Document:

Exhibit
10.51

 

FIRST AMENDMENT TO LEASE

 

THIS
FIRST AMENDMENT TO LEASE (this “First
Amendment”) is made as of June 1, 2010 (“Effective
Date”), by and between ARE-901/951 GATEWAY BOULEVARD, LLC, a Delaware limited liability company
(“Landlord”), and THERAVANCE, INC., a Delaware corporation (“Tenant”).

 

RECITALS

 

A.                                    Landlord and
Tenant are now parties to that certain Amended and Restated Lease Agreement
dated January 1, 2001 (the “Lease”).  Pursuant to the Lease, Tenant leases certain
premises consisting of approximately 59,816 rentable square feet (“Premises”) in a three (3)-story building located at 951
Gateway Boulevard, South San Francisco, California.  The Premises are more particularly described
in the Lease.  Capitalized terms used
herein without definition shall have the meanings defined for such terms in the
Lease.

 

B.                                    Pursuant to
that certain Sublease dated February 9, 2009 (“Sublease”)
now between Tenant and IPERIAN, INC., a Delaware corporation (as
successor-in-interest to iZumi Bio, Inc.,) (“Subtenant”),
Tenant subleases to Subtenant the entire second floor of the Building,
consisting of approximately 19,988 rentable square feet (“Second Floor
Premises”).

 

C.                                    Landlord and
Tenant desire, subject to the terms and conditions set forth below, to amend the
Lease to, among other things, (i) extend the Term of the Lease, (ii) provide
for the surrender by Tenant of the entire first floor of the Building,
consisting of approximately 19,914 rentable square feet (“First Floor
Premises”) on May 31, 2011 (“FFP Surrender
Date”), and (iii) provide for the surrender by Tenant of the
Second Floor Premises on March 31, 2012 (“SFP
Surrender Date”).

 

NOW, THEREFORE, in consideration of the
foregoing Recitals, which are incorporated herein by this reference, the mutual
promises and conditions contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Landlord and Tenant hereby agree as follows:

 

1.                                      Term.  The “Expiration Date”
of the Term of the Lease is hereby extended from March 31, 2012, until May 31,
2020.  From and after the Effective Date,
references in the Lease to “Term” shall mean the one hundred twenty (120)
months commencing on June 1, 2010 and expiring on May 31, 2020.

 

2.                                      Premises.

 

a.                                      Following
the FFP Surrender Date. Notwithstanding anything to the contrary
contained in the Lease, commencing on June 1, 2011, the definition of “Premises”
shall be amended to mean the Second Floor Premises and the Third Floor
Premises.

 

As
of June 1, 2011, the Site Plan attached to the Lease as Exhibit A2
describing the Premises shall be deleted and replaced with Exhibit A
attached hereto.

 

b.                                      Following
the SFP Surrender Date. 
Commencing on April 1, 2012, the definition of “Premises” shall be
amended to mean the Third Floor Premises.

 

As of April 1, 2012, Exhibit A
attached hereto shall be amended to exclude the Second Floor Premises.

 

 

1

 

3.                                      Premises
Square Footage.

 

a.                                      Following
the FFP Surrender Date. 
Commencing on June 1, 2011, the definition of “Premises Square
Footage” contained in the Basic Lease Information shall be deleted and replaced
with the following:

 

“Premises
Square Footage:                                           39,902 rentable
square feet”

 

b.                                      Following
the SFP Surrender Date.  Commencing
on April 1, 2012, the definition of “Premises Square Footage” contained in
the Basic Lease Information shall be deleted and replaced with the following:

 

“Premises
Square Footage:                                           19,914 rentable
square feet”

 

4.                                      Tenant’s
Proportionate Share.

 

a.                                      Following
the FFP Surrender Date. 
Commencing on June 1, 2011, the definitions of “Tenant’s
Proportionate Share of Project” and “Tenant’s Proportionate Share of Building”
contained in the Basic Lease Information shall be deleted and replaced with the
following:

 

“Tenant’s Proportionate Share of Project:          66.71%

 

Tenant’s Proportionate Share of Building:        66.71%”

 

b.                                      Following
the SFP Surrender Date. 
Commencing on April 1, 2012, the definitions of “Tenant’s
Proportionate Share of Project” and “Tenant’s Proportionate Share of Building”
contained in the Basic Lease Information shall be deleted and replaced with the
following:

 

“Tenant’s Proportionate Share of Project:          33.29%

 

Tenant’s Proportionate Share of
Building:        33.29%”

 

5.                                      Monthly Base Rent.

 

a.                                      First
Floor Premises/Third Floor Premises.  Notwithstanding anything to the contrary
contained in the Lease, commencing on the Effective Date of this First
Amendment, Monthly Base Rent for the First Floor Premises and the entire third
floor of the Building, consisting of approximately 19,914 rentable square foot
feet (“Third Floor Premises”) shall be payable
as follows through the FFP Surrender Date:

 

	
  Time
  Period

  	
   

  	
  Monthly Base Rent

  
	
   

  	
   

  	
   

  
	
  6/1/10
  — 5/31/11

  	
   

  	
  $103,552.80
  per month

  

 

b.                                      Third
Floor Premises. 
Notwithstanding anything to the contrary contained in the Lease,
commencing on June 1, 2011, Monthly Base Rent for the Third Floor Premises
shall be payable pursuant to the following table:

 

	
  Time
  Period

  	
   

  	
  Monthly Base Rent

  
	
   

  	
   

  	
   

  
	
  6/1/11
  — 3/31/12

  	
   

  	
  $55,759.20
  per month

  
	
  4/1/12
  — 3/31/13

  	
   

  	
  $58,746.30
  per month

  
	
  4/1/13
  — 3/31/14

  	
   

  	
  $60,508.69
  per month

  
	
  4/1/14
  — 3/31/15

  	
   

  	
  $62,323.95
  per month

  

 

2

 

	
  4/1/15
  — 3/31/16

  	
   

  	
  $64,193.69
  per month

  
	
  4/1/16
  — 3/31/17

  	
   

  	
  $66,119.50
  per month

  
	
  4/1/17
  — 3/31/18

  	
   

  	
  $68,103.08
  per month

  
	
  4/1/18
  — 3/31/19

  	
   

  	
  $70,146.17
  per month

  
	
  4/1/19
  — 3/31/20

  	
   

  	
  $72,250.56
  per month

  
	
  4/1/20 — 5/31/20

  	
   

  	
  $74,418.08 per month

  

 

c.                                       Second
Floor Premises. 
Notwithstanding anything to the contrary contained in the Lease,
commencing on the date of this First Amendment, Tenant shall pay to Landlord
Monthly Base Rent for the Second Floor Premises through the SFP Surrender Date,
as follows:

 

	
  Time
  Period

  	
   

  	
  Monthly Base Rent

  
	
   

  	
   

  	
   

  
	
  6/1/10
  — 11/30/10

  	
   

  	
  $51,968.80
  per month

  
	
  12/1/10
  - 2/28/11

  	
   

  	
  $41,175.28
  per month

  
	
  3/1/11
  — 3/31/12

  	
   

  	
  $42,410.54
  per month

  

 

6.                                      Notice
to Subtenant. 
Concurrently with Tenant’s execution of this First Amendment, Tenant
shall notify Subtenant in writing that the Lease with respect to the Second
Floor Premises will terminate as of March 31, 2012, pursuant to this First
Amendment, and that Subtenant shall have no right to extend the term of the
Sublease beyond March 31, 2012.

 

7.                                      Additional
Rent. 
Notwithstanding anything to the contrary contained in the Lease,
commencing on December 1, 2010, until the SFP Surrender Date, Tenant shall
be required to pay for Expenses (as defined in Paragraph 4.2 of the Lease) with
respect to the Second Floor Premises only in an amount equal to $1.50 per
rentable square foot of the Second Floor Premises per month.  Notwithstanding the foregoing, Tenant shall
continue to pay Expenses and Additional Rent for the First Floor Premises
(through the FFP Surrender Date, as the same may be extended pursuant to Section 12(a) below)
and the Third Floor Premises as provided for in the Lease.

 

8.                                      Additional
Tenant Improvement Allowance.  Landlord and Tenant have amended the 901
Gateway Lease to, among other things, provide Tenant an “Additional TI
Allowance” of up to $2,606,840.00. 
Notwithstanding anything to the contrary contained in the 901 Gateway
Lease, Tenant shall only have the right to use up to $782,052.00 of the
Additional TI Allowance for the design and construction of fixed and permanent
improvements within the Third Floor Premises desired by and performed by Tenant
and which improvements shall be of a fixed and permanent nature (the “Additional Tenant Improvements”); provided, however, that
Tenant shall comply with the terms of Section 3 of that certain
First Amendment to Lease of even date herewith entered into by Landlord and
Tenant with respect to the 901 Gateway Lease in connection with Tenant’s use of
the Additional TI Allowance and the construction by Tenant of the Additional
Tenant Improvements within the Third Floor Premises.

 

9.                                      Security
Deposit.  Effective
as of the Effective Date of this First Amendment, Paragraph 7 of the
Lease is hereby deleted in its entirety and replaced with the following:

 

“7.                                Security Deposit.  Tenant acknowledges and agrees that Tenant
has delivered to Landlord a Security Deposit (as defined in the 901 Gateway
Lease) pursuant to the terms of the 901 Gateway Lease and that Landlord shall
have the right to apply all or any portion of such Security Deposit in
connection with any Default (as defined in Paragraph 24) under this
Lease.

 

The
Security Deposit is not an advance rental deposit or a measure of Landlord’s
damages in case of Tenant’s default. 
Upon each occurrence of a Default 
by Tenant under this Lease, Landlord may use all or any part of the
Security Deposit to pay delinquent payments due

 

3

 

under this Lease, future rent
damages under California Civil Code Section 1951.2, and the cost of any
damage, injury, expense or liability caused by such Default, without prejudice
to any other remedy provided herein or provided by law.  Landlord’s right to use the Security Deposit
under this Paragraph 7 includes the right to use the Security Deposit to pay
future rent damages following the termination of this Lease pursuant to
Paragraph 25.5 below.  Upon any use of
all or any portion of the Security Deposit, Tenant shall pay Landlord within
twenty (20) days after receipt of written demand the amount that will restore
(by the delivery of a replacement or amended Letter of Credit) the Security
Deposit to the amount set forth in the definition of “Letter of Credit” set
forth in the Basic Lease Information of the 901 Gateway Lease.  Tenant hereby waives the provisions of any
law, now or hereafter in force, including, without limitation, California Civil
Code Section 1950.7, which provide that Landlord may claim from a security
deposit only those sums reasonably necessary to remedy defaults in the payment
of rent, to repair damage caused by Tenant or to clean the Premises, it being
agreed that Landlord may, in addition, claim those sums reasonably necessary to
compensate Landlord for any other loss or damage, foreseeable or unforeseeable,
caused by the Default of Tenant  or any
of Tenant’s Agents under this Lease. 
Upon bankruptcy or other debtor-creditor proceedings against Tenant, the
Security Deposit shall be deemed to be applied first to the payment of Rent and
other charges due Landlord for periods prior to the filing of such proceedings,
subject to applicable bankruptcy law.  If
Tenant shall fully perform every provision of this Lease to be performed by
Tenant and Landlord is holding cash in the amount of a bifurcated Letter of
Credit  (as described below) or cash
proceeds therefrom, the Security Deposit, or any balance thereof (i.e., after
deducting therefrom all amounts to which Landlord is entitled under the
provisions of this Lease), shall be returned to Tenant within ninety (90) days
after the expiration or earlier termination of this Lease.  If Landlord is holding a bifurcated Letter of
Credit upon the expiration or earlier termination of this Lease, Landlord shall
comply with the LC Issuer’s requirements necessary to cancel the bifurcated
Letter of Credit by the date that is ninety (90) days after the expiration or
earlier termination of this Lease.

 

Notwithstanding
anything contained in this Paragraph 7 to the contrary, if Landlord draws on
the Letter of Credit for any reason, then Tenant shall have the right, upon ten
(10) days’ prior written notice to Landlord, to obtain a refund from
Landlord of any unapplied proceeds of the Letter of Credit which Landlord has
drawn upon, any such refund being conditioned upon Tenant simultaneously
delivering to Landlord a replacement Letter of Credit in the amount required
by, and otherwise meeting the requirements contained in, this Paragraph 7 and
Paragraph 7 of the 901 Gateway Lease.

 

Notwithstanding
anything to the contrary contained herein or in the 901 Gateway Lease, if
requested by Landlord at any time following the date of this Lease, Tenant
shall cause the LC Issuing Bank (as defined in the 901 Gateway Lease) to
bifurcate the Letter of Credit (as defined in the 901 Gateway Lease) into two
separate letters of credit, one securing Tenant’s obligations under the 901
Gateway Lease and the other securing Tenant’s obligations under this
Lease.  Such bifurcated letters of credit
shall each be in an amount specified by Landlord, provided that the aggregate
amount of such letters of credit shall equal the amount of the Letter of Credit
immediately prior to such bifurcation. 
Concurrently with the bifurcation of the Letter of Credit, Landlord and
Tenant shall enter into a modification of the 901 Gateway Lease and a
modification of this Lease, which modifications shall amend Paragraph 7 of the
901 Gateway Lease and this Paragraph 7 to provide for separate, stand-alone
security deposit provisions in the 901 Gateway Lease and this Lease.

 

If
Landlord transfers its interest in the Project or this Lease, Landlord shall
either (a) transfer any Security Deposit then held by Landlord to a person
or entity assuming Landlord’s obligations under this Paragraph 7, or (b) return
to Tenant any Security Deposit then held by Landlord and remaining after the
deductions permitted herein.  Upon such
transfer to such transferee or the return of the Security Deposit to Tenant,
Landlord shall have no further obligation with respect to the Security Deposit,
and Tenant’s right to the return of the Security

 

4

 

Deposit shall apply solely
against Landlord’s transferee.  Landlord’s
obligation respecting the Security Deposit is that of a debtor, not a trustee,
and no interest shall accrue thereon.”

 

10.                               Unreserved
Parking Spaces.  Commencing
on June 1, 2011, the definition of “Unreserved Parking Spaces” contained
in the Basic Lease Information shall be deleted and replaced with the
following:

 

“Unreserved
Parking Spaces:                                Subject to the
terms of Paragraph 50, Tenant shall have the right, in common with other
tenants of the Project pro rata in accordance with the rentable area of the
Premises and the rentable areas of the Project occupied by such other tenants,
to park in the Project Parking Areas (as defined in Paragraph 50).”

 

11.                               Surrender
Plan.  Effective
as of the Effective Date of this First Amendment, Paragraph 32.9 of the Lease
hereby is deleted in its entirety and replaced with the following:

 

“32.9                  Condition
of Premises upon Expiration or Termination.  Upon the expiration of the Term or earlier
termination of Tenant’s right of possession, Tenant shall surrender the
Premises to Landlord (x) free of Hazardous Materials brought upon, kept,
used, stored, handled, treated, generated in, or released or disposed of from,
the Premises by Tenant or Tenant’s Agents (“Tenant
HazMat Operations”) in a manner consistent with prudent commercial
practices and such that no Hazardous Materials resulting from Tenant HazMat
Operations remain at the Premises in violation of Environmental Requirements
and the continued presence of such Hazardous Materials are not in excess of
industry standards for the occupancy and re-use of the Premises for research
and scientific purposes by a subsequent tenant of the Premises, and (z) released
of any license, clearance or other authorization of any kind issued by any
governmental authority having jurisdiction over the use, storage, handling,
treatment, generation, release, disposal, removal or remediation of Hazardous
Materials in, on or about the Premises (collectively referred to herein as “Hazardous Materials Clearances”).  At least 3 months prior to the surrender of
the Premises, Tenant shall deliver to Landlord a narrative description of the
actions proposed (or required by any governmental authority) to be taken by
Tenant in order to surrender the Premises (including any installations
permitted by Landlord to remain in the Premises) at the expiration or earlier
termination of the Term, free from any residual impact from the Tenant HazMat
Operations and in a manner consistent with prudent commercial practices and
such that no Hazardous Materials resulting from Tenant HazMat Operations remain
at the Premises in violation of Environmental Requirements and the continued
presence of Hazardous Materials are not in excess of industry standards for the
occupancy and re-use of the Premises for research and scientific purposes by a
subsequent tenant of the Premises (the “Surrender Plan”).  Such Surrender Plan shall be accompanied by a
current listing of (i) all Hazardous Materials licenses and permits held
by or on behalf of any of Tenant or Tenant’s Agents with respect to the
Premises, and (ii) all Hazardous Materials used, stored, handled, treated,
generated, released or disposed of or from the Premises by Tenant or Tenant’s
Agents, and shall be subject to the review and approval of Landlord’s
environmental consultant, which approval shall not be unreasonably withheld,
conditioned or delayed.  In connection
with the review and approval of the Surrender Plan, upon the request of
Landlord, Tenant shall deliver to Landlord or its consultant such additional
non-proprietary information concerning Tenant HazMat Operations as Landlord
reasonably shall request.  On or before
such surrender, Tenant shall deliver to Landlord commercially reasonable
evidence that the approved Surrender Plan has been satisfactorily completed and
Landlord shall have the right, subject to reimbursement at Tenant’s expense as
set forth below, to cause Landlord’s environmental consultant to inspect the
Premises and perform such additional procedures as may be deemed reasonably
necessary to confirm that the Premises are, as of the effective date of such
surrender or early termination of the Lease, free from any residual impact from
Tenant HazMat Operations as required pursuant to this Paragraph 7.  Tenant shall reimburse Landlord, as
Additional Rent, for the actual out-of pocket expense incurred by Landlord for
Landlord’s environmental consultant to review and approve the Surrender Plan
and to visit the Premises and verify satisfactory completion of the same, which

 

5

 

cost shall not exceed $5,000.  Landlord shall have the unrestricted right to
deliver such Surrender Plan (subject to any standard non-reliance letter, if
any, prepared by Tenant and delivered by Tenant to Landlord concurrently with
Tenant’s delivery of the Surrender Plan to Landlord, which non-reliance letter
shall be applicable only to third parties other than Landlord) and any report
by Landlord’s environmental consultant with respect to the surrender of the
Premises to Landlord’s potential tenants, purchasers, lenders and other third
parties with a need to know in connection with Landlord’s business; provided,
however, that Landlord instructs such parties to treat the same as
confidential.

 

If
Tenant shall fail to prepare or submit a Surrender Plan reasonably approved by
Landlord, or if Tenant shall fail to complete the approved Surrender Plan,  or if such Surrender Plan, whether or not
approved by Landlord, shall fail to adequately address any residual effect of
Tenant HazMat Operations in, on or about the Premises, shall fail to adequately
address any Hazardous Materials resulting from Tenant’s HazMat Operations
remaining at the Premises in violation of Environmental Requirements or in a manner
not consistent with prudent commercial practices or such that the continued
presence of such Hazardous Materials are in excess of industry standards for
the occupancy and re-use of the Premises for research and scientific purposes
by a subsequent tenant of the Premises, 
Landlord shall have the right to take such actions as Landlord
reasonably may deem reasonable or appropriate to assure that the Premises and
the Project are surrendered free from any such residual impact from Tenant
HazMat Operations, the cost of which actions shall be reimbursed by Tenant as
Additional Rent, without regard to the limitation set forth in the first
paragraph of this Paragraph 32.9.

 

All obligations of Tenant hereunder not fully
performed as of the expiration or earlier termination of this Lease, including
the obligations of Tenant under Paragraph 32 of this Lease, shall survive the
expiration or earlier termination of the Term, including, without limitation,
indemnity obligations, payment obligations with respect to rent and obligations
concerning the condition and repair of the Premises.”

 

12.                               Surrender of the Surrender Premises.

 

a.                                      First
Floor Premises.  The Lease
with respect to the First Floor Premises shall terminate as provided for in the
Lease on the FFP Surrender Date.  Tenant
shall voluntarily surrender the First Floor Premises on or before such date in
the condition which Tenant is required to surrender the Premises as of the
expiration of the Lease.  Tenant
represents and warrants that since the Commencement Date of the Lease, the
First Floor Premises has been used solely for offices purposes, warehousing and
shipping and receiving (including the storage of Subtenant’s chemicals in the
warehouse space and storage of chemical waste in the chemical waste room located
in the First Floor Premises). 
Notwithstanding anything to the contrary contained herein or in the
Lease, so long as the First Floor Premises continues to be used solely for
office purposes, warehousing and shipping and receiving through the FFP Surrender
Date, Tenant shall not be required to provide Landlord a Surrender Plan with
respect to the First Floor Premises in connection with Tenant’s surrender of
the First Floor Premises.  From and after
the FFP Surrender Date, Tenant shall have no further rights or obligations of
any kind with respect to the First Floor Premises.  Notwithstanding the foregoing, those
provisions of the Lease which, by their terms, survive the termination of the
Lease shall survive the surrender of the First Floor Premises and termination
of the Lease with respect to the First Floor Premises as provided for
herein.  Nothing herein shall excuse
Tenant from its obligations under the Lease with respect to the First Floor
Premises prior to the FFP Surrender Date. 
Notwithstanding anything to the contrary contained in the Lease, (i) Tenant
shall not be required to remove any Tenant Improvements or Alterations from the
First Floor Premises in connection with its surrender of the First Floor
Premises and all Tenant Improvements and Alterations located in the First Floor
Premises shall become the Property of Landlord on the Surrender Date, and (ii) 
in addition to any such Tenant Improvements and Alterations, all casework, if
any, located in the First Floor 

 

6

 

Premises as of the date of
this First Amendment shall also remain in the First Floor Premises and become
the Property of Landlord on the Surrender Date.

 

Tenant has informed Landlord that Tenant will be relocating certain of
its employees currently located in the First Floor Premises to a portion of
Tenant’s premises located within the 901 Gateway Building (as defined
below).  Tenant shall have the right to
extend the term of the Lease with respect to the First Floor Premises for a
period of ninety (90) days in order to complete the relocation of its
employees.  Not later than 90 days after
the mutual execution and delivery of this First Amendment by the parties,
Tenant shall notify Landlord in writing (“FFP Notice”)
whether Tenant elects to extend the term of the Lease with respect to the First
Floor Premises for such ninety (90) day period. 
If Tenant delivers the FFP Notice to Landlord within the time period
provided in the immediately preceding sentence, the FFP Surrender Date shall be
automatically extended for one (1) additional period of ninety (90) days (“FFP Extension Period”). 
During the FFP Extension Period, Tenant shall have the right to continue
to occupy the First Floor Premises pursuant to all of the terms and conditions
of the Lease, as modified by this First Amendment; provided, however, that
Tenant shall be required to pay Monthly Base Rent for the First Floor Premises
in an amount equal to $55,759.20 per month for each month of the FFP Extension
Period, along with all Additional Rent payable with respect to the First Floor
Premises pursuant to the terms of the Lease.

 

b.                                      Second
Floor Premises.  The Lease
with respect to the Second Floor Premises shall terminate as provided for in
the Lease on the SFP Surrender Date. 
Tenant shall voluntarily surrender the Second Floor Premises on or
before such date in the condition which Tenant is required to surrender the
Premises as of the expiration of the Lease and in compliance with the surrender
requirements set forth in the Lease (including this First Amendment).  From and after the SFP Surrender Date, Tenant
shall have no further rights or obligations of any kind with respect to the
Second Floor Premises.  Notwithstanding
the foregoing, those provisions of the Lease which, by their terms, survive the
termination of the Lease shall survive the surrender of the Second Floor
Premises and termination of the Lease with respect to the Second Floor Premises
as provided for herein.  Nothing herein
shall excuse Tenant from its obligations under the Lease with respect to the
Second Floor Premises prior to the SFP Surrender Date.  Notwithstanding anything to the contrary
contained in the Lease, (i) Tenant shall not be required to remove any
Tenant Improvements or Alterations from the Second Floor Premises in connection
with its surrender of the Second Floor Premises and all Tenant Improvements and
Alterations located in the Second Floor Premises shall become the Property of
Landlord on the SFP Surrender Date, and (ii) in addition to any such Tenant
Improvements and Alterations, all laboratory casework located in the Second
Floor Premises as of the date of this First Amendment shall also remain in the
Second Floor Premises and become the Property of Landlord on the SFP Surrender
Date.

 

Notwithstanding anything to the contrary contained herein, Tenant
acknowledges that Landlord may enter into a direct lease with Subtenant
pursuant to which Subtenant would lease the Second Floor Premises directly from
Landlord following the SFP Surrender Date (“Direct Lease”).  If Landlord and Subtenant enter into a Direct
Lease prior to the SFP Surrender Date, 
Tenant shall not be required to provide Landlord a Surrender Plan with
respect to the Second Floor Premises in connection with Tenant’s surrender of
the Second Floor Premises; provided, however, that Landlord shall have the
right to conduct any inspections and testing of the Second Floor Premises
determined reasonably necessary by Landlord to determine whether the condition
of the Second Floor Premises is in compliance with the provisions of the Lease
and whether any contamination has occurred in or from the Second Floor
Premises.  Upon request from Tenant,
Landlord shall provide Tenant with a copy of the results of such testing,
subject to Landlord’s standard non-reliance letter.  Notwithstanding anything to the contrary
contained herein, Tenant shall be required to pay the cost of such testing of
the Second Floor Premises if there is a violation of Paragraph 32 of the Lease
caused by Tenant or any of Tenant’s Agents or if contamination for which Tenant
is responsible under Paragraph 32 of the Lease is identified,

 

7

 

along
with all costs incurred to clean up, remove or remediate any contamination
identified by the investigations and testing conducted by Landlord hereunder.

 

c.                                       First Floor
Warehouse/Shipping and Receiving.  Landlord acknowledges and agrees that from
and after the FFP Surrender Date the warehouse and shipping and receiving areas
located in the First Floor Premises will be Common Area to which Tenant,
Subtenant and other tenants, licensees and occupants of the Building will have
shared access for warehouse and shipping and receiving purposes.  In addition, in connection with the splitting
of services pursuant to Section 13 below, Tenant may be required to
locate the new CDA compressor, N2 and CO2 distribution systems and the House
Vacuum in the warehouse space, which likely would result in the removal of some
existing cages (collectively, the “Warehouse Relocation Work”).  Subject to the provisions of Section 13
below, Landlord consents to Tenant’s installation of the Warehouse Relocation
Work in the First Floor warehouse, and Tenant’s continued use of the warehouse
and shipping and receiving areas in the First Floor Premises in common with
other tenants, licensees and occupants of the Building from and after the FFP
Surrender Date for such purposes.

 

13.                               Splitting
of Services.  Landlord
and Tenant acknowledge that because Tenant currently leases the entire Building
pursuant to the Lease and that certain adjacent building located at 901 Gateway
Boulevard, South San Francisco, California (“901 Building”)
pursuant to the 901 Gateway Lease, the services identified in this Section 13,
along with any additional services which may be identified by both Landlord and
Tenant, each in the exercise of its reasonable discretion (collectively, “Shared Services”), are currently shared between the Building
and the 901 Building.  Because Tenant is
surrendering the First Floor Premises and the Second Floor Premises pursuant to
this First Amendment, Tenant has requested that the Shared Services be split
pursuant to this Section 13 so that they may independently serve
each of the Building and the 901 Building, respectively (“Splitting
Work”).

 

a.                                      Landlord shall
make available to Tenant an allowance of up to $250,000.00 (the “Splitting Allowance”) for the Splitting Work.  Except for the Splitting Allowance, Tenant
shall be solely responsible for all of the costs of the Splitting Work.  Landlord and Tenant agree to work together in
good faith to minimize the cost of the Splitting Work.  The Splitting Allowance shall only be
available for use by Tenant for the payment of the cost of the Splitting Work
until July 31, 2012, and any portion of the Splitting Allowance which has
not been disbursed by Landlord for the Splitting Work on or before the
expiration of such date shall be forfeited and shall not be available for use
by Tenant.  Notwithstanding anything to
the contrary contained herein, Landlord and Tenant shall agree upon the
equitable allocation of the cost of the Splitting Work for any additional
Shared Services identified by Landlord and Tenant after July 31, 2012, at
the time such additional Shared Services are identified.

 

b.                                      Unless Landlord
elects otherwise, Tenant shall perform the Splitting Work pursuant to plans
approved by Landlord, which approval shall not be unreasonably withheld,
conditioned or delayed.  The contractors
for the Splitting Work shall be shall be selected by Tenant, subject to
Landlord’s approval, which approval shall not be unreasonably withheld.
conditioned or delayed.  Prior to the
commencement of the Splitting Work, Tenant shall deliver to Landlord a copy of
any contract with Tenant’s contractors and certificates of insurance from any
contractor performing any part of the Splitting Work evidencing industry
standard commercial general liability, automotive liability, “builder’s risk”,
and workers’ compensation insurance. 
Tenant shall cause the general contractor to provide a certificate of
insurance naming Landlord, Alexandria Real Estate Equities, Inc., and
Landlord’s lender (if any) as additional insureds for the general contractor’s
liability coverages required above. 
Landlord shall be entitled to receive the benefit of any warranties, if
any, obtained by Tenant with respect to Splitting Work

 

8

 

 

c.                                       Except as
otherwise expressly provided in this Section 13(c), Tenant shall
cause the Splitting Work to be completed on or before June 30, 2012.  Notwithstanding the foregoing, Tenant shall
complete the Splitting Work with respect to the CO2, N2, CDA, DI and House
Vacuum distribution of services (“Specified Services”)
no later than April 30, 2012; provided, however, that Landlord may, by not
less than one hundred twenty (120) days’ prior written notice to Tenant, cause
Tenant to complete the Splitting Work with respect to the Specified Services
prior to such date if Landlord intends to enter into a lease or other occupancy
agreement with a third party (including, without limitation, Subtenant) with
respect to any portion of the First Floor Premises and/or Second Floor
Premises.

 

d.                                      Notwithstanding
anything to the contrary contained herein, Tenant shall not be required to
perform any Splitting Work with respect to the telephone, IT, building
management and security systems serving the Building prior to March 31,
2011.  Prior to such date, Landlord and
Tenant agree to work together in good faith to determine the manner and timing
of splitting such systems at the lowest possible cost.

 

Tenant,
at Tenant’s sole cost and expense, shall disconnect the existing public address
systems serving the First Floor Premises and the Second Floor Premises on or
before April 30, 2011.

 

14.                               Utilities.  On or before September 1, 2010, Tenant
shall transfer all water, electricity, heat, light, power, sewer, refuse and
trash collection contracts for the Building to Landlord.  With respect to Tenant’s obligation to
transfer utilities to Landlord, Tenant and Landlord shall reasonably cooperate
to ensure that each such utility will continue to be available to the Building
without interruption.  Such cooperation
shall include working with each party’s account representative to coordinate
the termination of the utility service in Tenant’s name and the commencement of
such service in Landlord’s name in a manner that permits utility service
without disruption.  With respect to
janitorial services for the Premises, during the Term, as extended, Tenant
shall provide janitorial services to the Premises pursuant to its contract for
janitorial services with the vendor performing such services for the 901
Building and Landlord shall have no obligation to provide janitorial services
to the Premises.  Except for janitorial
services provided by Landlord with respect to the Common Areas, which shall be
passed through as an Expense, Landlord shall provide for its own janitorial
service to that portion of the Building not occupied by Tenant, and may not
charge Tenant for any portion of such service as an Expense or otherwise.

 

Notwithstanding anything to the contrary contained
in the Lease, as of the date that all such utilities are established in
Landlord’s name, Paragraph 5.1 of the Lease shall be deleted in its entirety
and replaced with the following:

 

“5.1                         Tenants
Obligation to Pay

 

Landlord shall provide, subject to the terms of this
Paragraph 5.1, water, electricity, heat, light, power, sewer, and other
utilities (including natural gas [but not process gas] and fire sprinklers to
the extent the Project is plumbed for such services), refuse and trash
collection and janitorial services (collectively, “Utilities”).  Landlord shall pay, as part of Expenses or
subject to Tenant’s reimbursement obligation, for all Utilities used on the
Premises, all maintenance charges for Utilities, and any storm sewer charges or
other similar charges for Utilities imposed by any governmental authority or
Utility provider, and any taxes, penalties, surcharges or similar charges
thereon.  Landlord may cause, at Tenant’s
expense, any Utilities to be separately metered or charged directly to Tenant
by the provider.  Notwithstanding the
foregoing, Tenant’s cost for the installation of any separate meter shall not
exceed that then-applicable cost of a “Demon Meter” or its reasonable
equivalent.  Tenant shall pay directly to
the Utility provider, prior to delinquency, any separately metered Utilities
and services which may be furnished to Tenant or the Premises during the
Term.  Tenant shall pay, as part of
Expenses, its share of all charges for jointly metered Utilities based upon
consumption, as reasonably determined by Landlord.  Tenant acknowledges that the Premises, the
Building and/or the Project may become subject to the 

 

9

 

rationing of Utility services or restrictions on
Utility use as required by a public utility company, governmental agency or
other similar entity having jurisdiction thereof.  Tenant acknowledges and agrees that its
tenancy and occupancy hereunder shall be subject to such rationing or
restrictions as may be imposed upon Landlord, Tenant, the Premises, the
Building and/or the Project, and Tenant shall in no event be excused or
relieved from any covenant or obligation to be kept or performed by Tenant by
reason of any such rationing or restrictions. 
Upon request from Landlord, Tenant agrees to cooperate in good faith
with Landlord to develop the most efficient energy conservation program
possible in order to comply with Laws, but in no event shall Landlord have the
right to implement any energy conservation program (except to the extent
mandated by Law) which unreasonably interferes, in Tenant’s reasonable good
faith judgment, with Tenant’s operation of its business at the Premises.  Except to the extent that an energy
conservation or program or measure is mandated by Law, Tenant shall have the
right, in Tenant’s reasonable discretion, to approve in advance any energy
conservation program or measure proposed by Landlord.”

 

15.                               Emergency
Generator. Although Landlord is the owner of emergency
generator and related automatic transfer switches serving the Building and the
901 Building  (collectively, the “Emergency Generator”), prior to the date of this First
Amendment, Tenant, as the sole tenant of the Building and the 901 Building, has
been operating and maintaining the Emergency Generator. Tenant shall, on the date
that is 1 day after the mutual execution and delivery of this First Amendment
by the parties (“EG Transfer Date”), (x) deliver
the Emergency Generator  to Landlord in
good working order with a full tank of diesel (y) assign to, transfer and
deliver to Landlord all governmental permits and licenses (to the extent such
permits and licenses are assignable), if any, warranties (to the extent
assignable), operating and maintenance manuals, records and other documents
concerning the Emergency Generator, and (y) terminate any service,
maintenance or other contracts maintained by Tenant with respect to the
Emergency Generator.  Tenant has not been
obligated to maintain a wastewater permit in connection with the Emergency Generator.  With respect to any permit required for the
Emergency Generator, Landlord acknowledges and agrees that Tenant has been in
the process of obtaining a generator permit in connection with a Tenant
permitting process underway with the Bay Area Air Quality Management District (“BAAQMD”)
for the 901 Building, that Tenant will remove the generator from its permit
application with BAAQMD, and that Landlord will need to obtain a generator
permit from BAAQMD in its own name.  To
the best of Tenant’s knowledge, Tenant does not have any other permits in
connection with the Emergency Generator. 
To the extent Tenant has current contracts with any vendors for the
Emergency Generator, Tenant and Landlord shall reasonably cooperate to assign
or terminate such contracts in the manner set forth in Section 14 above
regarding utilities.

 

To the extent it is not
possible for Tenant to remove the request for a generator permit from its
BAAQMD application or to assign or terminate any service maintenance or other
contracts within 1 day after the mutual execution and delivery of this First
Amendment, Tenant shall not be in default hereunder if Tenant promptly
commences efforts to do so and diligently performs until such actions have been
completed within a reasonable period after such date.

 

Landlord shall, within 5
days of the EG Transfer Date, as part of Expenses, conduct such testing of the
Emergency Generator required, in Landlord’s sole and absolute discretion, to
determine whether the Emergency Generator is, in fact, in good working
order.  If such testing discloses that
the Emergency Generator is not in good working order, Landlord shall have the
right, at Tenant’s sole cost and expense, to perform any maintenance and/or
repairs required to put the Emergency Generator in good working order.

 

Following the EG Transfer
Date, Landlord’s sole obligation for either providing emergency generators or
providing emergency back-up power to Tenant shall be: (i) to provide
emergency generators with not less than the current capacity of the Emergency
Generator and Tenant shall be entitled to Tenant’s share of the capacity
thereof available for use by all tenants

 

10

 

of the Building and the 901 Building, collectively,
in accordance with the rentable area of the Premises and the 901 Building  and the collective rentable areas
of the Building and the 901 Building occupied by such other tenants, (ii) to
contract with a third party to maintain the emergency generators (“Emergency Generator Servicer”) as per the manufacturer’s standard
maintenance guidelines, and (iii) to obtain and maintain licenses for the
emergency generators as required by applicable law.  Landlord shall have no obligation to provide
Tenant with operational emergency generators or back-up power or to supervise,
oversee or confirm that the Emergency Generator Servicer or any other third
party maintaining the emergency generators is maintaining the generators as per
the manufacturer’s standard guidelines or otherwise.  Landlord shall provide to Tenant copies of any
reports received by Landlord from the Emergency Generator Servicer regarding
its maintenance and repairs of the emergency generators; provided, however,
that in no event shall Landlord’s failure to deliver such reports constitute a
default by Landlord under the Lease. 
During any period of replacement, repair or maintenance of the emergency
generators when the emergency generators are not operational, including any
delays thereto due to the inability to obtain parts or replacement equipment,
Landlord shall have no obligation to provide Tenant with an alternative back-up
generator or generators or alternative sources of back-up power.  Tenant expressly acknowledges and agrees that
Landlord does not guaranty that such emergency generators will be operational
at all times or that emergency power will be available to the Premises when
needed.  Landlord shall provide Tenant
with not less than five (5) business days’ notice of the scheduled
disruption in the operation of the emergency generators. In the case of an
emergency, Landlord shall provide Tenant with notice of any emergency
disruption as soon as reasonably possible after Landlord becomes aware of the
need for such emergency disruption.

 

16.                               Maintenance.  Tenant shall continue to maintain the
Building pursuant to Paragraph 13.1 of the Lease following the FFP Surrender
Date until such date that Landlord notifies Tenant in writing that Landlord
shall assume the maintenance of the Building (“Assumption
Date”); provided, however, that in no event shall the Assumption
Date occur after July 31, 2011. 
Nothing contained herein shall release Tenant from its obligations
arising prior to the Assumption Date. 
Commencing on the Assumption Date, Paragraph 13 of the Lease shall be
deleted in its entirely and replaced with the following:

 

“13.  MAINTENANCE AND REPAIRS OF
PREMISES

 

13.1 
Landlord Repairs.  Landlord, as an Expense, shall repair,
replace when necessary (as reasonably determined by Landlord) and maintain in
good repair the exterior of the Building (including exterior doors), parking,
landscaping, exterior lighting, roof membrane, roof covering and all other
Common Areas of the Project, including HVAC, plumbing, fire sprinklers,
elevators, fire safety equipment, sewer and septic systems, the Emergency
Generator and all other building systems serving the Premises and other
portions of the Project (“Building Systems”),
uninsured losses and damages caused by Tenant, or by any of Tenant’s Agents
excluded.  Landlord, at Landlord’s sole
cost without right of reimbursement from Tenant, shall repair, replace when
necessary (as reasonably determined by Landlord) and maintain the structural
portions of the roof (specifically excluding the roof membrane and the roof
covering, the repair and/or replacement of which shall be treated as an
Expense), the foundation, footings, floor slab and load-bearing walls and
exterior walls of the Building (excluding any glass and any routine
maintenance, including, without limitation, any painting, sealing, patching and
waterproofing of such walls, repair, the maintenance of which shall be treated
as an Expense), uninsured losses and damages caused by Tenant or Tenant’s
Agents excluded.  Any losses and damages
caused by Tenant or any Tenant Agent shall be repaired by Landlord, to the
extent not covered by insurance, at Tenant’s sole cost and expense.  Landlord reserves the right to stop Building
Systems services when necessary (i) by reason of accident or emergency, or
(ii) for planned repairs, alterations or improvements, which are, in the
reasonable judgment of Landlord, desirable or necessary to be made, until said
repairs, alterations or improvements shall have been completed.  Landlord shall have no responsibility or
liability for failure to supply Building Systems services during any such

 

11

 

period
of interruption; provided, however, that Landlord shall, except
in case of emergency, give Tenant not less than five (5) business days’
advance notice of any planned stoppage of Building Systems services for
routine and planned maintenance, repairs, alterations or improvements.  Tenant shall promptly give Landlord written
notice of any repair required by Landlord pursuant to this section, after which
Landlord shall make a commercially reasonable effort to effect such repair
within five (5) business days, or, where the repair cannot reasonably be
completed within five (5) business days, as soon as reasonably possible
thereafter.  Landlord shall not be liable
for any failure to make any repairs or to perform any maintenance unless such
failure shall persist for an unreasonable time after the time periods set forth
herein.  Tenant waives its rights under
any state or local law to terminate this Lease or to make such repairs at
Landlord’s expense and agrees that the parties’ respective rights with respect
to such matters shall be solely as set forth herein. Repairs required as the
result of fire, earthquake, flood, vandalism, war, or similar cause of damage
or destruction shall be controlled by Paragraph 21.

 

Notwithstanding anything to the contrary contained in the Lease,
commencing on the Assumption Date, to the extent that Landlord performs or is
required to perform any capital repairs, replacements or improvements for the
Project, whether to comply with Law, with any obligation imposed on Landlord
pursuant to this Lease or at Landlord’s election, Tenant shall be responsible
as part of Expenses for its Proportionate Share of the cost of such capital
repairs, replacements and improvements amortized over the useful life (as
reasonably determined by Landlord taking into account relevant real estate
accounting principles, consistently applied, including, without limitation, the
hours of operation of the Building and its use for laboratory/office purposes) of
such capital items.  Tenant shall pay
Tenant’s Proportionate Share of such amortized costs for each month after such
capital repairs, replacements or improvements are completed until the first to
occur of the expiration of the Term (as it may be extended) or the end of the
period over which such costs are amortized.

 

13.2                        Tenant’s Repairs.  Subject to Paragraph 13.1 hereof,
Tenant, at its expense, shall repair and maintain in good condition all
portions of the Premises, including, without limitation, entries, doors
(excluding exterior doors providing access to the Building, maintenance, repair
and replacement of which is the obligation of Landlord as an Expense),
ceilings, interior windows, interior walls, and the interior side of demising
walls.  Should Tenant fail to make any
such repair or replacement or fail to maintain the Premises, Landlord shall
give Tenant notice of such failure.  If
Tenant fails to commence cure of such failure within ten (10) days of
Landlord’s notice, and thereafter diligently prosecute such cure to completion,
Landlord may perform such work and shall be reimbursed by Tenant within thirty
(30) days after receipt of written demand therefor (together with reasonable
documentation); provided, however, that if such failure by Tenant creates or
could create an emergency, Landlord may immediately commence cure of such
failure and shall thereafter be entitled to recover the actual and reasonable
costs of such cure from Tenant.  Subject
to Paragraphs 21 and 22 of the Lease, Tenant shall bear the full
uninsured cost of any repair or replacement to any part of the Project that
results from damage caused by Tenant or any Tenant Party and any repair that
benefits only the Premises.”

 

17.                               Signs.  Tenant shall be entitled to its Proportionate
Share of any available external Building signage, if any, which signage shall
be at Tenant’s cost and expense. 
Notwithstanding the foregoing, Tenant acknowledges and agrees that
Tenant’s signage on the Building including, without limitation, the size, color
and type, shall be subject to Landlord’s prior written approval and shall be
consistent with Landlord’s signage program at the Project and applicable legal
requirements.  Tenant shall be
responsible, at Tenant’s sole cost and expense, for the maintenance of Tenant’s
signage, for the removal of Tenant’s signs at the expiration or earlier
termination of this Lease and for the repair all damage resulting from such
removal.

 

18.                               Option
to Renew.  Tenant
shall have two (2) options (each a “Renewal Option”)
to extend the term of this Lease with respect to the entire Premises for
successive periods of five (5) years each (each a “Renewal Term”)
pursuant to the provisions of Paragraph 49 of the Lease.  For 

 

12

 

avoidance
of doubt, the parties hereby acknowledge and agree that if the Monthly Base
Rent during any Renewal Term is calculated pursuant to Paragraph 49.4(ii) of
the Lease, Monthly Base Rent shall be increased on each annual anniversary of
the commencement of such Renewal Term by a percentage as determined by Landlord
and agreed to by Tenant at the time the Fair Market Rent is determined.

 

19.                               Right
of First Offer. 
Notwithstanding anything to the contrary contained herein or in the
Lease, Paragraph 51 of the Lease is hereby deleted in its entirety and of no
further force or effect and Tenant shall have no further right of first offer
or other right to purchase the Building.

 

20.                               Right
to Expand.

 

a.                                      Right of First Refusal.  From and after the FFP Surrender Date with
respect to the First Floor Premises, and from and after the SFP Surrender Date
with respect to the Second Floor Premises through the expiration or earlier
termination of the Term, each time that Landlord intends to accept a written
proposal (the “Pending Deal”) to
lease the First Floor Space or, if applicable, the Second Floor Space to a
third party (“ROFR Space”), Landlord shall
deliver to Tenant written notice (the “Pending
Deal Notice”) of the existence and the terms of such Pending Deal;
provided, however, that the terms of this Section 20(a) shall
not apply to any current or future transaction pursuant to which Landlord
intends to lease all or any of the Second Floor Space and/or the First Floor
Premises directly to Subtenant.  Tenant
shall be entitled to exercise its right under this Section 20(a) only
with respect to the entire ROFR Space. Within ten (10) business days after
Tenant’s receipt of the Pending Deal Notice, Tenant shall deliver to Landlord
written notice (the “Space Acceptance Notice”)
if Tenant elects to lease the ROFR Space. 
Tenant’s right to receive the Pending Deal Notice and election to lease
or not lease the ROFR Space pursuant to this Section 20(a) is
hereinafter referred to as the “Right of
First Refusal.” If Tenant elects to lease the ROFR Space by
delivering the Space Acceptance Notice within the required ten (10) business
day period, Tenant shall be deemed to agree to lease the ROFR Space on the
terms and conditions set forth in the Pending Deal Notice and any other terms
agreeable to Landlord and Tenant, in the respective sole discretion of each
party.

 

If (i) Tenant fails to
deliver a Space Acceptance Notice to Landlord within the required ten (10) business
day period, or (ii) no lease amendment or lease agreement for the ROFR
Space, acceptable to Landlord and Tenant in their respective reasonable
discretion, has been executed and delivered by the parties within thirty (30)
days after Landlord delivers a draft of the same to Tenant despite the good
faith efforts of both parties, Tenant shall be deemed to have elected not to
exercise Tenant’s right to lease the ROFR Space pursuant to the Pending Deal
Notice in question in which case Tenant shall be deemed to have forever waived
its right to lease the ROFR Space pursuant to the Pending Deal Notice in
question, this Section 20(a) shall terminate and be of no
further force or effect with respect to the Pending Deal Notice in question,
and Landlord shall have the right to lease the ROFR Space to the party that was
the subject of the Pending Deal Notice on substantially the same business terms
and conditions set forth in the Pending Deal Notice.  Notwithstanding the foregoing, if Landlord
negotiates with the proposed tenant economic lease terms materially more
favorable (but in no event shall the economic lease terms be considered
materially more favorable unless the difference in net effective base rent is
10% or greater), as reasonably determined by Landlord, than those offered to
Tenant but rejected as part of the Pending Deal Notice, Landlord shall be
required to submit the more favorable economic terms to Tenant for its
review.  Tenant shall have five (5) business
days after receipt of the more favorable economic terms to accept or reject the
revised terms.  If Tenant rejects the more
favorable terms, Landlord shall be free to enter into a lease with the proposed
tenant on such terms.  Tenant’s rejection
of any particular Pending Deal Notice shall not relieve Landlord of its
obligation to again offer any Right of First Refusal Space to Tenant at any
time that Landlord intends, other than with respect to Subtenant with respect
to whom the terms of this Section 20 shall not apply, to again
agree to a written proposal from another party to lease such space in such
period.

 

13

 

b.                                      Amended Lease.  If: (i) Tenant
fails to timely deliver a Space Acceptance Notice, or (ii) after the
expiration of a period of thirty (30) days from Tenant’s delivery of a Space
Acceptance Notice pursuant to Section 20(a), no lease amendment or
lease agreement for the ROFR Space, acceptable to Landlord and Tenant, in the
respective sole discretion of each, has been executed, Tenant shall be deemed
to have waived its right to lease the ROFR Space at issue.

 

c.                                       Exceptions.  Notwithstanding the above, the Right of First
Refusal shall not be in effect and may not be exercised by Tenant:

 

(i)                                     during any period of time that Tenant is in Default under any provision
of the Lease; or

 

(ii)                                  if Tenant has been in Default under any provision of the Lease three (3) or
more times, whether or not the Defaults are cured, during the twelve (12) month
period prior to the date on which Tenant seeks to exercise the Right of First
Refusal.

 

d.                                      Termination.  The Right of First Refusal shall terminate
and be of no further force or effect even after Tenant’s due and timely
exercise of the Right of First Refusal, if, after such exercise, but prior to
the commencement date of the lease of such ROFR Space, (i) Tenant fails to
timely cure any default by Tenant under the Lease; or (ii) Tenant has
Defaulted three (3) or more times during the period from the date of the
exercise of the Right of First Refusal to the date of the commencement of the
lease of the ROFR Space, whether or not such Defaults are cured.

 

e.                                       Rights
Personal.  The Right
of First Refusal is personal to Tenant and is not assignable without Landlord’s
consent, which may be granted or withheld in Landlord’s sole discretion
separate and apart from any consent by Landlord to an assignment of Tenant’s
interest in the Lease, except that they may be assigned in connection with any
Permitted Transfer of this Lease.

 

f.                                        No
Extensions.  The period
of time within which the Right of First Refusal may be exercised shall not be
extended or enlarged by reason of Tenant’s inability to exercise the Right of
First Refusal.

 

21.                               Additional
Modifications to Lease.  From and after the Effective Date of this
First Amendment, the Lease shall be modified as follows:

 

a.                                      Modification to
Basic Lease Information.  The
Tenant’s Contact Person shall be “General Counsel” rather than “Marty Glick”.

 

b.                                      Modification to
Paragraph 2.3(a), “Changes to Common Area”.  The following shall be added at the end of
Paragraph 2.3(a):  “Notwithstanding the
foregoing, Landlord’s exercise of the foregoing rights shall not materially
interfere with Tenant’s access to or use of the Premises to the extent that
Tenant’s business operations are materially interrupted thereby.”

 

c.                                       Modification to
Paragraph 2.3(b), “Changes to Common Area”.  The second sentence of Paragraph 2.3(b) hereby
is deleted and revised to state in its entirety as follows:  “During periods of construction only,
Landlord shall have the right to provide parking to Tenant on properties
reasonably proximate to the Project (the “Adjacent Properties”)
or through the use of valets or parking attendants on the Parking Areas or the
Adjacent Properties, provided that Tenant shall at all times have parking for
the number of automobiles contemplated under the Lease.”

 

d.                                      Modification to
Paragraph 4.2, “Additional Rent”. There shall be added to
Paragraph 4.2 a new Paragraph 4.2.11, “Exclusions from Expenses”, which reads
as follows:

 

14

 

“4.2.11        Exclusions from Expenses.  Notwithstanding anything to the contrary
contained in this Paragraph 4.2, and in addition to the exclusions set forth in
the preceding paragraph, there shall be excluded from Expenses and Additional
Rent the following: (i) leasing commissions, advertising expenses, promotional
expenses, attorneys’ fees, disbursements, and other costs and expenses incurred
in procuring prospective tenants, negotiating and executing leases, and
constructing improvements required to prepare for a new tenant’s occupancy for
the Building or the Project, if any; (ii) finance and debt service fees,
principal and/or interest on debt or amortization payments on any mortgages
executed by Landlord covering Landlord’s property, any other indebtedness of
Landlord, and rental under any ground lease or leases for the Building or the
Project; (iii) any depreciation allowance or expense, amortization (except
for expenditures permitted under this Lease) or expense reserve; (iv) the
costs of Landlord’s third party property manager or, if there is no third party
property manager, administration fees in excess of the amount of 3.0% of Base
Rent); (v) except for management fees, Landlord’s general overhead and any
overhead or profit increment to any subsidiary or affiliate of Landlord for
services on or to the Project to the extent that the cost of such service
exceeds competitive costs for such services rendered by persons or entities of
similar skill, competence and experience other than a subsidiary or affiliate
of Landlord; (vi) any costs or expenses representing any amount paid for
services and materials to a (personal or business) related person, firm, or
entity to the extent such amount exceeds the amount that would have been paid
for such service or materials at the then existing market rates in the absence
of such relationship; (vii) compensation paid to any employee of Landlord
above the grade of Property Manager/Building Superintendent, including officers
and executives of Landlord (provided that Landlord may pass through as Expenses
compensation paid to employees at or below the grade of Property
Manager/Building Superintendant or affiliates of Landlord providing services to
the Project); (viii) costs of electrical energy furnished and metered
directly to tenants of the Project or for which Landlord is entitled to be
reimbursed by tenants as additional rental over and above tenant’s Monthly Base
Rent or pass-through of Expenses; (ix) the cost of any work or service
furnished to any tenant or occupant of the Project to a materially greater
extent or in a materially more favorable manner than that furnished generally
to the tenants and other occupants of the Project, or the costs of work or
service furnished exclusively for the benefit of any tenant or occupant of the
Project or at such tenant’s cost; (x) the costs and expenses incurred in
resolving disputes with other tenants, other occupants, or prospective tenants
or occupants of the Project, collecting rents or otherwise enforcing leases of
the tenants of the Project; (xi) any costs incurred to remove, study,
test, remediate or otherwise related to the presence of Hazardous Materials in
the Building, which Hazardous Materials (A) Tenant proves originated from
any separately demised tenant space within the Building other than the Premises
or (B) Tenant proves were not brought upon, kept, used, stored, handled,
treated, generated in, or released or disposed of from, the Building by Tenant
or Tenant’s Agents; (xii) the costs of any work or service performed for
any facility other than a facility located within the Project; (xiii) the
costs of repairs, alterations, and general maintenance necessitated by the
gross negligence or willful misconduct of Landlord or its agents, employees, or
contractors or repairs; (xiv) interest or penalties due to the late payment
by Landlord of taxes, utility bills or other such costs (except to the extent
caused by Tenant’s action or inaction); (xv) any of the following tax or
assessment expenses: (a) estate, inheritance, transfer, gift, federal,
state or franchise taxes of Landlord, or (b) penalties and interest, other
than those attributable to Tenant’s failure to comply timely with its
obligations pursuant to this Lease; and (xvi) bad debt expenses and
charitable contributions and donations. 
Landlord agrees that (a) Landlord will not collect or be entitled
to collect more than one hundred percent (100%) of the Expenses actually paid
by Landlord in connection with the operation of the Project in any calendar
year, and (b) Landlord shall make no profit from Landlord’s collection of
Expenses.”

 

15

 

e.                                       Modifications
to Paragraph 15, “Tenant’s Insurance”.  The third sentence of Paragraph 15.2 hereby
is revised in its entirety to state:  “No
such policy shall contain a deductible greater than Twenty-Five Thousand
Dollars ($25,000.00).  Paragraph 15.5
hereby is deleted and revised to state in its entirety as follows:  “All insurance required to be carried by
Tenant hereunder shall be maintained with insurance companies authorized to do
business in the State of California for the issuance of the applicable type of
insurance coverage and rated A-VII or better in Best’s Key Rating Guide.  Tenant shall deliver to Landlord certificates
of insurance and true and complete copies of any and all endorsements required
herein for all insurance required to be maintained by Tenant hereunder at the
execution of this Lease by Tenant. 
Tenant shall, at least thirty (30) days prior to expiration of each
policy, furnish Landlord and the other parties named as additional insureds
with certificates of renewal thereof. 
Tenant shall (i) provide Landlord with 30 days advance written
notice of cancellation of each policy, and (ii) require Tenant’s insurer
to endeavor to provide 30 days advance written notice of cancellation of each
policy.”

 

f.                                        Modification to
Paragraph 23.2, “Assignment and Subletting — Requirements of Request for
Consent”.  Paragraph
23.2 shall be amended to provide that if Tenant requests consent to a proposed
assignment or subletting (except in connection with a Permitted Transfer),
whether or not the term of the proposed transfer is for the balance of the
Term, Landlord shall have the right to recapture that portion of the Premises
that is the subject of the proposed assignment or subletting and terminate the
Lease with respect thereto; provided, however, that subsection (3) of
Paragraph 23.2 shall be of no further force or effect and Landlord shall not
have the right to sublease or take an assignment, as the case may be, of the
interest in the Lease that is at issue.

 

g.                                       Modification to
Paragraph 24, “Tenant’s Default”.  The following is hereby added at the end of
Paragraph 24.(a):  “provided, however,
that if Tenant vacates the Premises at any time during the last nine (9) months
of the Term but continues to perform all of its obligations hereunder,
including, without limitation, maintaining all insurance policies required by
this Lease and complying with all of the requirements of Paragraph 32.9, Tenant
shall not be deemed to be in default under this Paragraph 24.(a);”.

 

h.                                      Modification to
Paragraph 32.2, “Tenant’s Obligation to Update Disclosure Certificates”.  The first sentence of Paragraph 32.2 hereby
is deleted and revised to state in its entirety as follows:  “Within ten (10) business days after
receipt of Landlord’s written request, Tenant shall complete, execute and
deliver to Landlord an updated Disclosure Certificate (each, an “Updated
Disclosure Certificate”) describing Tenant’s then current and proposed future
uses of Hazardous Materials on or about the Premises, which Update Disclosure
Certificates shall be in the same format as that which is set forth in Exhibit D
or in such other form as is reasonably acceptable to Landlord”.

 

i.                                          Modification to
Paragraph 34, “Waiver”.  The
last two sentences of Paragraph 34 hereby are deleted and revised to state in
their entirety as follows:  “No delay or
omission in the exercise of any right or remedy of Landlord or Tenant in regard
to any default by the other shall impair such right or remedy or be construed
as a waiver.  Any waiver by Landlord or
Tenant of any default must be in writing and shall not be a waiver of any other
default concerning the same or any other provisions of this Lease.”

 

j.                                         Modification to
Paragraph 40, “Financial Statements”.  Paragraph 40 hereby is deleted and revised to
state in its entirety as follows:  “Within
ten (10) days after Landlord’s request, Tenant shall deliver to Landlord
the then current, or if Tenant is a publicly traded company, the most recent
publicly available financial statements of Tenant prepared, compiled or
reviewed by a certified public accountant, including a balance sheet and 

 

16

 

profit
and loss statement for the most recent prior year, all prepared in accordance
with GAAP.”.

 

k.                                      New Paragraphs.  The following new paragraphs are hereby added
to the Lease:

 

“53.                         Commercially
Reasonable.  Where
Landlord or Tenant are required to use “best efforts” in the performance of any
obligation under this Lease, “best efforts” shall mean “commercially reasonable
good faith efforts.”

 

“54.                         Force
Majeure.  Whenever a
period of time is herein prescribed for action (other than the payment of
money) to be taken by Landlord or Tenant, such party shall not be liable or responsible
for, and there shall be excluded from the computation for any such period of
time, any delays due to strikes, riots, acts of God, shortages of labor or
materials, war, terrorist activity, governmental laws, regulations or
restrictions”.

 

22.                               Brokers.  Landlord and Tenant each represents and
warrants that it has not dealt with any broker, agent or other person
(collectively, “Broker”) in connection with this
First Amendment and that no Broker brought about this transaction, other than
BT Cassidy/Turley.  Landlord and Tenant
each hereby agree to indemnify and hold the other harmless from and against any
claims by any Broker, other than the broker, if any named in this Section 22,
claiming a commission or other form of compensation by virtue of having dealt
with Tenant or Landlord, as applicable, with regard to this First Amendment.

 

23.                               OFAC.  To Tenant’s knowledge, without any duty of
inquiry, as of the date of Tenant’s execution of this First Amendment, Tenant
is currently (a) in compliance with and shall at all times during the Term
of the Lease remain in compliance with the regulations of the Office of Foreign
Assets Control (“OFAC”) of the U.S. Department of
Treasury and any statute, executive order, or regulation relating thereto
(collectively, the “OFAC Rules”), (b) not
listed on, and shall not during the term of the Lease be listed on, the
Specially Designated Nationals and Blocked Persons List maintained by OFAC
and/or on any other similar list maintained by OFAC or other governmental
authority pursuant to any authorizing statute, executive order, or regulation,
and (c) not a person or entity with whom a U.S. person is prohibited from
conducting business under the OFAC Rules.

 

24.                               Miscellaneous.

 

a.                                      This First
Amendment is the entire agreement between the parties with respect to the
subject matter hereof and supersedes all prior and contemporaneous oral and
written agreements and discussions.  This
First Amendment may be amended only by an agreement in writing, signed by the
parties hereto.

 

b.                                      This First
Amendment is binding upon and shall inure to the benefit of the parties hereto,
their respective agents, employees, representatives, officers, directors,
divisions, subsidiaries, affiliates, assigns, heirs, successors in interest and
shareholders.

 

c.                                       Tenant
acknowledges that it has read the provisions of this First Amendment,
understands them, and is bound by them. Time is of the essence in this First
Amendment.

 

d.                                      This First
Amendment may be executed in any number of counterparts, each of which shall be
deemed an original, but all of which when taken together shall constitute one
and the same instrument.  The signature page of
any counterpart may be detached therefrom without impairing the legal effect of
the signature(s) thereon provided such signature page is attached to
any other counterpart identical thereto except having additional signature pages executed
by other parties to this First Amendment attached thereto.

 

17

 

e.                                       Except as
amended and/or modified by this First Amendment, the Lease is hereby ratified
and confirmed and all other terms of the Lease shall remain in full force and
effect, unaltered and unchanged by this First Amendment.  In the event of any conflict between the
provisions of this First Amendment and the provisions of the Lease, the
provisions of this First Amendment shall prevail.  Whether or not specifically amended by this
First Amendment, all of the terms and provisions of the Lease are hereby
amended to the extent necessary to give effect to the purpose and intent of
this First Amendment.

 

[Signatures are on the next page.]

 

18

 

IN WITNESS WHEREOF, the parties hereto have
executed this First Amendment as of the day and year first above written.

 

	
   

  	
  TENANT:

  
	
   

  	
   

  
	
   

  	
  THERAVANCE, INC.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
  /s/
  Rick E Winningham

  
	
   

  	
   

  
	
   

  	
  By:
  Rick E Winningham

  
	
   

  	
  Its:
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LANDLORD:

  
	
   

  	
   

  
	
   

  	
  ARE-901/951 GATEWAY BOULEVARD, LLC,

  
	
   

  	
  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ALEXANDRIA
  REAL ESTATE EQUITIES, L.P.,

  
	
   

  	
   

  	
  a
  Delaware limited partnership,

  
	
   

  	
   

  	
  managing
  member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  ARE-QRS
  CORP.,

  
	
   

  	
   

  	
   

  	
  a
  Maryland corporation,

  
	
   

  	
   

  	
   

  	
  general
  partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/
  Eric S. Johnson

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:
  Eric S. Johnson

  
	
   

  	
   

  	
   

  	
  Its:
  Vice President, Real Estate Legal Affairs

  

 

19

 

EXHIBIT A

 

The Premises

 

(Attached)Exhibit 10.1

 

Aspen Technology, Inc.

 

Executive Annual
Incentive Bonus Plan

 

FY11

 

For

 

“ NAME “

 

I.         Purpose

 

The purpose of Aspen
Technology’s (“Company”) Executive Annual Incentive Plan (the “Plan”) is to
motivate and reward performance that results in the achievement of key Company
objectives as well as individual objectives.

 

II.        Effective Date of Plan

 

The Plan will operate on a
fiscal year basis (“Plan Year”), and is effective from July 1, 2010
through June 30, 2011.

 

III.      Eligibility

 

Eligibility is afforded to
those employees:

 

A.    whose
positions are determined by Aspen Technology to have significant impact on the
operating results of the Company; and

B.    who
have been employed by the Company for six months or more (pro-rated target
awards for employment greater than six months and less than twelve months).

 

1

 

In FY11, the eligible
positions include CEO, EVP-Field Operations, CFO, SVP, Global Accounts &
Sales Operations, SVP Marketing, SVP HR, SVP R&D, SVP WW CS&T, SVP
Strategy and SVP & General Counsel.

 

Eligibility for the Plan
does not guarantee payment of an award. 
Payment is dependent upon performance. 
Further, eligibility does not guarantee continuation of employment.  If employment ends prior to the end of the
performance period any payment eligibility is subject to the Executive
Retention Agreement then in force. Should an Executive voluntarily resign after
the completion of the performance period they are eligible to receive the
earned bonus in accordance with the Plan.

 

2

 

IV.      Target Award

 

The Plan is based on the “Target
Award” concept, which bases the award on a combination of the Company’s overall
performance and your individual performance. 
In order to achieve the Target Award amount, the Company and the
Individual must achieve 100% of their pre-established objectives by the end of
the Plan Year. The actual award paid to the participant, if any, for a given
Plan Year will be based on a combination of the Company’s overall performance
and the performance of the Individual, as adjusted for the overall level of
bonus pool funding.

 

The Target Award for each
position is the incentive award as defined when 100% of all Plan objectives are
met and the Company attains the necessary level of performance to fund the
bonus pool at 100%.

 

V.       Components of Award

 

“Company Metric Performance”
for Plan purposes is based on the accomplishment of one or more predetermined
annual Company financial objectives, which will be selected each year based on
their critical importance to the Company’s success.  Company Metric Performance for fiscal year
2011 will be measured based on the achievement of the FY11 Global License
Bookings and Cash Flow from Operations. 
Individual Performance will be based on an Assessment of Overall
Performance by the CEO or the Compensation Committee of the Board of Directors
(in the case of the CEO).

 

The following summarizes the
weighting for the various incentive components for FY11.

 

	
  FY11 Plan Components

  	
   

  	
  Overall
  Bonus

  Weighting

  	
   

  	
  On
  Target Metric

  
	
  Global License Bookings

  	
   

  	
  65%

  	
   

  	
  $      TBD      

  
	
  Cash Flow from Operations

  	
   

  	
  35%

  	
   

  	
  $      TBD      

  
	
  CEO Performance Assessment

  	
   

  	
  Influences
  bonus at 80% to 100%

  	
   

  	
  CEO/Compensation
  Committee

  

 

3

 

A.    Company Metric Performance (License Bookings & Cash Flow)

 

The achievement level will
then correspond to a bonus plan funding/weighting percentage by individual
metric according to the following table:

 

	
  Actual Performance

  Achieved by Metric

  	
   

  	
  Funding
  Level of Metric

  Based on Performance

  
	
  <
  70% of Target

  	
   

  	
  0%

  
	
  70%
  of Target

  	
   

  	
  50%

  
	
  80%
  of Target

  	
   

  	
  70%

  
	
  90%
  of Target

  	
   

  	
  90%

  
	
  100%
  of Target

  	
   

  	
  100%

  

 

This Plan is capped at 100%
funding

 

The funding is based on a
minimum achievement of 70% of the on target metric.  At 70% achievement, the plan funds at 50%
target and will increase at a 2:1 ratio until 90% achievement.  Achievement between 90% and 100% will fund at
a 1:1 ratio.  Each metric is measured and
funded independently.

 

B.    Individual Performance (CEO Performance Assessment)

 

Annual assessment of the
individual’s performance will be developed by the Plan participant in
coordination with the CEO or the Compensation Committee of the Board of
Directors (in the case of the CEO).  For
fiscal year 2011, annual objectives will be comprised of select individual
objectives in conjunction with the overall day-to-day performance of the
executive. The CEO or the Compensation Committee of the Board of Directors (in
the case of the CEO) must approve all performance objectives.

 

	
  Individual Performance

  	
   

  	
  CEO
  Performance Multiplier

  
	
  CEO
  Assessment

  	
   

  	
  80%
  to 100%

  

 

Assessment of individual
performance as assessed by the CEO or the Compensation Committee of the Board
of Directors (in the case of the CEO) will be included in the Plan. Individuals
may receive a performance achievement rating between 80% and 100%. Individual
performance rating will be used as a multiplier against the funded level of
each financial metric to determine a final earned bonus under each financial
metric at year end.  There will not be a
mid-year assessment component.

 

Your Performance Objectives
for FY11 are identified in Appendix A.

 

4

 

VI.      Plan Funding Allocation and Achievement

 

For
fiscal year 2011, Plan funding will be based on the attainment of specified
levels of Global License Bookings and Cash Flow from Operations.  Funding is contingent upon and proportional
to the Company’s attainment of required levels (minimum 70% performance).  In FY11, there is the potential for a
mid-year payment as well as a final year-end payment.  The mid-year payment is based on mid-year
performance against the mid-year targets and will not exceed 25% of the annual
bonus target.  The year-end payment is
based on total annual performance against the annual performance targets less
any payment received at mid -year.

 

The allocation of target
bonus by metric/measurement for each measurement period is as follows:

 

	
  Measurement

  	
   

  	
  % of
  Annual Bonus

  
	
  License Booking

  	
   

  	
  65%

  
	
  Cash Flow

  	
   

  	
  35%

  
	
  Performance

  	
   

  	
  override

  

 

The annual (year-end)
calculation will also be weighted by the performance assessment rating. It will
not be assessed at the mid-year calculation.

 

Should
the mid-year bonus earned be less than the target of 25% of bonus potential,
the unrealized difference (up to the 25% mid-year potential) can be made up at
year-end based on annual achievement against annual goals.

 

VII.     Bonus Calculation

 

A.    Bonus
calculation takes into account four components:

·      License
Bookings achievement and corresponding funding percentage (Section V. A.);

·      Cash
Flow from Operations and corresponding funding percentage (Section V. A.);

·      CEO
Performance Assessment and corresponding performance percentage (Section V.
A.);and

·      Target
Bonus ($) level (as defined in Appendix A)

 

B.    The bonus will be measured on a first half performance at mid-year and on
an annual performance level at year end. 

 

5

 

First Half (H1) Calculation
(Maximum payout of 25% of annual bonus target)

 

License Bookings

 

	
  Annual
  Bonus Target

  	
   

  	
  X

  	
   

  	
  Metric
  Weighting 65%

  	
   

  	
  X

  	
   

  	
  Maximum
  Payout 25%

  	
   

  	
  X

  	
   

  	
  Mid
  -Year Funding Achievement %

  	
   

  	
  =

  	
   

  	
  H1
  License Bookings Bonus Payout

  

 

Cash Flow from Operations

 

	
  Annual
  Bonus Target

  	
   

  	
  X

  	
   

  	
  Metric
  Weighting 35%

  	
   

  	
  X

  	
   

  	
  Maximum
  Payout 25%

  	
   

  	
  X

  	
   

  	
  Mid
  -Year Funding Achievement %

  	
   

  	
  =

  	
   

  	
  H1
  Cash Flow Bonus Payout

  

 

Total H1 Bonus

 

	
  H1
  License Booking Bonus Payout

  	
   

  	
  +

  	
   

  	
  H1
  Cash Flow Bonus Payout

  	
   

  	
  =

  	
   

  	
  Total
  H1 Bonus Payout

  

 

End of
Year (YE) Calculation

 

License Bookings

 

	
  Annual
  Bonus Target

  	
   

  	
  X

  	
   

  	
  Metric
  Weighting 65%

  	
   

  	
  X

  	
   

  	
  Funding
  Achievement %

  	
   

  	
  =

  	
   

  	
  YE
  License Bookings Earned Bonus

  

 

Cash Flow from Operations

 

	
  Annual
  Bonus Target

  	
   

  	
  X

  	
   

  	
  Metric
  Weighting 35%

  	
   

  	
  X

  	
   

  	
  Funding
  Achievement %

  	
   

  	
  =

  	
   

  	
  YE
  Cash Flow Earned Bonus

  

 

YE Bonus Funding

 

	
  YE
  License Booking Earned

  	
   

  	
  +

  	
   

  	
  YE
  Cash Flow Earned

  	
   

  	
  -

  	
   

  	
  H1
  Paid Bonus

  	
   

  	
  = Total YE Bonus Funding

  

 

Performance Assessment (range from 80% to 100%)

 

6

 

Performance Percent
as Assessed by CEO/Compensation Committee

 

Final YE Earned Bonus

 

	
  Total
  YE Bonus Funding

  	
   

  	
  X

  	
   

  	
  Performance
  Percent

  	
   

  	
  =

  	
   

  	
  Final YE Earned Bonus Amount

  

 

7

 

Illustration

 

The following illustrations demonstrate sample
calculations for determining potential bonus payments using an annual bonus
potential of $100,000.

 

H1 Bonus Calculation

 

	
   

  	
   

  	
  Target
  Bonus $

  	
   

  	
  Achievement

  	
   

  	
  Funding

  %

  	
   

  	
  Bonus
  Earned

  
	
  License Booking

  	
   

  	
  $100,000
  x 65% x 25% = $16,250

  	
   

  	
  90%

  	
   

  	
  90%

  	
   

  	
  $16,250
  * 90% = $14,625

  
	
  Cash Flow

  	
   

  	
  $100,000
  x 35% x 25% = $8,750

  	
   

  	
  80%

  	
   

  	
  70%

  	
   

  	
  $8,750
  * 70% = $6,125

  
	
  Bonus Earned

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $14,625
  + $6,125 = $20,750

  

 

YE Bonus Calculation

 

	
   

  	
   

  	
  Target
  Bonus $

  	
   

  	
  Achievement

  	
   

  	
  Funding

  %

  	
   

  	
  Bonus
  Earned

  
	
  License Booking

  	
   

  	
  $100,000
  x 65% = $65,000

  	
   

  	
  85%

  	
   

  	
  80%

  	
   

  	
  $65,000
  * 80% = $52,000

  
	
  Cash Flow

  	
   

  	
  $100,000
  x 35% = $35,000

  	
   

  	
  100%

  	
   

  	
  100%

  	
   

  	
  $35,000
  * 100% = $35,000

  
	
  Annual
  Bonus Funding

  	
   

  	
  $52,000
  + $35,000 = $87,000

  
	
  YE
  Bonus Funding (Annual Funding – H1 Payout)

  	
   

  	
  $87,000
  - $20,750 = $66,250

  
	
  Performance
  Percent Awarded

  	
   

  	
  95%

  
	
  Final
  Bonus Earned

  	
   

  	
  $66,250
  * 95% = $62,937.50

  

 

	
  Total Annual Bonus Earned

  	
   

  	
  Bonus
  Payment

  	
   

  
	
  First
  Half (H1) Bonus Earned

  	
   

  	
  $

  	
  20,750.00

  	
   

  
	
  End
  of Year (YE) Bonus Earned

  	
   

  	
  $

  	
  62,937.50

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total
  Bonus Earned for the Plan Year

  	
   

  	
  $

  	
  83,687.50

  	
   

  
	
  Percent
  of Annual Bonus Target

  	
   

  	
  83.7

  	
  %

  

 

Note: All Actual Plan awards will be adjusted up/down based on Company bonus
pool funding levels.

 

8

 

VIII.      Discretionary
Awards

 

In addition to awards based
on the performance metrics established herein and notwithstanding any
limitations including caps set forth elsewhere herein, the Compensation
Committee of the Board of Directors may make discretionary awards to eligible
employees in such amounts as the Committee determines are appropriate and in
the best interests of the Company.

 

IX.           Administration

 

Administration of this Plan
will be the responsibility of the CEO or the Compensation Committee of the
Board of Directors. Any interpretation of the terms, conditions, goals, or
payments from this Plan required because of a dispute will be made solely by
the CEO or the Compensation Committee of the Board of Directors after a full
review of the facts, input from the affected parties, and with appreciation of
the overall intent of the Plan and previous practices.

 

If any term or condition of
this Plan is found to be in non-conformance with a given state or federal law
(USA) or local legislation (International locations), that term or condition
will be non-enforceable but will not negate other terms and conditions of the
Plan.  However, Aspen Technology, Inc.,
will review and modify the overall Plan to conform to such law.

 

Eligibility and
participation in this Plan in no way implies or reflects any guarantee or
contract of employment, except as may be stipulated by applicable local
law.  Aspen Technology, Inc.,
reserves the right to amend, modify, or terminate this Plan and the procedures
set forth herein at any time.  Any change
to the terms of the Plan will be made in writing by SVP of Human Resources to
all Participants in as far in advance as possible of the effective date of such
change, and will be subject to acceptance by the Participant.  No change shall be retroactive from the date
such change is announced.

 

9

 

 

Appendix
A

 

FY11 Performance
Objectives

 

To Be Completed by Employee and
Manager.  List your top 3 performance
objectives for FY11.

 

	
  Employee’s Name:

  	
   

  	
  Manager’s Name:

  	
   

  	
  Organization:

  	
   

  	
  Date Prepared:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FY11 Compensation

  	
   

  	
  Base Salary: $

  	
   

  	
  Bonus Target: $

  	
   

  	
  OTE: $

  
									

 

	
  Performance Objective:

  	
   

  	
  Measures:

  (Enter measures used

  to gauge progress).

  	
   

  	
  Target:

  (Enter target for

  each measure).

  	
   

  	
  Activity:

  (List necessary activities to achieve the Objective

  if applicable).

  	
   

  	
  Status/Progress:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

10

 

	
  Employee Signature:

  	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CEO
  Signature:

  	
   

  	
   

  	
  Date:

  	
   

  

 

11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00176-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00176-of-00352.parquet"}]]