Event of Default
described in Section 18.1(d) or 18.1(f), whether or not another Lease Event of
Default described in one or more other clauses of Section 18.1 shall have been
or thereafter is declared, this Lease shall terminate immediately without notice
and Lessee shall immediately pay to Administrative Agent, on behalf of Lessor,
as and for liquidated damages, an amount equal to the Lease Balance, together
with all Supplemental Rent payable under the Operative Documents, including
Break Costs payable under any Lessor Hedging Agreement.

                (j)     Notwithstanding anything to the contrary set forth
herein, upon the occurrence of a Lease Event of Default, Lessor shall not
reenter, take possession, foreclose, or sell either of the Properties until the
Purchase Option shall have terminated in accordance with Section 5.1(d).

                SECTION 18.3 Proceeds of Sale; Deficiency. All payments received
and amounts held or realized by Lessor at any time when an Event of Default
shall have occurred and be continuing and after the Lease Balance shall have
been accelerated pursuant to this Lease, as well as all payments or amounts then
held or thereafter received by Lessor, except for the

                                      -23-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

proceeds of sale pursuant to Section 18.2, shall be distributed forthwith upon
receipt by Lessor in accordance with Article X of the Participation Agreement.

                SECTION 18.4 Grant and Foreclosure on Lessee's Estate. Without
limiting any other remedies set forth in this Lease, the following shall apply:

                        (a)     Lessor and Lessee agree that if a Lease Event of
        Default shall have occurred and be continuing, Lessor may proceed by a
        suit or suits in equity or at law or otherwise, whether for a
        foreclosure hereunder as against all or any part of Lessee's interests
        in either or both Properties or for the sale of such interest under the
        judgment or decree of a court of competent jurisdiction, or against
        Lessee on a recourse basis for the Lease Balance and all other amounts
        due from Lessee hereunder, or for the specific performance granted, or
        for the appointment of a receiver pending any foreclosure hereunder or
        the sale of the Lessee Collateral, or for the enforcement of any other
        appropriate legal or equitable remedy, and at any sale of Lessee's
        interest in either or both Properties, as applicable, whether pursuant
        to power of sale, foreclosure or otherwise, Lessor may become the
        purchaser of such interest or any part thereof, and in such case for the
        purpose of making settlement for or payment of the purchase price, shall
        be entitled to offset any claims for the indebtedness hereunder and
        under the Operative Documents in order that they may be credited as paid
        on the purchase price, and Lessor shall be entitled to recover all costs
        incident to such proceedings, including attorneys' fees and expenses in
        such amounts as may be fixed by the court. In accordance with Applicable
        Law and rules of the court, Lessee does hereby assent to the passing and
        entry of a decree for the sale of all or any portion of either or both
        Properties. Upon any such purchase, such purchaser shall acquire good
        title to either or both Properties, as applicable, so purchased, free of
        the Lien of this Lease and free of all rights of redemption in favor of
        Lessee;

                        (b)     This instrument and the other Operative
        Documents will be deemed given to secure not only the Lease Balance,
        accrued Rent and all other sums due hereunder, but also future advances
        made by Lessor in connection with the transactions contemplated by the
        Operative Documents, whether such advances are obligatory or to be made
        at the option of Lessor or otherwise to the same extent as if such
        future advances were made on the Lease Commencement Date. To the fullest
        extent permitted by law, the Lien of this instrument shall be valid as
        to all such sums due hereunder, including all future advances, from the
        time this instrument is executed.

                        (c)     Without in any way limiting or restricting any
        of Lessor's rights, remedies, powers and authorities under this
        instrument, and in addition to all of such rights, remedies, powers, and
        authorities, if a Lease Event of Default shall have occurred and be
        continuing, Lessor shall also have and may exercise any and all rights,
        remedies, powers and authorities under Applicable Laws upon default in
        the payment of the Lease Balance, accrued Rent and all other sums due
        hereunder, including, without limitation, any right or remedy available
        to it as a secured party under the UCC. Promptly upon Lessor's request,
        to the extent any portion of the Lessee Collateral constitutes property
        subject to the UCC, Lessor at its option, may give Lessee notice of the
        time and place of any public sale of any such property, or of the date
        after which any private sale or other

                                      -24-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

        disposition thereof is to be made, by sending notice by registered or
        certified first class mail, postage prepaid, to Lessee at least ten (10)
        days before the time of such sale or other disposition. If any notice of
        any proposed sale, assignment or transfer by Lessor of any portion of
        the Lessee Collateral or any interest therein is required by law, Lessee
        conclusively agrees that fifteen (15) days notice to Lessee of the date,
        time and place (and, in the case of a private sale, the terms) thereof
        is reasonable. Without limiting the generality of the foregoing, all
        expenses incurred by Lessor to the extent reimbursable under the UCC,
        whether incurred before or after any decree or judgment of foreclosure,
        and whether or not enumerated in any other provision of this instrument,
        shall be added to the indebtedness secured by this instrument and by the
        judgment of foreclosure.

                        (d)     Lessee, for itself and on behalf of all Persons
        now or hereafter interested in the Lessee Collateral, voluntarily and
        knowingly hereby waives to the fullest extent permitted by applicable
        law any and all right to reinstatement or redemption and any and all
        other rights under all present and future appraisement, homestead,
        moratorium, valuation, exemption, stay, extension, and redemption
        statutes, laws or equities now or hereafter existing and all rights or
        marshalling in the event of any sale of the Lessee Collateral or any
        part hereof or interest therein, and hereby further waives the pleading
        of any statute of limitations as a defense to any and all indebtedness
        secured by this instrument, and Lessee agrees that no defense, claim or
        right based on any thereof will be asserted, or may be enforced, in any
        action enforcing or relating to this instrument. Without limited the
        generality of the preceding sentence, Lessee, for itself and on behalf
        of each and every Person acquiring any interest in or title to the
        Lessee Collateral subsequent to the date of this instrument, hereby
        irrevocably waives any and all rights of reinstatement or redemption
        from sale under any order, judgment or decree of foreclosure of this
        instrument or under any power contained herein or under any sale
        pursuant to any statute, order, judgment or decree of foreclosure of any
        court.

                SECTION 18.5 Receipt of a Sufficient Discharge to Purchaser.
Upon any sale of the Lessee Collateral, or any part thereof or interest therein,
whether pursuant to power of sale, foreclosure or otherwise, the receipt of
Lessor or the officer making the sale under judicial proceedings shall be a
sufficient discharge to the purchaser for the purchase money, and such purchaser
shall not be obliged to see to the application thereof.

                SECTION 18.6 Sale a Bar Against Lessee. Any sale of the Lessee
Collateral, or any part thereof or interest therein, under or by virtue of this
instrument, whether pursuant to a power of sale, foreclosure or otherwise, shall
forever be a bar against Lessee.

                SECTION 18.7 Liabilities to Become Due on Sale. Upon any sale of
the Lessee Collateral, or any portion thereof or interest therein, by reason of
Lessor's exercise of any remedy under or by virtue of this Lease or any other
Operative Document, whether pursuant to power of sale, foreclosure or other
remedy available at law or in equity or by statute or otherwise, at the option
of Lessor, if the Lease Balance shall not have been previously declared due and
payable, the Lease Balance and all other indebtedness which this agreement
secures (other than any obligations evidenced by any Lessor Hedging Agreement
except as otherwise provided by the terms thereof) shall immediately become due
and payable together with any interest accrued thereon.

                                      -25-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                SECTION 18.8 Provisions Subject to Applicable Law. All rights,
powers and remedies provided in this instrument may be exercised only to the
extent that such exercise does not violate any Applicable Law, and are intended
to be limited to the extent necessary in order not to render this instrument
invalid, unenforceable or not entitled to be recorded, registered or filed under
the provisions of any Applicable Law. If any term of this instrument or any
application thereof shall be invalid or unenforceable, the remainder of this
instrument and any other application of such term shall not be affected thereby.

                SECTION 18.9 Survival of Lessee's Obligations. No repossession
of either or both Properties or exercise of any remedy under Section 18.2,
including termination of this Lease, shall, except as specifically provided
therein, relieve Lessee of any of its liabilities and obligations hereunder,
including the obligation to pay Base Rent. In addition, except as specifically
provided therein, Lessee shall be liable, except as otherwise provided above,
for any and all unpaid Rent due hereunder before, after or during the exercise
of any of the foregoing remedies, including all reasonable legal fees and other
costs and expenses incurred by Lessor and the Administrative Agent by reason of
the occurrence of any Lease Event of Default or the exercise of Lessor's
remedies with respect thereto, and including all costs and expenses (excluding
internal in-house costs of the Participants' counsel) incurred in connection
with the return of either or both Properties, as applicable, in the manner and
condition required by, and otherwise in accordance with the provisions of,
Article XII as if such Property or Properties, as applicable, were being
returned at the end of the Lease Term. At any sale of either or both Properties
or any part thereof or any other rights pursuant to Section 18.2, Lessor or the
Administrative Agent may bid for and purchase such property.

                SECTION 18.10 Remedies Cumulative; No Waiver; Consents. To the
extent permitted by, and subject to the mandatory requirements of, Applicable
Laws, each and every right, power and remedy herein specifically given to Lessor
or otherwise in this Lease shall be cumulative and shall be in addition to every
other right, power and remedy herein specifically given or now or hereafter
existing at law, in equity or by statute, and each and every right, power and
remedy whether specifically herein given or otherwise existing may be exercised
from time to time and as often and in such order as may be deemed expedient by
Lessor, and the exercise or the beginning of the exercise of any power or remedy
shall not be construed to be a waiver of the right to exercise at the same time
or thereafter any other right, power or remedy. No delay or omission by Lessor
in the exercise of any right, power or remedy or in the pursuit of any remedy
shall impair any such right, power or remedy or be construed to be a waiver of
any default on the part of Lessee or to be an acquiescence therein. Lessor's
consent to any request made by Lessee shall not be deemed to constitute or
preclude the necessity for obtaining Lessor's consent, in the future, to all
similar requests. No express or implied waiver by Lessor of any Lease Event of
Default shall in any way be, or be construed to be, a waiver of any future or
subsequent Lease Event of Default.

                SECTION 18.11 Right to Perform Lessee's Obligations. If a Lease
Event of Default shall have occurred and be continuing, Lessor may perform or
comply with such agreement, and Lessor shall not thereby be deemed to have
waived any default caused by such failure, and the amount of payment required to
be made by Lessee hereunder and made by Lessor on behalf of Lessee, and the
reasonable out-of-pocket costs and expenses of Lessor (including reasonable
attorneys' fees and expenses) incurred in connection with the performance

                                      -26-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

of or compliance with such agreement, as the case may be, together with interest
thereon at the Overdue Rate, shall be deemed Supplemental Rent, payable by
Lessee to Lessor upon demand.

                                  ARTICLE XIX.
                                  HOLDING OVER

                SECTION 19.1 Holding Over. If Lessee shall for any reason remain
in possession of a Property after the expiration or earlier termination of this
Lease as to such Property (unless such Property is conveyed to Lessee), such
possession shall be as a tenancy at sufferance during which time Lessee shall
continue to pay Supplemental Rent that would be payable by Lessee hereunder were
the Lease then in full force and effect with respect to such Property and Lessee
shall continue to pay Base Rent in an amount equal to 150% of the Base Rent that
would have been payable had the Lease not terminated or expired for each month
or portion thereof after expiration of the Lease. Such Base Rent shall be
payable from time to time upon demand by Lessor. During any period of tenancy at
sufferance, Lessee shall, subject to the second preceding sentence, be obligated
to perform and observe all of the terms, covenants and conditions of this Lease,
but shall have no rights hereunder other than the right, to the extent given by
law to tenants at sufferance, to continue its occupancy and use of such
Property. Nothing contained in this Article XIX shall constitute the consent,
express or implied, of Lessor to the holding over of Lessee after the expiration
or earlier termination of this Lease as to any Property (unless such Property is
conveyed to Lessee) and nothing contained herein shall be read or construed as
preventing Lessor from maintaining a suit for possession of such Property or
exercising any other remedy available to Lessor at law or in equity.

                                   ARTICLE XX.
                           GRANT OF SECURITY INTEREST

                SECTION 20.1 Grant of Lien. Title to each Property shall remain
in Lessor, as security for the obligations of Lessee under this Lease and the
other Operative Documents, and Lessee hereby assigns, grants, pledges, mortgages
and warrants to Lessor, as secured party, for the benefit of Lessor and its
permitted transferees and assignees a Lien in the Lessee Collateral to secure
the payment and performance of all obligations of Lessee now or hereafter
existing under this Lease or any other Operative Document, until such time as
Lessee shall have fulfilled all of its obligations under the Operative
Documents. Upon Lessee's request, Lessor shall at such time as all of the
obligations (other than any contingent obligations) of Lessee under this Lease
and the other Operative Documents have been paid or performed in full with
respect to either or both Properties, execute and deliver termination statements
and other appropriate documentation presented to it in final execution form and
reasonably requested by Lessee, all at Lessee's expense, to evidence Lessor's
release of its Lien in respect of such Property or Properties, as applicable.
Lessee, at its expense, shall execute, acknowledge and deliver all such
instruments and take all such actions as Lessor may request from time to time in
order to further effectuate the terms of this Lease, to carry out the terms
hereof, or to better assure and confirm the rights, powers and remedies of
Lessor hereunder.

                SECTION 20.2 Assignment of Lease and Rents. The assignment and
grant of the Lien contained in Section 20.1 above shall constitute an absolute,
present and irrevocable assignment and grant of the subleases, rents, income,
proceeds and benefits of each Property;

                                      -27-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

provided that so long as no Lease Event of Default has occurred and is
continuing, Lessor hereby grants permission to Lessee to collect, receive and
apply such rents, income, proceeds and benefits as they become due and payable,
but not in advance hereof, and in accordance with all of the other terms,
conditions and provisions hereof and of the leases, contracts, agreements and
other instruments with respect to which such payments are made or such other
benefits are conferred. Upon the occurrence of a Lease Event of Default, such
permission shall terminate immediately and automatically, without notice to
Lessee or any other Person. Such assignment shall be fully effective without any
further action on the part of Lessee or Lessor and, upon the occurrence and
during the continuance of a Lease Event of Default hereunder, at Lessor's
option, Lessor shall be entitled to collect, receive and apply all rents,
income, proceeds and benefits from Lessor's Interest, including all right, title
and interest of Lessee in any escrowed sums or deposits or any portion thereof
or interest therein, whether or not Lessor takes possession of the Lessee
Collateral or any part thereof. Lessee further grants to Lessor the right, at
Lessor's option, upon the occurrence and during the continuance of a Lease Event
of Default hereunder:

                                (i)     to enter upon and take possession of
                either or both Properties for the purpose of collecting said
                rents, income, proceeds and other benefits;

                                (ii)    to dispossess by the customary summary
                proceedings any tenant, purchaser or other Person;

                                (iii)   to let or convey either or both
                Properties or any portion thereof or any interest therein;

                                (iv)    to apply such rents, income, proceeds
                and other benefits, after the payment of all necessary fees,
                charges and expenses, on account of the liabilities secured by
                this instrument in accordance with Section 18.3.

                                  ARTICLE XXI.
                               COVENANTS OF LESSEE

                SECTION 21.1 Assumption Upon Merger, Etc. If Lessee shall
consolidate with or merge into any other Person or sell, convey, transfer or
lease all or substantially all its assets, then the Person (if other than
Lessee) formed by such consolidation or into which Lessee shall be merged or the
Person that shall acquire by sale, conveyance, transfer or lease all or
substantially all the assets of Lessee shall assume in writing all of the
obligations of Lessee under the Operative Documents to which Lessee is a party.
No such consolidation, merger or transfer of assets shall occur unless Lessor,
the Administrative Agent and the Participants have received a legal opinion of
independent counsel to the surviving entity in respect of the assumption
agreement in form and substance reasonably satisfactory to Lessor and the
Administrative Agent. Upon any such consolidation or merger, or any sale,
conveyance, transfer or lease of substantially all the assets of Lessee in
accordance with this Article XXI, the successor Person formed by such
consolidation or into which Lessee shall be merged or to which such sale,
conveyance, transfer or lease shall be made shall succeed to, and be substituted
for, and may exercise every right and power of, Lessee under this Lease and the
other Operative Documents to which Lessee is a party.

                                      -28-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                  ARTICLE XXII.
                               COVENANTS OF LESSOR

                SECTION 22.1 Quiet Enjoyment. Lessor covenants that it will not
interfere in Lessee's right to peaceably and quietly hold, possess and use the
Properties hereunder during the Lease Term, so long as no Lease Event of Default
has occurred and is continuing.

                                 ARTICLE XXIII.
                                  MISCELLANEOUS

                SECTION 23.1 Binding Effect; Successors and Assigns. The terms
and provisions of this Lease, and the respective rights and obligations
hereunder of Lessor and Lessee, shall be binding upon their respective
successors, legal representatives and assigns (including, in the case of Lessor,
any Person to whom Lessor may transfer Lessor's Interests or any interest
therein) and inure to the benefit of their respective permitted successors and
assigns.

                HGSI hereby waives its right to assert any defense, claim or
counterclaim against the Lessor to the extent such defense, claim or
counterclaim arises out of the Lessor's lack of legal capacity to sue for
failure of qualifying to do business under Maryland Applicable Law.

                SECTION 23.2 Notices. Unless otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
parties hereto shall be by letter, facsimile (with telephonic confirmation),
bank wire or where expressly provided for herein, telephone (with written
confirmation promptly thereafter shall be deemed to have been given, in the
case of notice by letter, the earlier of when delivered to the addressee by hand
or courier (including an overnight courier) if delivered on a Business Day and,
if not delivered on a Business Day, the first Business Day thereafter or on the
third Business Day after depositing the same in the mails, registered or
certified mail, postage prepaid, return receipt requested, addressed as provided
on Schedule II to the Participation Agreement and, in the case of notice by
facsimile, telephone or bank wire, when transmitted during business hours on a
Business Day and, if not transmitted during business hours on a Business Day,
the first Business Day thereafter, addressed as provided on Schedule II to the
Participation Agreement, or to such other address as any of the parties hereto
may designate by written notice. Copies of all notices given by facsimile or
bank wire shall be contemporaneously sent by overnight courier. Notwithstanding
any other provision of this Lease or the Operative Documents, if Lessee is
required to deliver notice to one or more of the parties to the Operative
Documents notice to all such parties shall be deemed to have been duly given by
Lessee by delivering any such notice to the Administrative Agent, who shall in
turn promptly deliver such notice to the appropriate party hereto.

                SECTION 23.3 Severability. Any provision of this Lease that
shall be prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction, and each party
hereto shall remain liable to perform its obligations hereunder except to the
extent of such unenforceability. To the extent

                                      -29-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

permitted by applicable law, Lessee hereby waives any provision of law that
renders any provision hereof prohibited or unenforceable in any respect.

                SECTION 23.4 Amendment; Complete Agreements. This Lease and the
terms hereof may be terminated, amended, supplemented, waived or modified only
in accordance with Section 12.5 of the Participation Agreement. This Lease and
the other Operative Documents are intended by the parties as a final expression
of their lease agreement and as a complete and exclusive statement of the terms
thereof, all negotiations, considerations and representations between the
parties having been incorporated herein. No representations, undertakings, or
agreements have been made or relied upon in the making of this Lease other than
those specifically set forth in this Lease and in the other Operative Documents.

                SECTION 23.5 Headings. The Table of Contents and headings of the
various Articles and Sections of this Lease are for convenience of reference
only and shall not modify, define or limit any of the terms or provisions
hereof.

                SECTION 23.6 Counterparts. This Lease may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.

                SECTION 23.7 Governing Law. This Lease shall in all respects be
governed by, and construed in accordance with, the laws of the State of Maryland
applicable to agreements made and to be performed entirely within such State,
including all matters of construction, validity and performance.

                SECTION 23.8 Apportionments. Upon any termination of this Lease
(other than a termination resulting in delivery of Lessor's Interests then
subject to this Lease to Lessee), except as otherwise set forth herein, there
shall be apportioned, as of the date of such termination, all rents (including
water or sewer rents), real estate taxes, municipal assessments, or other
charges payable with respect to the Properties.

                SECTION 23.9 Priority. If a Lease Event of Default shall occur,
this Lease and the Lease Supplements shall be subject and subordinate to the
Deeds of Trust.

                SECTION 23.10 No Joint Venture. Any intention to create a joint
venture or partnership relation between Lessor and Lessee is hereby expressly
disclaimed.

                SECTION 23.11 No Accord and Satisfaction. The acceptance by
Lessor of any sums from Lessee (whether as Base Rent or otherwise) in amounts
which are less than the amounts due and payable by Lessee hereunder is not
intended, nor shall it be construed, to constitute an accord and satisfaction of
any dispute between such parties regarding sums due and payable by Lessee
hereunder, unless Lessor specifically acknowledges it as such in writing.

                SECTION 23.12 No Merger. There shall be no merger of this Lease
or of the estate hereby with the fee or any other estate or interest or
ownership interest in the Properties or any part thereof by reason of the fact
that the same Person may acquire or own or hold, directly or indirectly, (a)
this Lease or any estate created hereby or any interest in this Lease or in any

                                      -30-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

such estate and (b) the fee estate or other estate or interest or ownership
interest in the Properties or any part thereof.

                SECTION 23.13 Lessor Bankruptcy. The parties hereto agree that
if Lessee elects to remain in possession of the Properties after the rejection
of the Lease by Lessor under Section 365(h) of the Bankruptcy Code all of the
terms and provisions of this Lease shall be effective during such period of
possession by Lessee, including Lessee's Purchase Option even if Lessor becomes
subject to a case or proceeding under the Bankruptcy Code prior to the exercise
by Lessee of such purchase rights.

                SECTION 23.14 Abandonment. Lessee shall not abandon the
Properties during the Lease Term.

                SECTION 23.15 Investments. Any funds held by Lessor as security
for Lessee's performance of its obligations hereunder (other than the Liquid
Collateral held in either Account) shall, until paid to Lessee or otherwise
applied in accordance herewith, be invested by Lessor in Cash Equivalents as
selected by Lessee. Any gain (including interest received) realized as a result
of any such investment (net of any fees, commissions, Taxes and other expenses,
if any, incurred in connection with such investment) shall be retained with, and
distributed and re-invested in the same manner, as the original security amount.
Provided Lessor invests such funds in accordance with the preceding sentence,
Lessor shall have no liability for any losses arising from any such investments
or reinvestments.

                SECTION 23.16 Counterparts; Deed of Trust; Notice. This Lease
will be simultaneously executed in multiple counterparts, each of which, when so
executed and delivered, shall constitute an original, fully enforceable
counterpart for all purposes except that only the counterpart stamped or marked
"COUNTERPART NUMBER ONE" shall constitute to the extent applicable, if any,
"chattel paper" or other "collateral" within the meaning of the Uniform
Commercial Code in effect in any jurisdiction. The Administrative Agent or (if
no Loans are outstanding) Lessor shall be the sole authorized holder of
COUNTERPART NUMBER ONE. Lessee and Lessor agree that a notice of this Lease
shall be executed and recorded in the land records of Maryland.

                SECTION 23.17 Further Assurances. Lessor and Lessee, at the cost
and expense of the requesting party, will cause to be promptly and duly taken,
executed, acknowledged and delivered all such further acts, documents and
assurances as any of the others reasonably may request from time to time in
order to carry out more effectively the intent and purposes of this Lease.
Lessee, at its own cost and expense, will cause all financing statements,
fixture filings and other documents to be recorded or filed at such places and
times and in such manner, and will take all such other actions or cause such
actions to be taken, as may be necessary or as may be reasonably requested by
Lessor in order to preserve and protect the title of Lessor to the Properties
and Lessor's rights under this Lease.

                SECTION 23.18 No Merger of Title. There shall be no merger of
this Lease or of the leasehold estate created hereby by reason of the fact that
the same Person may acquire, own or hold, directly or indirectly, in whole or in
part, (a) this Lease or the leasehold estate created hereby or any interest in
this Lease or such leasehold estate, (b) the free estate in any

                                      -31-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

Property, except as may expressly be stated in a written instrument duly
executed and delivered by the appropriate Person or (c) a beneficial interest in
Lessor.

                SECTION 23.19 Non-recourse. Lessee shall look only to Lessor's
Interests and other rights, if any, in the Properties for the satisfaction of
Lessee's remedies if there is a default by Lessor hereunder, and no other
property or assets of Lessor or its partners, owners or principals, disclosed or
undisclosed, shall be subject to levy, execution or other enforcement procedure
for the satisfaction of Lessee's remedies under or with respect to (a) this
Lease, (b) the relationship of Lessor and Lessee hereunder or under Applicable
Laws, (c) Lessee's use or occupancy of the Properties or (d) any other liability
of Lessor to Lessee. Nothing in the immediately preceding sentence shall in any
way affect, impair or detract from (i) Lessee's "net lease" obligations
hereunder as provided in Section 4.1 or (ii) the duties and obligations under
the Participation Agreement and other Operative Documents of the Participants
and other parties to the Operative Documents.

                    [SIGNATURES APPEAR ON THE FOLLOWING PAGE]

                                      -32-
<PAGE>

                                                          LEASE AGREEMENT (HGSI)

        IN WITNESS WHEREOF, Lessor and Lessee have duly authorized, executed and
delivered this LEASE as of the date first hereinabove set forth.

                                         GENOME STATUTORY TRUST 2001A,
                                         as Lessor

                                         By:  /s/ C. SCOTT NIELSON
                                            ------------------------------------
                                            Name:  C. Scott Nielson
                                            Title: Vice President

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                         HUMAN GENOME SCIENCES, INC.,
                                         as Lessee

                                         By: /s/ STEVEN C. MAYER
                                            ------------------------------------
                                            Name:  Steven C. Mayer
                                            Title: Senior Vice President and CFO

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

STATE OF NEW YORK    )
                     ) SS
COUNTY OF NEW YORK   )

On the 7th day of November in the year 2001 before me, the undersigned, a Notary
Public in and for said State, personally appeared C. Scott Nielson, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual(s) whose name(s) is (are) subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.

                                     /s/ DIMITRIOS J. ANGELIS
                                     -------------------------------------------
                                     (Signature and office of individual taking
                                     acknowledgment)

                                        Dimitrios J. Angelis
                                        Notary Public

Notarial Seal

STATE OF NEW YORK    )
                     ) SS
COUNTY OF NEW YORK   )

On the 7th day of November in the year 2001 before me, the undersigned, a Notary
Public in and for said State, personally appeared Steven C. Mayer, personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual(s) whose name(s) is (are) subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
capacity(ies), and that by his/her/their signature(s) on the instrument, the
individual(s), or the person upon behalf of which the individual(s) acted,
executed the instrument.

                                     /s/ COLLEEN FANE
                                     -------------------------------------------
                                     (Signature and office of individual taking
                                     acknowledgment)

                                       Colleen Fane
                                       Notary Public

Notarial Seal

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                   EXHIBIT A-1
                          Description of Traville Site

                                    Attached.

<PAGE>

                                                          LEASE AGREEMENT (HGSI)

                                   EXHIBIT A-2
                             Manufacturing Property

                                    Attached.

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