Document:

srra-ex101_105.htm

 

		
	
Confidential
	
EXHIBIT 10.1

 

[***] = redacted

 

 

 

 

LICENSE AGREEMENT

 

 

between

AstraZeneca AB

and

 

 

Sierra Oncology, Inc.,

 

Dated as of August 03, 2021

 

 

 

			
	
 
	
 
	
 

 

Confidential

 

 

TABLE OF CONTENTS

 

	
RECITALS 1
	
 

	
 
	
 
	
 

	
ARTICLE 1
	
DEFINITIONS
	
1

	
 
	
 
	
 

	
ARTICLE 2
	
GRANT OF RIGHTS
	
14

	
 
	
 
	
 

	
ARTICLE 3
	
DEVELOPMENT, REGULATORY, TRANSITION AND COMMERCIALIZATION ACTIVITIES
	
16

	
 
	
 
	
 

	
ARTICLE 4
	
PAYMENTS AND TAXES
	
21

	
 
	
 
	
 

	
ARTICLE 5
	
INTELLECTUAL PROPERTY
	
28

	
 
	
 
	
 

	
ARTICLE 6
	
CONFIDENTIALITY AND NON-DISCLOSURE
	
35

	
 
	
 
	
 

	
ARTICLE 7
	
REPRESENTATIONS AND WARRANTIES
	
40

	
 
	
 
	
 

	
ARTICLE 8
	
INDEMNITY
	
43

	
 
	
 
	
 

	
ARTICLE 9
	
TERM AND TERMINATION
	
46

	
 
	
 
	
 

	
ARTICLE 10
	
MISCELLANEOUS
	
49

 

 

Schedules

 

	
Schedule 1.10
	
AstraZeneca General Know-How

	
Schedule 1.12
	
AstraZeneca Patents

	
Schedule 1.13
	
AstraZeneca Regulatory Documentation

	
Schedule 1.14
	
AstraZeneca Specific Know-How

	
Schedule 1.24
	
Combination Data

	
Schedule 1.80
	
[***] Combination Patents

	
Schedule 1.81
	
Ongoing Research Programs

	
Schedule 3.1.3
	
Product Development Plan

	
Schedule 3.2.1
	
Transition Plan

	
Schedule 6.4
	
Press Release and Public Announcement

	
Schedule 6.5
	
Publications

 

 

 

 

 

Confidential

 

LICENSE AGREEMENT

This License Agreement (this “Agreement”) is made and entered into as of the date last signed (the “Effective Date”) by and between AstraZeneca AB, a company incorporated in Sweden, with its principal place of business at SE-151 85, Södertälje, Sweden (“AstraZeneca”) and Sierra Oncology, Inc., a Delaware corporation with offices at 1820 Gateway Drive, Suite 110 San Mateo, CA 94404 USA (“Licensee”).  AstraZeneca and Licensee are sometimes referred to herein individually as a “Party” and collectively as the “Parties”.

 

RECITALS

WHEREAS, AstraZeneca owns or controls certain intellectual property rights and other proprietary rights and information with respect to the Licensed Compounds (as defined herein) and the Licensed Products (as defined herein), which are targeted oncology therapeutics, in the Field (as defined below) in the Territory (as defined herein); 

WHEREAS, Licensee is developing and commercializing targeted therapeutics to address serious unmet medical needs in oncology; and 

WHEREAS, subject to the terms and conditions of this Agreement, AstraZeneca wishes to grant to Licensee, and Licensee wishes to receive from AstraZeneca, an exclusive license to develop, manufacture and commercialize the Licensed Compounds and the Licensed Products in the Field in the Territory.

NOW, THEREFORE, in consideration of the premises and the mutual promises and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows:

ARTICLE 1
DEFINITIONS

Unless otherwise specifically provided herein, the following terms shall have the following meanings:

1.1.“Accounting Standard” means, with respect to a Party or its Affiliates or its or their Sublicensees, GAAP, IFRS, or such other similar national or international standards as such Party, Affiliates or its or their Sublicensees adopts, in each case, consistently applied.

1.2.“Affiliate” means, with respect to a Person, any Person that, directly or indirectly, controls, is controlled by or is under common control with such first Person at any time for so long as such Person controls, is controlled by or is under common control with such first Person.  For purposes of this definition, “control” and, with correlative meanings, the terms “controlled by” and “under common control with” means:  (a) the possession, directly or indirectly, of the power to direct the management or policies of a business entity, whether through the ownership of voting securities, by contract relating to voting rights or corporate governance or otherwise; or (b) the ownership, directly or indirectly, of more than fifty percent (50%) of the voting securities or other 

 

Confidential

ownership interests of a business entity (or, with respect to a limited partnership or other similar entity, its general partner or controlling entity).

1.3.“Agreement” has the meaning set forth in the preamble hereto.

1.4.“Anti-Corruption Laws” means the U.S. Foreign Corrupt Practices Act, as amended, the UK Bribery Act 2010, as amended, and any other applicable anti-corruption laws and laws for the prevention of fraud, racketeering, money laundering or terrorism.

1.5.“Applicable Law” means applicable laws, rules and regulations, including any rules, regulations, guidelines or other requirements of the Regulatory Authorities, that may be in effect from time to time, including all applicable Anti-Corruption Laws.

1.6.“Arbitrators” has the meaning set forth in Section 10.6.3 (Arbitration Procedure).

1.7.“Arbitration Notice” has the meaning set forth in Section 10.6.2 (Arbitration Notice).

1.8.“AstraZeneca” has the meaning set forth in the preamble hereto.

1.9.“AstraZeneca Corporate Names” means those Trademarks, names and logos of AstraZeneca or any of its Affiliates, as determined by AstraZeneca, use of which is legally required or otherwise reasonably necessary to Develop or Commercialize the Licensed Compounds or the Licensed Products in the Field in the Territory. 

1.10.“AstraZeneca General Know-How” means the Information Controlled by AstraZeneca or any of its Affiliates as of the Effective Date [***], and is not AstraZeneca Specific Know-How, including the Information as encompassed in the reports and documents described in Schedule 1.10 (AstraZeneca General Know-How).  AstraZeneca General Know-How does not include Combination Data.    

1.11.“AstraZeneca Know-How” means AstraZeneca General Know-How and AstraZeneca Specific Know-How.  

1.12.“AstraZeneca Patents” means the Patents listed on Schedule 1.12 (AstraZeneca Patents); and any foreign counterparts thereof, as well as any Patents filed or claiming priority from such Patents or such foreign counterparts, but excluding the [***] Combination Patents.

1.13.“AstraZeneca Regulatory Documentation” means Regulatory Documentation Controlled by AstraZeneca or any of its Affiliates as of the Effective Date [***] the Licensed Compounds or the Licensed Products in the Field. The AstraZeneca Regulatory Documentation is listed on Schedule 1.13 (AstraZeneca Regulatory Documentation).

1.14.“AstraZeneca Specific Know-How” means the Information Controlled by AstraZeneca or any of its Affiliates [***], in each case to the extent solely and exclusively relevant to the BRD4 Inhibitor Program. AstraZeneca Specific Know-How shall include the Information encompassed in the reports and documents described in Schedule 1.14 (AstraZeneca Specific 

2 | Page

 

Confidential

Know-How), other than any SOPs encompassed therein.  AstraZeneca Specific Know-How does not include Combination Data. 

1.15.“Auditor” has the meaning set forth in Section 4.11 (Audit Dispute).

1.16.“BRD4 Inhibitor Compound” means any pharmaceutical compound [***].

1.17.“BRD4 Inhibitor Program” means the activities undertaken in relation to the, BRD4 Inhibitor Compounds.

1.18.“Breaching Party” has the meaning set forth in Section 9.2.1 (Termination for Material Breach).

1.19.“Business Day” means a day other than (i) a Saturday or Sunday or (ii) a day on which banking institutions in New York, London or Stockholm are permitted or required to be closed by Applicable Law or executive orders.

1.20.“Calendar Quarter” means each successive period of three (3) calendar months commencing on January 1, April 1, July 1 and October 1, except that the first Calendar Quarter of the Term shall commence on the Effective Date and end on the day immediately prior to the first to occur of January 1, April 1, July 1 or October 1 after the Effective Date and the last Calendar Quarter shall end on the last day of the Term.

1.21.“Calendar Year” means each successive period of twelve (12) calendar months commencing on January 1 and ending on December 31, except that the first Calendar Year of the Term shall commence on the Effective Date and end on December 31 of the year in which the Effective Date occurs and the last Calendar Year of the Term shall commence on January 1 of the year in which the Term ends and end on the last day of the Term.

1.22.“Change of Control” means (a) any consolidation, amalgamation, scheme of arrangement or merger of any Party with or into any other Person or other reorganization in which the shareholders of such Party immediately prior to such consolidation, amalgamation, merger, scheme of arrangement or reorganization own less than fifty percent (50%) of such Party’s voting power in the aggregate immediately after such consolidation, merger, amalgamation, scheme of arrangement or reorganization, or any transaction or series of related transactions to which such Party is a party or target in which in excess of fifty percent (50%) over such Party’s voting power is transferred; or (b) a sale, transfer, lease or other disposition of all or substantially all of the assets of any Party (or any series of related transactions resulting in such sale, transfer, lease or other disposition of all or substantially all of the assets of such Party).

1.23.“China” means the PRC, Hong Kong, Macau and Taiwan.

1.24.“Combination Data” means the data Controlled by AstraZeneca or any of its Affiliates (a) as of the Effective Date that is arising from and related to combination studies for the BRD4 Inhibitor Compound [***], or (b) generated by or on behalf of AstraZeneca or any of its Affiliates as of the Effective Date or during the Term [***]. 

3 | Page

 

Confidential

1.25.“Combination Product” means a Licensed Product that is comprised of or contains a Licensed Compound as an active ingredient together with one (1) or more other active ingredients and is sold either as a fixed dose/unit or as separate doses/units in a single package.

1.26.“Commercial Milestone Event” has the meaning set forth in Section 4.2.2 (Commercial Milestones).

1.27.“Commercial Milestone Payment” has the meaning set forth in Section 4.2.2 (Commercial Milestones).

1.28.“Commercialization” means, in respect of a pharmaceutical product, any and all activities directed to the preparation for sale of, offering for sale of or sale of such product, including activities related to planning, market research, marketing, promoting, bidding and pricing, distributing and importing and exporting such product and interacting with Regulatory Authorities regarding any of the foregoing.  When used as a verb, “to Commercialize” and “Commercializing” means to engage in Commercialization and “Commercialized” has a corresponding meaning.

1.29.“Commercially Reasonable Efforts” means, with respect to the performance of Development, Commercialization or Manufacturing activities with respect to a Licensed Compound or a Licensed Product by Licensee, the carrying out of such activities in a diligent manner using efforts and resources comparable to the efforts and resources commonly used in the pharmaceutical industry by a company of similar size for compounds or products of similar market potential at a similar stage in development or product life.  “Commercially Reasonable Efforts” shall be determined [***],without regard to any payments owed by Licensee to AstraZeneca under this Agreement, but, shall take into account the competitiveness of the marketplace, the standard of care, Licensee’s proprietary position with respect to such Licensed Compound or Licensed Product, applicable regulatory circumstances, the likelihood of success of Commercialization and all other relevant factors such as technical, legal, commercial, scientific or medical factors.  [***] that [***] is [***], it is understood and agreed [***] may be [***] in a [***] and [***] other [***] results obtained [***], and [***] and later [***] results obtained [***].  

1.30.“Confidential Information” has the meaning set forth in Section 6.1 (Confidentiality Obligations).

1.31.“Control” means, with respect to any item of Information, Regulatory Documentation, material, Patent or other intellectual property right, and subject to Section 10.4.2 (Assignment; Excluded Rights), possession of the right, whether directly or indirectly and whether by ownership, license or otherwise (other than by operation of the license and other grants in Section 2.1 (Grants to Licensee)), to grant a license, sublicense or other right (including the right to reference Regulatory Documentation) to or under such Information, Regulatory Documentation, material, Patent or other intellectual property right as provided for herein without [***].

1.32.“Cover” means with respect to a particular subject matter at issue and a relevant Patent, but for ownership of or rights granted to a Person under such Patent, the manufacture, use, sale, offer for sale, or importation of such subject matter would infringe one or more Valid Claims 

4 | Page

 

Confidential

(including, if applicable, in the case of a patent application that has not been issued, evaluating such infringement as if such Valid Claim were issued) in such Patent. 

1.33.“Cure Period” shall have the meaning set forth in Section 9.2.1 (Termination for Material Breach).

1.34.“Development” means, in respect of a pharmaceutical product, all activities related to research, pre-clinical and other non-clinical testing, test method development and stability testing, toxicology, formulation, process development, manufacturing scale-up, qualification and validation, quality assurance/quality control, clinical studies, including Manufacturing in support thereof, statistical analysis and report writing, the preparation and submission of Drug Approval Applications, regulatory affairs with respect to the foregoing and all other activities necessary or reasonably useful or otherwise requested or required by a Regulatory Authority as a condition or in support of obtaining or maintaining a Regulatory Approval for such product.  When used as a verb, “Develop” means to engage in Development.

1.35.“Development Milestone Event” has the meaning set forth in Section 4.2.1 (Development Milestones). 

1.36.“Development Milestone Payment” has the meaning set forth in Section 4.2.1 (Development Milestones).

1.37.“Disclosing Party” has the meaning set forth in Section 6.1 (Confidentiality Obligations).

1.38.“Dispute” has the meaning set forth in Section 10.6.1 (Escalation to Senior Officers).

1.39.“Drug Approval Application” means a New Drug Application as defined in the FFDCA (“NDA”) or any corresponding application for marketing a drug in any country in the Territory, including, with respect to the European Union, a Marketing Authorization Application (“MAA”) filed with the EMA pursuant to the centralized approval procedure or with the applicable Regulatory Authority of a country in the European Union with respect to the mutual recognition or any other national approval. 

1.40.“Effective Date” has the meaning set forth in the preamble hereto.

1.41.“EMA” means the European Medicines Agency and any successor agency thereto.

1.42.“Enforcing Party” has the meaning set forth in Section 5.3.2 (Enforcement of Patents).

1.43. “European Union” means United Kingdom (for clarity, regardless of whether it is a member of the EU), Germany, Italy, France and Spain and the other member states as constituted in the union.

1.44.“Exploit” means, in respect of a pharmaceutical product, to make, have made, import, use, sell or offer for sale, including to research, Develop, Commercialize, register, 

5 | Page

 

Confidential

Manufacture, have Manufactured, hold or keep (whether for disposal or otherwise), have used, export, transport, distribute, promote, market or have sold or otherwise dispose of such product.  “Exploitation” means the act of Exploiting a product.

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

1.46.“FFDCA” means the United States Federal, Food, Drug, and Cosmetic Act, as amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.47.“Field” means all therapeutic, prophylactic, palliative and diagnostic uses in humans and animals.

1.48.“First Commercial Sale” means, with respect to a Licensed Product and a country, the first sale for monetary value for use or consumption by the end user of such Licensed Product in such country after approval of a Drug Approval Application for such Licensed Product has been obtained in such country.  Sales, leases or transfers of a Licensed Product for research or Development, including proof of concept studies or other clinical trial purposes, or for compassionate use, where the Licensed Product is supplied without charge shall not be considered a First Commercial Sale.

1.49. “GAAP” means United States generally accepted accounting principles, consistently applied.

1.50.“Generic Product” means, with respect to a particular Licensed Product and on a country-by-country basis, a generic pharmaceutical product that is marketed for sale by a Third Party (not licensed, supplied or otherwise permitted by Licensee, its Affiliates or Sublicensees) and that contains the same or substantially the same active ingredient as the Licensed Product and is approved for use in such country by a Regulatory Authority through a regulatory pathway referencing clinical data submitted by Licensee, its Affiliates or Sublicensees to obtain Regulatory Approval for such Licensed Product.

1.51.“Governmental Authority” means any federal, state, national, provincial or local government, or political subdivision thereof, or any multinational organization or any authority, agency or commission entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power (including any fiscal, revenue, customs, or exercise authority body or official anywhere in the world), any court or tribunal (or any department, bureau or division thereof, or any governmental arbitrator or arbitral body).

1.52.“IFRS” means International Financial Reporting Standards, consistently applied. 

1.53.“Improvement” means any [***] or [***] with respect to [***] in the activities under this Agreement, and whether or not patented or patentable, including [***] or [***] that [***].  

1.54. “IND” means (a) an investigational new drug application filed with the FDA for authorization to commence clinical studies and its equivalent in other countries or regulatory 

6 | Page

 

Confidential

jurisdictions and (b) all supplements and amendments that may be filed with respect to the foregoing.

1.55.“Indemnification Claim Notice” has the meaning set forth in Section 8.3.1 (Notice of Claim).

1.56.“Indemnified Party” has the meaning set forth in Section 8.3.1 (Notice of Claim).

1.57.“Indemnifying Party” has the meaning set forth in Section 8.3.1 (Notice of Claim).

1.58."Indication" means a separate and distinct disease or medical condition in humans or animals (a) for which a Licensed Product that is in clinical trials is intended to treat in such clinical trials or (b) for which a Licensed Product has received a separate and distinct Regulatory Approval with an approved label claim to treat such disease or condition, as applicable. For example, [***] shall not be considered separate Indications.

1.59.“Information” means all technical, scientific and other know-how and information, trade secrets, knowledge, technology, means, methods, processes, practices, formulae, instructions, skills, techniques, procedures, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, apparatuses, specifications, data, results and other material, including: biological, chemical, pharmacological, toxicological, pharmaceutical, physical and analytical, pre-clinical, clinical, safety, manufacturing and quality control data, processes and information, including study designs and protocols, assays and biological methodology, in each case (whether or not confidential, proprietary, patented or patentable) in written, electronic or any other form now known or hereafter developed.

1.60.“Infringement” has the meaning set forth in Section 5.3.1 (Notice).

1.61.“Invention” means any Information, Improvement, composition of matter, article of manufacture, invention, discovery, finding, or other subject matter, patentable or otherwise, that is conceived or reduced to practice by a Party, under or in connection with this Agreement.

1.62.“Invoiced Sales” has the meaning set forth in Section 1.76 (Net Sales).

1.63."Knowledge" means the actual knowledge of the [***] of AstraZeneca and its Affiliates who worked on matters involving the Licensed Compound.

1.64.“Licensed Compound” means (a) the BRD4 Inhibitor Compounds, including the chemical compound designated internally by AstraZeneca as of the Effective Date as “AZD5153”, and (b) [***].

1.65.“Licensed Product” means any pharmaceutical product in any and all forms, presentations, dosages and formulations that is comprised of or contains a Licensed Compound, [***].

1.66.“Licensee” has the meaning set forth in the preamble hereto.

7 | Page

 

Confidential

1.67.“Licensee Corporate Names” means the Trademarks, names and logos indicating Licensee or any of its Affiliates.

1.68.“Licensee IP and Information” means [***]. 

1.69.“Losses” has the meaning set forth in Section 8.1 (Indemnification of AstraZeneca).

1.70.“Major Market Country(ies)” means each of the PRC, the United States, Japan, United Kingdom, France, Germany, Spain or Italy. 

1.71.“Manufacture” and “Manufacturing” means, in respect of a pharmaceutical product, all activities related to the production, manufacture, processing, filling, finishing, packaging, labeling, shipping and holding of such product or any intermediate thereof, including process development, process qualification and validation, scale-up, pre-clinical, clinical and commercial manufacture and analytic development, product characterization, stability testing, quality assurance and quality control.

1.72.“Material Anti-Corruption Law Violation” means a violation of an Anti-Corruption Law relating to the subject matter of this Agreement by Licensee or its Affiliate that would, if it were publicly known, in the reasonable view of AstraZeneca, have a material adverse effect on AstraZeneca or on the reputation of AstraZeneca because of its relationship with Licensee.

1.73.“Material Breach” has the meaning set forth in Section 9.2.1 (Termination for Material Breach).

1.74.“Milestone Event” means a Development Milestone Event or a Commercial Milestone Event. 

1.75.“Milestone Payment” means a Development Milestone Payment or a Commercial Milestone Payment. 

1.76.“Net Sales” means, with respect to a Licensed Product for any period, the gross amount billed or invoiced by Licensee, its Affiliates or its or their Sublicensees to Third Parties for the sale of a Licensed Product in such period (the “Invoiced Sales”), less deductions for:  

1.76.1.[***]; 

1.76.2.[***]; 

1.76.3.[***]; 

1.76.4.[***]; 

1.76.5.[***]; and

[***].  

[***].

8 | Page

 

Confidential

[***].

[***].

Subject to the above, Net Sales shall be calculated in accordance with the standard internal policies and procedures of Licensee, its Affiliates or its or their Sublicensees, which must be in accordance with the applicable Accounting Standard.

1.77.“NMPA” means the China National Medical Products Administration, and local or provincial counterparts thereto or divisions thereof, and any successor agency or authority thereto having substantially the same function.

1.78.“Non-Breaching Party” has the meaning set forth in Section 9.2.1 (Termination for Material Breach).

1.79.“Notice of Breach” has the meaning set forth in Section 9.2.1 (Termination for Material Breach).

1.80.“[***] Combination Patents” means the Patents listed on Schedule 1.80 ([***] Combination Patents); and any foreign counterparts thereof, as well as any Patents filed or claiming priority from such Patents or such foreign counterparts, but excluding the AstraZeneca Patents.

1.81.“Ongoing Research Programs” means the research programs regarding the Licensed Compounds conducted by, or with the prior agreement of, AstraZeneca and its Affiliates that are in process as of the Effective Date, as described in Schedule 1.81 (Ongoing Research Programs) and “Ongoing Research Agreements” means the contracts governing such Ongoing Research Programs.

1.82.“Party” and “Parties” have the meaning set forth in the preamble hereto.

1.83.“Patent Challenge” has the meaning set forth in Section 9.2.3 (Termination for Patent Challenge).  

1.84.“Patents” means: (a) all national, regional and international patents and patent applications, including provisional patent applications; (b) all patent applications filed either from such patents, patent applications or provisional applications or from an application claiming priority from or common priority with either of these, including divisionals, continuations, continuations-in-part, provisionals, converted provisionals and continued prosecution applications; (c) any and all patents that have issued or in the future issue from the foregoing patent applications ((a) and (b)), including utility models, petty patents, innovation patents and design patents and certificates of invention; (d) any and all extensions or restorations by existing or future extension or restoration mechanisms, including revalidations, reissues, re-examinations and extensions (including any supplementary protection certificates and the like) of the foregoing patents or patent applications ((a), (b) and (c)); and (e) any similar rights, including so-called pipeline protection or any importation, revalidation, confirmation or introduction patent or registration patent or patent of additions to any of such foregoing patent applications and patents. A single “Patent” includes a patent or patent application of (a) and all other patents, applications, 

9 | Page

 

Confidential

and other rights that fall under (b)-(e) based on their relationship to such patent or patent application of (a).  For purposes of the Patent lists in this Agreement, if any patent, application, or other right from within such single “Patent” (as described in the foregoing sentence) is on the list, then all patents, applications and other rights that form part of such same Patent in accordance with the foregoing sentence, shall be deemed included on the list.

1.85.“Payment” means any payment due from Licensee to AstraZeneca under or pursuant to this Agreement, including the Milestone Payments, Royalty Payments and Sublicensing Payments.

1.86.“Person” means an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture or other similar entity or organization, including a government or political subdivision, department or agency of a government.

1.87.“Pharmacovigilance Agreement” has the meaning set forth in Section 3.3.2 (Global Safety Database).

1.88.“Phase 3 Clinical Study” means a human clinical study of a product in any country that would satisfy the requirements of 21 C.F.R. 312.21(c) and that is designed or intended to (a) establish that the product is safe and efficacious for its intended use, (b) define warnings, precautions and adverse reactions that are associated with the product in the dosage range to be prescribed, and (c) support Regulatory Approval for such product.  

1.89.“PMDA” means the Japanese Pharmaceutical and Medical Device Agency or any successor thereto.

1.90.“PRC” means the People’s Republic of China, for purpose of this Agreement, excluding Hong Kong, Macau and Taiwan regions.

1.91.“Product Development Plan” has the meaning set forth in Section 3.1.3(a) (Product Development Plans), as amended from time to time.

1.92.“Product Trademarks” means the Trademark(s) used or to be used by Licensee or its Affiliates or its or their Sublicensees for the Commercialization of Licensed Product in the Territory and any registrations thereof or any pending applications relating thereto in the Territory, including any unregistered Trademark rights related to the Licensed Product as may exist through use before, on or after the Effective Date (excluding, in any event, any AstraZeneca Corporate Names, any Licensee Corporate Names and any Trademarks that consist of or include any corporate name or corporate logo of the Parties or their Affiliates or its or their (sub)licensees (or Sublicensees)). 

1.93. “Quality Agreement” has the meaning set forth in Section 3.6 (Manufacture of Licensed Product).

1.94.“Receiving Party” has the meaning set forth in Section 6.1 (Confidentiality Obligations).

10 | Page

 

Confidential

1.95.“Reference Rate” means the greater of (i) the Federal Open Market Committee’s upper bound federal funds rate, initially set on the day a payment is due and reset on the first Business Day every month, and (ii) zero.

1.96.“Registration Enabling Trial”, means, with respect to a Licensed Product, a human clinical study (whether or not designated a Phase 3 Clinical Study), the results of which, together with prior data and information concerning such Licensed Product, [***] of an effectiveness claim in support of the initial approval of an NDA for such intended use of such Licensed Product. A Registration Enabling Trial includes a Phase 3 Clinical Study.  If a human clinical study is denominated not a Phase 3 Clinical Study (for example, human clinical studies formally registered as Phase 2 clinical studies) then it shall only be treated as a Registration Enabling Trial hereunder if and when [***].

1.97.“Regulatory Approval” means, with respect to a particular Licensed Product and a particular country, any and all approvals (including approvals of Drug Approval Applications), licenses, registrations or authorizations of any Regulatory Authority necessary for the Exploitation of a Licensed Product in such jurisdiction, including, where applicable, (a) any IND, clinical trial approval or notification, and supplements and amendments thereto; (b) pricing or reimbursement approval in such jurisdiction, (c) pre-approval and post-approval marketing authorizations (including any prerequisite Manufacturing or distribution approval or authorization related thereto), and (d) labeling approval.  

1.98.“Regulatory Authority” means any applicable supra-national, federal, national, regional, state, provincial or local regulatory agencies, departments, bureaus, commissions, councils or other government entities regulating or otherwise exercising authority with respect to the Exploitation of the Licensed Compounds or the Licensed Products anywhere in the world, including the FDA and the EMA.

1.99.“Regulatory Documentation” means: all (a) applications (including all INDs, clinical trial applications and Drug Approval Applications), registrations, licenses, authorizations and approvals (including Regulatory Approvals); (b) correspondence and reports submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents with respect thereto, including all regulatory drug lists, advertising and promotion documents, adverse event files and complaint files; and (c) preclinical, clinical and other data results, analyses, publications, and reports contained or referred to in any of the foregoing; in each case ((a), (b) and (c)) relating to a Licensed Compound or a Licensed Product.  

1.100.“Regulatory Exclusivity Period” means, with respect to each Licensed Product in any country in the Territory, any period of data, market or other regulatory exclusivity (other than Patent exclusivity) in such country that confers exclusive marketing rights with respect to such Licensed Product in such country [***] another party from using or otherwise relying on any data supporting the approval of the Drug Approval Application for such Licensed Product without the prior written consent of the new drug authorization-holder, marketing authorization-holder (or any equivalent in any country in the Territory), as applicable, and may include any new chemical entity exclusivity, new use or indication exclusivity, new formulation exclusivity, orphan drug exclusivity, non-patent related pediatric exclusivity or any other applicable marketing or data 

11 | Page

 

Confidential

exclusivity, including any such periods listed in the FDA’s Orange Book or any such periods under national implementations in the EU of Article 10 of Directive 2001/83/ED, Article 14(11) of Parliament and Council Regulation (EC) No. 726/2004, Parliament and Council Regulation (ED) No. 141/2000 on orphan medicines, Parliament and Council Regulation (ED) No. 1901/2006 on medicinal products for pediatric use and all international equivalents of any of the foregoing.  

1.101.“Representatives” has the meaning set forth in Section 7.8 (Anti-Bribery and Anti-Corruption Compliance). 

1.102.“Retained Rights” means, with respect to the Licensed Compounds and the Licensed Products, the rights of AstraZeneca and its Affiliates and its and their licensors, (sub)licensees and contractors to (a) perform its and their obligations under this Agreement; (b) perform its and their obligations under the Ongoing Research Programs, and (c) Develop, obtain and maintain Regulatory Approvals for and Manufacture, Commercialize and otherwise Exploit any compound or product, other than the Licensed Compounds or the Licensed Products, in any field (including the Field) anywhere in the Territory.

1.103. “Royalty Payment” has the meaning set forth in Section 4.3.1 (Royalty Rates). 

1.104.“Royalty Term” means, with respect to a Licensed Product, and each country in the Territory, the period beginning on the date of First Commercial Sale of such Licensed Product in such country and ending on the last to occur of: (a) the expiration of the last-to-expire Valid Claim of an [***] that, if asserted against a person, would, in the absence of a license, be sufficient to prevent the Development, Manufacture, sale and use by such person of all Generic Products with respect to such Licensed Product in such country; (b) the expiration of any Regulatory Exclusivity Period in such country for such Licensed Product; and (c) the [***] of the First Commercial Sale of such Licensed Product in such country.  

1.105.“Senior Officer” means, with respect to AstraZeneca, its [***] (or equivalent) and with respect to Licensee, its [***]. 

1.106.“SOPs” has the meaning set forth in Section 2.3.3 (Proprietary AstraZeneca Information).

1.107.“Sublicensee” means a Third Party, other than AstraZeneca or any of its Affiliates or its or their (sub)licensees, that is granted a sublicense by Licensee or its Affiliate under the grants in Section 2.1 (Grants to Licensee), as provided in Section 2.2 (Sublicensee).

1.108.“Sublicensing Income” means, with respect to any Licensed Compound or Licensed Product for any period, the total amount of any payments, other than royalties on sales or Net Sales, obtained by Licensee or its Affiliates from a Sublicensee in consideration for the grant [***] related to the Licensed Compound or Licensed Product that exceed the fair market value of such activities or funding, as applicable, and any premium paid over the fair market value of shares, options, or other securities in respect of any of the share capital of Licensee or its Affiliate. Notwithstanding anything express or implied in the foregoing, Sublicensing Income shall not include (a) [***], (b) [***], (c) [***], (d) [***], (e) [***], (f) [***], and (g) [***]. 

12 | Page

 

Confidential

1.109.“Tax” or “Taxes” means any and all applicable tax and taxes (including any value added tax or sales tax, stamp or other duty, levy, impost, or withholding of any nature and howsoever called or described) by whomsoever and wheresoever imposed, levied, collected or assessed.

1.110.“Term” has the meaning set forth in Section 9.1 (Term and Expiration).

1.111.“Territory” means the entire world.

1.112.“Third Party” means any Person other than AstraZeneca, Licensee and their respective Affiliates.

1.113.“Third Party Claims” has the meaning set forth in Section 8.1 (Indemnification of AstraZeneca).

1.114.“Third Party Infringement Claim” has the meaning set forth in Section 5.4 (Infringement Claims by Third Parties).

1.115.“Third Party Patent Right” has the meaning set forth in Section 5.6 (Third Party Patent Rights).

1.116.“Third Party Trademark Claim” has the meaning set forth in Section 5.7.3 (Third Party Claims).

1.117.“Trademark” means any word, name, symbol, color, shape, designation or any combination thereof, including any trademark, service mark, trade name, brand name, sub-brand name, trade dress, product configuration rights, program name, delivery form name, certification mark, collective mark, logo, tagline, slogan, design or business symbol, that functions as an identifier of source, origin or quality, whether or not registered, and all statutory and common law rights therein and all registrations and applications therefor, together with all goodwill associated with, or symbolized by, any of the foregoing.

1.118.“Transfer Activities” has the meaning set forth in Section 3.2.2 (Transition Plan).

1.119.“Transition Plan” has the meaning set forth in Section 3.2.1 (Transition Plan).

1.120.“United States” or “U.S.” means the United States of America and its territories and possessions (including the District of Columbia and Puerto Rico).

1.121.“University” means the [***]. 

1.122.“US Dollars” or “$” means United States dollars, the lawful currency of the United States.

1.123.“Valid Claim” means (a) a claim of any issued and unexpired Patent whose validity, enforceability or patentability has not been affected by (i) irretrievable lapse, abandonment, revocation, dedication to the public or disclaimer or (ii) a holding, finding or decision of invalidity, unenforceability or non-patentability by a court, governmental agency, 

13 | Page

 

Confidential

national or regional patent office or other appropriate body that has competent jurisdiction, such holding, finding or decision being final and unappealable or unappealed within the time allowed for appeal or (b) a claim of a pending Patent application that was filed and is being prosecuted in good faith and has not been abandoned or finally disallowed without the possibility of appeal or re-filing of the application, provided that such Patent application has not been pending for more than [***].  

1.124.“VAT” has the meaning set forth in Section 4.7.2 (VAT).

ARTICLE 2
GRANT OF RIGHTS

2.1.Grants to Licensee.  As of the Effective Date, subject to Sections 2.2 (Sublicenses), 2.3 (Retention of Rights; Limitations Applicable to License Grants) and the other terms and conditions of this Agreement, AstraZeneca hereby grants to Licensee: 

2.1.1.License Grant under AstraZeneca Patents and AstraZeneca Specific Know-How. Subject to Section 2.3.3 (Proprietary AstraZeneca Information), an exclusive (including with regard to AstraZeneca and its Affiliates) license, with the right to grant sublicenses through one or multiple tiers in accordance with Section 2.2 (Sublicenses), under the AstraZeneca Patents, and to use the AstraZeneca Specific Know-How, to Develop, Manufacture, Commercialize or otherwise Exploit the Licensed Compounds and the Licensed Products in the Field in the Territory; 

2.1.2.License Grant under AstraZeneca Regulatory Documentation. Subject to Section 2.3.3 (Proprietary AstraZeneca Information), an exclusive license (including with regard to AstraZeneca and its Affiliates) and right of reference, with the right to grant sublicenses through one or multiple tiers and further right of reference in accordance with Section 2.2 (Sublicenses), to use the AstraZeneca Regulatory Documentation to Develop, Manufacture, Commercialize or otherwise Exploit the Licensed Compounds and the Licensed Products in the Field in the Territory; 

2.1.3.License Grant under AstraZeneca General Know-How, [***] Combination Patents and Combination Data. A non-exclusive license, with the right to grant sublicenses through one or multiple tiers in accordance with Section 2.2 (Sublicenses), to use AstraZeneca General Know-How, [***] Combination Patents and Combination Data to Develop, Manufacture, Commercialize or otherwise Exploit the Licensed Compounds and the Licensed Products in the Field in the Territory; 

2.1.4.Licensee Right of Reference.  Except in relation to AstraZeneca Regulatory Documentation which will be subject to Section 2.1.2, a non-exclusive, royalty-free license and right of reference, with the right to grant sublicenses and further rights of reference through multiple tiers in accordance with Section 2.2 (Sublicenses), to use all other Regulatory Documentation (i) solely and exclusively related to AZD5153 and (ii) Controlled by AstraZeneca during the Term after the Effective Date, to Develop, Manufacture, Commercialize or otherwise Exploit the Licensed Compounds and the Licensed Products in the Field in the Territory, [***].

14 | Page

 

Confidential

2.1.5.Patents and Information Arising Out of Ongoing Research Programs.  

(a)To the extent Information or Patents are [***], then on receipt by AstraZeneca of such Information or Patents it shall be promptly added to the corresponding Schedule to this Agreement and be deemed to be AstraZeneca Specific Know-How or AstraZeneca Patents, respectively and provided to Licensee; or

(b) To the extent Information is or Patents are [***] then (x) on receipt by AstraZeneca of such Information it shall be promptly added to the corresponding Schedule to this Agreement and will be deemed to be AstraZeneca General Know-How or Combination Data accordingly, and provided to Licensee or (y) in the case of any such Patents, AstraZeneca [***] license with the right to grant sublicenses through one or multiple tiers in accordance with Section 2.2 (Sublicenses), to use such Patents to Develop, Manufacture, Commercialize or otherwise Exploit the Licensed Compounds and the Licensed Products in the Field in the Territory;

(c)AstraZeneca will [***] Information arising out of the ongoing clinical externally sponsored research under AstraZeneca reference [***], provided however [***].  For pharmacovigilance matters pertaining to the ongoing clinical externally sponsored research under AstraZeneca reference [***] for the Licensed Compound or Licensed Product, the Pharmacovigilance Agreement will control.  

(d)For the avoidance of doubt, nothing in this Section 2.1.5 shall require AstraZeneca or its Affiliates to breach the terms of any Ongoing Research Agreement [***].

2.2.Sublicenses.   

2.2.1.Sublicense to Affiliates. Licensee shall have the right to grant sublicenses (or further rights of reference) through one or multiple tiers under the licenses and right of reference in Section 2.1 (Grants to Licensee) to its Affiliates for so long as such Affiliates remain Affiliates of Licensee; provided that Licensee will remain responsible and liable for the performance of such Affiliate under such sublicensed rights to the same extent as if such activities were conducted by Licensee, and will cause its Affiliates  to comply with the terms and conditions of this Agreement; [***]. No consent from AstraZeneca shall be required for Licensee to grant the sublicenses of this Section 2.2.1.

2.2.2.Sublicense to Third Parties. Subject to Section 4.4 (Sublicensing Payment) Licensee (or its Affiliates) shall have the right to grant sublicenses (or further rights of reference) through one or multiple tiers under the licenses and right of reference in Section 2.1 (Grants to Licensee), to Third Parties provided that in respect of a grant of rights [***] (a) [***], or (b) [***].  [***].  Licensee shall further cause each Sublicensee to comply with the applicable terms and conditions of this Agreement, as if such Sublicensee were a Party to this Agreement; provided, however, that (i) Licensee shall be liable for any failure to comply by a Sublicensee and the grant of any such sublicense shall not relieve Licensee of its obligations under this Agreement, except to the extent they are satisfactorily performed by such Sublicensee, and (ii) Licensee waives any requirement that AstraZeneca exhaust any right or remedy, or proceed against any Sublicensee for any obligation or performance under this Agreement.  Licensee shall notify AstraZeneca within 

15 | Page

 

Confidential

[***] of any such sublicense to be undertaken pursuant to this Section 2.2.2 and a copy of any sublicense agreement executed by Licensee shall be provided to AstraZeneca within [***]; provided that the financial terms and other terms of any such sublicense agreement to the extent not pertinent to an understanding of compliance with this Agreement may be redacted.

2.3.Retention of Rights; Limitations Applicable to License Grants.  

2.3.1.Retained Rights of AstraZeneca.  Notwithstanding anything to the contrary in this Agreement and without limitation of any rights granted or reserved to AstraZeneca pursuant to any other term or condition of this Agreement, AstraZeneca hereby expressly retains, on behalf of itself and its Affiliates (and on behalf of its licensors, (sub)licensees and contractors) all rights, title and interests in and to the AstraZeneca Patents, the [***] Combination Patents, the Combination Data,  the AstraZeneca Know-How, AstraZeneca Regulatory Documentation with respect to any Licensed Compound or Licensed Product and the AstraZeneca Corporate Names, in each case, solely for purposes of and to the extent required for performing or exercising the Retained Rights. 

2.3.2.No Other Rights Granted by AstraZeneca.  Except as expressly provided herein and without limiting the foregoing, AstraZeneca grants no other right or license, including any rights or licenses to the AstraZeneca Patents, the [***] Combination Patents, the Combination Data, the AstraZeneca Know-How, the AstraZeneca Regulatory Documentation, the AstraZeneca Corporate Names, or any other Patent, Trademark or other intellectual property rights not expressly granted herein.

2.3.3.Proprietary AstraZeneca Information.  AstraZeneca and Licensee acknowledge that certain AstraZeneca proprietary Information or AstraZeneca Controlled standard operating procedures, including working practices and general methodologies (together “SOPs”) are comprised in the AstraZeneca Know-How and AstraZeneca Regulatory Documentation but is or are used by AstraZeneca and its Affiliates in connection with its ongoing business (and is, accordingly, not used solely and exclusively in the Development of the Licensed Compounds and Licensed Products).  For the avoidance of doubt, subject to license grants to Licensee under Section 2.1 (Grants to Licensee), AstraZeneca hereby expressly retains, on behalf of itself and its Affiliates, all rights, title and interests in and to such SOPs and such SOPs shall be deemed as AstraZeneca Confidential Information.

ARTICLE 3
DEVELOPMENT, REGULATORY, TRANSITION AND COMMERCIALIZATION ACTIVITIES

3.1.Development. 

3.1.1.In General.  Licensee shall have the right and the obligation (to the extent provided in Section 3.1.2) to develop the Licensed Products in the Field in the Territory at its own cost and expense in accordance with the Product Development Plan.  Licensee shall perform or cause to be performed its development activities hereunder in good scientific manner.

3.1.2.Diligence.  After the Effective Date, subject to the Retained Rights, as between the Parties, Licensee shall be solely responsible for all aspects of the Development of the 

16 | Page

 

Confidential

Licensed Compounds and the Licensed Products in the Territory at Licensee’s own cost and expense. Subject to the express written terms of this Agreement, all decisions concerning the Development of the Licensed Compounds and Licensed Products covered under this Agreement shall be within the sole discretion of Licensee. For clarity, Licensee shall have the right to amend the Product Development Plan from time to time, subject to the Commercially Reasonable Efforts obligations in this Section 3.1.2.  Licensee shall (directly or through one or more Affiliates or Sublicensees) use Commercially Reasonable Efforts to Develop and obtain and maintain Regulatory Approvals for at least [***].  Subject to Section 2.2.1 and Section 2.2.2, Licensee may seek to satisfy such obligation through its own actions or through those of its Affiliates and/or Sublicensees. 

3.1.3.Product Development Plans.  

(a)Attached hereto as Schedule 3.1.3 (Product Development Plan) is the initial product-specific plan for the Development of Licensed Products in the Territory (“Product Development Plan”). 

(b)To the extent any Development activities contemplated under the Product Development Plan require the use of any AstraZeneca compounds other than any Licensed Compound, the Parties shall negotiate in good faith for separate license, supply or collaboration agreements with respect to any such AstraZeneca compounds.  

3.1.4.Development Costs.  Licensee shall be responsible for all of its costs and expenses in connection with the Development of and obtaining and maintaining Regulatory Approvals for, the Licensed Product in the Field in the Territory.

3.1.5.Development Records.  Licensee shall, and shall cause its Affiliates and its and their Sublicensees to, maintain, in good scientific manner, complete and accurate books and records pertaining to Development of Licensed Product hereunder, in sufficient detail to verify compliance with its obligations under this Agreement.  Such books and records shall (a) be appropriate for patent and regulatory purposes, (b) be in compliance with Applicable Law, (c) properly reflect all work done and results achieved in the performance of its Development activities hereunder, and (d) be retained by Licensee for at least [***] after the expiration or termination of this Agreement in its entirety or for such longer period as may be required by Applicable Law.  [***]. 

3.1.6.Development Reports.  No later than [***] following the end of each full Calendar Year during which Licensee is conducting Development activities hereunder, Licensee shall provide AstraZeneca with a written report for review and discussion of such Development activities it has performed, or caused to be performed, since the preceding report (or, with respect to the first such report, since the Effective Date), its Development activities in process and the future activities it expects to initiate during the following twelve (12)-month period.  Each such report shall be [***] of Licensee’s Development activities as compared to the Product Development Plan, including: (a) [***] and (b) [***].  Notwithstanding the foregoing, if AstraZeneca markets or has in development a competing pharmaceutical product or product candidate [***], Licensee, acting reasonably, shall be entitled to omit those certain details it 

17 | Page

 

Confidential

reasonably deems to be competitively sensitive in respect of such Licensed Product from such reports.

3.2.Transition Activities.

3.2.1.Transition Plan.  To facilitate Licensee’s Development obligations as contemplated hereunder, the Parties have agreed to a transition plan, attached as Schedule 3.2.1 (the “Transition Plan”). The Transition Plan may be amended from time to time on mutual written agreement of the Parties. Licensee is responsible for such costs as identified in the Transition Plan. 

3.2.2.Transfer Activities. 

(a)Immediately after documentation by Licensee in writing that the payments payable by Licensee to AstraZeneca under Section 4.1 (Upfront Payment) have been made, AstraZeneca and Licensee will comply with the Transition Plan and initiate the transfer activities contemplated thereunder (the “Transition Activities”).  

(b)AstraZeneca will use commercially reasonable efforts to carry out all Transfer Activities assigned to it under the Transition Plan, as amended from time to time in accordance with Section 3.2.2(a), in accordance with the timelines and payment terms set forth in the Transition Plan.  The Transition Activities include, without limitation, (a) certain technology transfer activities, (b) [***] and (c) transitional Manufacturing of drug product by AstraZeneca.  Licensee will not be responsible for any delay in performance by Licensee of its obligations under this Agreement (including its diligence obligations as set forth in Section 3.1.2) caused by AstraZeneca’s delay in carrying out any Transition Activities. 

(c)For a period up to [***], if either Party identifies any AstraZeneca Regulatory Documentation or AstraZeneca Know-How in the respective Schedules, that were not previously delivered to Licensee, either Party shall notify the other Party of such identification, and AstraZeneca and its Affiliates shall use its commercially reasonable efforts to disclose and make available to Licensee such AstraZeneca Regulatory Documentation or AstraZeneca Know-How that Licensee reasonably requires, including in connection with preparing, filing, obtaining, and maintaining Regulatory Documentation for Licensed Products in the Field in the Territory.

3.2.3.Ongoing Research Programs.  As between the Parties, AstraZeneca shall be solely responsible for the Ongoing Research Programs in accordance with accepted pharmaceutical industry norms and ethical practices.  It is understood that while AstraZeneca retains the right to complete or wind-down the Ongoing Research Programs in accordance with current commitments under the Ongoing Research Agreements, AstraZeneca shall not expand, extend, or modify (except with respect to wind-down of such Ongoing Research Agreement) the Ongoing Research Programs and/or Ongoing Research Agreements without advance, written consent from Licensee [***] AZD5153. 

AstraZeneca shall use reasonable efforts to provide Licensee with [***], consistent with Section 2.1.5 where AstraZeneca [***].  Any [***] pursuant to this Section 3.2.3 shall be deemed to be Confidential Information of AstraZeneca.  For the avoidance of doubt, [***].

18 | Page

 

Confidential

3.3.Regulatory Activities.

3.3.1.Regulatory Approvals. Subject to the Retained Rights, except as otherwise set forth in Section 3.2 (Transition Activities), Licensee shall have the sole right, at Licensee’s own cost and expense, to prepare, submit, obtain, and maintain Drug Approval Applications (including the setting of the overall regulatory strategy therefor), Regulatory Approvals, and other submissions (including INDs) to Regulatory Authorities, and to conduct communications with the Regulatory Authorities, for Licensed Product in the Field in the Territory, in the name of Licensee (or its Affiliate or Sublicensee), or if required or advisable under any Applicable Law, jointly with its designee.  AstraZeneca shall, and shall cause its Affiliates or sublicensees to, cooperate with Licensee, at Licensee’s reasonable request and at Licensee’s cost and expense, with respect to any regulatory matters for which Licensee is responsible.  

3.3.2.Global Safety Database.  Licensee shall establish, hold and maintain (at Licensee’s sole cost and expense) the global safety database for Licensed Products following transition of such database to Licensee in accordance with the Transition Plan.  Within [***], the Parties shall enter into a written pharmacovigilance agreement governing each Party’s respective obligations with respect to allocation of responsibilities for reporting to the other Party and appropriate Regulatory Authorities adverse events, complaints, and other safety-related matters with respect to the Licensed Compounds and Licensed Products (the “Pharmacovigilance Agreement”). 

3.3.3.Recalls, Suspensions or Withdrawals.  As between the Parties, Licensee shall be solely responsible for handling any recall, market suspension or market withdrawal in the Field in the Territory at its sole cost and expense; provided that prior to any implementation of such a recall, market suspension or market withdrawal, Licensee shall consult with AstraZeneca and shall consider AstraZeneca’s comments in good faith.  If a recall, market suspension or market withdrawal is mandated by a Regulatory Authority in the Territory, as between the Parties, Licensee shall initiate such a recall, market suspension or market withdrawal in compliance with Applicable Law.

3.3.4.Information Sharing and Right of Reference. Subject to the terms and conditions of this Agreement,  Licensee and AstraZeneca hereby agree to share regulatory and safety information pertaining to the Licensed Compound and Licensed Product and grants to the other access to, and a right of reference with respect to, any Regulatory Documentation Controlled by the other Party in respect of the Licensed Product or Licensed Compound, provided that in the case of the grant to AstraZeneca, the grant is solely as necessary to support the ongoing clinical externally sponsored research with the University under AstraZeneca reference [***] in Schedule 1.81. The Parties agree to execute, acknowledge, and deliver any further documents or instruments and to perform all such other acts as may be necessary or appropriate in order to effect such right of reference. 

3.4.Commercialization.

3.4.1.Diligence.  Licensee shall be solely responsible for Commercialization of the Licensed Products throughout the Territory at Licensee’s own cost and expense.  Subject to the express written terms of this Agreement, all decisions concerning the Commercialization of 

19 | Page

 

Confidential

the Licensed Compounds and Licensed Products covered under this Agreement shall be within the sole discretion of Licensee.  Licensee shall (directly or through one or more Affiliates or Sublicensees) use Commercially Reasonable Efforts to Commercialize [***].

3.4.2.Commercialization Records.  Licensee shall maintain complete and accurate books and records pertaining to Commercialization of Licensed Product hereunder, in sufficient detail to verify compliance with its obligations under this Agreement, which shall be in compliance with Applicable Law and properly reflect all significant work done and results achieved in the performance of its Commercialization activities.  Such records shall be retained by Licensee for at least [***] after the expiration or termination of this Agreement in its entirety or for such longer period as may be required by Applicable Law.  [***].

3.4.3.Commercialization Reports.  Without limiting Section 3.4.2 (Commercialization Records), within [***] following the end of each Calendar Year during which Licensee is conducting Commercialization activities hereunder, Licensee shall provide AstraZeneca with written reports of the Commercialization activities it has performed, or caused to be performed, in respect of Licensed Product since the preceding report (or, with respect to the first such report, since the Effective Date), and the future Commercialization activities it expects to initiate in respect of Licensed Product during the following twelve (12)-month period.  Each such report shall be [***] with its obligations set forth in Section 3.4.1 (Diligence).  Notwithstanding the foregoing, if AstraZeneca or any of its Affiliates [***], Licensee, acting reasonably, shall be entitled to omit those certain details it reasonably deems to be competitively sensitive information from its reports under this Section 3.4.3 in respect of such Licensed Product.

3.5.Compliance with Applicable Law.  Licensee shall, and shall cause its Affiliates and Sublicensees to, comply with all Applicable Law with respect to the Exploitation of Licensed Product.    

3.6.Manufacture of Licensed Product.  Subject to Section 3.2.2, Licensee shall have the sole responsibility for, at its expense, Manufacturing (or having Manufactured) and supplying the Licensed Compound and the Licensed Product for their Development and Commercialization activities in accordance with Applicable Law in the Territory, either by itself or through its Affiliates, its and their Sublicensees or Third-Party contract manufacturers.  Notwithstanding the foregoing, AstraZeneca agrees to, at Licensee’s cost, supply to Licensee with inventory of the Licensed Product (whether in the form of drug tablets or drug substance) in accordance with the Transition Plan at AstraZeneca’s [***].  Such supply shall include all appropriate documentation including accurate certificates of analysis and any release documentation. The Parties shall execute a quality agreement to set forth the Parties’ respective responsibilities with respect to quality matters relating to supply and compliance with cGMP (the “Quality Agreement”) [***] of the Effective Date. In the event of any conflict between the Quality Agreement and this Agreement, the terms of the Quality Agreement shall control all quality matters. Further terms applicable to such supply are set forth in Schedule 3.2.1 (Transition Plan).

3.7.Subcontracting.  Subject to Section 2.2 (Sublicenses), Licensee may subcontract with a Third Party to perform any or all of its obligations hereunder (including by appointing one or more distributors); provided, that (a) no such permitted subcontracting shall relieve Licensee of any obligation hereunder (except to the extent satisfactorily performed by such subcontractor) or 

20 | Page

 

Confidential

any liability and Licensee shall be and remain fully responsible and liable therefor and shall be fully responsible and liable for any act or omission of such subcontractor with respect to such subcontracted obligations, and (b) Licensee shall use commercially reasonable efforts to ensure that the agreement pursuant to which Licensee engages any Third Party subcontractor (i) is consistent in all material respects with this Agreement and (ii) contains terms obligating such subcontractor to comply with the confidentiality, intellectual property and all other relevant provisions of this Agreement.    

ARTICLE 4
PAYMENTS AND TAXES

4.1.Upfront Payment.  AstraZeneca shall submit an invoice to Licensee as soon as possible after the Effective Date and Licensee shall pay to AstraZeneca a non-refundable and non-creditable upfront payment of Eight Million US Dollars ($8,000,000) (“Upfront Payment”) within fifteen (15) days following of the invoice date.

4.2.Milestone Payments. 

4.2.1.Development Milestones.  In partial consideration of the rights granted by AstraZeneca to Licensee hereunder, Licensee shall pay to AstraZeneca the following non-refundable and non-creditable payments in accordance with Section 4.2.4 (Invoicing and Payment) after providing determination of the occurrence of a development milestone event in accordance with Section 4.2.3 of the first achievement or occurrence of each of the following development milestone events described in this Section 4.2.1 (Development Milestones) by Licensee or any of its Affiliates or Sublicensees with respect to a Licensed Product, as the case may be (each such milestone event, a “Development Milestone Event,” and each such milestone payment, a “Development Milestone Payment”).  For clarity, (a) each of the Development Milestone Payments set forth in this Section 4.2.1 (Development Milestones) will be payable [***], (b) [***], and (c) no more than [***] shall be payable to AstraZeneca under this Section 4.2.1.

 

		
	
Development Milestone Events applicable for the Territory
	
Development Milestone Payments

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

21 | Page

 

Confidential

		
	
[***]
	
[***]

	
[***]
	
[***]

4.2.2.Commercial Milestones.  In partial consideration of the rights granted by AstraZeneca to Licensee hereunder, Licensee shall pay to AstraZeneca the following non-refundable and non-creditable commercial milestone in accordance with Section 4.2.4 (Invoicing and Payment) after the first achievement or occurrence of each of the following commercial milestone events is achieved by Licensee or any of its Affiliates or its or their Sublicensees with respect to a Licensed Product (each such milestone event, a “Commercial Milestone Event,” and each such milestone payment, a “Commercial Milestone Payment”). If in a given Calendar Year more than one Commercial Milestone Events are achieved, Licensee shall pay to AstraZeneca a separate Commercial Milestone Payment with respect to each Commercial Milestone Event achieved. For clarity, (a) each of the Commercial Milestone Payments set forth in this Section 4.2.2 (Commercial Milestones) will be payable only once (b) no Commercial Milestone Payment shall be payable for subsequent or repeated achievements of such Commercial Milestone Event with respect to [***], and (c) no more than [***] shall be payable to AstraZeneca under this Section 4.2.2. 

	
 

Commercial Milestone Events applicable for the Territory
	
Commercial Milestone Payments

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

 

4.2.3.Determination That Milestones Have Occurred.  Licensee shall notify AstraZeneca of the achievement or occurrence of each Milestone Event set forth in Section 4.2.1 (Development Milestones) or Section 4.2.2 (Commercial Milestones) in accordance with Section 4.2.4 (Invoicing and Payment). In the case of the Commercial Milestones, whether they have been met will be assessed by Licensee within [***] days after the end of each Calendar Quarter once sales begin, and shall [***]. In the event that, notwithstanding the fact that Licensee has not provided AstraZeneca such a notice, AstraZeneca believes that any such Milestone Event has been achieved, it shall so notify Licensee in writing and the Parties shall promptly discuss in good faith whether such Milestone Event has been achieved; provided that the Commercial Milestones will only be evaluated on the timeline provided in the foregoing sentence and AstraZeneca shall not have the right to accelerate their assessment under this sentence.  Any dispute under this Section 4.2.3 (Determination That Milestones Have Occurred) regarding whether or not such a Milestone Event has been achieved shall be subject to resolution in accordance with Section 10.5 (Dispute Resolution). 

22 | Page

 

Confidential

4.2.4.Invoicing and Payment. Licensee shall give AstraZeneca written notice of the achievement of each milestone event in Section 4.2.1 (Development Milestones) or Section 4.2.2 (Commercial Milestones) no later than [***] Business days after learning such achievement (and subject to the timing for Commercial Milestone Events as set forth in Section 4.2.3).  Following receipt of such notice, AstraZeneca shall submit an invoice to Licensee for the full amount of the corresponding milestone, which amount shall be payable within [***] days of the date of invoice. 

4.3.Royalties.  

4.3.1.Royalty Rates.  Subject to Section 4.3.2 (Reductions), during the Royalty Term, Licensee shall pay AstraZeneca a royalty based on the corresponding amount of incremental Net Sales of all Licensed Products in the Territory multiplied by the applicable royalty rate (i.e., each tier of Net Sales shall be multiplied by the royalty rate applicable to such tier) in each Calendar Year, as set forth below (the “Royalty Payments”).  For each Calendar Year, the below tiered royalties shall be calculated such that the higher tiered royalty rates are only used after Net Sales in each Calendar Year exceed the top threshold of the previous tier and such higher tiered royalty rate will only apply to the portion of Net Sales that falls within that tier.

		
	
That portion of Net Sales of all Licensed Products in the Territory in a Calendar Year that is:
	
Royalty Rate

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

	
[***]
	
[***]

 

As an example, in a Calendar Year in which there are [***] in Net Sales, the amount would be calculated as [***] due in royalty.

4.3.2.Reductions.

(a)Reductions for Third Party Patent Rights. Subject to Section 4.3.2(c), if Licensee enters into an agreement with a Third Party in order to obtain a license to a Third Party Patent Right with respect to a Licensed Product that Licensee in good faith determines is necessary to Exploit such Licensed Product or to avoid claims of Infringement related to Exploitation of such Licensed Product in the Field in a country in the Territory, Licensee shall be entitled to deduct from royalties payable hereunder in a given Calendar Year with respect to such Licensed Product in such country [***] paid to such Third Party in such Calendar Year under such license [***] to such Third Party Patent Right.

23 | Page

 

Confidential

(b) Expiration of Valid Claims and Reduction for Generic Products.  Subject to Section 4.3.2(c), if, during the Royalty Term for a Licensed Product in a country in the Territory, (i) the Exploitation of such Licensed Product is no longer Covered by any Valid Claim (or, for clarity such Licensed Product is never Covered by a Valid Claim) in such country, and (ii) any Third Party launches a Generic Product in that country; then the royalties payable pursuant to Section 4.3.1 shall be reduced in accordance with the following process: 

	
 
	
(1)
	
On a country-by-country and Licensed Product-by-Licensed Product basis, at any time during the Royalty Term after the expiration of Valid Claims that Cover such Licensed Product in such country, then the royalty rates of Section 4.3. shall each be reduced by [***]; 

	
 
	
(2)
	
If at any time [***] makes Generic Products of a Licensed Product commercially available in that country in the Territory and the unit sales of all Generic Products in such country in a Calendar Year, exceed [***] of the sum of unit sales of such Licensed Product and all Generic Products in such country, then the royalty rate applicable to Net Sales of such Licensed Product in such country shall be reduced by [***]. 

(c)[***]

4.3.3.Royalty Term.  Licensee shall have no obligation to pay any royalty with respect to Net Sales of any Licensed Product in any country after the Royalty Term for such Licensed Product in such country has expired. 

4.3.4.No Multiple Royalties.  The rates set forth in Section 4.3.1 shall not be modified for multiple Valid Claims Covering the applicable Licensed Product (i.e., the rates are the same whether it is one Valid Claim that Covers or if multiple Valid Claims Cover).

4.4.Sublicensing Payment.  In the event that Licensee and a Third Party enter into a sublicense agreement [***] pursuant to which Licensee grants a sublicense to such Third Party for substantially all of Licensee’s rights to the Licensed Product(s) or the Licensed Compound(s) in the Field in one or more countries in the Territory, within [***] of Sublicensing Income [***] under such sublicense agreement, Licensee shall pay to AstraZeneca an amount (“Sublicensing Payment”) equal to [***]. To the extent that Licensee at the same time as wishing to sublicense its rights under this Agreement to the AstraZeneca Patents, [***] Combination Patents, AstraZeneca Know-How, AstraZeneca Regulatory Documentation, or Combination Data (“AstraZeneca IP Sublicense”) also wishes to out-license or sub-license any other intellectual property rights (the “Other IP Sublicense”), then Licensee shall use Commercially Reasonable Efforts to separate the AstraZeneca IP Sublicense and the Other IP Sublicense into two (2) separate agreements with separate financial terms. Only to the extent that it is not possible to enter into two (2) such separate agreements and Licensee as a result will have to enter into one (1) sole sublicensee Agreement (the “Combined Sublicense Agreement”), then the portion of the consideration received by Licensee or its Affiliates under the Combined Sublicense Agreement for 

24 | Page

 

Confidential

which said [***] applies shall be [***] between the AstraZeneca Patents, [***] Combination Patents, AstraZeneca Know-How, AstraZeneca Regulatory Documentation, Combination Data and those other rights, and such apportionment shall be reasonable and in accordance with customary standards in the industry.  Licensee shall promptly deliver to AstraZeneca a written report setting forth such [***].  In the event AstraZeneca disagrees with the determination made by Licensee, AstraZeneca shall so notify Licensee within [***] of receipt of Licensee’s report and the parties shall meet to discuss and resolve such disagreement in good faith.  If the parties are unable to agree in good faith as to such fair market values within [***] Business Days, then such matter shall be submitted for resolution pursuant to Section 10.6.  

4.5.Payments and Reports.  Licensee shall calculate all amounts payable to AstraZeneca pursuant to Sections 4.1 (Milestone Payments), 4.3 (Royalties) and 4.4 (Sublicensing Payment) at the end of each Calendar Quarter, which amounts shall be converted to US Dollars, in accordance with Section 4.6 (Mode of Payment; [***]).  Licensee shall pay to AstraZeneca the Royalty Payments due with respect to a given Calendar Quarter within [***] days after the end of such Calendar Quarter, provided however that should such Calendar Quarter coincide with Licensee’s financial year end, Licensee shall pay within [***] after the end of such date.  Each Royalty Payment due to AstraZeneca shall be accompanied by a statement specifying, on a Licensed Product-by-Licensed Product basis, the amount of Invoiced Sales, Net Sales and deductions taken to arrive at Net Sales attributable to each Licensed Product in each country in the Territory during the applicable Calendar Quarter (including such amounts expressed in local currency and as converted to US Dollars) and a calculation of the amount of Royalty Payment due on such Net Sales for such Calendar Quarter.  Without limiting the generality of the foregoing, Licensee shall require its Affiliates and Sublicensees to account for their Net Sales and to provide such reports with respect thereto as if such sales were made by Licensee. 

4.6.Mode of Payment[***].  All Payments shall be made by deposit of US Dollars in immediately available cleared funds in the requisite amount (for clarity, net of applicable withholding taxes as provided in Section 4.7.1, if any),  to such bank account as AstraZeneca may from time to time designate by notice to Licensee.  For the purpose of calculating any sums due under, or otherwise reimbursable pursuant to, this Agreement (including the calculation of Net Sales expressed in currencies other than US Dollars), Licensee shall convert any amount expressed in a foreign currency into US Dollar equivalents using its, its Affiliate’s or Sublicensee’s standard conversion methodology consistent with the applicable Accounting Standard.  As between the Parties, Licensee shall be solely responsible for any foreign exchange requirements for converting a foreign currency into a Dollar equivalent.  Licensee shall take, or shall cause its Affiliates or their Sublicensees to take, all actions required by Applicable Law for the purpose of transferring, or having transferred on its behalf, milestones, royalties or any other payments to AstraZeneca, directly or indirectly, pursuant to this Agreement, or to Licensee pursuant to the applicable sublicense agreement, including filing or registration of the relevant sublicense agreement(s) between Licensee and its Affiliates or Sublicensees with the competent Governmental Authority and obtaining any required approval, permit or license for the payment transfer from the competent Governmental Authority. [***].

25 | Page

 

Confidential

4.7.Taxes.

4.7.1.Tax Responsibilities.  The amounts payable pursuant to this Agreement shall not be reduced on account of any Taxes and shall be made without any withholding unless required by Applicable Law. The Licensor alone shall be responsible for paying to the appropriate Tax authority any and all Taxes (other than withholding taxes required by Applicable Laws and Regulations to be paid by the Licensee) levied on account of, or measured in whole or in part by reference to, any Payments to which it is entitled.  If any deductions or withholdings are required by Applicable Law to be made from any Payment, Licensee shall make timely payment to the proper Governmental Authority of the withheld amount and send to AstraZeneca proof of such payment within [***] days following such payment to enable AstraZeneca to claim such payment of Taxes on AstraZeneca’s applicable tax returns.  If any such payment must be made by Licensee, Licensee shall have the right to deduct such amount required to be withheld and paid on behalf of AstraZeneca from the Payments due to AstraZeneca under this Agreement; provided that Licensee shall be required to make the payments to the Government Authority in a timely manner.  If AstraZeneca is entitled under any applicable Tax treaty to a reduction of rate of, or the elimination of, applicable withholding Tax, it shall deliver to Licensee or the appropriate Governmental Authority (with the assistance of Licensee to the extent that this is reasonably required and is requested in writing) the prescribed forms necessary to reduce the applicable rate of withholding or to relieve Licensee of its obligation to withhold such Tax, and Licensee shall apply the reduced rate of withholding or dispense with withholding, as the case may be; provided that Licensee has received evidence of AstraZeneca’s delivery of all applicable forms (and, if necessary, its receipt of appropriate governmental authorization) [***] days prior to the time that the Payments are due.  If the Licensee withholds any Taxes from the Payments while the Licensor is entitled under any applicable tax treaty to a reduction of rate of, or the elimination of, applicable withholding tax, the Licensee shall cooperate with the Licensor with respect to any documentation required by the appropriate Governmental Authority or reasonably requested by the Licensor to secure a reduction of the rate of, or the elimination of, the applicable Taxes withheld or to secure a repayment of any Taxes withheld by the Paying Party from an applicable Governmental Authority.

4.7.2.[***]

4.7.3.If a party (or any of its Affiliates) receives and uses a credit for, or receives a refund of, any Tax by reason of any deduction or withholding or gross up on account of tax made pursuant to Section 4.7.2 then that party shall reimburse to the other party such amount as will leave it (and its Affiliates) (after such reimbursement) in the same position it would have been if that other party had not been required to make payment under Section 4.7.2.  Each party shall use (or procure the relevant Affiliate uses) all reasonable endeavours to obtain and utilise any available credit or obtain any refund.

4.7.4.Value Added Tax. Notwithstanding anything contained in Section 4.7.1, this Section 4.7.2 shall apply with respect to value added tax (“VAT”).  All Payments are exclusive of VAT.  If any VAT is chargeable in respect of any Payments, Licensee shall pay VAT at the applicable rate in respect of any such Payments following the receipt of a VAT invoice, issued in the appropriate form by AstraZeneca in respect of those Payments, such VAT to be payable on the later of [***] by Licensee of the applicable invoice relating to that VAT payment. AstraZeneca will provide Licensee any information or copies of documentation in AstraZeneca’s control as are 

26 | Page

 

Confidential

reasonably necessary for Licensee to reclaim, if applicable, such VAT.  The Parties will issue invoices for all amounts due under this Agreement consistent with indirect Tax requirements.   

4.8.Interest on Late Payments.  If any payment due to either Party under this Agreement is not paid when due, then such paying Party shall pay interest thereon (before and after any judgment) at an annual rate equal to the lessor of (i)  [***] above the Reference Rate, and (ii) the maximum rate permitted under Applicable Law. Any interest will accrue from day to day and is calculated based on the actual number of days elapsed from the payment due date to the actual payment date and [***]. Interest is compounded daily.  

4.9.Financial Records.  Licensee shall and shall cause its Affiliates and its and their Sublicensees to, keep complete and accurate financial books and records pertaining to the Commercialization of Licensed Products hereunder, including books and records of Invoiced Sales and Net Sales of Licensed Products, in sufficient detail to calculate and verify all amounts payable hereunder.  Licensee shall and shall cause its Affiliates and its and their Sublicensees to, retain such books and records until [***] as may be required by Applicable Law.  

4.10.Audit.  At the request of AstraZeneca, Licensee shall and shall cause its Affiliates and its and their Sublicensees to, permit AstraZeneca to have a nationally recognized, independent, certified public accounting firm designated by AstraZeneca and subject to Licensee’s prior written consent (which shall not be unreasonably withheld, conditioned or delayed), once annually, during regular business hours, upon reasonable notice (which shall be no less than [***] days’ prior written notice), and under strict obligations of confidentiality and limited use (use limited to conducting and reporting the results of the audit), to audit the books and records maintained pursuant to Section 4.9 (Financial Records) solely to ensure the accuracy of all reports and payments made hereunder within the [***] period preceding the date of the request for review. No Calendar Year will be subject to audit under this Section 4.10 more than once.  Licensee will receive a copy of each such report concurrently with receipt by AstraZeneca.   Except as provided below, the cost of this audit shall be borne by AstraZeneca, unless the audit reveals, with respect to a period, an underpayment by Licensee of more than [***] from the reported amounts for such period, in which case Licensee shall bear the cost of the audit.  Unless disputed pursuant to Section 4.11 (Audit Dispute), if such audit concludes that (i) additional amounts were owed by Licensee, Licensee shall pay the additional amounts, with interest from the date originally due as provided in Section 4.8 (Interest on Late Payments) or (ii) excess payments were made by Licensee, AstraZeneca shall reimburse Licensee such excess payments (or, at Licensee’s option, credit such amounts against future payments payable to AstraZeneca under this Agreement), in either case ((i) or (ii)), within [***] after the date on which such audit is completed by AstraZeneca.  

4.11.Audit Dispute.  In the event of a dispute with respect to any audit under Section 4.10 (Audit), AstraZeneca and Licensee shall work in good faith to resolve the disagreement.  If the Parties are unable to reach a mutually acceptable resolution of any such dispute within [***] days, the dispute shall be submitted for resolution to a certified public accounting firm jointly selected by each Party’s certified public accountants or to such other Person as the Parties shall mutually agree (the “Auditor”).  [***].

27 | Page

 

Confidential

ARTICLE 5
INTELLECTUAL PROPERTY 

5.1.Ownership of Intellectual Property. 

5.1.1.Ownership of Technology.  As between the Parties, each Party shall own and retain all rights, title and interests in and to any and all:  (a) Inventions that are conceived, discovered, developed or otherwise made by or on behalf of such Party or its Affiliates or its or their (sub)licensees (or Sublicensee(s)), as applicable, under or in connection with this Agreement, solely, with one another, or jointly with Third Parties, but not with the other Party or the other Party’s Affiliates, whether or not patented or patentable, and any and all Patents and other intellectual property rights with respect thereto; and (b) other Inventions and other intellectual property rights that are Controlled (other than pursuant to the license grants set forth in Section 2.1 (Grants to Licensee)) by such Party or its Affiliates or its or their (sub)licensees (or Sublicensees) (as applicable) outside of this Agreement. The Parties shall jointly own any patentable Inventions that are conceived jointly by inventors from each Party (with each Party for this purpose being deemed to include its Affiliates) and all Patents that may be filed with respect thereto (“Joint Inventions”). [***], and AstraZeneca’s interest in Joint Inventions shall be deemed included in the intellectual property exclusively licensed to Licensee in Section 2.1. Each Party shall, and does hereby, assign, and shall cause its Affiliates and its and their (sub)licensees and Sublicensees to so assign, to the other Party, without additional compensation, such rights, title and interests in and to any Inventions as well as any intellectual property rights with respect thereto, as is necessary to fully effect the sole and joint ownership worldwide provided for in Sections 5.1.1 (Ownership of Technology), 5.1.4  (Ownership of Product Trademarks) and 5.1.5 (Ownership of Corporate Names).

5.1.2.Determination of Inventorship.  The determination of whether any Inventions are conceived, discovered, developed or otherwise made by a Party for the purpose of allocating proprietary rights (including Patent, copyright or other intellectual property rights) therein, shall, for purposes of this Agreement and notwithstanding Section 10.7 (Governing Law), be made in accordance with United States patent laws for determining inventorship (excluding any conflicts or choice of law rule or principle) as such law exists as of the Effective Date irrespective of where or when such conception, discovery, development or making occurs.

5.1.3.Assignment Obligation.  Each Party shall cause all Persons who perform Development activities, Manufacturing activities, or regulatory activities for such Party or its Affiliates under this Agreement, or who conceive, discover, develop, invent or otherwise make any Inventions by or on behalf of such Party or its Affiliates or its or their (sub)licensees under or in connection with this Agreement, to be under an obligation to assign (or, if such Party is unable to cause such Person to agree to such assignment obligation despite such Party’s using commercially reasonable efforts to negotiate such assignment obligation, then to grant an exclusive license under) their rights in such Inventions resulting therefrom to such Party, or its Affiliates or Sublicensees, except where Applicable Law requires otherwise and except in the case of governmental, not-for-profit, and public institutions that have standard policies against such an assignment (in which case, a suitable license, or right to obtain such a license, shall be obtained).  Notwithstanding the foregoing, Licensee may engage outside contractors in support of its activities hereunder (for example, contract manufacturing organizations) without obtaining such an 

28 | Page

 

Confidential

assignment of Inventions are not solely related to the Licensed Compound or Licensed Product; [***].

5.1.4.Ownership of Product Trademarks.  As between the Parties, Licensee shall own all rights, title and interests to the Product Trademarks in the Territory.

5.1.5.Ownership of Corporate Names.  As between the Parties, AstraZeneca shall retain all rights, title and interests in and to AstraZeneca Corporate Names and Licensee shall retain all rights, title and interests in and to Licensee Corporate Names.  

5.2.Maintenance and Prosecution of Patents. 

5.2.1.In General.

(a)Licensee shall have (i) the right and obligation, through counsel of its choice, to prepare, file, prosecute, maintain, and have final decision making authority with respect to the preparation, filing, prosecution and maintenance of, all AstraZeneca Patents, and (ii) the sole right (but not obligation), through counsel of its choice, to prepare, file, prosecute, maintain, and have final decision making authority with respect to the preparation, filing, prosecution and maintenance of any Licensee Patents, including, for both (i) and (ii), directing any related interference, re-issuance, re-examination and opposition proceedings with respect thereto.  Licensee will have the right, to include in any Patent (including any Patent filed by Licensee), any AstraZeneca Specific Know-How, provided that if and to the extent that the inclusion of any such AstraZeneca Specific Know-How in any such Patent results in AstraZeneca having an ownership interest in such Patent (or any other Patent that claims priority, in whole or in part, directly or indirectly, to such Patent), then such Patent (and any such other Patents) will automatically be treated as “AstraZeneca Patents” hereunder for all purposes.  

(b)Licensee shall bear all costs and expenses in connection with the preparation, filing, prosecution and maintenance of all AstraZeneca Patents, as well as the Licensee Patents that Licensee elects to file patent protection for and retain final decision-making authority with respect to such Patents in the Territory;

(c)In the event that Licensee elects not to seek patent protection for or decides to abandon before all appeals within the respective patent office have been exhausted any AstraZeneca Patent in the Territory, Licensee shall so notify AstraZeneca, and AstraZeneca may take over the preparation, filing, prosecution and maintenance of any such AstraZeneca Patent at its sole cost and expense;

(d)  AstraZeneca shall have (i) the right and obligation, through counsel of its choice, to prepare, file, prosecute, maintain, and have final decision making authority with respect to the preparation, filing, prosecution and maintenance of, all [***] Combination Patents, including directing any related interference, re-issuance, re-examination and opposition proceedings with respect thereto. AstraZeneca will have the right, to include in any Patent (including any Patent filed by Licensee), any AstraZeneca Specific Know-How.  AstraZeneca shall afford the Licensee a reasonable opportunity to comment upon AstraZeneca’s preparation, filing, prosecution, and maintenance of the [***] Combination Patents, including providing patent authority communications promptly upon receipt, and providing draft of filings and responses to 

29 | Page

 

Confidential

office actions [***] days in advance or such shorter time period as may be reasonable under exigent circumstances, and reasonably considering the Licensee’s timely comments thereon.

(e)AstraZeneca shall bear all costs and expenses in connection with the preparation, filing, prosecution and maintenance of all [***] Combination Patents that AstraZeneca elects to file patent protection for and retain final decision-making authority with respect to such Patents in the Territory;

(f)In the event that AstraZeneca elects not to seek patent protection for or decides to abandon before all appeals within the respective patent office have been exhausted any [***] Combination Patent in the Territory, AstraZeneca shall so notify Licensee, and Licensee may take over the preparation, filing, prosecution and maintenance of any such [***] Combination Patent at its sole cost and expense. 

5.2.2.Cooperation.  The Parties shall, and shall cause their Affiliates to, assist and cooperate with each other, as such requesting Party may reasonably request from the other Party from time to time, in the preparation, filing, prosecution and maintenance of the AstraZeneca Patents and the [***] Combination Patents.   Without limiting the foregoing, each Party shall, and shall cause its Affiliates to (a) offer its or their comments, if any, promptly and (b) provide access to relevant documents and other evidence and make its or their employees available at reasonable business hours, to the extent reasonably necessary for the preparation, filing, prosecution and maintenance of the AstraZeneca Patents and [***] Combination Patents; provided, however, that neither Party shall be required to provide legally privileged information with respect to such intellectual property unless and until procedures reasonably acceptable to such Party are in place to protect such privilege; and provided, further, that the requesting Party shall reimburse the other Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.  

5.2.3.Patent Term Extension and Supplementary Protection Certificate.  

(a)Licensee shall also have the sole right to make decisions regarding, and the sole right to apply for, patent term extensions for any AstraZeneca Patent or Licensee Patent, including in the United States with respect to extensions pursuant to 35 U.S.C. §156 et. seq. and in other jurisdictions pursuant to supplementary protection certificates, and in all jurisdictions with respect to any other extensions that are now or become available in the future, wherever applicable, for the AstraZeneca Patents, and any Licensee Patents and with respect to the Licensed Compounds and the Licensed Products, in each case including whether or not to so apply, provided that with respect to AstraZeneca Patents, Licensee shall consult with AstraZeneca and consider in good faith AstraZeneca’s comments whether or not to so apply and the course of action with respect to such filings.  AstraZeneca shall provide prompt and reasonable assistance, as requested by the Licensee, including by taking such action as patent holder as is required under any Applicable Law to obtain such extension or supplementary protection certificate.

(b)AstraZeneca shall have the sole right to make decisions regarding, and the sole right to apply for, patent term extensions for any [***] Combination Patents, including in the United States with respect to extensions pursuant to 35 U.S.C. §156 et. seq. and in other jurisdictions pursuant to supplementary protection certificates, and in all jurisdictions with respect 

30 | Page

 

Confidential

to any other extensions that are now or become available in the future, wherever applicable for the [***] Combination Patents including whether or not to so apply, provided that AstraZeneca shall consult with Licensee and consider in good faith Licensee’s comments whether or not to so apply and the course of action with respect to such filings, and AstraZeneca shall [***].  Licensee shall provide prompt and reasonable assistance, as requested by AstraZeneca, including by taking such action as is required under any Applicable Law to obtain such extension or supplementary protection certificate. 

5.3.Enforcement of Patents.

5.3.1.Notice.  Each Party shall promptly notify the other Party in writing of any actual, alleged or threatened infringement of the AstraZeneca Patents, [***] Combination Patents or the Licensee Patents in the Territory of which such Party becomes aware (an “Infringement”).  

5.3.2.Enforcement of Patents.  

(a)As between the Parties, Licensee shall have (a) the sole right, but not the obligation, to prosecute any Infringement with respect to the Licensee Patents, and (b) the first right, but not the obligation, to prosecute any Infringement with respect to the AstraZeneca Patents, in each case (a) and (b), using counsel of its choice. As between the Parties, AstraZeneca shall have the first right, but not the obligation, to prosecute any Infringement with respect to the [***] Combination Patents, using counsel of its choice.

(b) In respect of the AstraZeneca Patents, if Licensee fails to bring any such action or proceeding within [***] days of a request by AstraZeneca to do so or if Licensee earlier notifies AstraZeneca in writing of its intent not to bring such action or proceeding, then AstraZeneca will have the right (but not the obligation) to bring any such action or proceeding by counsel of its own choice. In respect of the [***] Combination Patents, if AstraZeneca fails to bring any such action or proceeding within [***] days of a request by Licensee to do so or if AstraZeneca earlier notifies Licensee in writing of its intent not to bring such action or proceeding, then Licensee will have the right (but not the obligation) to bring any such action or proceeding by counsel of its own choice. From and after the date of such assumption in accordance with this Section 5.3(b), such Party shall be deemed to be the “Enforcing Party” for the purposes of this Section 5.3 (Enforcement of Patents) (but not for purposes of any other Section of this Agreement) with respect to such Patent.  

5.3.3.Costs of Enforcement.  The Enforcing Party shall solely bear the cost and expenses incurred by it (or any Affiliate of Enforcing Party) in connection with any enforcement actions taken pursuant to this Section 5.3 (Enforcement of Patents).

5.3.4.Cooperation.  The Parties shall cooperate fully in any Infringement action pursuant to this Section 5.3 (Enforcement of Patents), including by making the inventors, applicable records, and documents (including laboratory notebooks) with respect to the relevant Patents available to the Enforcing Party on the Enforcing Party’s request.  With respect to an action controlled by the applicable Enforcing Party, the other Party shall, and shall cause its Affiliates to, assist and cooperate with the Enforcing Party, as the Enforcing Party may reasonably request from time to time, in connection with its activities set forth in this Section 5.3 (Enforcement of Patents), 

31 | Page

 

Confidential

including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided that the Enforcing Party shall reimburse such other Party for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.  Unless otherwise set forth herein, the Enforcing Party shall have the right to settle such claim; provided that neither Party shall have the right to settle any Infringement litigation under this Section 5.3 (Enforcement of Patents) in a manner that has a material adverse effect on the rights or interests of the other Party (including any impact upon the exclusivity of any exclusive license to Licensee hereunder) or in a manner that imposes any costs or liability on, or involves any admission by, the other Party, without the express written consent of such other Party (which consent shall not be unreasonably withheld, conditioned or delayed). In connection with any activities with respect to an Infringement action prosecuted by the applicable Enforcing Party pursuant to this Section 5.3 (Enforcement of Patents) involving Patents exclusively licensed under Article 2 (Grant of Rights) to the other Party, the Enforcing Party shall (a) consult with the other Party as to the strategy for the prosecution of such claim, suit, or proceeding, (b) consider in good faith any comments from the other Party with respect thereto, and (c) keep the other Party reasonably informed of any material steps taken, and provide copies of all material documents filed, in connection with such action.

5.3.5.Recovery.  Except as otherwise agreed by the Parties in writing in connection with a cost sharing arrangement, any recovery realized as a result of such litigation described above in this Section 5.3 (Enforcement of Patents) (whether by way of settlement or otherwise) with respect to AstraZeneca Patents shall be first allocated to reimburse the Parties for their out-of-pocket costs and expenses in making such recovery (which amounts shall be allocated pro rata if insufficient to cover the totality of such costs and expenses).  Any remainder after such reimbursement is made shall be allocated [***].

5.4.Infringement Claims by Third Parties.  If the Exploitation of the Licensed Compounds or the Licensed Products in the Territory results in, or is reasonably expected to result in, any claim, suit or proceeding by a Third Party alleging Infringement by Licensee or any of its Affiliates or its or their Sublicensees, distributors or customers, including any defense or counterclaim in connection with an Infringement action initiated pursuant to Section 5.3.2 (Enforcement of Patents) (a “Third Party Infringement Claim”), the Party first becoming aware of such alleged Infringement shall promptly notify the other Party thereof in writing.  As between the Parties, Licensee shall have the first right to defend against any such Third Party Infringement Claim, using counsel of Licensee’s choice, and Licensee shall solely bear all costs and expenses (including any damages, awards, royalties, settlement amounts and other liabilities) incurred by Licensee or any of its Affiliates or its or their Sublicensees, distributors or customers in connection with such Third Party Infringement Claim. AstraZeneca may participate in any such claim, suit or proceeding with counsel of its choice at its sole cost and expense; provided that Licensee shall retain the right to control such claim, suit or proceeding.  AstraZeneca shall, and shall cause its Affiliates to, assist and cooperate with Licensee, as Licensee may reasonably request from time to time, in connection with its activities set forth in this Section 5.4 (Infringement Claims by Third Parties), including, where necessary, furnishing a power of attorney solely for such purpose or joining in, or being named as a necessary party to, such action, providing access to relevant documents and other evidence, and making its employees available at reasonable business hours; provided that Licensee shall reimburse AstraZeneca for its reasonable and verifiable out-of-pocket 

32 | Page

 

Confidential

costs and expenses incurred in connection therewith.  If Licensee or its designee does not take commercially reasonable steps to defend against such claim, suit or proceeding within [***] days following the first notice provided above with respect to such Third Party Infringement Claim or, provided such date occurs after the first such notice of such Third Party Infringement Claim is provided, [***] Business Days before the time limit, if any, set forth in Applicable Law for filing of such actions, whichever comes first, then (a) Licensee shall so notify AstraZeneca and (b) AstraZeneca may defend at its discretion against such Third Party Infringement Claim at its sole cost and expense; provided that AstraZeneca shall not enter into any settlement of any claim described in this Section 5.4 that incurs any financial liability on the part of Licensee, requires an admission of liability, wrongdoing or fault on the part of Licensee, without Licensee’s prior written consent, in each case, such consent not to be unreasonably withheld, conditioned or delayed.

5.5.Invalidity or Unenforceability Defenses or Actions. 

5.5.1.Each Party shall promptly notify the other Party in writing of any alleged or threatened assertion of invalidity or unenforceability of any of the AstraZeneca Patents, [***] Combination Patents, or Licensee Patents by a Third Party of which such Party becomes aware.

5.5.2.Licensee shall have the first right, but not the obligation to defend and control the defense of the validity and enforceability of the AstraZeneca Patents, using counsel of Licensee’s choice, including when such invalidity or unenforceability is raised as a defense or counterclaim in connection with an Infringement action initiated pursuant to Section 5.3 (Enforcement of Patents).  Licensee shall solely bear the cost and expense of such defenses that it elects to undertake worldwide, including for any costs and expenses incurred in connection with any such defense in the Territory in the Field. In connection with any activities with respect to a defense, claim or counterclaim relating to the AstraZeneca Patents, pursuant to this Section 5.5 (Invalidity or Unenforceability Defenses or Actions), Licensee shall (a) consult with AstraZeneca as to the strategy for such activities, (b) consider in good faith any comments from AstraZeneca, and (c) keep AstraZeneca reasonably informed of any material steps taken and provide copies of all material documents filed, in connection with such defense, claim or counterclaim. Licensee shall not enter into any settlement of any claim described in this Section 5.5 that admits to the invalidity, narrowing of scope or unenforceability of the AstraZeneca Patents or this Agreement without AstraZeneca’s prior written consent, in each case, such consent not to be unreasonably withheld, conditioned or delayed.   If Licensee decides not to defend and control the defense of the validity or enforceability of any AstraZeneca Patent, then Licensee shall so notify AstraZeneca and AstraZeneca may choose to defend and control the defense of the validity or enforceability of any AstraZeneca Patent at its sole cost and expense.

5.5.3.AstraZeneca shall have the first right, but not the obligation to defend and control the defense of the validity and enforceability of the [***] Combination Patents, using counsel of AstraZeneca’s choice, including when such invalidity or unenforceability is raised as a defense or counterclaim in connection with an Infringement action initiated pursuant to Section 5.3 (Enforcement of Patents).  AstraZeneca shall solely bear the cost and expense of such defenses that it elects to undertake worldwide, including for any costs and expenses incurred in connection with any such defense in the Territory in the Field. In connection with any activities with respect to a defense, claim or counterclaim relating to the [***] Combination Patents, pursuant to this Section 5.5 (Invalidity or Unenforceability Defenses or Actions), AstraZeneca shall keep Licensee 

33 | Page

 

Confidential

reasonably informed of any material steps taken and provide copies of all material documents filed, in connection with such defense, claim or counterclaim. AstraZeneca shall not enter into any settlement of any claim described in this Section 5.5 that admits to the invalidity, narrowing of scope or unenforceability of the [***] Combination Patents or this Agreement without Licensee’s prior written consent, in each case, such consent not to be unreasonably withheld, conditioned or delayed.   If AstraZeneca decides not to defend and control the defense of the validity or enforceability of any [***] Combination Patents, then AstraZeneca shall so notify Licensee and Licensee may choose to defend and control the defense of the validity or enforceability of any [***] Combination Patents at its sole cost and expense.  

5.6.Third Party Patent Rights.  If in the reasonable opinion of Licensee, the Exploitation of any Licensed Compound or any Licensed Product in the Field and in the Territory by Licensee, any of its Affiliates or any of its or their Sublicensees or distributors or customers infringes or is reasonably expected to infringe (or, may become subject to claims by a Third Party of Patent infringement, whether or not the claims are considered to be valid and correct) any Patent of a Third Party in the Territory (such right, a “Third Party Patent Right”), then, as between the Parties, Licensee shall have the first right, but not the obligation, to negotiate and obtain a license from such Third Party to such Third Party Patent Right as necessary or desirable for Licensee or its Affiliates or its or their Sublicensees or distributors or customers to Exploit the Licensed Compounds and Licensed Products in the Field in the Territory; provided that [***]. In case this Section 5.6 (Third Party Patent Rights) is applicable, the royalty reductions in Section 4.3.2(a) (Reductions for Third Party Patent Rights) will apply.

5.7.Product Trademarks.  

5.7.1.Prosecution of Product Trademarks.  Licensee shall have the sole right to register, prosecute and maintain the Product Trademarks using counsel of its own choice.  All costs and expenses of registering, prosecuting and maintaining the Product Trademarks in the Territory shall be borne solely by Licensee. 

5.7.2.Enforcement of Product Trademarks. Each Party shall provide to the other Party prompt written notice of any actual or threatened Infringement of the Product Trademarks in the Territory and of any actual or threatened claim that the use of the Product Trademarks in the Territory violates the rights of any Third Party, in each case, of which such Party becomes aware. Licensee shall have the sole right, but not the obligation, to take such action as Licensee, deems necessary against a Third Party based on any alleged, threatened or actual Infringement, dilution, misappropriation or other violation of or unfair trade practices or any other like offense relating to, the Product Trademarks by a Third Party in the Territory at its sole cost and expense and using counsel of its own choice.  Licensee shall retain any damages or other amounts collected in connection therewith.

5.7.3.Third Party Claims. As between the Parties, Licensee shall defend against and settle any alleged, threatened or actual claim, suit or proceeding by a Third Party that the use or registration of the Product Trademarks in the Territory infringes, dilutes, misappropriates or otherwise violates any Trademark or other right of that Third Party or constitutes unfair trade practices or any other similar offense or any other claims, suits or proceedings as may be brought by a Third Party in connection with the use of the Product Trademarks with respect to a Licensed 

34 | Page

 

Confidential

Product in the Territory (“Third Party Trademark Claim”), using counsel of its choice, and Licensee shall solely bear all costs and expenses (including any damages, awards, royalties, settlement amounts and other liabilities) incurred by Licensee or any of its Affiliates or its or their Sublicensees, distributors or customers in connection with such Third Party Trademark Claim.  AstraZeneca shall, and shall cause its Affiliates to, assist and cooperate with Licensee, as Licensee may reasonably request from time to time, in connection with its activities set forth in this Section 5.7 (Product Trademarks); provided that Licensee shall reimburse AstraZeneca for its reasonable and verifiable out-of-pocket costs and expenses incurred in connection therewith.

5.8.Corporate Names.  The Parties shall not, and shall not permit their Affiliates or its or their sublicensees to, (a) use in their respective businesses, any Trademark that is confusingly similar to, misleading or deceptive with respect to or that dilutes any (or any part) of the AstraZeneca Corporate Names, in the case of Licensee, or the Licensee Corporate Names, in the case of AstraZeneca; (b) do any act that endangers, destroys or similarly affects, in any material respect, the value of the goodwill pertaining to the AstraZeneca Corporate Names, in the case of Licensee, or the Licensee Corporate Names, in the case of AstraZeneca; or (c) contest the validity of or ownership of the AstraZeneca Corporate Names, in the case of Licensee, or the Licensee Corporate Names, in the case of AstraZeneca, anywhere in the Territory or any registrations issued or issuing with respect thereto or any pending registration thereof.  Licensee agrees, and shall cause its Affiliates and Sublicensees, to conform (a) to the customary industry standards for the protection of the AstraZeneca Corporate Names and to such trademark usage guidelines as AstraZeneca may furnish from time to time with respect to the use of the AstraZeneca Corporate Names and (b) to adhere to and maintain the quality standards of AstraZeneca with respect to goods sold and services provided under the AstraZeneca Corporate Names.

ARTICLE 6
CONFIDENTIALITY AND NON-DISCLOSURE

6.1.Confidentiality Obligations.  At all times during the Term and for a period of [***] following termination or expiration hereof in its entirety, each Party shall and shall cause its officers, directors, employees and agents to, keep confidential and not publish or otherwise disclose to a Third Party and not use, directly or indirectly, for any purpose other than for the purposes of performing its obligations or exercising its rights under this Agreement, any Confidential Information furnished or otherwise made known to it, directly or indirectly, by the other Party, except to the extent such disclosure or use is expressly permitted by the terms of this Agreement. Confidential Information shall be disclosed only to employees and agents who have a need for such information and who are bound by obligations of nondisclosure and non-use at least as restrictive as those set forth herein.  Each Party shall be responsible for any disclosure or use of the Confidential Information by such employees or agents.  Each Party shall reasonably promptly notify the other Party of any intended, or unintended, unauthorized disclosure or use of any of the other Party’s Confidential Information. “Confidential Information” means any technical, business or other information provided by or on behalf of one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”) in connection with this Agreement, on or after the Effective Date, including to the extent so provided, information relating to the terms of this Agreement (subject to Section 6.4 (Press Release and Public Announcements)); any Licensed Compound or any Licensed Product (including the Regulatory Documentation and Combination Data); any Development or Commercialization of any Licensed Compound or any Licensed 

35 | Page

 

Confidential

Product; any know-how with respect thereto developed by or on behalf of the Disclosing Party or its Affiliates or the scientific, regulatory or business affairs or other activities of either Party.  Notwithstanding the foregoing, the terms of this Agreement shall be deemed to be the Confidential Information of both Parties and both Parties shall be deemed to be the Receiving Party and the Disclosing Party with respect thereto.  Notwithstanding the foregoing, the confidentiality and non-use obligations under this Section 6.1 (Confidentiality Obligations) with respect to any Confidential Information shall not include any information that:

(a)is or hereafter becomes public domain by public use, publication, general knowledge or the like through no breach of this Agreement by the Receiving Party;

(b)can be demonstrated by documentation or other competent proof to have been in the Receiving Party’s (or its Affiliates’) possession prior to disclosure by the Disclosing Party without any obligation of confidentiality with respect to such information; 

(c)is subsequently received by the Receiving Party from a Third Party who is not bound by any obligation of confidentiality with respect to such information;

(d)has been published by a Third Party or otherwise enters the public domain through no fault of the Receiving Party in breach of this Agreement; or

(e)can be demonstrated by documentation or other competent evidence to have been independently developed by or for the Receiving Party without reference to the Disclosing Party’s Confidential Information.

Specific aspects or details of Confidential Information shall not be deemed to be within the public domain or in the possession of the Receiving Party merely because the Confidential Information is embraced by more general information in the public domain or in the possession of the Receiving Party.  Further, any combination of Confidential Information shall not be considered in the public domain or in the possession of the Receiving Party merely because individual elements of such Confidential Information are in the public domain or in the possession of the Receiving Party unless the combination and its principles are in the public domain or in the possession of the Receiving Party.  For purposes of this Section 6.1, “public domain” means “publicly known” and does not refer to patentability.

6.2.Permitted Disclosures.  Each Party may disclose Confidential Information to the extent that such disclosure is:

6.2.1.made in response to a valid order of a court of competent jurisdiction or other supra-national, federal, national, regional, state, provincial and local governmental or regulatory body of competent jurisdiction or, as otherwise required by Applicable Law (including any securities laws or regulation or rules of a securities exchange), including by reason of filing with securities’ regulators; provided, however, that the Receiving Party shall first have given notice to the Disclosing Party and given the Disclosing Party a reasonable opportunity (and reasonable assistance if requested by the Disclosing Party) to quash such order or to obtain a protective order or confidential treatment requiring that the Confidential Information and documents that are the subject of such order be held in confidence by such court or agency or, if disclosed, be used only for the purposes for which the order was issued; and provided, further, that the Confidential 

36 | Page

 

Confidential

Information disclosed in response to such court or governmental order shall be limited to that information which is legally required to be disclosed in response to such court or governmental order;

6.2.2.made by or on behalf of the Receiving Party to the Regulatory Authorities as required in connection with any filing, application or request for Regulatory Approval; provided, however, that reasonable measures shall be taken to assure confidential treatment of such information to the extent practicable and consistent with Applicable Law;

6.2.3.made by or on behalf of the receiving Party to a patent authority as may be reasonably necessary or useful for purposes of obtaining or enforcing a Patent; provided, however, that reasonable measures shall be taken to assure confidential treatment of such information, to the extent such protection is available; or

6.2.4.made by or on behalf of the Receiving Party to potential or actual acquirers of all or substantially all of the business to which this Agreement relates, underwriters, investors, lenders or other financing sources, any bona fide actual or prospective collaborators or strategic partners, and in the case of Licensee to licensors, sublicensees, licensees in each case with respect to Licensed Compound and/or Licensed Product, and to employees, directors, agents, consultants and advisers of any such Third Party, in each case as may be necessary or useful in connection with their evaluation of such potential or actual acquisition, investment, collaboration or other transaction; provided, however, that such persons shall be subject to obligations of confidentiality and non-use with respect to such Confidential Information substantially similar to the obligations of confidentiality and non-use of the receiving Party pursuant to this Article 6 (Confidentiality and Non-Disclosure) (with a duration of confidentiality and non-use obligations as appropriate that is no less than [***] from the date of disclosure).

6.3.Use of Name.  Except as expressly provided herein, neither Party shall mention or otherwise use the name, logo or Trademark of the other Party or any of its Affiliates or any of its or their (sub)licensees (or Sublicensees) (or any abbreviation or adaptation thereof) in any publication, press release, marketing and promotional material or other form of publicity without the prior written approval of such other Party.  The restrictions imposed by this Section 6.3 (Use of Name) shall not prohibit (a) either Party from making any disclosure identifying the other Party to the extent required in connection with its exercise of its rights or obligations under this Agreement, or (b) either Party from making any disclosure identifying the other Party that is required by Applicable Law or the rules of a stock exchange on which the securities of the disclosing Party are listed (or to which an application for listing has been submitted).

6.4.Press Release and Public Announcements.  The Licensee will issue a press release substantially in the form attached as Schedule 6.4. Neither Party shall issue any other public announcement, press release or other public disclosure regarding this Agreement or its subject matter without the other Party’s prior written consent, such consent not to be unreasonably withheld, delayed or conditioned, except for any such disclosure that is, in the opinion of the Disclosing Party’s counsel, required by Applicable Law or the rules of a stock exchange on which the securities of the Disclosing Party are listed (or to which an application for listing has been submitted).  In the event a Party is, in the opinion of its counsel, required by Applicable Law or the rules of a stock exchange on which its securities are listed (or to which an application for listing 

37 | Page

 

Confidential

has been submitted) to make such a public disclosure, such Party shall submit the proposed disclosure in writing to the other Party as far in advance as reasonably practicable (and in no event less than [***] Business Days prior to the anticipated date of disclosure unless a faster disclosure timeline is, in such counsel’s opinion, required by Applicable Law) so as to provide a reasonable opportunity to comment thereon.  Neither Party shall be required to seek the permission of the other Party to repeat any information regarding the terms of this Agreement or any amendment hereto that has already been publicly disclosed by such Party or by the other Party, in accordance with this Section 6.4 (Press Release and Public Announcements); provided that such information remains accurate as of such time and provided the frequency and form of such disclosure are reasonable. 

6.5.Publications.  

6.5.1.The Parties recognize the desirability of publishing and publicly disclosing the results of and information regarding, activities under this Agreement.  Accordingly, Licensee shall be free to publicly disclose the results of and information regarding, activities under this Agreement, subject to prior review by AstraZeneca of any disclosure of AstraZeneca’s Confidential Information for issues of patentability and protection of such Confidential Information, in a manner consistent with Applicable Law and industry practices, as provided in this Section 6.5 (Publications).  Accordingly, prior to publishing or disclosing any Confidential Information of AstraZeneca, Licensee shall provide AstraZeneca with drafts of proposed abstracts, manuscripts or summaries of presentations that cover such Confidential Information at least [***] prior to submission to a Third Party.  AstraZeneca shall respond promptly through its designated representative and no later than [***] upon receiving such drafts, manuscripts or summaries from Licensee. Failure to respond within such [***], as applicable, shall be deemed approval to publish or present. Licensee agrees to comply with AstraZeneca’s request to delete references to AstraZeneca’s Confidential Information in any such paper and to allow a reasonable period [***] necessary to permit filings for patent protection.  

6.5.2.With respect to the publications listed on Schedule 6.5 regarding information generated in the studies identified therein, AstraZeneca (or its bona fide collaborators) shall have the right to publish any results or information regarding the Licensed Compound or the Licensed Products, or any activities under the applicable Ongoing Study Agreement, without Licensee’s prior written consent. [***], AstraZeneca shall (i) provide Licensee with an opportunity to review draft publications and shall consider in good faith any comments with respect to the Licensed Compound or Licensed Product provided by Licensee with respect thereto and, (ii) comply with Licensee’s request to delete references to Licensee’s Confidential Information in any such publication and to allow a reasonable period [***] necessary to permit filings for patent protection, provided that AstraZeneca shall not be obligated to file for such patent protection.  Such Information provided to Licensee as outlined in this Section 6.5.2 shall be deemed AstraZeneca Confidential Information.

6.6.Return of Confidential Information.  Upon the effective date of the expiration or termination of this Agreement for any reason, either Party may request in writing and the non-requesting Party shall either, with respect to Confidential Information to which such non-requesting Party does not retain rights under the surviving provisions of this Agreement, at the requesting Party’s election, (a) promptly destroy all copies of such Confidential Information in the 

38 | Page

 

Confidential

possession or control of the non-requesting Party and confirm such destruction in writing to the requesting Party or (b) promptly deliver to the requesting Party, at the non-requesting Party’s sole cost and expense, all copies of such Confidential Information in the possession or control of the non-requesting Party.  Notwithstanding the foregoing, the non-requesting Party shall be permitted to retain such Confidential Information (a) to the extent necessary or useful for purposes of performing any continuing obligations or exercising any ongoing rights hereunder and, in any event, a single copy of such Confidential Information for archival purposes and (b) any computer records or files containing such Confidential Information that have been created solely by such non-requesting Party’s automatic archiving and back-up procedures, to the extent created and retained in a manner consistent with such non-requesting Party’s standard archiving and back-up procedures, but not for any other uses or purposes.  All Confidential Information shall continue to be subject to the terms of this Agreement for the period set forth in Section 6.1 (Confidentiality Obligations).

6.7.Privileged Communications.  In furtherance of this Agreement, it is expected that the Parties may, from time to time, disclose to one another privileged communications with counsel, including opinions, memoranda, letters and other written, electronic and verbal communications.  Such disclosures are made with the understanding that they shall remain confidential in accordance with this Article 6 (Confidentiality and Non-Disclosure), that they will not be deemed to waive any applicable attorney-client or attorney work product or other privilege and that they are made in connection with the shared community of legal interests existing between AstraZeneca and Licensee, including the community of legal interests in avoiding Infringement of any valid, enforceable patents of Third Parties and maintaining the validity of the AstraZeneca Patents.  In the event of any litigation (or potential litigation) with a Third Party related to this Agreement or the subject matter hereof, the Parties shall, upon either Party’s request, enter into a reasonable and customary joint defense agreement.  In any event, each Party shall consult in a timely manner with the other Party before engaging in any conduct (e.g., producing information or documents) in connection with litigation or other proceedings that could conceivably implicate privileges maintained by the other Party. Notwithstanding anything contained in this Section 6.7 (Privileged Communications), nothing in this Agreement shall prejudice a Party’s ability to take discovery of the other Party in disputes between them relating to the Agreement and no information otherwise admissible or discoverable by a Party shall become inadmissible or immune from discovery solely by this Section 6.7 (Privileged Communications).

6.8.No Insider Trading. Each Party acknowledges and agrees that it is: (a) is aware of the restrictions imposed by the United States federal securities laws and other applicable foreign and domestic laws on a person or entity possessing material non-public information about a public company; and (b) shall comply with such laws and will not trade on the basis of Confidential Information, to the extent that it constitutes material non-public information about Licensee or AstraZeneca, recognizing that this Agreement and events with respect to activities under this Agreement may be material to either Party. Each Party shall cause its Affiliates and its and their employees, agents, and representatives to comply with the provisions of this Section.  

39 | Page

 

Confidential

ARTICLE 7
REPRESENTATIONS, WARRANTIES AND COVENANTS

7.1.Mutual Representations and Warranties.  AstraZeneca and Licensee each represents and warrants to the other, as of the Effective Date that:

7.1.1.it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has all requisite power and authority, corporate or otherwise, to execute, deliver and perform this Agreement;

7.1.2.the execution and delivery of this Agreement and the performance by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action and do not violate:  (a) such Party’s charter documents, bylaws or other organizational documents; (b) in any material respect, any agreement, instrument or contractual obligation to which such Party is bound; (c) any requirement of any Applicable Law; or (d) any order, writ, judgment, injunction, decree, determination or award of any court or Governmental Authority presently in effect applicable to such Party;

7.1.3.this Agreement is a legal, valid and binding obligation of such Party enforceable against it in accordance with its terms and conditions, subject to the effects of bankruptcy, insolvency or other laws of general application affecting the enforcement of creditor rights, judicial principles affecting the availability of specific performance and general principles of equity (whether enforceability is considered a proceeding at law or equity); and

7.1.4.it is not under any obligation, contractual or otherwise, to any Person that conflicts with or is inconsistent in any material respect with the terms of this Agreement or that would impede the diligent and complete fulfillment of its obligations hereunder.

7.2.Debarment. AstraZeneca and Licensee each represents and warrants to the other, as of the Effective Date, and covenants during the Term of this Agreement, that: neither it nor any of its Affiliates has been debarred or is subject to debarment and neither it nor any of its Affiliates will knowingly use in any capacity, in connection with the services to be performed under this Agreement, any Person who has been debarred pursuant to Section 306 of the FFDCA or who is the subject of a conviction described in such section.  It will inform the other Party in writing promptly if it or any such Person who is performing services hereunder is debarred or is the subject of a conviction described in Section 306 or if any action, suit, claim, investigation or legal or administrative proceeding is pending or, is threatened, relating to the debarment or conviction of it or any such Person performing services hereunder.

7.3.Anti-Tax Evasion.  AstraZeneca and Licensee each  represents,  warrants  and  undertakes that neither it nor its Affiliates shall commit a Tax evasion facilitation offence under Part 3 of  the  UK  Criminal  Finances  Act  2017  in  connection  with or  attributable  to  this Agreement or the transactions contemplated hereby.  Each  Party shall promptly report to  the other  Party any apparent breach of this Section 7.3 and shall: (a) answer, in reasonable detail, any written or oral inquiry from the other Party related to its and its Affiliates compliance with this Section 7.3; (b) facilitate the interview of employees of such Party by the other Party (or any agent of such party) at any reasonable time specified by the inquiring Party related to such Party’s compliance 

40 | Page

 

Confidential

with this Section 7.3; and (c) co-operate with the inquiring Party or any Governmental Authority in relation to any investigation relating to the matters referred to in Section 7.3, in  all  cases,  as  reasonably  required  to  enable  that  other  party  to  comply with its undertaking under this Section 7.3.  

7.4.Additional Representations and Warranties of AstraZeneca.  AstraZeneca further represents and warrants to Licensee, as of the Effective Date, that:  

7.4.1.(a) AstraZeneca or one of its Affiliates [***] the AstraZeneca Patents, the [***] Combination Patents, the Combination Data and the AstraZeneca Know-How and AstraZeneca has the right to grant the licenses and sublicenses granted to Licensee under this Agreement; and (b) AstraZeneca or its Affiliate solely owns the AstraZeneca Patents;

7.4.2.AstraZeneca has not received any written claim [***] that any of the AstraZeneca Patents are invalid or unenforceable; 

7.4.3.(a) The Regulatory Documentation listed on Schedule 1.13 represents [***] by AstraZeneca or any of its Affiliates as of the Effective Date relating exclusively to the Licensed Compounds or the Licensed Products in the Field, and (b) AstraZeneca has the right to grant the licenses, rights of reference and sublicenses granted to Licensee under this Agreement. 

7.4.4.AstraZeneca has the rights to transfer to Licensee any AstraZeneca Know-How, Regulatory Documentation or other materials required to be transferred to Licensee pursuant to this Agreement;

7.4.5.No patent application or registration with respect to the AstraZeneca Patents is the subject of any pending interference, opposition, cancellation, or patent protest pursuant to any Applicable Law; 

7.4.6.The AstraZeneca Patents include all Patents Controlled by AstraZeneca or its Affiliates as of the Effective Date [***] the Exploitation of the Licensed Compounds and Licensed Products in the Field in the Territory;

7.4.7.[***] any written notice from any Third Party, asserting or alleging (i) that the Exploitation of any Licensed Compound or Licensed Product prior to the Effective Date infringed or misappropriated the intellectual property rights of such Third Party, or (ii) that the Exploitation of the Licensed Compounds and Licensed Products as contemplated under this Agreement will infringe or misappropriate the intellectual property rights of such Third Party; 

7.4.8.AstraZeneca has complied, [***] with all Applicable Law applicable to (a) the prosecution and maintenance of AstraZeneca Patents and (b) its Development, Manufacture, Commercialization or other Exploitation of the Licensed Compounds and Licensed Products in the Field; 

7.4.9.Except as otherwise disclosed by AstraZeneca to Licensee prior to the Effective Date, to AstraZeneca’s knowledge, [***] safety or efficacy of AZD5153.

41 | Page

 

Confidential

7.5.Additional Representations, Warranties and Covenants of Licensee.  Licensee further represents and warrants to AstraZeneca, as of the Effective Date, that:

7.5.1.No consent, approval, qualification, order or authorization of, registration, declaration or filing with, or notice to, any Governmental Authority or other Person is necessary or required by or with respect to Licensee or its Affiliates in connection with the execution and delivery by Licensee of this Agreement, the consummation by Licensee or its Affiliates of the license contemplated by this Agreement or the compliance by the Licensee with the provisions of this Agreement.

7.5.2.[***] and [***] of [***] and [***] the [***] of the [***] hereunder and [***] the [***] relating to [***]; and [***] that [***] for the [***] except to the extent [***].

7.5.3.Licensee has sufficient funds to make the Upfront Payment to AstraZeneca pursuant to Section 4.1 (Upfront Payment).

7.6.DISCLAIMER OF WARRANTIES.  EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH HEREIN, NEITHER PARTY MAKES ANY REPRESENTATIONS OR GRANTS ANY WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE; AND EACH PARTY SPECIFICALLY DISCLAIMS ANY OTHER WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

7.7.ADDITIONAL WAIVER.  LICENSEE AGREES THAT:  (a) EXCEPT AS PROVIDED IN SECTION 7.4, THE AstraZeneca PATENTS AND [***] COMBINATION PATENTS ARE LICENSED “AS IS,” “WITH ALL FAULTS,” AND “WITH ALL DEFECTS,” [***].

7.8.Anti-Bribery and Anti-Corruption Compliance.  Each of Licensee and AstraZeneca agrees, on behalf of itself, its officers, directors and employees and on behalf of its Affiliates, agents, representatives, consultants and subcontractors hired in connection with the subject matter of this Agreement (“Representatives”) that for the performance of its obligations hereunder:

7.8.1.Obligations to Comply. Such Party and its Representatives shall comply with the Anti-Corruption Laws and shall not take any action that will, or would reasonably be expected to, cause the other Party or its Affiliates to be in violation of any such laws or policies.

7.8.2.Notification of Violation. Such Party shall promptly provide the other Party with written notice of the following events:  (a) upon becoming aware of any breach or violation by such Party or its Representative of any representation, warranty or undertaking set forth in Section 7.8.1 (Obligations to Comply), or (b) upon receiving a formal notification that it is the target of a formal investigation by a Governmental Authority for a Material Anti-Corruption Law Violation or upon receipt of information from any of its Representatives connected with this 

42 | Page

 

Confidential

Agreement that any of them is the target of a formal investigation by a Governmental Authority for a Material Anti-Corruption Law Violation.

ARTICLE 8
INDEMNITY

8.1.Indemnification of AstraZeneca.  Licensee shall indemnify AstraZeneca, its Affiliates, its or their (sub)licensees and its and their respective directors, officers, employees and agents and defend and save each of them harmless, from and against any and all losses, damages, liabilities, costs and expenses (including reasonable attorneys’ fees and expenses) (collectively, “Losses”) in connection with any and all suits, investigations, claims or demands of Third Parties (collectively, “Third Party Claims”) arising from or occurring as a result of: (a) the breach of any representation, warranty, covenant or other term of this Agreement by Licensee; (b) the fraud, gross negligence or willful misconduct on the part of Licensee or its Affiliates or its or their Sublicensees or its or their distributors or contractors or its or their respective directors, officers, employees or agents in performing its or their obligations under this Agreement, as applicable; or (c) the Exploitation by or on behalf of Licensee or any of its Affiliates or its or their Sublicensees or its or their distributors or contractors of any Licensed Compound or Licensed Product; except, in each case of clauses (a), (b) and (c), for those Losses for which AstraZeneca has an obligation to indemnify Licensee pursuant to Section 8.2 (Indemnification of Licensee), as to which Losses each Party shall indemnify the other to the extent of their respective liability for the Losses.

8.2.Indemnification of Licensee.  AstraZeneca shall indemnify Licensee, its Affiliates and their respective Sublicensees, directors, officers, employees and agents and defend and save each of them harmless, from and against any and all Losses in connection with any and all Third Party Claims arising from or occurring as a result of: (a) the breach of any representation, warranty, covenant or other term of this Agreement by AstraZeneca; (b) the fraud, gross negligence or willful misconduct on the part of AstraZeneca or its Affiliates or their respective directors, officers, employees or agents in performing its or their obligations under this Agreement, as applicable; or (c) the Exploitation by or on behalf of AstraZeneca or any of its Affiliates or its or their sub/licensees of any Licensed Compound or Licensed Product prior to the Effective Date of after a reversionary event under Article 9;  except, in each case of clauses (a), (b), and (c) for those Losses for which Licensee has an obligation to indemnify AstraZeneca pursuant to Section 8.1 (Indemnification of AstraZeneca), as to which Losses each Party shall indemnify the other to the extent of their respective liability for the Losses.   

8.3.Indemnification Procedures. 

8.3.1.Notice of Claim.  All indemnification claims in respect of a Party, its Affiliates or its or their (sub)licensees (or Sublicensees) or their respective directors, officers, employees and agents shall be made solely by such Party to this Agreement (the “Indemnified Party”) against the other Party to this Agreement (the “Indemnifying Party”).  The Indemnified Party shall give the Indemnifying Party prompt written notice (an “Indemnification Claim Notice”) of any Losses or discovery of fact upon which such Indemnified Party intends to base a request for indemnification under this Article 8 (Indemnity); provided that no failure or delay in providing such notice shall relieve the Indemnifying Party of any liability it may have to the Indemnified Party, except to the extent that such failure or delay materially prejudices the 

43 | Page

 

Confidential

Indemnifying Party with respect to such claim.  Each Indemnification Claim Notice must contain a description of the Third Party Claim and the nature and amount of such Loss (to the extent that the nature and amount of such Loss is known at such time).  The Indemnified Party shall furnish promptly to the Indemnifying Party copies of all papers and official documents received in respect of any Losses and Third Party Claims.

8.3.2.Control of Defense.  The Indemnifying Party shall have the right to assume the defense of (and the obligation to do so if requested by the Indemnified Party) any Third Party Claim at its sole costs and expenses by giving written notice to the Indemnified Party within thirty (30) days after the Indemnifying Party’s receipt of an Indemnification Claim Notice.  The assumption of the defense of a Third Party Claim by the Indemnifying Party shall not be construed as an acknowledgment that the Indemnifying Party is liable to indemnify the Indemnified Party in respect of the Third Party Claim, nor shall it constitute a waiver by the Indemnifying Party of any defenses it may assert against the Indemnified Party’s claim for indemnification.  Upon assuming the defense of a Third Party Claim, the Indemnifying Party may appoint as lead counsel in the defense of the Third Party Claim any legal counsel selected by the Indemnifying Party.  In the event the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall immediately deliver to the Indemnifying Party all original notices and documents (including court papers) received by the Indemnified Party in connection with the Third Party Claim.  Should the Indemnifying Party assume the defense of a Third Party Claim, except as provided in Section 8.3.3 (Right to Participate in Defense), the Indemnifying Party shall not be liable to the Indemnified Party for any legal expenses subsequently incurred by such Indemnified Party in connection with the analysis, defense or settlement of the Third Party Claim unless specifically requested in writing by the Indemnifying Party.  If the Parties cannot agree upon the application of Sections 8.1 and 8.2 to the applicable Third Party Claim, then each Party may conduct its own defense thereof and reserves the right to claim indemnity hereunder upon resolution of the underlying Third Party Claim.

8.3.3.Right to Participate in Defense.  Any Indemnified Party shall be entitled to participate in the defense of such Third Party Claim and to employ counsel of its choice for such purpose; provided, however, that such employment shall be at the Indemnified Party’s sole cost and expense unless (a) the employment thereof has been specifically authorized by the Indemnifying Party in writing (in which case, the defense shall be controlled as provided in Section 8.3.2 (Control of Defense)), (b) the Indemnifying Party has failed to assume the defense and employ counsel in accordance with Section 8.3.2 (Control of Defense) (in which case the Indemnified Party shall control the defense), or (c) the interests of the Indemnified Party and the Indemnifying Party with respect to such Third Party Claim are sufficiently adverse to prohibit the representation by the same counsel of both Parties under Applicable Law, ethical rules or equitable principles (in which case, the Indemnified Party shall control its defense).

8.3.4.Settlement.  With respect to any Losses relating solely to the payment of money damages by the Indemnifying Party in connection with a Third Party Claim and that shall not result in the applicable indemnitee(s) becoming subject to injunctive or other relief or otherwise adversely affecting the business of the Indemnified Party in any manner, the Indemnifying Party shall have the sole right to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss (but not extending to any admission by any of the other Party’s indemnitees), on such terms as the Indemnifying Party, in its sole discretion, shall 

44 | Page

 

Confidential

deem appropriate.  With respect to all other Losses in connection with Third Party Claims, where the Indemnifying Party has assumed the defense of the Third Party Claim in accordance with Section 8.3.2 (Control of Defense), the Indemnifying Party shall have authority to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss; provided it obtains the prior written consent of the Indemnified Party (which consent shall not be unreasonably withheld, conditioned or delayed).  If the Indemnifying Party does not assume and conduct the defense of a Third Party Claim as provided above, the Indemnified Party may defend against such Third Party Claim; provided that the Indemnified Party shall not settle any Third Party Claim without the prior written consent of the Indemnifying Party (which consent shall not be unreasonably withheld, conditioned or delayed).

8.3.5.Cooperation.  Regardless of whether the Indemnifying Party chooses to defend or prosecute any Third Party Claim, the Indemnified Party shall, and shall cause each indemnitee to, cooperate in the defense or prosecution thereof and shall furnish such records, information and testimony, provide such witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith.  Such cooperation shall include access during normal business hours afforded to the Indemnifying Party to and reasonable retention by the Indemnified Party of, records and information that are reasonably relevant to such Third Party Claim and making Indemnified Parties and other employees and agents available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder and the Indemnifying Party shall reimburse the Indemnified Party for all its, its Affiliates’ and its and their (sub)licensees’ (or Sublicensees’) or their respective directors’, officers’, employees’ and agents’, as applicable, reasonable and verifiable out-of-pocket expenses in connection therewith.

8.3.6.Expenses.  Except as provided above, the costs and expenses, including fees and disbursements of counsel, incurred by the Indemnified Party and its Affiliates and its and their (sub)licensees (or Sublicensees) and their respective directors, officers, employees and agents, as applicable, in connection with any claim shall be reimbursed on a Calendar Quarter basis by the Indemnifying Party, without prejudice to the Indemnifying Party’s right to contest the Indemnified Party’s right to indemnification and subject to refund in the event the Indemnifying Party is ultimately held not to be obligated to indemnify the Indemnified Party.

8.4.Special, Indirect and Other Losses.  EXCEPT (A) IN THE EVENT OF THE WILLFUL MISCONDUCT OR FRAUD OF A PARTY OR OF A PARTY’S BREACH OF ITS OBLIGATIONS UNDER ARTICLE 6 (CONFIDENTIALITY AND NON-DISCLOSURE), (B) AS PROVIDED UNDER SECTION 10.11 (EQUITABLE RELIEF), OR (C) TO THE EXTENT ANY SUCH DAMAGES ARE REQUIRED TO BE PAID TO A THIRD PARTY AS PART OF A CLAIM FOR WHICH A PARTY PROVIDES INDEMNIFICATION UNDER THIS ARTICLE 8 (INDEMNITY), NEITHER PARTY NOR ANY OF ITS AFFILIATES OR (SUB)LICENSEES SHALL BE LIABLE IN CONTRACT, TORT, NEGLIGENCE, BREACH OF STATUTORY DUTY OR OTHERWISE FOR ANY SPECIAL OR PUNITIVE DAMAGES OR FOR LOSS OF PROFITS SUFFERED BY THE OTHER PARTY, provided that nothing in this Agreement shall limit or exclude any Party’s liability for death or personal injury, fraudulent misrepresentation or anything else FOR which itS LIABILITY cannot by Applicable law BE limitED or excludeD.

45 | Page

 

Confidential

8.5.Insurance.  Licensee shall have and maintain such types and amounts of insurance covering its Exploitation of the Licensed Compounds and Licensed Products as is (a) normal and customary in the biopharmaceutical industry generally for parties similarly situated and (b) otherwise required by Applicable Law (or reasonable self-insurance sufficient to provide materially the same level of protection), during the period when any Licensed Product is being clinically tested in human subjects or commercially distributed or sold in the Territory. Upon reasonable request by AstraZeneca, Licensee shall provide to AstraZeneca evidence of its insurance coverage, including copies of applicable insurance policies.  The insurance policies shall be under an occurrence form, but if only a claims-made form is available to Licensee, then Licensee shall continue to maintain such insurance after the expiration or termination of this Agreement in its entirety for a period of [***].

ARTICLE 9
TERM AND TERMINATION

9.1.Term and Expiration.  This Agreement shall commence on the Effective Date and, unless earlier terminated in accordance herewith, shall expire upon the expiration of the last-to-expire Royalty Term for the Licensed Products in the Territory and in any event no later than the 10th anniversary of the expiration of the last Valid Claim of an AstraZeneca Patent hereunder (such period, the “Term”). On a country-by-country basis, upon the expiration of a Royalty Term in a country, the license grants to Licensee under Section 2.1 (Grants to Licensee) will become fully paid-up, perpetual, and irrevocable for such country. 

9.2.Termination.

9.2.1.Termination for Material Breach.  In the event that either Party (the “Breaching Party”) is adjudicated to be in material breach of this Agreement (a “Material Breach”), in addition to any other right and remedy the other Party (the “Non-Breaching Party”) may have, the Non-Breaching Party may provide written notice (the “Notice of Breach”) to the Breaching Party specifying the Material Breach and unless the Breaching Party cures the Material Breach specified in the Notice of Breach within [***] (the “Cure Period”), the Non-Breaching Party may exercise its right to terminate the Agreement in accordance with Section 9.4 (Consequences of Termination). Notwithstanding the foregoing, if Licensee or any of its Affiliates or its or their Sublicensees, fail to pay to AstraZeneca the Upfront Payment on or before the due date, AstraZeneca has the right to terminate this Agreement immediately with no cure period. With regard to all other payments, if Licensee or any of its Affiliates or its or their Sublicensees, fail to pay to AstraZeneca any other undisputed payments than the Upfront Payment, the cure period for such non-payment will be [***]. Should any dispute arise regarding any other payment under this Agreement (except the Upfront Payment), the dispute resolution process in Section 10.6 shall apply. In case of a dispute regarding a payment under this Agreement and such dispute is resolved or decided in AstraZeneca’s favor, then the Licensee will pay interest, in accordance with Section 4.8 (Interest on Late Payment) to AstraZeneca for the delay of payment, from the original due payment date until the full payment of such previously disputed payment.

9.2.2.Termination by Licensee for Convenience.  Licensee may terminate this Agreement for convenience by delivering a [***] day prior written notice to AstraZeneca.

46 | Page

 

Confidential

9.2.3.Termination for Patent Challenge. In the event that Licensee or any of its Affiliates or Sublicensees, anywhere in the Territory, institutes, prosecutes or otherwise participates in (or in any way aids any Third Party in instituting, prosecuting or participating in), at law or in equity or before any administrative or regulatory body, any claim, demand, action or cause of action for declaratory relief, damages or any other remedy or for an enjoinment, injunction or any other equitable remedy, including any interference, re-examination, opposition or any similar proceeding, alleging that any claim in a AstraZeneca Patent or [***] Combination Patent is invalid, unenforceable or otherwise not patentable or would not be infringed by Licensee’s activities absent the rights and licenses granted hereunder (collectively, a “Patent Challenge”), AstraZeneca shall have the right to immediately terminate this Agreement in its entirety, including the rights of any Sublicensees, upon written notice to Licensee; provided, however, that AstraZeneca will not have the right to terminate this Agreement under this Section 9.2.3 for any such challenge by any Sublicensee if (a) Licensee provides written notice to terminate such sublicense within [***] days of AstraZeneca’s notice to Licensee under this Section 9.2.3 or (b) such challenge is dismissed within [***] days of AstraZeneca’s notice to Licensee under this Section 9.2.3 and not thereafter continued.

9.2.4.Termination for Insolvency.  In the event that either Party (or any Affiliate that controls (as defined in the definition of Affiliate) such Party), (a) files for protection under bankruptcy or insolvency laws, (b) makes an assignment for the benefit of creditors, (c) appoints or suffers appointment of a receiver or trustee over substantially all of its property that is not discharged within [***] days after such filing, (d) proposes a written agreement of composition or extension of its debts, (e) proposes or is a party to any dissolution or liquidation, (f) files a petition under any bankruptcy or insolvency act or has any such petition filed against it that is not discharged within [***] days of the filing thereof or (g) admits in writing its inability generally to meet its obligations as they fall due in the general course, then the other Party may terminate this Agreement in its entirety effective immediately upon written notice to such Party.

9.3.Rights in Bankruptcy.  All rights and licenses granted under or pursuant to this Agreement by Licensee or AstraZeneca are and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction, licenses of right to “intellectual property” as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that the Parties, as licensees of such rights under this Agreement, shall retain and may fully exercise all of their rights and elections under the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction.  The Parties further agree that, in the event of the commencement of a bankruptcy proceeding by or against either Party under the U.S. Bankruptcy Code or any analogous provisions in any other country or jurisdiction, the Party that is not a party to such proceeding shall be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectual property and all embodiments of such intellectual property, which, if not already in the non-subject Party’s possession, shall be promptly delivered to it (a) upon any such commencement of a bankruptcy proceeding upon the non-subject Party’s written request therefor, unless the Party subject to such proceeding elects to continue to perform all of its obligations under this Agreement or, (b) if not delivered under clause (a) above, following the rejection of this Agreement by or on behalf of the Party subject to such proceeding upon written request therefor by the non-subject Party.  

47 | Page

 

Confidential

9.4.Consequences of Termination.  In the event of a termination of this Agreement:

9.4.1. Licenses Grants by AstraZeneca. All rights and licenses granted by AstraZeneca hereunder shall immediately terminate.

9.4.2. Sublicenses.  Any sublicense granted by Licensee pursuant to Section 2.2 that remains in good standing as of the effective date of termination of this Agreement shall at the Sublicensee’s election, to be made no later than the  effective date of termination, be assigned by Licensee to AstraZeneca, and each such assigned sublicense will remain in full force and effect with AstraZeneca as the licensor or sublicensor instead of Licensee; provided that AstraZeneca shall not have any greater obligations under such sublicense as are contained in this Agreement.

9.4.3.Right of Negotiation to Licensee IP, Information, Regulatory Documentation.  The Parties shall in negotiate in good faith and use reasonable efforts to enter into an agreement for the transfer of rights to AstraZeneca for the Licensee IP and Information and Regulatory Documentation related to AZD5153 generated by Licensee or its Affiliates during the Term pursuant to this Agreement on commercially reasonable terms, including payment(s) to Licensee. If the Parties are unable to agree on commercially reasonable terms under this Section 9.4.3, the Parties shall each submit a written proposal to the other for an amount of the disputed fair market value. The Parties shall meet within [***] days in New York, NY, to discuss the two proposals with the objective of finding a mutual agreeable solution on commercially reasonable terms. If [***] no solution has been reached, then the [***] of Licensee or his or her nominee (which nominee shall be at the level of Vice President or above within the organization) and a nominee of the [***] (which nominee shall be at the level of Vice President or above within the organization), shall meet to seek a solution. If no solution has been found at this meeting, then [***] advisory firm [***] healthcare field. Each Party shall promptly and independently submit all the information that has been discussed in connection with [***]. The advisory firm shall [***]. The [***] the Party [***] proposal [***] the advisory firm shall be [***]; provided that [***] nor any other version of [***] the other Party.

9.4.4.Wind-Down, Ongoing Clinical Trials and Continuous Supply.  To the extent necessary, the Parties shall responsibly wind-down, in accordance with accepted pharmaceutical industry norms and ethical practices, any ongoing research and development programs under this Agreement. To clarify, any winding-down or changes to ongoing clinical trials due to termination of this Agreement must be performed according to Applicable Law and strictly comply with Good Clinical Practice (GCP), including but not limited to practices and ethical standards for continuous supply to such ongoing clinical trials.

9.5.Remedies.  [***] termination of this Agreement in accordance with the provisions hereof shall not limit remedies that may otherwise be available in law or equity.

9.6.Accrued Rights; Surviving Obligations.  Termination or expiration of this Agreement for any reason shall be without prejudice to any rights that shall have accrued to the benefit of a Party prior to such termination or expiration.  Such termination or expiration shall not relieve a Party from obligations that are expressly indicated to survive the termination or expiration of this Agreement.  In addition and without limiting the generality of the foregoing, Sections 5.1 (Ownership of Intellectual Property), 7.6 (Disclaimer of Warranties), 7.8  (Anti-Bribery and Anti-

48 | Page

 

Confidential

Corruption Compliance), 9.3 (Rights in Bankruptcy), 9.4 (Consequences of Termination),  9.5 (Remedies), 10.5 (Severability), 10.6 (Dispute Resolution), 10.7 (Governing Law), 10.8 (Notices), 10.11 (Equitable Relief), 10.12 (Waiver and Non-Exclusion of Remedies), 10.13 (No Benefit to Third Parties), 10.14 (Further Assurance), 10.15 (Relationship of the Parties), 10.16 (References), 10.17 (Construction), 10.18 (Counterparts), this Section 9.6 (Accrued Rights; Surviving Obligations), Article 1 (Definitions), Article 4 (Payments and Taxes) as applied to payments that came due during the Term, Article 6 (Confidentiality and Non-Disclosure), and Article 8 (Indemnity) of this Agreement shall survive the termination or expiration of this Agreement for any reason. 

ARTICLE 10
MISCELLANEOUS

10.1.Force Majeure.  Neither Party shall be held liable or responsible to the other Party or be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of this Agreement (other than an obligation to make payments) when such failure or delay is caused by or results from events beyond the reasonable control of the non-performing Party, including fires, floods, earthquakes, hurricanes, embargoes, shortages, epidemics, quarantines, war, acts of war (whether war be declared or not), terrorist acts, insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances (whether involving the workforce of the non-performing Party or of any other Person), acts of God or acts, omissions or delays in acting by any Governmental Authority (except to the extent such delay results from the breach by the non-performing Party or any of its Affiliates of any term or condition of this Agreement).  The non-performing Party shall notify the other Party of such force majeure within a reasonable period after such occurrence by giving written notice to the other Party stating the nature of the event, its anticipated duration and any action being taken to avoid or minimize its effect.  The suspension of performance shall be of no greater scope and no longer duration than is necessary and the non-performing Party shall use commercially reasonable efforts to remedy its inability to perform. When the force majeure no longer exists, the non-performing Party shall promptly resume performance under this Agreement. Without limitation of the foregoing, in the event that the suspension of performance continues for [***] this Section 10.1 (Force Majeure), the Party [***] not [***] without regard to [***], except that [***] Party [***] right [***] to effect [***] upon written notice [***].   

10.2.Cyber Security. In performing its obligations and exercising its rights under this Agreement, Licensee warrants and represents that it will maintain adequate administrative, technical, and physical measures, controls, tools, systems, policies and procedures in accordance with good cyber security industry practice.  Licensee will notify AstraZeneca, in writing, about any security incident affecting or which may affect any IT Infrastructure or data or facilities owned, leased or used by and/or provided for use by Licensee, which may affect Licensee’s obligations under this Agreement, without undue delay and in any event within [***] after the Licensee becomes aware of or suspects that a security incident has occurred that is expected to affect performance under this Agreement. Such notification will be, in the first instance, sent by e-mail to the following e-mail address: [***] and immediately followed up by telephone to [***]. 

10.3.Export Control.  This Agreement is made subject to any restrictions concerning the export of products or technical information from the United States or other countries that may 

49 | Page

 

Confidential

be imposed on the Parties from time to time.  Each Party agrees that it will not export, directly or indirectly, any technical information acquired from the other Party under this Agreement or any products using such technical information to a location or in a manner that at the time of export requires an export license or other governmental approval, without first obtaining the written consent to do so from the appropriate Governmental Authority in accordance with Applicable Law.

10.4.Assignment.

10.4.1.Right to Assign. Neither Party may assign its rights or, except as expressly provided in this Agreement, delegate its obligations under this Agreement, whether by operation of law or otherwise, in whole or in part without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed, except that either Party shall have the right, without such consent, (i) to perform any or all of its obligations and exercise any or all of its rights under this Agreement through any of its Affiliates or its or their (sub)licensees, and (ii) assign any or all of its rights and delegate any or all of its obligations hereunder to any of its Affiliates or its or their (sub)licensees or to any successor in interest (whether by merger, acquisition, asset purchase or otherwise) to all or substantially all of the business to which this Agreement relates; provided that the assigning Party shall provide written notice to the other Party within [***] days after such assignment or delegation.  Any permitted successor of a Party or any permitted assignee of all of a Party’s rights under this Agreement that has also assumed all of such Party’s obligations hereunder in writing shall, upon any such succession or assignment and assumption, be deemed to be a Party to this Agreement as though named herein in substitution for the assigning Party, whereupon the assigning Party shall cease to be a Party to this Agreement and shall cease to have any rights or obligations under this Agreement.  All validly assigned rights of a Party shall inure to the benefit of and be enforceable by, and all validly delegated obligations of such Party shall be binding on and be enforceable against, the permitted successors and assigns of such Party.  Any attempted assignment or delegation in violation of this Section 10.4.1 (Right to Assign) shall be void and of no effect.   

10.4.2.Excluded Rights. The rights to Information, materials and intellectual property: (a) controlled by a Third Party permitted assignee of a Party that were controlled by such Third Party permitted assignee (and not such Party) immediately prior to such assignment (other than as a result of a license or other grant of rights, covenant or assignment by such Party or its Affiliates to, or for the benefit of, such Third Party permitted assignee); or (b) controlled by an Affiliate of a Party that becomes an Affiliate through any Change of Control of such Party that were controlled by such Affiliate (and not such Party) immediately prior to such Change of Control (other than as a result of a license or other grant of rights, covenant or assignment by such Party or its other Affiliates to, or for the benefit of, such Affiliate), in each case ((a) and (b)), shall be automatically excluded from the rights licensed or granted to the other Party under this Agreement.  

10.5.Severability.  If any provision of this Agreement is held to be illegal, invalid or unenforceable under any present or future law and if the rights or obligations of either Party under this Agreement will not be materially and adversely affected thereby, then: (a) such provision shall be fully severable, (b) this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance here from, and (d) the Parties will use their best efforts 

50 | Page

 

Confidential

to replace such illegal, invalid or unenforceable provision with a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision that implements the purposes of this Agreement to the fullest extent practical. To the fullest extent permitted by Applicable Law, each Party hereby waives any provision of law that would render any provision hereof illegal, invalid or unenforceable in any respect.  

10.6.Dispute Resolution.  

10.6.1.Escalation to Senior Officers. Except as provided in Section 10.11 (Equitable Relief), if a dispute, controversy, difference or claim arises between the Parties in connection with or relating to this Agreement, including the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to it, or any document or instrument delivered in connection herewith (a “Dispute”), then either Party shall refer such Dispute to the Senior Officers for attempted resolution by good faith negotiations during a period of [***] Business Days.  Any final decision mutually agreed to by the Senior Officers shall be conclusive and binding on the Parties.  

10.6.2.Arbitration Notice. If such Senior Officers are unable to resolve any such Dispute within such [***] Business Day period set forth in Section 10.6.1  (Escalation to Senior Officers), either Party shall refer such Dispute to be resolved by arbitration in accordance with Section 10.6.3 (Arbitration Procedure) upon written notice to the other Party (an “Arbitration Notice”) and seek such remedies as may be available.  

10.6.3.Arbitration Procedure. Upon receipt of an Arbitration Notice by a Party, the applicable Dispute shall be resolved by final and binding arbitration before a panel of three (3) experts with relevant industry experience and unaffiliated with each Party (the “Arbitrators”).  Each of Licensee and AstraZeneca shall promptly select one (1) Arbitrator, which selections shall in no event be made later than [***] days after the Arbitration Notice.  The third Arbitrator shall be chosen promptly by mutual agreement of the Arbitrator chosen by Licensee and the Arbitrator chosen by AstraZeneca, but in no event later than [***] after the date that the last of such Arbitrators was appointed.  The Arbitrators shall determine what discovery will be permitted, consistent with the goal of reasonably controlling the cost and time that the Parties must expend for discovery; provided that the Arbitrators shall permit such discovery as they deem necessary to permit an equitable resolution of the Dispute. The arbitration shall be administered by the International Chamber of Commerce (“ICC”) according to the then effective arbitration rules of ICC. The arbitration will be held in New York, USA and conducted in English. The Arbitrators shall, within [***] days after the conclusion of the arbitration hearing, issue a written award and statement of decision describing the essential findings and conclusions on which the award is based, including the calculation of any damages awarded.  The decision or award rendered by the Arbitrators shall be final and non-appealable, and judgment may be entered upon it in accordance with Applicable Law in any court of competent jurisdiction.  The Arbitrators shall be authorized to award compensatory damages, but shall not be authorized to reform, modify or materially change this Agreement or any other agreements contemplated hereunder. 

10.6.4.Cost Sharing and Continued Performance. Each Party shall bear its own counsel fees, costs, and disbursements arising out of the dispute resolution procedures described in this Section 10.6 (Dispute Resolution), and shall pay an equal share of the fees and costs of the 

51 | Page

 

Confidential

Arbitrators and all other general fees related to any arbitration described in Section 10.6.3 (Arbitration Procedure); provided, however, the Arbitrators shall be authorized to determine whether a Party is the prevailing Party, and if so, to award to that prevailing Party reimbursement for its reasonable counsel fees, costs and disbursements (including expert witness fees and expenses, photocopy charges, or travel expenses), or the fees and costs of the Arbitrators, in whole or in part.  Unless the Parties otherwise agree in writing, during the period of time that any arbitration proceeding described in Section 10.6.3 (Arbitration Procedure) is pending under this Agreement, the Parties shall continue to comply with all those terms and provisions of this Agreement that are not the subject of such pending arbitration proceeding.  Nothing contained in this Agreement shall deny any Party the right to seek injunctive or other equitable relief from a court of competent jurisdiction in the context of a bona fide emergency or prospective irreparable harm, and such an action may be filed and maintained notwithstanding any ongoing arbitration proceeding.  All arbitration proceedings and decisions of the Arbitrator under this Section 10.6 (Dispute Resolution) shall be deemed Confidential Information of both Parties under Article 6 (Confidentiality and Non-Disclosure).

10.7.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.  The Parties agree to exclude the application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods.   In addition the Parties agree to New York, New York, USA as the venue for any court action permitted under this Agreement, consents to the jurisdiction and venue of the federal courts in such location, and waives all defenses that they may have to such jurisdiction and venue including that the court cannot assert personal jurisdiction over the defendant and forum non conveniens.

10.8.Notices.

10.8.1.Notice Requirements.  Any notice, request, demand, waiver, consent, approval or other communication permitted or required under this Agreement shall be in writing, shall refer specifically to this Agreement and shall be deemed given only if delivered by hand or (if applicable) sent by facsimile transmission (with transmission confirmed) or by internationally recognized overnight delivery service that maintains records of delivery, addressed to the Parties at their respective addresses specified in Section 10.8.2 (Address for Notice) or to such other address as the Party to whom notice is to be given may have provided to the other Party in accordance with this Section 10.8.1 (Notice Requirements), with a required courtesy copy sent by email, which will not constitute notice but without which notice will not be deemed effective.  Such notice shall be deemed to have been given as of the date delivered by hand or (if applicable) transmitted by facsimile (with transmission confirmed) or on the second (2nd) Business Day (at the place of delivery) after deposit with an internationally recognized overnight delivery service.  Any notice delivered by facsimile (if applicable) shall be confirmed by a hard copy delivered as soon as practicable thereafter.  This Section 10.8.1 (Notice Requirements) is not intended to govern the day-to-day business communications necessary between the Parties in performing their obligations under the terms of this Agreement.

52 | Page

 

Confidential

10.8.2.Address for Notice.

If to Licensee, to:

Sierra Oncology, Inc.

1820 Gateway Drive, Suite 110 

San Mateo, CA 94404 U.S.A.

Attention: CEO

 

with a required copy (which shall not constitute notice) to: 

Sierra Oncology, Inc.

1820 Gateway Drive, Suite 110 

San Mateo, CA 94404 U.S.A.

Attention: General Counsel

 

And a required email CC (which shall not alone constitute notice) to:

[***]

If to AstraZeneca, to:

AstraZeneca AB

SE-151 85 Södertälje, Sweden 

Attention: [***]
Email: [***]

with a copy (which shall not constitute notice) to:

[***]

 

Attention: Legal Department 

 

 

10.9.Entire Agreement; Amendments.  This Agreement, together with the Schedules attached hereto, sets forth and constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof and all prior agreements, understandings, promises and representations, whether written or oral, with respect thereto are superseded hereby.  Each Party confirms that it is not relying on any representations or warranties of the other Party except as specifically set forth in this Agreement.  No amendment, modification, release or discharge shall be binding on the Parties unless in writing and duly executed by authorized representatives of both Parties.  In the event of any inconsistencies between this Agreement and any schedules or other attachments hereto, the terms of this Agreement shall control.

10.10.Language.  This Agreement shall be written and executed in, and all other communications under or in connection with this Agreement shall be in English. 

53 | Page

 

Confidential

10.11.Equitable Relief.  Each Party acknowledges and agrees that the restrictions set forth in Article 5 (Intellectual Property) and Article 6 (Confidentiality and Non-Disclosure) are reasonable and necessary to protect the legitimate interests of the other Party and that such other Party would not have entered into this Agreement in the absence of such restrictions and that any breach or threatened breach of any provision of such Section or Articles may result in irreparable injury to such other Party for which there will be no adequate remedy at law.  In the event of a breach or threatened breach of any provision of such Section or Articles, the non-breaching Party shall be authorized and entitled to seek from any court of competent jurisdiction injunctive relief, whether preliminary or permanent, specific performance and an equitable accounting of all earnings, profits and other benefits arising from such breach, which rights shall be cumulative and in addition to any other rights or remedies to which such non-breaching Party may be entitled in law or equity.  Both Parties agree to waive any requirement that the other (a) post a bond or other security as a condition for obtaining any such relief or (b) show irreparable harm, balancing of harms, consideration of the public interest or inadequacy of monetary damages as a remedy.  Nothing in this Section 10.11 (Equitable Relief) is intended or should be construed, to limit either Party’s right to equitable relief or any other remedy for a breach of any other provision of this Agreement.

10.12.Waiver and Non-Exclusion of Remedies. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition.  The waiver by either Party of any right hereunder or of the failure to perform or of a breach by the other Party shall not be deemed a waiver of any other right hereunder or of any other breach or failure by such other Party whether of a similar nature or otherwise.  The rights and remedies provided herein are cumulative and do not exclude any other right or remedy provided by Applicable Law or otherwise available except as expressly set forth herein.

10.13.No Benefit to Third Parties. Except as provided in Article 8 (Indemnity), covenants and agreements set forth in this Agreement are for the sole benefit of the Parties and their successors and permitted assigns and they shall not be construed as conferring any rights or enforceable by on any other Persons.

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

10.15.Relationship of the Parties.  It is expressly agreed that AstraZeneca, on the one hand, and Licensee, on the other hand, shall be independent contractors and that the relationship between the two (2) Parties shall not constitute a partnership, joint venture or agency.  Neither AstraZeneca, on the one hand, nor Licensee, on the other hand, shall have the authority to make any statements, representations or commitments of any kind or to take any action that will be binding on the other Party without the prior written consent of the other Party to do so.  All persons employed by a Party shall be employees of such Party and not of the other Party and all costs and 

54 | Page

 

Confidential

obligations incurred by reason of any such employment shall be for the account and expense of such first Party.

10.16.References.  Unless otherwise specified, (a) references in this Agreement to any Article, Section or Schedule shall mean references to such Article, Section or Schedule of this Agreement, (b) references in any Section to any clause are references to such clause of such Section, (c) references to any agreement, instrument or other document in this Agreement refer to such agreement, instrument or other document as originally executed or, if subsequently amended, replaced or supplemented from time to time, as so amended, replaced or supplemented and in effect at the relevant time of reference thereto, and (d) references to any specific law, rule or regulation, or Section or other division thereof, will be deemed to include the then-current amendments thereto or any replacement or successor law, rule or regulation thereof.

10.17.Construction.  Except where the context otherwise requires, wherever used, the singular shall include the plural, the plural the singular, the use of any gender shall be applicable to all genders and the word “or” is used in the inclusive sense (and/or). The word “will” will be construed to have the same meaning and effects as the word “shall.” Whenever this Agreement refers to a number of days, unless otherwise specified, such number refers to calendar days.  The captions of this Agreement are for convenience of reference only and in no way define, describe, extend or limit the scope or intent of this Agreement or the intent of any provision contained in this Agreement.  The term “including,” “include,” or “includes” and all other conjugations of the verb “to include” as used herein shall mean including, without limiting the generality of any description preceding such term.  The language of this Agreement shall be deemed to be the language mutually chosen by the Parties and no rule of strict construction shall be applied against either Party.  Derivative forms of the defined terms in Article 1 shall be interpreted accordingly.

10.18.Counterparts.  This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  This Agreement may be executed by facsimile, PDF format via email, or other electronically transmitted signatures and such signatures shall be deemed to bind each Party as if they were original signatures.

[SIGNATURE PAGE FOLLOWS]

 

55 | Page

 

 

 

THIS AGREEMENT IS EXECUTED by the authorized representatives of the Parties as of the date first written above.

 

	
For and on behalf of
	
 
	
For and on behalf of
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
AstraZeneca AB
	
 
	
Sierra Oncology, Inc.
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
By:
	
 
	
 
	
 
	
By:
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Name:
	
 
	
 
	
 
	
Name:
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Title:
	
 
	
 
	
 
	
Title:
	
 
	
 
	
 

 

 

 

 

 

 

 

Schedule 1.10

AstraZeneca General Know-How

 

[***]

 

 

Schedule 1.12

AstraZeneca Patents

[***]

 

 

 

Schedule 1.13

AstraZeneca Regulatory Documentation

[***]

 

 

 

 

 

Schedule 1.14

AstraZeneca Specific Know-How

 

[***]

 

 

Schedule 1.24 

Combination Data

[***]

 

 

 

Schedule 1.80 

Olaparib Combination Patents

[***]

 

 

 

 

Schedule 1.81

Ongoing Research Programs

 

[***]

 

 

Schedule 1.81(A)

 

[***]

 

 

 

Schedule 1.81(B) 

 

[***]

 

 

 

Schedule 3.1.3

 

Product Development Plan

 [***]

 

[***]

 

 

[***]

 

 

[***]

 

 

[***]

 

 

Schedule 3.2.1 

Transition Plan

[***]

 

 

 

Schedule 6.4 

Press Release and Public Announcement

Sierra Oncology Signs Exclusive Global In-Licensing Agreement with AstraZeneca for 

Novel BET Inhibitor to Expand Myelofibrosis Pipeline

 

—Combination study to build upon momelotinib’s differentiated potential as a cornerstone myelofibrosis therapy-—

 

SAN MATEO, CA, August 4, 2021 - Sierra Oncology, Inc. (NASDAQ: SRRA), a late-stage biopharmaceutical company on a mission to deliver targeted therapies that treat rare forms of cancer, today announced it has acquired an exclusive global license from AstraZeneca (LSE/STO/NASDAQ: AZN) for AZD5153, a potent and selective BRD4 BET inhibitor with a novel bivalent binding mode. Sierra plans to initiate a Phase 2 study examining momelotinib in combination with AZD5153 in myelofibrosis patients in the first half of 2022. 

 

“This global in-licensing deal is of two-fold importance to Sierra’s long-term strategy. First, it brings another novel compound into the Sierra development pipeline, expanding our opportunity to deliver transformative therapies for patients with rare cancers. Second, it may allow us to enhance and extend our ability to treat myelofibrosis patients, building on momelotinib’s potential as a cornerstone therapy,” said Stephen Dilly, MBBS, PhD, President and Chief Executive Officer at Sierra Oncology. 

 

Inhibitors of the Bromodomain and Extra-terminal Domain (BET protein family consisting of BRD2, BRD3, BRD4 and BRDT) can modify a range of pathological cellular processes, including the initiation and continuation of transcription and cell cycle control. BET inhibition can lead to decreased inflammatory cytokine release, anti-fibrotic activity and reduced mutant cell proliferation, all of which are indicative of disease-modifying effects. Several BET inhibitors are under clinical investigation in multiple solid tumor and hematologic indications, including myelofibrosis. 

 

AZD5153 is a selective BRD4 inhibitor with a novel bivalent binding mode that inhibits both protein bromodomains, resulting in improved potency. Unlike currently available JAK inhibitors, momelotinib is not myelosuppressive, therefore the combination of momelotinib and AZD5153 may provide an efficacy and safety advantage over other JAK inhibitor plus BET inhibitor combinations and allow for prolonged dose intensity and treatment duration. This trial will be designed to provide preliminary proof of concept for a future confirmatory study and support potential additional studies of momelotinib with other novel agents in development for myelofibrosis. Trial initiation is anticipated to begin in the first half of 2022.

 

Mark Kowalski, MD, PhD, Chief, Early Research and Development at Sierra added, “The combination of JAK inhibition and BET inhibition has been identified as a promising emergent approach for the treatment of myelofibrosis. However, currently available JAK inhibitors are myelosuppressive, leaving a critical unmet need for patients with anemia or those at risk of developing treatment-emergent anemia. Given momelotinib’s unique mechanism as an inhibitor of ACVR1 / ALK2 in addition to JAK1 and JAK2, we are excited by the potential for improved outcomes for myelofibrosis patients with this promising combination.”

 

 

 

Deal Terms

 

Under the terms of the agreement, Sierra will pay AstraZeneca an upfront payment, as well as certain pre-determined development, regulatory and commercial milestones. In addition, Sierra will provide tiered royalty payments based on future commercial success. Sierra will be responsible for the initial Phase 2 trial execution and all future global development and commercialization activities.

 

Conference Call & Webcast

In connection with this announcement, Sierra will host a conference call and webcast today, August 4, 2021, at 5:00 pm ET. The call may be accessed by calling (XXX) XXX-XXXX (Toll-free in North America) or (XXX) XXX-XXXX (International Dial-in) and entering the Conference ID number: XXXXXX. The call will be webcast live and will be accessible through the Investor section of the Company’s website at www.SierraOncology.com. An archived replay of the webcast will be made available at the same location.

 

About Momelotinib

Momelotinib is a selective and orally bioavailable JAK1, JAK2 and ACVR1 / ALK2 inhibitor for the potential treatment of myelofibrosis. Myelofibrosis results from dysregulated JAK-STAT signaling and is characterized by constitutional symptoms, splenomegaly (enlarged spleen) and progressive anemia. 

 

Momelotinib is currently under investigation in the MOMENTUM clinical trial, a global, randomized, double-blind Phase 3 study for symptomatic and anemic myelofibrosis patients. Top-line data are anticipated in Q1 2022. The U.S. Food & Drug Administration has granted Fast Track designation for momelotinib. 

 

About Sierra Oncology

Sierra Oncology is a late-stage biopharmaceutical company on a mission to deliver targeted therapies that treat rare forms of cancer. We harness our deep scientific expertise to identify compounds that target the root cause of disease to advance targeted therapies with assets on the leading edge of cancer biology. Our team takes an evidence-based approach to understand the limitations of current treatments and explore new ways to change the cancer treatment paradigm. Together we are transforming promise into patient impact.

 

For more information, visit www.SierraOncology.com. 

 

Cautionary Note on Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding Sierra Oncology's expectations regarding the commercialization and future success of momelotinib and future expansion of its pipeline, the potential of AZD5153 including its impact on Sierra Oncology’s ability to treat myelofibrosis patients and its potential safety and efficacy advantages when combined with momelotinib, the timing of Sierra Oncology’s initiation of a Phase 2 study examining momelotinib in connection with AZD5153, including the timing of enrollment and the expected timing for top-line data in the MOMENTUM clinical trial. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions that could cause actual results 

 

 

to differ materially from those described in the forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, including, among others, the risk that Sierra Oncology may not be able to successfully develop, obtain regulatory approval for and commercialize momelotinib or experience significant delays in doing so, Sierra Oncology may not be able to demonstrate acceptable safety and efficacy of momelotinib and momelotinib in combination with AZD5153, the risk that disruptions and impacts of COVID-19 will be significant and lengthy, Sierra Oncology's cash resources may be insufficient to fund its current operating plans and it may be unable to raise additional capital when needed, Sierra Oncology may be unable to acquire additional assets to build a pipeline of additional product candidates, Sierra Oncology's third-party manufacturers may cause its supply of materials to become limited or interrupted or fail to be of satisfactory quantity or quality, Sierra Oncology may be unable to obtain and enforce intellectual property protection for its technologies and momelotinib and the other factors described under the heading "Risk Factors" set forth in Sierra Oncology's filings with the Securities and Exchange Commission from time to time. Sierra Oncology undertakes no obligation to update the forward-looking statements contained herein or to reflect events or circumstances occurring after the date hereof, other than as may be required by applicable law.

 

For Further Information: 

 

Investor Contact

 

DeDe Sheel

415.732.9828

dsheel@sierraoncology.com

 

Media Contact

 

Lauren Musto

615.351.7777

lmusto@sierraoncology.com  

 

 

SOURCE: Sierra Oncology

 

 

 

Schedule 6.5

Publications

[***]Document

Exhibit 10.1
			
	

PURCHASE AND SALE AGREEMENT
AND ESCROW INSTRUCTIONS
BY AND BETWEEN
KBSII GRANITE TOWER, LLC,
a Delaware limited liability company
(“Seller”)
AND
GRANITE TOWER LLC, 
a Delaware limited liability company
(“Buyer”)

	[Granite Tower – 1099 18th Street, Denver, CO]

TABLE OF CONTENTS
															
	1.	BASIC TERMS AND DEFINITIONS; REFERENCES	2
					
		1.1	Basic Terms and Definitions	2
					
		1.2	References	3
					
	2.	PURCHASE AND SALE	3
					
	3.	PURCHASE PRICE AND DEPOSIT	4
					
		3.1	Purchase Price	4
					
		3.2	Payment of Purchase Price	4
					
		3.3	Disposition of Deposit Upon Failure to Close	4
					
		3.4	Independent Contract Consideration	5
					
	4.	PROPERTY INFORMATION; TITLE REVIEW; INSPECTIONS AND DUE DILIGENCE; TENANT ESTOPPEL CERTIFICATES; CONFIDENTIALITY	5
					
		4.1	Property Information	5
					
		4.2	Title and Survey Review; Title Policy	6
					
		4.3	Inspections; Due Diligence Period	7
					
		4.4	Tenant Estoppel Certificates	9
					
		4.5	Contracts	10
					
		4.6	Confidentiality	10
					
	5.	OPERATIONS AND RISK OF LOSS	11
					
		5.1	Ongoing Operations	11
					
		5.2	New Contracts	12
					
		5.3	Leasing Arrangements	12
					
		5.4	Damage or Condemnation	13
					
	6.	SELLER’S AND BUYER’S DELIVERIES	14
					

i

															
		6.1	Seller’s Deliveries into Escrow	14
					
		6.2	Buyer’s Deliveries into Escrow	15
					
		6.3	Closing Statements/Escrow Fees; Tenant Notices	15
					
		6.4	Post-Closing Deliveries	15
					
	7.	CONDITIONS TO BUYER’S AND SELLER’S OBLIGATIONS	15
					
		7.1	Conditions to Buyer’s Obligations	15
					
		7.2	Conditions to Seller’s Obligations	16
					
	8.	CLOSE OF ESCROW; POSSESSION	17
					
	9.	ESCROW	18
					
		9.1	Closing	18
					
		9.2	Escrow and Title Charges	19
					
		9.3	Procedures Upon Failure of Condition	19
					
	10.	PRORATIONS	20
					
		10.1	Collected Rent	20
					
		10.2	Operating Costs and Additional Rent Reconciliation	20
					
		10.3	Taxes and Assessments	21
					
		10.4	Leasing Commissions, Tenant Improvements and Contracts	22
					
		10.5	Tenant Deposits	22
					
		10.6	Utilities and Utility Deposits	23
					
		10.7	Owner Deposits	23
					
		10.8	Percentage Rents	23
					
		10.9	Final Adjustment After Closing	24
					
	11.	SELLER’S REPRESENTATIONS AND WARRANTIES; AS-IS	24
					
		11.1	Seller’s Representations and Warranties	24
					
		11.2	As-Is	26
					

ii

															
	12.	BUYER’S COVENANTS, REPRESENTATIONS AND WARRANTIES; RELEASE; ERISA; INDEMNIFICATION	29
					
		12.1	Buyer’s Representations and Warranties	29
					
		12.2	Release	29
					
	13.	DEFAULT AND DAMAGES	31
					
		13.1	DEFAULT BY BUYER	31
					
		13.2	Default by Seller	33
					
	14.	BROKER’S COMMISSIONS	33
					
	15.	MISCELLANEOUS PROVISIONS	33
					
		15.1	Notices	33
					
		15.2	Assignment; Binding on Successors and Assigns	35
					
		15.3	Work Product	36
					
		15.4	Further Assurances	36
					
		15.5	Attorney’s Fees	36
					
		15.6	Survival of Representations, Warranties, Covenants, Obligations and Agreements	
					
		15.7	Entire Agreement	37
					
		15.8	Governing Law	38
					
		15.9	Counterparts	38
					
		15.10	Headings; Construction	38
					
		15.11	Time of Essence	38
					
		15.12	Partial Validity; Severability	38
					
		15.13	No Third Party Beneficiaries	39
					
		15.14	Intentionally Omitted	
					
		15.15	Joint Product of Parties	39
					
		15.16	Calculation of Time Periods	39
					

iii

															
		15.17	Procedure for Indemnity	39
					
		15.18	Waiver of Jury Trial	39
					
		15.19	No Personal Liability	39
					
		15.20	Joint and Several Liability	40

iv

PURCHASE AND SALE AGREEMENT
AND ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS (this “Agreement”) is made and entered into as of July 23, 2021, between KBSII GRANITE TOWER, LLC, a Delaware limited liability company (“Seller”), and GRANITE TOWER LLC, a Delaware limited liability company (“Buyer”), with reference to the following:
A.    Seller is the owner of the improved real property (the “Real Property”) described on Exhibit A attached hereto together with certain personal property located upon or used in connection with such improved real property and certain other assets relating thereto, all as more particularly described in Section 2 hereof.
B.    Seller desires to sell to Buyer, and Buyer desires to purchase from Seller, the Real Property, together with certain personal property and related assets on the terms and subject to the conditions contained in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.BASIC TERMS AND DEFINITIONS; REFERENCES
1.1.Basic Terms and Definitions.
(a)Effective Date.  The effective date of this Agreement shall be the date set forth above (“Effective Date”).
(b)Closing Date.  The last day that Close of Escrow (as defined in Section 8.1 hereof) may occur shall be August 16, 2021, at 1:00 p.m. (California time) (the “Closing Date”); provided, however, Seller or Buyer shall have the right to extend the Closing Date as provided in Section 7.2(e) below; provided further, however, if the Tenant Estoppel Condition (as such term is defined in Section 4.4 below) has not been satisfied by the date which is four (4) business days prior to the Closing Date, Seller or Buyer shall be entitled to one or more extensions of the Closing Date (not to exceed 30 days in the aggregate) in order to obtain the missing Tenant Estoppel Certificates; provided further, however, Buyer may extend the Closing Date one time by up to twenty-five (25) days, provided that by August 9, 2021, Buyer delivers to Seller written notice of Buyer's intention to extend the Closing Date and Buyer deposits with Escrow Holder an additional deposit, in cash or current funds, in the amount of One Million Dollars ($1,000,000.00)(the "Extension Deposit"), which shall be credited at the Close of Escrow towards the Purchase Price.  The Extension Deposit, once made, will be treated as part of the Deposit (as such term is defined below).   
(c)Title Review Period.  The “Title Review Period” shall end on July 23, 2021, at 5:00 p.m. (California time).
(d)Due Diligence Period.  The “Due Diligence Period” shall end on July 23, 2021, at 5:00 p.m. (California time).  
2

(e)Escrow Holder.  The escrow holder shall be Commonwealth Land Title Insurance Company (“Escrow Holder”), whose address is 4100 Newport Place Drive, Suite 120, Newport Beach, California 92660, Escrow Officer:  Joy Eaton; Telephone:  (949) 724-3145; Telecopier:  (949) 271-5762.
(f)Title Company.  The title company shall be Commonwealth Land Title Insurance Company (“Title Company”), whose address is 888 S. Figueroa Street, Suite 2100, Los Angeles, California 90017, Title Coordinator:  Amy Musselman; Telephone:  (213) 330-3041; Telecopier (213) 330-3085, with a copy to Anthony A. Behrstock; Telephone:  (213) 330-2333; Telecopier:  (213) 330-3113.
1.2.References.  All references to Exhibits refer to Exhibits attached to this Agreement and all such Exhibits are incorporated herein by reference.  The words “herein,” “hereof,” “hereinafter” and words of similar import refer to this Agreement as a whole and not to any particular Section hereof.
2.PURCHASE AND SALE
Subject to the terms and conditions of this Agreement, Seller agrees to sell, assign and transfer to Buyer and Buyer agrees to purchase from Seller, for the purchase price set forth in Section 3 hereof, all of Seller’s right, title and interest in and to the following (collectively, the “Property”):
2.1.The Real Property, together with the buildings located thereon, and all associated parking areas, and all other improvements located thereon (the buildings and such other improvements are referred to herein collectively as the (“Improvements”)); all references hereinafter made to the Real Property shall be deemed to include all rights, privileges, easements and appurtenances benefiting the Real Property and/or the Improvements situated thereon, including, without limitation, all mineral and water rights and all easements, rights-of-way and other appurtenances used or connected with the beneficial use or enjoyment of the Real Property;
2.2.All personal property, equipment, supplies and fixtures (collectively, the “Personal Property”) listed on Exhibit B attached hereto or otherwise left on the Real Property at the Close of Escrow to the extent owned by Seller;
2.3.All of Seller’s interest in any intangible property (expressly excluding the name “KBS” or any derivative thereof, or any name that includes the word “KBS” or any derivative thereof) used or useful in connection with the foregoing, including, without limitation, all contract rights, warranties, guaranties, licenses, permits, entitlements, governmental approvals and certificates of occupancy which benefit the Real Property and/or the Personal Property;
2.4.All of Seller’s interest in all leases affecting the Real Property as of the Close of Escrow and all security deposits, guaranties, and any non-cash security for tenant obligations under the Leases, including, but not limited to, any letters of credit and lease bonds delivered by tenants and any security interests in favor of Seller granted by any tenant (the “Leases”); and

3

2.5.All of Seller’s interest in the contracts listed on Exhibit C-1 attached hereto and all contracts hereafter entered into by Seller to the extent permitted by the provisions of this Agreement (the “Contracts”).
Notwithstanding anything to the contrary contained herein, the term “Property” shall expressly exclude any Rents (as such term is defined in Section 10.1 hereof) or any other amounts due and payable by tenants under the Leases for periods prior to the Close of Escrow, any Rent or other amounts payable by any former tenants of the Property, and any judgments, stipulations, orders, or settlements with any tenants under the Leases or former tenants of the Property (hereinafter collectively referred to as the “Excluded Property”).
3.PURCHASE PRICE AND DEPOSIT
3.1.Purchase Price.  The purchase price for the Property shall be Two Hundred Three Million Five Hundred Thousand Dollars ($203,500,000.00), minus the Seller Leasing Costs (and notwithstanding anything to the contrary in this Agreement, Seller will not be required to provide a credit to Buyer for the Seller Leasing Costs since they will be netted from the gross Purchase Price) and subject to the prorations provided for under this Agreement (the “Purchase Price”).
3.2.Payment of Purchase Price.  The Purchase Price shall be payable as follows:
3.2.1.Within one (1) business day after the Effective Date, Buyer shall deposit in escrow with Escrow Holder, in cash or current funds, the sum of Five Million Dollars ($5,000,000.00) (the “Deposit”).  Immediately upon Escrow Holder’s receipt of the Deposit (the “Opening of Escrow”), Escrow Holder shall invest the same in a federally insured interest-bearing account acceptable to Seller and Buyer, with all interest accruing thereon credited to the Purchase Price.  The Deposit shall be nonrefundable except as set forth in this Agreement.  Escrow Holder shall invest the Deposit in a federally insured interest-bearing account acceptable to Seller and Buyer, with all interest accruing thereon credited to the Purchase Price.  For purposes of this Agreement, any interest accruing on the Deposit from time to time shall be deemed part of the Deposit.  
3.2.2.Provided all the conditions in Section 7.1 hereof have been satisfied or waived by Buyer, Buyer shall deposit in cash or current funds with Escrow Holder no later than 1:00 p.m. (California time) on the Closing Date (as defined in Section 1.1(b) hereof) an amount equal to the Purchase Price less the Deposit and all interest accrued thereon plus or minus applicable prorations pursuant to Section 10 hereof.
3.3.Disposition of Deposit Upon Failure to Close.  If the Close of Escrow fails to occur due to Buyer’s default under this Agreement (all of the conditions to Buyer’s obligation to close having been satisfied or waived), then the disposition of the Deposit and all interest accrued thereon shall be governed by Section 13.1 hereof; if the Close of Escrow fails to occur due to Seller’s default under this Agreement (all of the conditions to Seller’s obligation to close having been satisfied or waived), then the Deposit and all interest accrued thereon shall promptly be refunded to Buyer; and if the Close of Escrow fails to occur due to the failure of any of the conditions set forth in Sections 7.1 or 7.2 hereof other than as a result of Buyer’s or Seller’s 
4

default under this Agreement, then the disposition of the Deposit and all interest accrued thereon shall be governed by Section 9.3 hereof.
3.4.Independent Contract Consideration.  Additionally, at the same time as the deposit of the Deposit with the Escrow Holder, Buyer shall deliver to Seller in cash the sum of One Hundred and No/100 Dollars ($100.00) (the “Independent Contract Consideration”) which amount has been bargained for and agreed to as consideration for Buyer’s exclusive option to purchase the Real Property and the right to inspect the Real Property as provided herein, and for Seller’s execution and delivery of this Agreement.  The Independent Contract Consideration is in addition to and independent of all other consideration provided in this Agreement, and is nonrefundable in all events.
4.PROPERTY INFORMATION; TITLE REVIEW; INSPECTIONS AND DUE DILIGENCE; TENANT ESTOPPEL CERTIFICATES; CONFIDENTIALITY; ONGOING WORK
4.1.Property Information.  Seller shall make available to Buyer within one (1) business day after the Effective Date, to the extent in Seller’s possession, the following, all of which shall be made available for review and copying (at Buyer’s cost and expense) through an electronic data room or at the Real Property (collectively, the “Property Information”):
(a)the Leases;
(b)a current rent roll for the Real Property, indicating rents collected, scheduled rents and concessions, delinquencies, and security deposits held (collectively, the “Rent Rolls”);
(c)the most current operating statements for the Real Property, if available (collectively, the “Operating Statements”);
(d)copies of the Contracts;
(e)existing land title surveys, if any, for the Real Property (collectively, the “Existing Surveys”); 
(f)any environmental, soils and/or engineering reports prepared for Seller or Seller’s predecessors; 
(g)most recent real property tax assessment notice and copies and all information related to any appeals;
(h)personal property tax schedule file for 2021 and personal property tax returns for the prior three calendar years; and
(i)the items listed in Exhibit N.
Under no circumstances shall Buyer be entitled to review any appraisals relating to the Property or any internal financial audits relating to the Property.
5

4.2.Title and Survey Review; Title Policy.
4.2.1.Delivery of Title Report.  Seller has delivered to Buyer a preliminary title commitment covering the Real Property (the “Title Report”) from the Title Company, together with copies of all documents referenced in the Title Report (collectively, the “Title Documents”).  Buyer, at its option and expense, may (a) obtain a new survey for the Real Property or (b) cause one or more of the Existing Surveys to be updated or recertified.  Buyer understands and acknowledges that if Buyer elects to obtain a new survey or an updated or recertified survey for the Real Property the completion and/or delivery of the surveys or updated or recertified surveys shall not be a condition precedent to the Close of Escrow.  Notwithstanding the foregoing, Buyer further acknowledges that Seller makes no representations or warranties, and Seller shall have no responsibility, with respect to the completeness of the Title Documents made available to Buyer by the Title Company.
4.2.2.Title Review and Cure.  Commencing from the date of this Agreement and continuing through and including the Title Review Period, Buyer shall have the right to approve or disapprove the condition of title to the Real Property.  On or before the expiration of the Title Review Period, Buyer shall deliver to Seller and Escrow Holder written notice (“Buyer’s Title Notice”) of Buyer’s approval or disapproval of the matters reflected in the Title Report and any Existing Survey; Buyer’s Title Notice delivered by Buyer to Seller must state that it is a “Buyer’s Title Notice being delivered in accordance with the provisions of Section 4.2.2 of the Purchase Agreement.”  The failure of Buyer to deliver to Seller Buyer’s Title Notice on or before the expiration of the Title Review Period shall be deemed to constitute Buyer’s approval of the condition of title to the Real Property other than for Mandatory Cure Defects (as defined below).  If Buyer disapproves any matter of title shown in the Title Report or Existing Survey for the Real Property, then Seller may, but shall have no obligation to, within one (1) business day after its receipt of the Buyer’s Title Notice for the Real Property (“Seller’s Election Period”), elect to eliminate or ameliorate to Buyer’s reasonable satisfaction the disapproved title matters by giving Buyer written notice (“Seller’s Title Notice”) of those disapproved title matters, if any, which Seller agrees to so eliminate or ameliorate by the Closing Date.  Buyer acknowledges and agrees that any title exception disapproved by Buyer shall be deemed ameliorated to Buyer’s reasonable satisfaction to the extent that Seller either causes such exception to be removed from the Title Policy (as such term is defined in Section 4.2.3 hereof) or to be affirmatively insured over at no cost to Buyer.  If Seller does not elect to, or is unable to, eliminate or ameliorate any disapproved title matters, Buyer reasonably disapproves Seller’s Title Notice, or Seller fails to timely deliver Seller’s Title Notice, then Buyer shall have the right, upon delivery to Seller and Escrow Holder (on or before one (1) business day following the expiration of Seller’s Election Period) of a written notice, to either:  (a) waive its prior disapproval, in which event said disapproved matters shall be deemed approved; or (b) terminate this Agreement and the Escrow (as such term is defined in Section 9.1 hereof).  Failure to take either one of the actions described in (a) and (b) above shall be deemed to be Buyer’s election to take the action described in clause (a) above.  If Buyer elects to terminate this Agreement as provided in clause (b) above, this Agreement shall automatically terminate, the parties shall be released from all further obligations under this Agreement (except pursuant to any provisions which by their terms survive a termination of this Agreement), the Deposit shall be immediately returned to Buyer and Buyer shall immediately return all Property Information to Seller.  Buyer 
6

shall have been deemed to have approved any title exception that Seller is not obligated to remove and to which either Buyer did not object as provided above, or to which Buyer did object, but with respect to which Buyer did not terminate this Agreement. 
4.2.3.Delivery of Title Policy at Closing.  As a condition precedent to the Close of Escrow, the Title Company shall have issued and delivered to Buyer, or shall have committed to issue and deliver to Buyer, with respect to the Real Property, an ALTA 2006 Owner’s Form of Title Insurance Policy (the “Title Policy”) issued by the Title Company as of the date and time of the recording of the Deed (as such term is defined in Section 6.1 hereof) for the Real Property, in the amount of the Purchase Price insuring Buyer as owner of good, marketable and indefeasible fee simple title to the Real Property, subject only to the Permitted Exceptions (as hereinafter defined).  For purposes of this Agreement, “Permitted Exceptions” shall mean and include (a) any lien to secure payment of real estate taxes, including special assessments, not delinquent, (b) all matters which could be revealed or disclosed by a physical inspection or a survey of the Real Property and matters affecting the Real Property which are created by or with the written consent of Buyer, (c) the rights of the tenants under the Leases affecting the Real Property, (d) all exceptions disclosed by the Title Report relating to the Real Property and which are approved or deemed approved by Buyer in accordance with Section 4.2.2 hereof, (e) any exception for liens (and/or potential liens) for services, labor or materials heretofore or hereafter furnished to the Property for which Buyer is expressly assuming the construction obligations and is responsible for payment under the terms of this Agreement, and/or which arises from any services, labor or materials contracted for by any tenant at the Property and with respect to which any such tenant is responsible for payment under the terms of its Lease, and (f) all applicable laws, ordinances, rules and governmental regulations (including, without limitation, those relating to building, zoning and land use) affecting the development, use, occupancy or enjoyment of the Real Property.  
Notwithstanding anything stated to the contrary herein, Seller covenants and agrees to remove (or cause to be removed) from the Property (which obligation shall be deemed satisfied if the same is insured over and the amount secured by any of the instruments referenced in clauses (a), (b) and (c) below have been paid and the holders of the same are obligated to cause the same to be released from the Property) concurrently with the Close of Escrow (a) all deeds of trust, mortgages and/or other debt instruments to the extent executed by Seller or expressly assumed by Seller in writing, (b) any other monetary liens (other than mechanic’s liens that are considered Permitted Exceptions) which are of an ascertainable amount, and do not exceed $500,000 in the aggregate and are capable of being removed upon the payment of no more than $500,000 in the aggregate, and (c) any liens that Seller has knowingly and intentionally placed on the Real Property and that secures a specific dollar amount of obligations of Seller (collectively, the “Mandatory Cure Defects”).  
4.3.Inspections; Due Diligence Period.
4.3.1.Inspections in General.  Commencing from the Effective Date and continuing through and including Closing or the sooner termination of this Agreement, Buyer, its employees, agents, contractors, and subcontractors and shall have a limited license (the “License”) to enter upon the Real Property for the purpose of making non-invasive inspections at 
7

Buyer’s sole risk, cost and expense.  Before any such entry, Buyer shall provide Seller with a certificate of insurance naming Seller as an additional insured and with an insurer reasonably satisfactory to Seller in the amount of not less than $1 million per occurrence and $3 million general aggregate on a per-occurrence basis.  In addition, Buyer, its agents, contractors, or subcontractors shall maintain, and shall have provided evidence reasonably satisfactory to Seller of Workers Compensation Insurance (including a Waiver of Subrogation endorsement in favor of Seller) with coverage amounts required by the applicable statutes of either the state where (a) such entry occurs, or (b) employees of the Buyer, its agents, contractors, or subcontractors, as applicable, are domiciled.  All of such entries upon the Real Property shall be at reasonable times during normal business hours and after at least twenty-four (24) hours prior notice to Seller or Seller’s agent, and Seller or Seller’s agent shall have the right to accompany Buyer during any activities performed by Buyer on the Real Property.  Notwithstanding anything stated to the contrary herein, such inspections shall not unreasonably interfere with the rights of tenants, Buyer shall have no right to inspect any of the occupied space in the Real Property, and Buyer shall not contact or speak to any of the tenants under the Leases, unless Buyer provides Seller with no less than twenty-four (24) hours prior written notice of such intention and Seller or Seller’s representative is present during such inspections and/or discussions with tenants; any discussions with tenants shall immediately cease at the tenant’s request and any discussions with tenants must be limited to their existing tenancy and premises and may not involve any lease renegotiations.  Seller agrees to make itself or its representatives reasonably available to be present during Buyer’s inspections and/or discussions with tenants.  At Seller’s request, Buyer shall provide Seller (at no cost to Seller) with a copy of the results of any tests and inspections made by Buyer, excluding only market and economic feasibility studies.  If any inspection or test disturbs the Real Property, Buyer will restore the Real Property to the same condition as existed before the inspection or test.  Buyer shall defend, indemnify Seller and hold Seller, Seller’s trustees, officers, tenants, agents, contractors and employees and the Real Property harmless from and against any and all losses, costs, damages, claims, or liabilities, including but not limited to, mechanics’ and materialmens’ liens and Seller’s attorneys’ fees, arising out of or in connection with Buyer’s, or its agents’, contractors’, employees’, or invitees’ entry upon or inspection of the Real Property, unless the claim is caused by the gross negligence or willful misconduct of Seller or its employees, agents, or contractors or arise from Buyer’s mere discovery of pre-existing conditions at the Real Property.  The provisions of this Section 4.3.1 shall survive the Close of Escrow or the earlier termination of this Agreement.
4.3.2.Environmental Inspections.  The inspections under Section 4.3.1 may include non-invasive Phase I environmental inspections of the Real Property, but no Phase II environmental inspections or other invasive inspections or sampling of soil or materials, including without limitation construction materials, either as part of the Phase I inspections or any other inspections, shall be performed without the prior written consent of Seller, which may be withheld in its sole and absolute discretion, and if consented to by Seller, the proposed scope of work and the party who will perform the work shall be subject to Seller’s review and approval.  At Seller’s request, Buyer shall deliver to Seller (at no cost to Seller) copies of any Phase II or other environmental reports to which Seller consents as provided above.
4.3.3.Termination During Due Diligence Period.  Unless Buyer shall affirmatively elect, in its sole, absolute, and unfettered discretion, to proceed forward with the 
8

transaction contemplated by this Agreement, such election to be made by written notice delivered to Seller or Seller’s counsel (which notice may be sent by e-mail) at or before the expiration of the Due Diligence Period, it shall be conclusively deemed that Buyer has elected to terminate this Agreement in which event the Deposit shall be immediately refunded to Buyer, Buyer shall immediately return all Property Information to Seller and, except for those provisions of this Agreement which expressly survive the termination of this Agreement, the parties hereto shall have no further obligations hereunder.  If, on the other hand, Buyer shall timely (prior to the expiration of the Due Diligence Period) notify Seller in writing of Buyer’s election to proceed forward with the acquisition of the Property, then this Agreement shall remain and continue in full force and effect and the transaction contemplated by this Agreement shall proceed forward subject to and in accordance with the provisions of this Agreement.  
4.4.Tenant Estoppel Certificates.  Seller shall endeavor to secure and deliver to Buyer by the Closing Date estoppel certificates for all Leases consistent with the information in the Rent Rolls and substantially in the form attached hereto as Exhibit D or such form as may be required under the applicable Leases.  Buyer may terminate this Agreement upon two (2) business days written notice to Seller if, no less than three (3) business days prior to the Closing Date, Seller fails to deliver to Buyer estoppel certificates substantially in the form attached hereto as Exhibit D or such form as may be required under any particular Lease (“Tenant Estoppel Certificates”), executed by (i) all tenants under Leases leasing 15,000 rentable square feet or more of the Real Property, and (ii) the remaining tenants under the Leases so that all of the Estoppel Certificates cover at least seventy-five percent (75%) of the leased rentable floor area of the Real Property and meeting the requirements set forth in this section, with no changes other than de minimus changes reasonably approved by Buyer and not disclosing the existence of any default under the Leases referenced to therein or any information inconsistent with the Rent Rolls (collectively, the “Tenant Estoppel Condition”). Seller shall prepare, or cause to be prepared, and deliver to Buyer for review and approval, no later than one (1) Business Day after the expiration of the Due Diligence Period, the estoppel certificates Seller intends to deliver to the tenants based on the form attached hereto as Exhibit D (the “Prepared Estoppels”), and Seller shall remit, or cause to be remitted, the Prepared Estoppels to all the tenants of the Property for signature within one (1) Business Day following Buyer’s notice to Seller that Buyer has approved the Prepared Estoppels (which notice shall set forth any required corrections).  If Buyer fails to notify Seller of its approval of, or any changes to, the Prepared Estoppels it receives from Seller for approval within two (2) Business Days following Buyer’s receipt of the same, Seller shall forward such Prepared Estoppels to all the tenants of the Property without Buyer’s prior approval.  Seller will provide Buyer with any proposed changes to the Tenant Estoppel Certificates and the executed Tenant Estoppel Certificates promptly upon receipt thereof by Seller for Buyer’s review and approval, which approval shall not be unreasonably withheld, conditioned, or delayed and shall be deemed given if Buyer fails to respond within five days after Buyer’s receipt of the Tenant Estoppel Certificate in question.   
Seller agrees that upon the request of Buyer, Seller shall deliver to tenants of the Property the form of subordination, non-disturbance and attornment agreement required by Buyer’s lender (“SNDAs”) as completed by Buyer or its lender and shall request that such tenants execute and return the SNDAs prior to Closing; provided, however, that it shall not be a condition to Closing 
9

that Seller deliver to Buyer the executed SNDAs and Seller’s failure to deliver the executed SNDAs to Buyer shall not constitute a default by Seller under this Agreement.
4.5.Contracts.  Buyer shall assume the obligations arising from and after the Closing Date under the Contracts; provided, however, Buyer’s obligation to assume that certain Master Equipment Lease Agreement (the “Fitness Equipment Contract”) shall be subject to Buyer’s receipt of Geneva Capital, LLC’s (the “Owner”) consent to Seller’s assignment, and Buyer’s assumption, of the Fitness Equipment Contract.  In the event Buyer is unable to, after using commercially reasonable efforts, obtain Owner’s consent to the foregoing assignment and assumption of the Fitness Equipment Contract, Seller hereby agrees to terminate the same and pay the termination fee/payoff amount in connection therewith (the “Termination Fee”), the fitness equipment which is provided for under the Fitness Equipment Contract shall be included as part of the Personal Property being transferred to Buyer at Closing, and Seller shall receive a credit at Closing in an amount equal to the Termination Fee.  In addition, notwithstanding anything stated to the contrary herein, Buyer shall not be obligated to assume any of Seller’s obligations under, and Seller shall terminate at Close of Escrow, the management and leasing agreement listed in Exhibit C-1 attached hereto and made a part hereof, except that, notwithstanding Seller’s termination of the management and leasing agreement listed in Exhibit C-1 attached hereto, and in consideration of Seller’s terminating the same, Buyer shall be responsible for, and Buyer shall assume pursuant to the terms and provisions of the Assignment of Leases and Contracts and Bill of Sale, as hereinafter defined, all leasing commissions payable (notwithstanding the termination of the management and leasing agreement) under the management and leasing agreement after the Close of Escrow arising out of the lease of space in the Property after the Close of Escrow provided that Buyer is provided with the names of all the prospects for whom a commission may be claimed no later than five (5) Business Days before Closing.
4.6.Confidentiality.  Prior to the Close of Escrow or in the event the Close of Escrow never occurs, the Property Information and all other information, other than matters of public record or matters generally known to the public, furnished to, or obtained through inspection of the Real Property by, Buyer, its affiliates, financing sources, lenders, employees, attorneys, creditors, officers, agents, accountants and other professionals relating to the Real Property, will be treated by Buyer, its affiliates, financing sources, lenders, employees, attorneys, creditors, officers, agents, accountants and other professionals as confidential, and will not be disclosed to anyone (except as reasonably required in connection with Buyer’s evaluation of the Real Property) except to Buyer’s consultants who agree to maintain the confidentiality of such information, and will be returned to Seller by Buyer if the Close of Escrow does not occur.  The terms of this Agreement will not be disclosed to anyone prior to or after the Close of Escrow except to Buyer’s and Seller’s consultants who agree to maintain the confidentiality of such information and Seller and Buyer agree not to make any public announcements or public disclosures or communicate with any media with respect to the subject matter hereof without the prior written consent of the other party.  The confidentiality provisions of this Section 4.6 shall not apply to any disclosures made by Buyer or Seller as required by law, by court order, or in connection with any subpoena served upon Buyer or Seller; provided Buyer and Seller shall provide each other with written notice before making any such disclosure.  Notwithstanding the foregoing and anything to the contrary in this Agreement, nothing contained herein shall impair 
10

Seller’s (or any Seller affiliate’s) right to disclose information relating to this Agreement or the Property (a) to any due diligence representatives and/or consultants that are engaged by, work for or are acting on behalf of, any securities dealers and/or broker dealers evaluating Seller or its affiliates, (b) in connection with any filings (including any amendment or supplement to any S-11 filing) with governmental agencies (including the United States Securities and Exchange Commission) by any REIT holding an interest (direct or indirect) in Seller, and (c) to any broker/dealers in the Seller’s or any REIT’s broker/dealer network and any of the REIT’s or Seller’s investors.  
4.7.Ongoing Work. Prior to Closing, Seller shall cause all work under the construction contracts listed on Exhibit P attached hereto (the “Construction Contracts”) to be performed in a diligent manner.  The general contractors under the Construction Contracts may be referred to individually as a “Contractor”.  Seller will keep Buyer generally advised of the status of construction under the Construction Contracts.  With respect to any Construction Contract for which the work is completed prior to the Closing Date, on or before the Closing Date, Seller shall satisfy all requirements of the Title Company in order for the Title Policy to be issued without exception for the work under such Construction Contract.  All of Seller’s right, title, and interest, if any, in and to the Construction Contracts for work that has not been completed as of the Closing Date (“Ongoing Work”), shall be assigned to and assumed by Buyer at Closing, Seller shall deliver to Purchaser prior to Closing an executed contractor’s certificate in the form attached hereto as Exhibit O from each Contractor for any Ongoing Work being assumed by Buyer at Closing (each, a “Contractor’s Certificate”), Seller shall provide Buyer with a credit at Closing for the remaining balance owed under any Construction Contract for Ongoing Work as reflected on each Contractor’s Certificate (less the amount, if any, for which a tenant is directly responsible for payment under the terms of such tenant’s Lease), and Buyer shall indemnify, defend, and hold Seller harmless for any liability in connection with the Ongoing Work relating to the period from or after the Closing Date.   Buyer acknowledges and agrees that any change orders or modifications to the scope or cost of the Ongoing Work authorized by Buyer after the Closing Date shall be Buyer’s responsibility.  Seller shall also provide Buyer with copies of all notices to owner received by Seller, and Seller shall provide Buyer and the Title Company with copies of all lien releases and lien waivers for all work which has been completed and for which payment has been made to each Contractor, if any, and an accounting of all payments made to each Contractor or otherwise for the work under any Construction Contract for Ongoing Work and anything else related to the Ongoing Work and/or the payment thereof as reasonably required by Buyer or the Title Company.  Seller shall cooperate with Buyer in all reasonable respects in connection with the turnover of the Ongoing Work to Buyer and shall arrange meetings between Buyer and the applicable Contractor(s) prior to Closing.  The provisions of this section shall survive Closing.
5.OPERATIONS AND RISK OF LOSS
5.1.Ongoing Operations.  During the pendency of this Agreement, but subject to the limitations set forth below, Seller shall carry on its businesses and activities relating to the Real Property substantially in the same manner as it did before the date of this Agreement.  The new and pending lease transactions (the “New and Pending Lease Transactions”) reflected on Schedule 1-1 and Schedule 1-2 attached hereto shall be deemed approved by Buyer for purposes 
11

of this Agreement, subject to Buyer’s review and approval of the form of lease or lease amendment, as applicable, which shall not be unreasonably withheld or delayed.
5.2.New Contracts.  Prior to the expiration of the Due Diligence Period, Seller may without Buyer’s consent modify or enter into any new contract relating to the Real Property, provided that Seller provides Buyer with prior written notice of the same prior to the expiration of the Due Diligence Period, which notice shall include a copy of the modified or new contract.  Following the expiration of the Due Diligence Period, except for (a) renewals or modifications of existing contracts (or new contracts in lieu of expiring contracts) on terms consistent with their existing terms but which shall be cancelable without penalty on not more than 30 days’ notice, or (b) agreements necessary to preserve or protect the Real Property from imminent damage or persons on the Real Property from imminent injury or loss of life (but as to both subsections (a) and (b) above, only to the extent copies are provided to Buyer), Seller shall not modify or enter into any new contract without Buyer’s prior written consent (in Buyer’s sole discretion, and which consent shall be deemed withheld if Buyer fails to respond within five days after written notice from Seller accompanied by the modified or new contract).  
5.3.Leasing Arrangements.  Prior to the expiration of the Due Diligence Period, Seller may without Buyer’s consent enter into new leases of space in the Real Property and amendments, expansions and renewals of the Leases, provided that Seller provides Buyer with prior written notice of the same. Following the expiration of the Due Diligence Period, except for the New and Pending Lease Transactions, Seller shall obtain Buyer’s consent, in Buyer’s sole discretion, before entering into any new lease of space in the Real Property and before entering into a Lease amendment, expansion, or renewal; provided, however, Buyer’s consent shall not be required for any Lease amendment, expansion and/or renewal which is provided for in the Lease and with respect to which Seller does not have any discretion.  Buyer shall be deemed to have withheld consent to any new lease or any Lease amendment, expansion, or renewal if it has not notified Seller of its consent within five (5) days after its receipt of Seller’s written request for consent, together with a copy of the Lease amendment, expansion, or renewal or the new lease and a summary of all Leasing Costs in connection with the proposed transaction.  At the Close of Escrow, (a) Buyer shall reimburse Seller for commissions, the cost of tenant improvements, and all other leasing costs and expenses paid by Seller with respect to all New and Pending Lease Transactions entered into and listed on Schedule 1-1 attached hereto and with respect to all other Lease amendments, expansions or renewals or new leases that were entered into pursuant to this Section 5.3 between the Effective Date and the Close of Escrow, (b) Buyer shall be entitled to a credit towards the Purchase Price equal to the leasing commissions, tenant improvement costs or allowances, free rent credits, and Gap Rent listed to in Schedule 1-2 attached hereto to the extent such transaction has been entered into and the amounts set forth on Schedule 1-2 attached hereto remain unpaid and due and owing as of the Close of Escrow (the “Seller Leasing Costs”), and (c) Buyer shall assume in writing (pursuant to the Assignment of Leases and Contracts and Bill of Sale) Seller’s obligations (whether arising before or after the Closing Date) under the Leases referred to in Schedule 1-1 and Schedule 1-2 attached hereto (to the extent they have been entered into), and all new leases and Lease amendments, expansions or renewals entered into in accordance with the terms of this Agreement. “Gap Rent” will mean the base rent and additional rent for operating expenses due for the period from the Closing Date until the commencement date of the Lease with the tenant ViewRay.
12

5.4.Damage or Condemnation.  Risk of loss resulting from any condemnation or eminent domain proceeding which is commenced or has been threatened against the Real Property before the Close of Escrow, and risk of loss to the Real Property due to fire, flood or any other cause before the Close of Escrow, shall remain with Seller.  If before the Close of Escrow the Real Property or any portion thereof shall be materially damaged, or if the Real Property or any material portion thereof shall be subjected to a bona fide threat of condemnation or shall become the subject of any proceedings, judicial, administrative or otherwise, with respect to the taking by eminent domain or condemnation, then Buyer may elect not to acquire the Real Property by delivering written notice of such election to Seller within five (5) days after Buyer learns of the damage or taking, in which event Buyer shall no longer be obligated to purchase, and Seller shall no longer be obligated to sell, the Real Property.  If the Closing Date is within the aforesaid 5day period, then the Close of Escrow shall be extended to the next business day following the end of said 5day period.  If no such election is made, and in any event if the damage is not material, this Agreement shall remain in full force and effect, the purchase contemplated herein, less any interest taken by eminent domain or condemnation, shall be effected with no further adjustment, and upon the Close of Escrow, Seller shall assign, transfer and set over to Buyer all of the right, title and interest of Seller in and to any awards that have been or that may thereafter be made for such taking, and Seller shall assign, transfer and set over to Buyer any insurance proceeds that may thereafter be made for such damage or destruction giving Buyer a credit at the Close of Escrow for any deductible under such policies.  For purposes of this Section 5.4, the phrase(s) (i) “Material damage” or “Materially damaged” means (a) damage reasonably exceeding five percent (5%) of the Purchase Price of the Real Property, or (b) any damage which is not fully insured (which shall include lost rents) and for which Buyer will not receive, at Seller’s election, a credit in the amount of the uninsured portion of such damage upon the Close of Escrow, and (ii) “material portion” means any portion of the Real Property that has a “fair market value” exceeding one percent (1%) of the Purchase Price of the Real Property.
5.5.Warranty Transfers.  To the extent prepared by Buyer, Seller hereby agrees to reasonable cooperate (at no cost, expense, liability or potential liability to Seller) and execute any transfer requests for any Property warranties (e.g. roof) for which consent is required, provided, however, Buyer shall be responsible for any transfer fees associated in connection therewith.
5.6.REA/CC&R Estoppels.  Other than the Condominium Estoppel (which is separately addressed in Section 7.1(g) below), Buyer shall be entitled to request Seller to deliver for signature an estoppel certificate to any reciprocal easement agreement or other agreement, covenant, condition or restriction that burdens the Property (including, without limitation, estoppel certificates from each of the other Unit Owners with respect to the Declaration of Condominium) so long as Buyer prepares the form of estoppel certificate and provides the address as to where such estoppel certificate should be delivered. Under no circumstances shall Buyer’s receipt of an executed estoppel certificate to any reciprocal easement agreements or other covenants, conditions or restrictions that burden the Property (including, without limitation, estoppel certificates from each of the other Unit Owners with respect to the Declaration of Condominium) be a condition precedent to Buyer’s obligation to consummate the transaction contemplated under this Agreement.
13

5.7.Open Permits.  Seller shall cooperate with Buyer and use commercially reasonable efforts (at no material cost to Seller) to cause the open permits that are on file and that affect the Property (which Seller acknowledges have been disclosed to Seller in writing) to be closed prior to Closing, provided, however, the closing of all or some of such permits shall not be a condition precedent to Closing.
6.SELLER’S AND BUYER’S DELIVERIES
6.1.Seller’s Deliveries into Escrow.  No less than one (1) business day prior to the Closing Date, Seller shall deliver into Escrow (as such term is defined in Section 9 hereof) to the Escrow Holder the following:
(a)Deed.  A deed (the “Deed”) in the form attached hereto as Exhibit E, executed and acknowledged by Seller, conveying to Buyer Seller’s title to the Real Property.
(b)Assignment of Leases and Contracts and Bill of Sale.  An Assignment of Leases and Contracts and Bill of Sale (“Assignment of Leases and Contracts and Bill of Sale”) in the form of Exhibit F attached hereto, executed by Seller.
(c)State Law Disclosures.  Such disclosures and reports as are required by applicable state and local law in connection with the conveyance of the Real Property.
(d)FIRPTA.  A Foreign Investment in Real Property Tax Act affidavit executed by Seller substantially in the form of Exhibit G attached hereto.
(e)Owner’s Affidavit.  An Owner’s Affidavit executed by Seller substantially in the form of Exhibit I attached hereto.
(f)Bring Down Certificate.  A bring-down certificate executed by Seller in the form of Exhibit J attached hereto, confirming whether the representations and warranties made by Seller in Section 11.1 hereof continue to be true and correct in all material respects.
(g)Rent Rolls.  Updated Rent Rolls and receivables report dated within 3 business days of the Closing Date reflecting facts as of the date of such Rent Roll and receivables report, respectively.
(h)DR Form 1083.  A DR Form 1083 signed by Seller and submitted to the Colorado Department of Revenue.
(i)Resignations and Appointments.  Resignations of Seller’s designees from the board of directors of the Block 95 Condominiums Association, Inc. (the “Condominium Association”) and replacement of them by Buyer’s designees.
(j)Additional Documents.  Any additional documents that Escrow Holder or the Title Company may reasonably require for the proper consummation of the transaction contemplated by this Agreement.
14

6.2.Buyer’s Deliveries into Escrow.  No less than one (1) business day prior to the Closing Date (except as otherwise provided below), Buyer shall deliver into Escrow to the Escrow Holder the following:
(a)Purchase Price.  The Purchase Price, less the Deposit that is applied to the Purchase Price, plus or minus applicable prorations, deposited by Buyer with the Escrow Holder in immediate, same day federal funds wired for credit into the Escrow Holder’s escrow account and deposited in Escrow Holder’s escrow account no later than 1:00 p.m. (California time) on the Closing Date.
(b)Assignment of Leases and Contracts and Bill of Sale.  An Assignment of Leases and Contracts and Bill of Sale executed by Buyer.
(c)State Law Disclosures.  Such disclosures and reports as are required by applicable state and local law in connection with the conveyance of the Real Property.
(d)Transfer Declaration – Form TD 1000.  A Form TD 1000 signed by Buyer and filed with the County Assessor.
(e)Additional Documents.  Any additional documents that Escrow Holder or the Title Company may reasonably require for the proper consummation of the transaction contemplated by this Agreement.
6.3.Closing Statements/Escrow Fees; Tenant Notices.  Concurrently with the Close of Escrow, Seller and Buyer shall deposit with the Escrow Holder executed closing statements consistent with this Agreement in the form required by the Escrow Holder and, Seller and Buyer shall execute at the Close of Escrow, and deliver to each tenant immediately after the Close of Escrow, tenant notices regarding the sale of the Real Property in substantially the form of Exhibit H attached hereto, or such other form as may be required by applicable state law.  Seller shall prepare a schedule of all of the estimated credits, adjustments, and prorations, and deliver it to the Title Company and Buyer not less than three (3) business days prior to the Closing Date.
6.4.Post-Closing Deliveries.  Immediately after the Close of Escrow, to the extent in Seller’s possession, Seller shall deliver to the offices of Buyer’s property manager:  the original Leases; copies or originals of all contracts, receipts for deposits, and unpaid bills; all keys, if any, used in the operation of the Real Property; and, if in Seller’s possession, any “as-built” plans and specifications of the Improvements.
7.CONDITIONS TO BUYER’S AND SELLER’S OBLIGATIONS
7.1.Conditions to Buyer’s Obligations.  The Close of Escrow and Buyer’s obligation to consummate the transaction contemplated by this Agreement are subject to the satisfaction of the following conditions for Buyer’s benefit (or Buyer’s waiver thereof, it being agreed that Buyer may waive any or all of such conditions) on or prior to the Closing Date or on the dates designated below for the satisfaction of such conditions:
15

(a)All of Seller’s representations and warranties contained herein shall be true and correct as of the date of this Agreement and as of the Closing Date, subject to any qualifications hereafter made to any of Seller’s representations as provided for in Section 11.1 hereof;
(b)As of the Closing Date, Seller shall have performed its obligations hereunder and all deliveries to be made at Close of Escrow by Seller shall have been tendered;
(c)There shall exist no actions, suits, arbitrations, claims, attachments, proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings, pending or threatened against Seller that would materially and adversely affect Seller’s ability to perform its respective obligations under this Agreement;
(d)There shall exist no pending or threatened action, suit or proceeding with respect to Seller before or by any court or administrative agency which seeks to restrain or prohibit, or to obtain damages or a discovery order with respect to, this Agreement or the consummation of the transaction contemplated hereby; and
(e)Subject to Section 4.4 above, no less than three (3) business days prior to the Closing Date, Seller shall have delivered or caused to be delivered to Buyer, Tenant Estoppel Certificates complying with the provisions of Section 4.4 above, which Tenant Estoppel Certificates shall be consistent with the information set forth in the Rent Rolls.
(f)At the Closing, the Title Company shall have irrevocably committed (or be willing to irrevocably commit) to issue to Buyer the Title Policy (excluding endorsements, other than curative endorsements obtained by Seller in accordance with the terms of this Agreement), unless this condition is not satisfied because of (a) the actions or omissions of Buyer, or (b) the failure of Buyer to satisfy any requirement in the Title Commitment applicable to Buyer.
(g)Seller shall have delivered to Buyer prior to Closing an estoppel certificate from (i) the Condominium Association in substantially the form of that received by Seller in connection with Seller’s acquisition of the Property (a copy of which Seller has previously delivered to Buyer as part of the Property Information), subject to any changes necessary to reflect any changes in facts and circumstances (the “Condominium Estoppel”), and (ii) the hotel owner of Unit 2 under the Condominium Declaration, in substantially the form of that attached hereto as Exhibit K (the “Hotel Owner Estoppel”) . 
If, notwithstanding the nonsatisfaction of any such condition, the Close of Escrow occurs, there shall be no liability on the part of Seller for breaches of representations and warranties of which Buyer had actual knowledge as of the Close of Escrow.
7.2.Conditions to Seller’s Obligations.  The Close of Escrow and Seller’s obligations to consummate the transaction contemplated by this Agreement are subject to the satisfaction of the following conditions for Seller’s benefit (or Seller’s waiver thereof, it being agreed that Seller may waive any or all of such conditions) on or prior to the Closing Date or the dates designated below for the satisfaction of such conditions:
16

(a)All of Buyer’s representations and warranties contained herein shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date;
(b)As of the Closing Date, Buyer has performed its obligations hereunder and all deliveries to be made at Close of Escrow by Buyer shall have been tendered including, without limitation, the deposit with Escrow Holder of the amounts set forth in Section 6.2(a) hereof;
(c)There shall exist no actions, suits, arbitrations, claims, attachments, proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings, pending or threatened against Buyer that would materially and adversely affect Buyer’s ability to perform its obligations under this Agreement; 
(d)There shall exist no pending or threatened action, suit or proceeding with respect to Buyer before or by any court or administrative agency which seeks to restrain or prohibit, or to obtain damages or a discovery order with respect to, this Agreement or the consummation of the transaction contemplated hereby; and
(e)Seller shall have received all consents and approvals from all governmental bodies from whom such consents and approvals are necessary in order to consummate the Close of Escrow, but only to the extent Seller’s failure to obtain such consents and/or approvals would prevent Seller from consummating the Close of Escrow (the “Consent and Approval Condition”); provided, however, if the Consent and Approval Condition is not satisfied as of the Closing Date, then so long as the governmental consent or approval required to be obtained by Seller for Closing is obtainable on or before November 30, 2021, either Seller or Buyer (but not both parties) shall be entitled to extend the Closing Date one time to November 30, 2021 for purposes of satisfying the Consent and Approval Condition by providing written notice of the same to the other party prior to Closing.  In connection therewith, Seller hereby agrees to use commercially reasonable efforts to satisfy the Consent and Approval Condition, but in no event shall Seller be obligated to incur any costs or expenses in excess of One Hundred Thousand Dollars ($100,000.00) in the aggregate unless Buyer elects, in writing, to reimburse Seller for any such excess costs or expenses for purposes of obtaining any required governmental consents or approvals to satisfy the Consent and Approval Condition.  In the event the Closing Date is extended as provided in this Section 7.2(e), upon the satisfaction of the Consent and Approval Condition, Seller shall have the right to accelerate the Closing Date by providing Buyer with no less than five (5) days’ prior written notice of the same.
8.CLOSE OF ESCROW; POSSESSION
8.1. “Close of Escrow” shall mean and refer to Seller’s receipt of the Purchase Price and the other amounts due Seller in accordance with the provisions of Section 9.1(b) below.  The wire deadline on the scheduled Closing Date is 1:00 pm California time (“Closing Wire Deadline”), except that if the Escrow Holder receives the amounts due from Buyer on the Closing Date and each holder of any mortgage financing encumbering the Property prior to Closing receives and accepts repayment of such financing from Escrow Holder on the Closing Date without charging interest or other amount for any day after the Closing Date (and Seller 
17

receives its share of the Purchase Price on the scheduled Closing Date), then the Closing Wire Deadline will be whatever time on the scheduled Closing Date Escrow Holder receives the Closing payment and Buyer will be considered to be in compliance with all other provisions of this Agreement requiring performance by 1:00 pm California time.
8.2.Sole exclusive possession of the Real Property, subject only to the Permitted Exceptions, shall be delivered to Buyer on the Closing Date.
9.ESCROW
9.1.Closing.  The escrow (the “Escrow”) for the consummation of this transaction shall be established with Escrow Holder at the address indicated in Section 15.1 hereof by the deposit of a signed copy of this Agreement with Escrow Holder contemporaneously with the execution hereof.  This Agreement shall constitute both an agreement among Buyer and Seller and escrow instructions for Escrow Holder.  If Escrow Holder requires separate or additional escrow instructions which it deems necessary for its protection, Seller and Buyer hereby agree promptly upon request by Escrow Holder to execute and deliver to Escrow Holder such separate or additional escrow instructions (the “Additional Instructions”).  In the event of any conflict or inconsistency between this Agreement and the Additional Instructions, this Agreement shall prevail and govern, and the Additional Instructions shall so provide.  The Additional Instructions shall not modify or amend the provisions of this Agreement unless otherwise agreed to in writing by Seller and Buyer.
On the Closing Date, provided that the conditions set forth in Sections 7.1 and 7.2 hereof have been satisfied or waived, Escrow Holder shall take the following actions in the order indicated below:
(a)With respect to all closing documents delivered to Escrow Holder hereunder, and to the extent necessary, Escrow Holder is authorized to insert into all blanks requiring the insertion of dates the date of the recordation of the Deed or such other date as Escrow Holder may be instructed in writing by Seller and Buyer;
(b)Deliver to Seller, in cash or current funds, the Purchase Price, plus or minus, as the case may be, the amounts determined in accordance with the provisions of Section 10 hereof, and those items referred in Section 6.2 hereof and conformed copies of the recorded Deed;
(c)Record the Deed in the official records of the County in which the Real Property is located;
(d)Deliver to Buyer those items referred to in Section 6.1 hereof and a conformed copy of the recorded Deed;
(e)Cause the Title Company to issue the Title Policy for the Real Property in accordance with the provisions of Section 4.2.3 hereof; and
18

(f)Deliver to Seller and Buyer a final closing statement which has been certified by Escrow Holder to be true and correct.
9.2.Escrow and Title Charges.
(a)Upon the Close of Escrow, escrow, title charges and other closing costs shall be allocated between Seller and Buyer as follows:
(i)Seller shall pay:  (1) the premiums for the Title Policy, (2) the cost of recording the Deed, and (3) one-half (1⁄2) of any escrow fees or similar charges of Escrow Holder.
(ii)Buyer shall pay one half (1⁄2) of any escrow fees or similar charges of Escrow Holder and all sales, gross receipts, compensating, stamp, excise, documentary, transfer, deed or similar taxes or fees (City, County and State) payable in connection with the consummation of the transactions contemplated by this Agreement.  If Buyer desires ALTA extended coverage for any Title Policy, Buyer shall pay the premiums and any additional costs (including any survey costs) for such coverage (additional to the premiums for standard coverage) and the cost of any endorsements to the Title Policy, if required by Buyer.
(iii)Buyer shall pay all costs incurred in connection with Buyer’s updating or recertifying the Existing Surveys or obtaining any new surveys for the Real Property.
(iv)Except to the extent otherwise specifically provided herein, all other expenses incurred by Seller and Buyer with respect to the negotiation, documentation and closing of this transaction, including, without limitation, Buyer’s and Seller’s attorneys’ fees, shall be borne and paid by the party incurring same.
(b)If the Close of Escrow does not occur by reason of Buyer’s or Seller’s default under this Agreement, then all escrow and title charges (including cancellation fees) shall be borne by the party in default.
9.3.Procedures Upon Failure of Condition.  Except as otherwise expressly provided herein, if any condition set forth in Sections 7.1 or 7.2 hereof is not timely satisfied or waived for a reason other than the default of Buyer or Seller in the performance of its respective obligations under this Agreement:
(a)This Agreement, the Escrow and the respective rights and obligations of Seller and Buyer hereunder shall terminate (other than the indemnity and insurance obligations of Buyer set forth in Sections 4.3.1 and 14 hereof and the confidentiality provisions of Section 4.6 hereof which shall survive such termination) at the written election of the party for whose benefit such condition was imposed;
(b)Escrow Holder, or if Seller is holding the Deposit, Seller shall return the Deposit to Buyer, shall promptly return to Buyer all funds of Buyer in its possession, including 
19

the Deposit and all interest accrued thereon, and to Seller and Buyer all documents deposited by them respectively, which are then held by Escrow Holder;
(c)Buyer shall return to Seller the Property Information and Buyer shall deliver to Seller all Work Product (as such term is defined in Section 15.3 hereof); and
(d)Any escrow cancellation and title charges shall be borne equally by Seller and Buyer.
10.PRORATIONS
If the Purchase Price is received by Seller’s depository bank in time to credit to Seller’s account on the Closing Date, the day the Close of Escrow occurs shall belong to Buyer and all prorations hereinafter provided to be made as of the Close of Escrow shall each be made as of the end of the day before the Closing Date.  If the cash portion of the Purchase Price is not so received by Seller’s depository bank on the Closing Date, then the day the Close of Escrow occurs shall belong to Seller and such proration shall be made as of the end of the day that is the Closing Date.  In each such proration set forth below, the portion thereof applicable to periods beginning as of Close of Escrow shall be credited to Buyer or charged to Buyer as applicable and the portion thereof applicable to periods ending as of Close of Escrow shall be credited to Seller or charged to Seller as applicable.
10.1.Collected Rent.  All rent (including, without limitation, all base rents, additional rents and retroactive rents, and expressly including tenant reimbursements for Operating Costs, as hereinafter defined) and all other income (and any applicable state or local tax on rent) (hereinafter collectively referred to as “Rents”) collected under Leases in effect on the Closing Date shall be prorated as of the Close of Escrow.  Uncollected Rent shall not be prorated and, to the extent payable for the period prior to the Close of Escrow, shall remain the property of Seller.  Any amounts received by Buyer after Closing from any party owing Rents shall first be applied to Buyer’s reasonable collection costs (including reasonable Attorneys’ Fees and costs but excluding compensation for services of Buyer or its employees or agents), then to accrued obligations of the tenant due after Close of Escrow, then to any rent due for the month of Closing (with Buyer and Seller each receiving their prorated share), and then to accrued obligations due prior to Close of Escrow.  Any prepaid Rents for the period following the Closing Date shall be paid over by Seller to Buyer.  In the event that Seller receives any rent after Closing that is applicable to the period after Closing, Seller will promptly remit Buyer’s share of all such amounts to Buyer.  Buyer will make reasonable efforts, without suit, to collect any Rents applicable to the period before the Close of Escrow including, without limitation, sending to tenants bills for the payment of past due Rents during the first twelve (12) month period following the Closing Date.  Buyer shall not be obligated to evict any tenant or to file suit to collect any Rents.  Seller may pursue collection of any Rents that were past due as of the Closing Date, provided that Seller shall have no right to terminate any Lease or any tenant’s occupancy under any Lease in connection therewith.
10.2.Operating Costs and Additional Rent Reconciliation.  Seller, as landlord under the Leases, is currently collecting from tenants under the Leases additional rent to cover taxes, insurance, utilities (to the extent not paid directly by tenants), common area maintenance and 
20

other operating costs and expenses (collectively, “Operating Costs”) in connection with the ownership, operation, maintenance and management of the Real Property.  To the extent that any additional rent (including, without limitation, estimated payments for Operating Costs) is paid by tenants to the landlord under the Leases based on an estimated payment basis (monthly, quarterly, or otherwise) for which a future reconciliation of actual Operating Costs to estimated payments is required to be performed at the end of a reconciliation period, Buyer and Seller shall make an adjustment at the Close of Escrow for the applicable reconciliation period (or periods, if the Leases do not have a common reconciliation period) based on a comparison of the actual Operating Costs to the estimated payments at the Close of Escrow.  If, as of the Close of Escrow, Seller has received additional rent payments in excess of the amount that tenants will be required to pay, based on the actual Operating Costs as of the Close of Escrow, Buyer shall receive a credit in the amount of such estimated excess.  If, as of the Close of Escrow, Seller has received additional rent payments that are less than the amount that tenants would be required to pay based on the actual Operating Costs as of the Close of Escrow, Seller shall receive a credit in the amount of such deficiency.  Operating Costs that are not payable by tenants either directly or reimbursable under the Leases shall be prorated between Seller and Buyer and shall be reasonably estimated by the parties if final bills are not available.  The parties shall “re-prorate” the Operating Costs prorated at Close of Escrow (including any portions thereof that may be required to be refunded to tenants) at the time that such estimates are actually adjusted or reconciled pursuant to the terms of the Leases and based on expenses actually incurred by Seller and Buyer for their respective periods of ownership as compared to Operating Costs collected by Seller from January 1, 2021 and ending on the Closing Date (taking into account the credit, if any, given at Closing related thereto) which shall occur by April 1, 2022.  Any amounts that may be due Seller as a result of such re-prorations shall be paid by Buyer to Seller within ten Business Days after the annual reconciliation statements are sent to the tenants by Buyer (to the extent not previously credited at Closing as provided above), and any amounts that may be due from Seller as a result of such re-prorations shall be paid by Seller to Buyer within ten Business Days after written request therefor is delivered to Seller by Buyer accompanied by supporting statements and documents reasonably satisfactory to Seller (to the extent not previously credited at Closing as provided above).
10.3.Taxes and Assessments.  Real estate taxes and assessments (“Real Estate Taxes”) and personal property taxes and assessments (“Personal Property Taxes” and, together with Real Estate Property Taxes, “Taxes”) imposed by any governmental authority with respect to the Real Property and Personal Property for the relevant tax year in which the Real Property is being sold and that are not yet due and payable or that have not yet been paid shall be prorated as of the Close of Escrow based upon (a) the most recent ascertainable assessed values and mill levies for Units 1A, 1B, 1C and 5, Block 95 Condominiums, and (b) an estimated appraised value of One Hundred Eighty-One Million, Five Hundred Forty-One Thousand and One Hundred Dollars ($181,541,100) (or such lower amount if the County Assessor has agreed to a lower appraised value prior to Closing) for Unit 1, Block 95 Condominiums, and based upon the number of days Buyer and Seller will have owned the Real Property during such relevant tax year.  Buyer shall receive a credit for any Taxes payable by Buyer which are unpaid as of the Close of Escrow and applicable to any period on or before the Closing Date.  Seller shall receive a credit for any Taxes paid by Seller and applicable to any period after the Close of Escrow.  Seller is protesting the assessment of the Property for 2021 (the “Tax Appeal”) under an agreement with Duff & 
21

Phelps (the “Tax Appeal Contract”). At Closing, Seller shall assign, and Buyer shall assume, the Tax Appeal Contract and shall have the right (but not the obligation), after the Closing Date, to continue the Tax Appeal to final disposition. The proration of Real Estate Taxes shall be final as of the Close of Escrow and shall not be subject to further adjustment (whether due to an error or for any other reason) after the Close of Escrow and there will be no re-proration of Real Estate Taxes under Section 10.9.  Notwithstanding anything stated to the contrary, (i) in no event shall Seller be responsible (and Buyer hereby expressly agrees to be responsible) for any assessments for Unit 1, Block 95 Condominiums attributable to an appraised value of the Property in excess of One Hundred Eighty-One Million, Five Hundred Forty-One Thousand and One Hundred Dollars ($181,541,100); and (ii) in no event shall Seller be entitled to (and Buyer will receive 100% of the benefit [subject to the obligation in the next paragraph to make refunds to tenants] of) any reduction in Real Estate Taxes from the amounts used for prorations at Close of Escrow resulting from the Tax Appeal.
Buyer shall have the obligation to refund to each tenant any amount paid by such tenant on account of Real Estate Property Taxes for 2021 to the extent exceeding the amount of Real Estate Taxes for 2021 actually payable by Buyer following final disposition of the Tax Appeal as reduced by the total amounts paid by Seller and Buyer under the Tax Appeal Contract or otherwise in the prosecution of the Tax Appeal, including, without limitation, attorney’s fees.
The obligations set forth herein shall survive the Close of Escrow and Buyer agrees that, as a condition to the transfer of the Property by Buyer, Buyer will cause any transferee to assume the obligations set forth herein.
10.4.Leasing Commissions, Tenant Improvements and Contracts.  At Close of Escrow, Buyer shall assume (pursuant to the Assignment of Leases and Contracts and Bill of Sale) the obligation to pay all (a) leasing costs that are due or become due prior to the Closing Date to the extent that the same (i) arise from a new lease or any Lease amendment, extension or expansion hereafter entered into by Seller in accordance with the terms and conditions of this Agreement, or (ii) arise out of any New and Pending Lease Transactions (including, without limitation, the commissions and/or tenant improvements referenced in Section 5.3 hereof), and (b) leasing costs that are due after the Closing Date to the extent that they are disclosed under such Leases or otherwise disclosed to Buyer in writing prior to the expiration of the Due Diligence Period or otherwise agreed to by Buyer in connection with any extension, expansion or refusal rights exercised after the Closing (the “Buyer Leasing Costs”).  Buyer will assume the obligations arising from and after the Closing Date under the Contracts which Buyer has elected to assume.  Buyer and Seller shall each be entitled to the credits, if any, provided for in Section 5.3 herein.  Buyer shall be entitled to receive a credit against the Purchase Price at Closing for the amount of any rental abatements or “free rent” periods attributable to periods from and after the Closing Date under Leases in effect as of the Effective Date.  
10.5.Tenant Deposits.  All tenant security deposits actually received by Seller (and interest thereon if required by law or contract to be earned thereon) and not theretofore applied to tenant obligations under the Leases shall be transferred or credited to Buyer at the Close of Escrow or placed in escrow if required by law.  As of the Close of Escrow, Buyer shall assume Seller’s obligations related to tenant security deposits. Unless and until this Agreement is 
22

terminated, Seller shall not apply any security deposits to any obligations under the Leases other than in the ordinary course of business.  With respect to any security deposit which is evidenced by a letter of credit, Seller shall deliver to Buyer at Closing (i) such original letter of credit, and (ii) an executed form assignment or transfer of its interest as beneficiary or such other instruments as the issuer of such letter of credit shall reasonably require in order to cause the named beneficiary under such letter of credit to be changed to Buyer.
10.6.Utilities and Utility Deposits.  Utilities for the Real Property (excluding utilities for which payment is made directly by tenants), including water, sewer, electric, and gas, based upon the last reading of meters prior to the Close of Escrow, shall be prorated.  Seller shall be entitled to a credit for all security deposits held by any of the utility companies providing service to the Real Property as set forth on Exhibit L attached hereto.  Seller shall endeavor to obtain meter readings on the day before the Closing Date, and if such readings are obtained, there shall be no proration of such items and Seller shall pay at Close of Escrow the bills therefor for the period to the day preceding the Close of Escrow, and Buyer shall pay the bills therefor for the period subsequent thereto.  If the utility company will not issue separate bills, Buyer will receive a credit against the Purchase Price for Seller’s portion and will pay the entire bill prior to delinquency after Close of Escrow.  If Seller has paid utilities no more than thirty (30) days in advance in the ordinary course of business, then Buyer shall be charged its portion of such payment at Close of Escrow.  Buyer shall be responsible for making any security deposits required by utility companies providing service to the Real Property, to the end that Seller’s utility deposits shall be refunded to Seller following the Closing, after appropriate charge for Seller’s utility bills. 
10.7.Owner Deposits.  Seller shall receive a credit at the Close of Escrow for all bonds, deposits, letters of credit, set aside letters or other similar items listed on Exhibit Q attached hereto that are outstanding with respect to the Real Property that have been provided by Seller or any of its affiliates to any governmental agency, public utility, or similar entity (collectively, “Owner Deposits”) to the extent assignable to Buyer.  To the extent any Owner Deposits are not assignable to Buyer, Buyer shall replace such Owner Deposits and obtain the release of Seller (or its affiliates) from any obligations under such Owner Deposits.  To the extent that any funds are released as a result of the termination of any Owner Deposits for which Seller did not get a credit, such funds shall be delivered to Seller immediately upon their receipt.
10.8.Percentage Rents.  Percentage rents actually collected for the month in which the Closing occurs shall be prorated as of the Closing Date.  After Buyer has completed any reconciliation of actual percentage rents payable and estimated percentage rents paid by the subject tenants, and all reconciled amounts have been paid, a reconciliation shall be made between Seller and Buyer with regard to such percentage rents, which shall occur by April 1, 2022.  Pursuant to such reconciliation, Seller and Buyer shall be entitled to their proportionate share of all percentage rents paid for the subject fiscal Lease year used to calculate each tenant’s percentage rents (less any out-of-pocket costs incurred in collecting said amounts, which shall belong to Buyer) based on the number of days of such fiscal year Seller and Buyer owned the Property (and adjusted for any amount of percentage rent prorated at Closing or received by Seller or Buyer).  As used in this Section 10.8, the term “percentage rents” shall not include and shall have deducted from such percentage rent amount any “base” or “minimum” rent 
23

component which is payable each month (regardless of actual sales), which “base” or “minimum” rent component shall be prorated or otherwise handled in the manner provided in this Agreement.  Buyer will make reasonable efforts, without suit, to collect all percentage rents payable after the Close of Escrow and relating to the period prior to the Close of Escrow, and all percentage rents which are delinquent as of the Close of Escrow, including, without limitation, sending to tenants bills for the payment of the same during the first twelve (12) month period following the Closing Date.  Buyer shall not be obligated to evict any tenant or to file suit to collect any percentage rents.  Seller may pursue collection of all percentage rents payable after the Close of Escrow and relating to the period prior to the Close of Escrow and all percentage rents which are delinquent as of the Close of Escrow, provided that Seller shall have no right to terminate any Lease or any tenant’s occupancy under any Lease in connection therewith.
10.9.Final Adjustment After Closing.  If final prorations cannot be made at the Close of Escrow for any item being prorated under this Section 10 (other than Real Estate Taxes), then, provided either Buyer or Seller identifies any such proration (“Post-Closing Proration”) in writing before the Close of Escrow (and for purposes of this Section 10.9, Seller and Buyer have agreed that Operating Costs under Section 10.2, and Percentage Rents under Section 10.8 shall constitute Post-Closing Prorations), Buyer and Seller agree to allocate such items on a fair and equitable basis as soon as invoices or bills are available and applicable reconciliation with tenants have been completed, with final adjustment to be made as soon as reasonably possible after the Close of Escrow (but in no event later than six (6) months after the Close of Escrow, except that adjustments arising from Operating Costs under Section 10.2 or from Percentage Rents under Section 10.8 hereof shall not be subject to such six-month limitation, but shall be made as soon as reasonably possible, to the effect that income and expenses are received and paid by the parties on an accrual basis with respect to their period of ownership.  Notwithstanding anything to the contrary stated in this Section 10, except for any Post-Closing Prorations (which must be determined and paid within the time periods set forth above), all prorations made under this Section 10 shall be final as of the Close of Escrow and shall not be subject to further adjustment (whether due to an error or for any other reason) after the Close of Escrow.  Any amounts that may be due Seller as a result of any Post-Closing Proration shall, as to Operating Costs under Section 10.2, be paid by Buyer to Seller within ten business days after the annual reconciliation statements are sent to the tenants by Buyer (to the extent not previously credited at Closing as provided in this Section 10), and as to any other Post-Closing Proration, within ten business days after final determination of the proration in question; and any amounts that may be due from Seller as a result of such Post-Closing Prorations shall be paid by Seller to Buyer within ten business days after written request therefor is delivered to Seller by Buyer accompanied by supporting statements and documents reasonably satisfactory to Seller (to the extent not previously credited at Closing as provided in this Section 10). 
11.SELLER’S REPRESENTATIONS AND WARRANTIES; AS-IS
11.1.Seller’s Representations and Warranties.  In consideration of Buyer’s entering into this Agreement and as an inducement to Buyer to purchase the Real Property from Seller, Seller makes the following representations and warranties to Buyer:
24

(a)Seller is a limited liability company organized and in good standing under the laws of the State of Delaware.  Seller has the legal right, power and authority to enter into this Agreement and to consummate the transactions contemplated hereby, and the execution, delivery and performance of this Agreement have been duly authorized and no other action by Seller is requisite to the valid and binding execution, delivery and performance of this Agreement, except as otherwise expressly set forth herein.
(b)There is no agreement to which Seller is a party or to Seller’s Actual Knowledge binding on Seller which would prevent Seller from consummating the transaction contemplated by this Agreement.
(c)To Seller’s Actual Knowledge, except as disclosed on Schedule 2 attached hereto, Seller has received no written notice from any governmental agency that the Property or the current use and operation thereof violate any applicable federal, state or municipal law, statute, code, ordinance, rule or regulation (including those relating to environmental matters), except with respect to such violations as have been fully cured prior to the date hereof.
(d)To Seller’s Actual Knowledge, except as disclosed on Schedule 2 attached hereto, Seller has not received written notice from any governmental agency of any condemnation proceedings relating to the Property.
(e)To Seller’s Actual Knowledge, except as disclosed on Schedule 2 attached hereto, except with respect to slip and fall and similar claims or matters covered by Seller’s commercial liability insurance policy, Seller has not received service of process with respect to any litigation that has been filed and is continuing against Seller that arises out of the ownership of the Property and would materially affect the Property or the use thereof, or Seller’s ability to perform hereunder.  
(f)To Seller’s Actual Knowledge, (x) Exhibit C-2 is a true, correct, and complete list of the Leases as of the Effective Date, and (y) Seller has delivered to Buyer, or made available to Buyer for review, true and complete, in all material respects, copies of all Leases set forth on Exhibit C-2.  To Seller’s Actual Knowledge, except for the notices referenced in Schedule 2, within the last six months prior to the Effective Date, Seller has not given any written notice to a tenant under any Lease of a default which remains uncured.  
(g)To Seller’s Actual Knowledge, neither Seller nor any of its respective affiliates or constituents, nor any of their respective brokers or other agents acting in any capacity in connection with the transactions contemplated by this Agreement is or will be (a) conducting any business or engaging in any transaction or dealing with any person appearing on the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) list of restrictions and prohibited persons (“Prohibited Person”) (which lists can be accessed at the following web address:  http://www.ustreas.gov/offices/enforcement/ofac/), including the making or receiving of any contribution of funds, goods or services to or for the benefit of any Prohibited Person; (b) dealing in, or otherwise engaging in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224 dated September 24, 2001, relating to “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism”; or (c) engaging in or conspiring to 
25

engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempting to violate, any of the prohibitions set forth in any U.S. anti-money laundering law.  
(h)To Seller’s Actual Knowledge, the Contracts listed on Exhibit C-1 attached hereto are all of the contracts affecting the Property as of the Effective Date other than any contracts disclosed in the Property Information or agreements disclosed in the Title Commitment, and except for the foregoing, there shall not be any other Contracts or contracts or agreements of any type pertaining to the Property, the obligation or liability for which Buyer or the Property could be liable after the Closing.
(i)To Seller’s Actual Knowledge, Seller has provided or made available to Buyer all Property Information in Seller's possession.
(j)To Seller’s Actual Knowledge, all Operating Costs reconciliations for calendar year 2020 have been made and, except as set forth in Schedule 2 attached hereto, all amounts which were reasonably determined by Seller to be owed to tenants in connection with such reconciliations have been paid or credited; provided, however, Seller makes no representation or warranty as to the accuracy or completeness of any such Operating Costs reconciliations for calendar year 2020.  
For purposes of this Section 11.1, the phrase “To Seller’s Actual Knowledge” shall mean the actual (and not implied, imputed, or constructive) knowledge of Tim Helgeson (whom the Seller represents is the asset manager for the Real Property), without any inquiry or investigation of any other parties, including, without limitation, the tenants and the property manager of the Real Property.
The representations and warranties made by Seller in this Agreement shall survive the recordation of the Deed for a period of nine (9) months and Buyer must give Seller notice of any breach of Seller’s representations or warranties within said nine (9) month period.  If, after the Effective Date, but before the Close of Escrow, Seller becomes aware of any facts or changes in circumstances that would cause any of its representations and warranties in this Agreement to be untrue at Close of Escrow, Seller may notify Buyer in writing of such fact.  In such case, or in the event Buyer obtains information which would cause any of Seller’s representations and warranties to be untrue at Close of Escrow, Buyer, as its sole and exclusive remedy, shall have the right to either (i) terminate this Agreement to the extent that the failure of any such representation or warranty to be true would have a material adverse impact on the Property, in which case the Deposit shall be immediately returned to Buyer and neither party shall have any rights or obligations under this Agreement (except for Sections 4.3.1, 15.3 and 15.5 which survive termination of this Agreement); or (ii) to the extent Buyer is not permitted to terminate this Agreement pursuant to clause (i) above, accept a qualification to Seller’s representations and warranties as of the Close of Escrow and complete the purchase and sale of the Property without any rights to recovery for breach of the unqualified representation and warranty.  Other than as set forth in the immediately preceding sentence, if Buyer proceeds with the Close of Escrow, Buyer shall be deemed to have expressly waived any and all remedies for the breach of any representation or warranty discovered by Buyer prior to the Close of Escrow.
11.2.As-Is.  As of the expiration of the Due Diligence Period, Buyer will have:
26

(a)examined and inspected the Property and will know and be satisfied with the physical condition, quality, quantity and state of repair of the Property in all respects (including, without limitation, the compliance of the Real Property with the Americans With Disabilities Act of 1990 Pub.L. 101-336, 104 Stat. 327 (1990), and any comparable local or state laws (collectively, the “ADA”)) and by proceeding with this transaction following the expiration of the Due Diligence Period shall be deemed to have determined that the same is satisfactory to Buyer;
(b)reviewed the Property Information and all instruments, records and documents which Buyer deems appropriate or advisable to review in connection with this transaction, including, but not by way of limitation, any and all architectural drawings, plans, specifications, surveys, building and occupancy permits, and any licenses, leases, contracts, warranties and guarantees relating to the Real Property or the business conducted thereon, and Buyer, by proceeding with this transaction following the expiration of the Due Diligence Period, shall be deemed to have determined that the same and the information and data contained therein and evidenced thereby are satisfactory to Buyer;
(c)reviewed all applicable laws, ordinances, rules and governmental regulations (including, but not limited to, those relating to building, zoning and land use) affecting the development, use, occupancy or enjoyment of the Real Property, and Buyer, by proceeding with this transaction following the expiration of the Due Diligence Period, shall be deemed to have determined that the same are satisfactory to Buyer; and
(d)at its own cost and expense, made its own independent investigation respecting the Property and all other aspects of this transaction, and shall have relied thereon and on the advice of its consultants in entering into this Agreement, and Buyer, by proceeding with this transaction following the expiration of the Due Diligence Period, shall be deemed to have determined that the same are satisfactory to Buyer.
TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, AND EXCEPT FOR SELLER’S REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT AND IN THE DOCUMENTS EXECUTED IN CONNECTION WITH THE CLOSE OF ESCROW (“SELLER’S WARRANTIES”), THIS SALE IS MADE AND WILL BE MADE WITHOUT REPRESENTATION, COVENANT, OR WARRANTY OF ANY KIND (WHETHER EXPRESS, IMPLIED, OR, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, STATUTORY) BY SELLER.  AS A MATERIAL PART OF THE CONSIDERATION FOR THIS AGREEMENT, BUYER AGREES TO ACCEPT THE PROPERTY ON AN “AS IS” AND “WHERE IS” BASIS, WITH ALL FAULTS, AND WITHOUT ANY REPRESENTATION OR WARRANTY, ALL OF WHICH SELLER HEREBY DISCLAIMS, EXCEPT FOR SELLER’S WARRANTIES.  EXCEPT FOR SELLER’S WARRANTIES, NO WARRANTY OR REPRESENTATION IS MADE BY SELLER AS TO FITNESS FOR ANY PARTICULAR PURPOSE, MERCHANTABILITY, DESIGN, QUALITY, CONDITION, OPERATION OR INCOME, COMPLIANCE WITH DRAWINGS OR SPECIFICATIONS, ABSENCE OF DEFECTS, ABSENCE OF HAZARDOUS OR TOXIC SUBSTANCES, ABSENCE OF FAULTS, FLOODING, OR COMPLIANCE WITH LAWS AND REGULATIONS INCLUDING, WITHOUT 
27

LIMITATION, THOSE RELATING TO HEALTH, SAFETY, AND THE ENVIRONMENT (INCLUDING, WITHOUT LIMITATION, THE ADA).  BUYER ACKNOWLEDGES THAT BUYER HAS ENTERED INTO THIS AGREEMENT WITH THE INTENTION OF MAKING AND RELYING UPON ITS OWN INVESTIGATION OF THE PHYSICAL, ENVIRONMENTAL, ECONOMIC USE, COMPLIANCE, AND LEGAL CONDITION OF THE PROPERTY AND THAT BUYER IS NOT NOW RELYING, AND WILL NOT LATER RELY, UPON ANY REPRESENTATIONS AND WARRANTIES MADE BY SELLER OR ANYONE ACTING OR CLAIMING TO ACT, BY, THROUGH OR UNDER OR ON SELLER’S BEHALF CONCERNING THE PROPERTY.  ADDITIONALLY, BUYER AND SELLER HEREBY AGREE THAT (A) EXCEPT FOR SELLER’S WARRANTIES, BUYER IS TAKING THE PROPERTY “AS IS” WITH ALL LATENT AND PATENT DEFECTS AND THAT EXCEPT FOR SELLER’S WARRANTIES, THERE IS NO WARRANTY BY SELLER THAT THE PROPERTY IS FIT FOR A PARTICULAR PURPOSE, (B) EXCEPT FOR SELLER’S WARRANTIES, BUYER IS SOLELY RELYING UPON ITS EXAMINATION OF THE PROPERTY, AND (C) BUYER TAKES THE PROPERTY UNDER THIS AGREEMENT UNDER THE EXPRESS UNDERSTANDING THAT THERE ARE NO EXPRESS OR IMPLIED WARRANTIES (EXCEPT FOR THE LIMITED WARRANTIES OF TITLE SET FORTH IN THE DEED AND SELLER’S WARRANTIES).
WITH RESPECT TO THE FOLLOWING, BUYER FURTHER ACKNOWLEDGES AND AGREES THAT SELLER SHALL NOT HAVE ANY LIABILITY, OBLIGATION OR RESPONSIBILITY OF ANY KIND AND THAT SELLER HAS MADE NO REPRESENTATIONS OR WARRANTIES OF ANY KIND:
1.    THE CONTENT OR ACCURACY OF ANY REPORT, STUDY, OPINION OR CONCLUSION OF ANY SOILS, TOXIC, ENVIRONMENTAL OR OTHER ENGINEER OR OTHER PERSON OR ENTITY WHO HAS EXAMINED THE PROPERTY OR ANY ASPECT THEREOF;
2.    THE CONTENT OR ACCURACY OF ANY OF THE ITEMS (INCLUDING, WITHOUT LIMITATION, THE PROPERTY INFORMATION) DELIVERED TO BUYER PURSUANT TO BUYER’S REVIEW OF THE CONDITION OF THE PROPERTY; OR
3.    THE CONTENT OR ACCURACY OF ANY PROJECTION, FINANCIAL OR MARKETING ANALYSIS OR OTHER INFORMATION GIVEN TO BUYER BY SELLER OR REVIEWED BY BUYER WITH RESPECT TO THE PROPERTY.
BUYER ALSO ACKNOWLEDGES THAT THE REAL PROPERTY MAY OR MAY NOT CONTAIN ASBESTOS AND, IF THE REAL PROPERTY CONTAINS ASBESTOS, THAT BUYER MAY OR MAY NOT BE REQUIRED TO REMEDIATE ANY ASBESTOS CONDITION IN ACCORDANCE WITH APPLICABLE LAW.
BUYER IS A SOPHISTICATED REAL ESTATE INVESTOR AND IS, OR WILL BE AS OF THE CLOSE OF ESCROW, FAMILIAR WITH THE REAL PROPERTY AND ITS SUITABILITY FOR BUYER’S INTENDED USE.  THE PROVISIONS OF THIS SECTION 11.2 SHALL SURVIVE INDEFINITELY ANY CLOSING OR TERMINATION OF 
28

THIS AGREEMENT AND SHALL NOT BE MERGED INTO THE DOCUMENTS EXECUTED AT CLOSE OF ESCROW.
						
		/s/MW
BUYER’S INITIALS

12.BUYER’S COVENANTS, REPRESENTATIONS AND WARRANTIES; RELEASE; ERISA; INDEMNIFICATION
In consideration of Seller entering into this Agreement and as an inducement to Seller to sell the Real Property to Buyer, Buyer makes the following covenants, representations and warranties:
12.1.Buyer’s Representations and Warranties.
(a)Authority.  Buyer is a limited liability company organized and in good standing under the laws of the State of Delaware.  Buyer has the legal right, power and authority to enter into this Agreement and to consummate the transactions contemplated hereby, and the execution, delivery and performance of this Agreement have been duly authorized and no other action by Buyer is requisite to the valid and binding execution, delivery and performance of this Agreement, except as otherwise expressly set forth herein.  There is no agreement to which Buyer is a party or to Buyer’s knowledge binding on Buyer which is in conflict with this Agreement.
(b)Executive Order 13224.  To the best of Buyer’s knowledge, neither Buyer nor any of its respective affiliates or constituents, nor any of their respective brokers or other agents acting in any capacity in connection with the transactions contemplated by this Agreement is or will be (a) conducting any business or engaging in any transaction or dealing with any person appearing on the U.S. Treasury Department’s OFAC list of restrictions and Prohibited Persons (which lists can be accessed at the following web address:  http://www.ustreas.gov/offices/enforcement/ofac/), including the making or receiving of any contribution of funds, goods or services to or for the benefit of any Prohibited Person; (b) dealing in, or otherwise engaging in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224 dated September 24, 2001, relating to “Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism”; or (c) engaging in or conspiring to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempting to violate, any of the prohibitions set forth in any U.S. anti-money laundering law.
12.2.Release.  By proceeding with this transaction following the expiration of the Due Diligence Period, Buyer shall be deemed to have made its own independent investigation of the Property, the Property Information and the presence of Hazardous Materials on the Real Property as Buyer deems appropriate.  Accordingly, subject to the Seller’s Warranties, on behalf of itself and all of its officers, directors, shareholders, employees, representatives and affiliated entities (collectively, the “Releasors”) hereby expressly waives and relinquishes any and all rights and remedies Releasors may now or hereafter have against Seller, its successors and assigns, partners, shareholders, officers and/or directors (the “Seller Parties”), whether known or 
29

unknown, which may arise from or be related to (a) the physical condition, quality, quantity and state of repair of the Real Property and the prior management and operation of the Real Property, (b) the Property Information or any other information relating to the Property provided to Buyer by Seller or Seller’s agents, (c) the Real Property’s compliance or lack of compliance with any federal, state or local laws or regulations, and (d) any past, present or future presence or existence of Hazardous Materials on, under or about the Real Property or with respect to any past, present or future violation of any rules, regulations or laws, now or hereafter enacted, regulating or governing the use, handling, storage or disposal of Hazardous Materials, including, without limitation, (i) any and all rights and remedies Releasors may now or hereafter have under the Comprehensive Environmental Response Compensation and Liability Act of 1980 (“CERCLA”), the Superfund Amendments and Reauthorization Act of 1986, the Resource Conservation and Recovery Act, and the Toxic Substance Control Act, all as amended, and any similar state, local or federal environmental law, rule or regulation, and (ii) any and all claims, whether known or unknown, now or hereafter existing, with respect to the Real Property under Section 107 of CERCLA (42 U.S.C.A. §9607).  As used herein, the term “Hazardous Material(s)” includes, without limitation, any hazardous or toxic materials, substances or wastes, such as (1) any materials, substances or wastes which are toxic, ignitable, corrosive or reactive and which are regulated by any local governmental authority, or any agency of the United States government, (2) any other material, substance, or waste which is defined or regulated as a hazardous material, extremely hazardous material, hazardous waste or toxic substance pursuant to any laws, rules, regulations or orders of the United States government, or any local governmental body, (3) asbestos, (4) petroleum and petroleum based products, (5) formaldehyde, (6) polychlorinated biphenyls (PCBs), and (7) freon and other chlorofluorocarbons.
						
		/s/MW
BUYER’S INITIALS

WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, BUYER, ON BEHALF OF ITSELF AND THE OTHER RELEASORS, HEREBY ASSUMES ALL RISK AND LIABILITY RESULTING OR ARISING FROM, OR RELATING TO THE OWNERSHIP, USE, CONDITION, LOCATION, MAINTENANCE, REPAIR, OR OPERATION OF, THE PROPERTY.
THE FOREGOING WAIVERS, RELEASES AND AGREEMENTS BY BUYER, ON BEHALF OF ITSELF AND THE RELEASORS, SHALL SURVIVE THE CLOSE OF ESCROW AND THE RECORDATION OF THE DEED AND SHALL NOT BE DEEMED MERGED INTO THE DEED UPON ITS RECORDATION.
Notwithstanding any provision hereof to the contrary, the provisions of this Section 12.2 shall not apply to, and Buyer does not release Seller from, (a) any damages, claims, liabilities or obligations arising out of or in connection with a breach of any covenant, representation or warranty of Seller set forth in this Agreement or any of the documents executed in connection with this Agreement that survives Closing, or (b) a “Fraudulent Seller Breach” (i.e., (x) a breach of Seller’s representations and warranties to the extent that such breach results from facts not included in the Property Information or known to Buyer immediately prior to the Closing and 
30

made by Seller with the intent to deceive Buyer, (y) a breach of any other obligation of Seller under this Agreement if such obligation was entered into with the intent to deceive Buyer, or (z) Seller’s intentional withholding of material information from the Property Information with an intent to deceive Buyer).
13.DEFAULT AND DAMAGES
13.1.DEFAULT BY BUYER.  BUYER AND SELLER HEREBY ACKNOWLEDGE AND AGREE THAT, IN THE EVENT THE CLOSE OF ESCROW FAILS TO OCCUR DUE TO A BUYER DEFAULT (ALL OF THE CONDITIONS TO BUYER’S OBLIGATIONS TO CLOSE HAVING BEEN SATISFIED OR WAIVED), SELLER WILL SUFFER DAMAGES IN AN AMOUNT WHICH WILL, DUE TO THE SPECIAL NATURE OF THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT AND THE SPECIAL NATURE OF THE NEGOTIATIONS WHICH PRECEDED THIS AGREEMENT, BE IMPRACTICAL OR EXTREMELY DIFFICULT TO ASCERTAIN.  IN ADDITION, BUYER WISHES TO HAVE A LIMITATION PLACED UPON THE POTENTIAL LIABILITY OF BUYER TO SELLER IN THE EVENT THE CLOSE OF ESCROW FAILS TO OCCUR DUE TO A BUYER DEFAULT, AND WISHES TO INDUCE SELLER TO WAIVE OTHER REMEDIES WHICH SELLER MAY HAVE IN THE EVENT OF A BUYER DEFAULT.  BUYER AND SELLER, AFTER DUE NEGOTIATION, HEREBY ACKNOWLEDGE AND AGREE THAT THE AMOUNT OF THE DEPOSIT REPRESENTS A REASONABLE ESTIMATE OF THE DAMAGES WHICH SELLER WILL SUSTAIN IN THE EVENT OF SUCH BUYER DEFAULT.  BUYER AND SELLER HEREBY AGREE THAT SELLER MAY, IN THE EVENT THE CLOSE OF ESCROW FAILS TO OCCUR DUE TO A BUYER DEFAULT, TERMINATE THIS AGREEMENT BY WRITTEN NOTICE TO BUYER AND ESCROW HOLDER, CANCEL THE ESCROW AND RECEIVE (OR RETAIN, IF SELLER ALREADY HOLDS THE DEPOSIT) THE DEPOSIT AS LIQUIDATED DAMAGES AND ESCROW HOLDER SHALL IMMEDIATELY DELIVER (UNLESS IT HAS ALREADY DONE SO) THE DEPOSIT TO SELLER.  SUCH RETENTION OF THE DEPOSIT BY SELLER IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER AND SHALL NOT BE DEEMED TO CONSTITUTE A FORFEITURE OR PENALTY.  OTHER THAN RECOVERY AND RETENTION OF THE DEPOSIT, AND EXCEPT AS PROVIDED BELOW IN THIS SECTION 13.1, SELLER SHALL NOT BE ENTITLED TO MAINTAIN ANY ACTION FOR DAMAGES, AND SHALL NOT HAVE ANY OTHER RIGHT OR REMEDY AT LAW OR IN EQUITY IN THE EVENT THE CLOSE OF ESCROW FAILS TO OCCUR DUE TO A BUYER DEFAULT.  

31

NOTHING IN THIS SECTION 13.1 SHALL (A) PREVENT OR PRECLUDE ANY RECOVERY OF ATTORNEYS’ FEES OR OTHER COSTS INCURRED BY SELLER PURSUANT TO SECTION 15.5 OR (B) IMPAIR OR LIMIT THE EFFECTIVENESS OR ENFORCEABILITY OF THE INDEMNIFICATION OBLIGATIONS OF BUYER CONTAINED IN SECTION 4.3.1 AND SECTION 14 HEREOF.  SELLER AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE PROVISIONS OF THIS SECTION 13.1 AND BY THEIR INITIALS IMMEDIATELY BELOW AGREE TO BE BOUND BY ITS TERMS.
						
		Seller’s Initials:  /s/CJS
Buyer’s Initials:  /s/MW

32

13.2.Default by Seller.  If Seller defaults in its obligations to sell and convey the Property to Buyer pursuant to this Agreement, Buyer’s sole and exclusive remedy shall be to elect one of the following:  (a) to terminate this Agreement, in which event Buyer shall be entitled to the return by the Escrow Holder to Buyer of the Deposit, along with a reimbursement of Buyer’s out-of-pocket expenses not to exceed One Hundred Thousand Dollars ($100,000.00) in the aggregate, or (b) to bring a suit for specific performance provided that any suit for specific performance must be brought as to the Property within 30 days of Seller’s default, Buyer’s waiving the right to bring suit at any later date to the extent permitted by law.  This Agreement confers no present right, title or interest in the Property to Buyer and Buyer agrees not to file a lis pendens or other similar notice against the Real Property except in connection with, and after, the proper filing of a suit for specific performance.
14.BROKER’S COMMISSIONS
Except for CBRE, Seller’s broker (whose commission shall be paid by Seller pursuant to a separate agreement between Seller and Seller’s broker), neither party hereto has had any contact or dealing regarding the Real Property, or any communication in connection with the subject matter of this transaction, through any licensed real estate broker or other person who can claim a right to a commission or finder’s fee as a procuring cause of the sale contemplated herein.  In the event that any other broker or finder perfects a claim for a commission or finder’s fee, the party responsible for the contact or communication on which the broker or finder perfected such claim shall indemnify, save harmless and defend the other party from said claim and all costs and expenses (including reasonable attorneys’ fees) incurred by the other party in defending against the same.
15.MISCELLANEOUS PROVISIONS
15.1.Notices.  All written notices or demands of any kind which either party hereto may be required or may desire to serve on the other in connection with this Agreement shall be served by personal service, by registered or certified mail, recognized overnight courier service or email transmission.  Any such notice or demand so to be served by registered or certified mail, recognized overnight courier service or email transmission shall be delivered with all applicable delivery charges thereon fully prepaid and, if the party so to be served be Buyer, addressed to Buyer as follows:
Granite Tower LLC
5355 Town Center Road, Suite 350
Boca Raton, FL  33486
Attention:  Brett Reese
Telephone No:  (561) 447-1801
Email:  breese@cpgcre.com
Related Companies
30 Hudson Yards
New York, NY  10001
Attention:  Michael Winston
Email:  mwinston@related.com 

33

with a copy thereof to:
Shutts & Bowen LLP
525 Okechobee Blvd., Suite 1100
West Palm Beach, FL  33401
Attention:  Arthur J. Menor, Esq.
Telephone No:  (561) 650-8510
Email:  amenor@shutts.com
and, if the party so to be served be Seller, addressed to Seller as follows:
c/o KBS Capital Advisors LLC
800 Newport Center Drive, Suite 700
Newport Beach, CA 92660
Attention:  Gio Cordoves
Telephone No:  (949) 797-0324
Email:  gcordoves@kbs.com
with copies thereof to:
c/o KBS Capital Advisors LLC
800 Newport Center Drive, Suite 700
Newport Beach, CA 92660
Attention:  Tim Helgeson
Telephone No:  (949) 797-0356
Email:  thelgeson@kbs.com

and
James Chiboucas, Esq.
800 Newport Center Drive, Suite 700
Newport Beach, CA 92660
Telephone No.:  (949) 417-6555
Email:  jchiboucas@kbs.com 
and
Greenberg Traurig
18565 Jamboree Road, Suite 500
Irvine, California 92612
Attention:  L. Bruce Fischer, Esq.
Telephone No.:  (949) 732-6670
Email:  fischerb@gtlaw.com 
and, if the party to be served be Escrow Holder, addressed to Escrow Holder as follows:

34

Commonwealth Land Title Insurance Company
4100 Newport Place Drive, Suite 120
Newport Beach, California 92660
Attention:  Joy Eaton
Telephone No.: (949) 724-3145
Email:  joyeaton@cltic.com
Service of any such notice or demand so made by personal delivery, registered or certified mail or recognized overnight courier shall be deemed complete on the date of actual delivery as shown by the addressee’s registry or certification receipt or, as to email transmissions, upon confirmation of transmission generated by the sender’s machine (provided that a copy of such notice or demand is delivered by any of the other methods provided above within one (1) business day following delivery of such email transmission), as applicable, or at the expiration of the third (3rd) business day after the date of dispatch, whichever is earlier in time.  Either party hereto may from time to time, by notice in writing served upon the other as aforesaid, designate a different mailing address to which or a different person to whose attention all such notices or demands are thereafter to be addressed.  Counsel for a party may give notice or demand on behalf of such party, and such notice or demand shall be treated as being sent by such party. Notwithstanding any of the foregoing to the contrary, for so long as the COVID-19 pandemic continues and any of the addressees is subject to governmental regulations or recommendations such as “stay at home” or similar actions restricting or limiting access to their place of work, no notice shall be effective unless also provided to the email addresses listed or referenced above.
15.2.Assignment; Binding on Successors and Assigns.  Buyer shall not assign, transfer or convey its rights or obligations under this Agreement or with respect to the Property without the prior written consent of Seller, which consent Seller may withhold in its sole, absolute and subjective discretion; provided, however, Buyer may assign its rights under this Agreement without Seller’s consent to a single entity Affiliate (as hereinafter defined), so long as (i) Buyer provides Seller with notice of such assignment at least five (5) business days before the Closing Date, which notice must be accompanied by the name of such assignee and such assignee’s signature block, (ii) the Affiliate assumes, jointly and severally, in writing Buyer’s obligations hereunder and the Affiliate agrees in writing to be subject to all of the terms and conditions set forth in this Agreement pursuant to an assignment and assumption agreement substantially in the form attached hereto as Exhibit M and made a part hereof (the “Assignment and Assumption Agreement”), (iii) Buyer shall not be released from its obligations hereunder; and (iv) the assignee to which Buyer is assigning this Agreement is able to make the representation and warranty in Section 12.1(b) herein without violating the same.  As used in this Section 15.2, the term “Affiliate” means (a) an entity (which may not consist of more than one entity) that directly or indirectly controls, is controlled by or is under common control with the Buyer, or (b) any fund or entity sponsored by Buyer, or (c) an entity (which may not consist of more than one entity) at least a majority of whose economic interests are owned by an affiliate of CP Group Holdings LLC and an affiliate of the Related Companies; and the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations.  Any attempted assignment in violation of the provisions of this Section 15.2 shall be void and Buyer shall be deemed in default hereunder.  Any permitted assignments shall not relieve the assigning party from its liability under this Agreement.  Subject to the 
35

foregoing, and except as provided to the contrary herein, the terms, covenants, conditions and warranties contained herein and the powers granted hereby shall inure to the benefit of and bind all parties hereto and their respective heirs, executors, administrators, successors and assigns, and all subsequent owners of the Property.
15.3.Work Product.  Effective upon and in the event of a termination of this Agreement for any reason, Buyer shall assign and deliver to Seller (at no additional cost to Buyer), and does hereby assign without the need for any further act or instrument, all reports, plans, studies, documents, written information and the like which has been generated by Buyer’s third party consultants, whether prior to the Opening of Escrow or during the period of Escrow (excluding any privileged or confidential information; provided, however, in no event shall any third-party reports relating to the physical condition of the Property constitute privileged or confidential information) in connection with Buyer’s proposed acquisition, development, use or sale of the Real Property (collectively, the “Work Product”) without any representation or warranty of any kind and subject to any confidentiality restrictions set forth therein.  In such event, Buyer shall deliver the Work Product which has been assigned to Seller not later than ten (10) days after the date of the termination of this Agreement.  The Work Product shall be fully paid for and shall not be subject to any lien, encumbrance or claim of any kind.  Buyer shall also return all materials and information (including, without limitation, the Property Information) given to it by Seller or its consultants during Escrow, in the same condition as delivered to Buyer.
15.4.Further Assurances.  In addition to the acts and deeds recited herein and contemplated to be performed, executed or delivered by Seller or Buyer, Seller and Buyer hereby agree to perform, execute and deliver, or cause to be performed, executed and delivered, on the Closing Date or thereafter any and all such further acts, deeds and assurances as Buyer or Seller, as the case may be, may reasonably require in order to consummate fully the transactions contemplated hereunder. This section shall survive Closing.
15.5.Attorneys’ Fees.  If any legal action or any arbitration or other proceeding is brought or if an attorney is retained for the enforcement of this Agreement or any portion thereof, or because of any alleged dispute, breach, default or misrepresentation in connection with any of the provisions of this Agreement, the prevailing party shall be entitled to recover from the other reimbursement for the reasonable fees of attorneys and other costs (including court costs and witness fees) incurred by it, in addition to any other relief to which it may be entitled.  The term “prevailing party” means the party obtaining substantially the relief sought, whether by compromise, settlement or judgment.
15.6.Survival of Representations, Warranties, Covenants, Obligations and Agreements.
(a)Except as otherwise expressly provided below in this Section 15.6, none of the representations, warranties, covenants, obligations or agreements contained in this Agreement shall survive the Close of Escrow or the earlier termination of this Agreement.
(b)Notwithstanding the provisions of Section 15.6(a), the indemnification provisions of Buyer under Sections 4.3.1 and Buyer and Seller under 14 (which Section 14 shall 
36

only survive the termination of this Agreement for a period of nine (9) months) hereof and the provisions of Sections 3.4, 4.6, 11.2, 13.2, 15.3, 15.5, 15.6, 15.17, 15.18, 15.19 and 15.20 hereof (collectively, the “Surviving Termination Obligations”) shall survive the termination of this Agreement without limitation, and any claim based upon any breach of a representation or warranty, or a breach of a covenant, obligation or agreement included in any of the Surviving Termination Obligations shall be actionable and enforceable at any time after the date of the termination of this Agreement.
(c)Notwithstanding the provisions of Section 15.6(a), the indemnification provisions of Buyer under Sections 4.3.1 and 10.5 hereof, the provisions of Section 10 and Sections 4.6, 4.7, 6.4, 11.2 and  12.2 that relate to Buyer, the provisions of Sections 15.4, 15.5, 15.6, 15.16, 15.17, 15.18, 15.19 and 15.20 hereof (collectively, the “Surviving Closing Obligations”) shall survive the Close of Escrow without limitation, and shall not be merged with the recording of the Deed, and any claim based upon any breach of a representation or warranty, or a breach of a covenant, obligation or agreement included in any of the Surviving Closing Obligations shall be actionable and enforceable at any time after the Closing.
(d)Notwithstanding the provisions of Section 15.6(a), the provisions of Sections 11.1, 12.1 and 14 hereof (collectively, the “Limited Surviving Closing Obligations”) shall survive the Close of Escrow and the execution and delivery of the Deed only for a period of nine (9) months immediately following the Closing, and any claim based upon any breach of a representation or warranty, or a breach of a covenant, obligation or agreement included in any of the Limited Surviving Closing Obligations shall be actionable and enforceable if and only if notice of such claim is given to the party which allegedly breached such representation or warranty, or breached such covenant, obligation or agreement, within nine (9) months after the Closing (the “Survival Period”).  Notwithstanding anything stated to the contrary in this Agreement, in no event shall Seller’s liability, if any, with respect to any Limited Surviving Closing Obligations and/or any Surviving Closing Obligations exceed $3,075,000.00 (the “Cap”); provided, however, notwithstanding the foregoing, the Cap shall not apply to the prorations under this Agreement, Seller’s obligations under Section 4.7 of this Agreement, or Seller’s indemnity obligations under Section 14 of this Agreement.
(e)Each party acknowledges that such party’s obligations as to any Limited Surviving Closing Obligations shall be considered “liability” for purposes of any distribution limitation imposed under the organizational laws applicable to such party, its members, partners, and shareholders, and their respective members, partners, and shareholders.  Seller shall not dissolve as an entity and shall reserve and not distribute an amount equal to the Cap during the Survival Period or if a valid claim made by Buyer against Seller pursuant to this Section 15.6 is outstanding, until the resolution of such claim, and Buyer shall be entitled to exercise any and all rights available to Buyer under Section 18-804(b)(1) of the Delaware Limited Liability Act, as amended.  This section shall survive Closing.
15.7.Entire Agreement.  This Agreement contains the entire agreement and understanding of the parties in respect to the subject matter hereof, and the parties intend for the literal words of this Agreement to govern and for all prior negotiations, drafts, and other extrinsic communications, whether oral or written, to have no significance or evidentiary effect.  The 
37

parties further intend that neither this Agreement nor any of its provisions may be changed, amended, discharged, waived or otherwise modified orally except only by an instrument in writing duly executed by the party to be bound thereby.  The parties hereto fully understand and acknowledge the importance of the foregoing sentence and are aware that the law may permit subsequent oral modification of a contract notwithstanding contract language which requires that any such modification be in writing, but Buyer and Seller fully and expressly intend that the foregoing requirements as to a writing be strictly adhered to and strictly interpreted and enforced by any court which may be asked to decide the question.  Each party hereto acknowledges that this Agreement accurately reflects the agreements and understandings of the parties hereto with respect to the subject matter hereof and hereby waive any claim against the other party which such party may now have or may hereafter acquire to the effect that the actual agreements and understandings of the parties hereto with respect to the subject matter hereof may not be accurately set forth in this Agreement.
15.8.Governing Law.  This Agreement shall be governed by the laws of the State of Colorado.
15.9.Counterparts.  This Agreement may be executed simultaneously in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.    The parties intend that faxed or PDF format signatures constitute original signatures binding on the parties.   The signature page of a counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to a counterpart identical thereto.
15.10.Headings; Construction.  The various headings of this Agreement are included for convenience only and shall not affect the meaning or interpretation of this Agreement or any provision hereof.  When the context and construction so require, all words used in the singular herein shall be deemed to have been used in the plural and the masculine shall include the feminine and the neuter and vice versa.  The use in this Agreement of the term “including” and related terms such as “include” shall in all cases mean “without limitation.”  All references to “days” in this Agreement shall be construed to mean calendar days unless otherwise expressly provided and all references to “business days” shall be construed to mean days on which national banks are open for business.  All references to “commercially reasonable efforts” will not include any obligation to institute or threaten legal proceedings, to declare or threaten to declare any person in default, to incur any liabilities, to expend any monies (other than customary telephone, printing, copying, delivery, and similar expenses), or to cause any other person to do any of the foregoing.
15.11.Time of Essence.  Seller and Buyer hereby acknowledge and agree that time is strictly of the essence with respect to each and every term, condition, obligation and provision hereof.
15.12.Partial Validity; Severability.  If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be held invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall 
38

not be affected thereby, and each such term and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law.
15.13.No Third Party Beneficiaries.  This Agreement is for the sole and exclusive benefit of the parties hereto and their respective permitted successors and assigns, and no third party is intended to, or shall have, any rights hereunder.
15.14.Joint Product of Parties.  This Agreement is the result of arms-length negotiations between Seller and Buyer and their respective attorneys.  Accordingly, neither party shall be deemed to be the author of this Agreement and this Agreement shall not be construed against either party.
15.15.Calculation of Time Periods.  Unless otherwise specified, in computing any period of time described herein, the day of the act or event after which the designated period of time begins to run is not to be included and the last day of the period so computed is to be included at, unless such last day is a Saturday, Sunday or legal holiday for national banks in California and Colorado, in which event the period shall run until the end of the next day which is neither a Saturday, Sunday, or legal holiday.  Unless otherwise expressly provided herein, the last day of any period of time described herein shall be deemed to end at 5:00 p.m. (California time).
15.16.Procedure for Indemnity.  The following provisions govern actions for indemnity under this Agreement.  Promptly after receipt by an indemnitee of notice of any claim, such indemnitee will, if a claim in respect thereof is to be made against the indemnitor, deliver to the indemnitor written notice thereof and the indemnitor shall have the right to participate in and, if the indemnitor agrees in writing that it will be responsible for any costs, expenses, judgments, damages, and losses incurred by the indemnitee with respect to such claim, to assume the defense thereof, with counsel mutually satisfactory to the parties; provided, however, that an indemnitee shall have the right to retain its own counsel, with the reasonable fees and expenses to be paid by the indemnitor, if the indemnitee reasonably believes that representation of such indemnitee by the counsel retained by the indemnitor would be inappropriate due to actual or potential differing interests between such indemnitee and any other party represented by such counsel in such proceeding.  The failure of indemnitee to deliver written notice to the indemnitor within a reasonable time after indemnitee receives notice of any such claim shall relieve such indemnitor of any liability to the indemnitee under this indemnity only if and to the extent that such failure is prejudicial to its ability to defend such action, and the omission so to deliver written notice to the indemnitor will not relieve it of any liability that it may have to any indemnitee other than under this indemnity.  If an indemnitee settles a claim without the prior written consent of the indemnitor, then the indemnitor shall be released from liability with respect to such claim unless the indemnitor has unreasonably withheld such consent.
15.17.Waiver of Jury Trial.  To the extent permitted by applicable law, the parties hereby waive any right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
15.18.No Personal Liability.  Notwithstanding anything stated to the contrary herein, and except as otherwise set forth in Section 15.6(e) above, Seller’s liability under this Agreement 
39

shall be limited to Seller’s interest in the Property and neither Seller, Seller’s constituent partners and/or members, Seller’s asset manager, nor Seller’s directors, employees or agents shall have any personal liability hereunder.  In no event shall Buyer’s partners, shareholders, members, owners, officers, directors, managers, employees, agents, or affiliates have any liability for any claim or matter arising out of or relating to this Agreement or the Property, whether based on contract, common law, statute, equity, or otherwise.
15.19.Joint and Several Liability.  If Buyer is composed of more than one individual or entity, all obligations and liabilities of Buyer under this Agreement shall be joint and several as to each of the individuals or entities who compose Buyer.
15.20.Additional Closing Procedures.
(a)Closing Deliveries.  Notwithstanding anything to the contrary contained in this Agreement, Seller and Buyer agree that, upon the occurrence of a Postponing Event (as defined below) delivery of PDF signatures of executed Closing documents delivered via email to Buyer, Seller and/or Escrow Holder (and counsel to Buyer and Seller), as applicable, will be deemed duly delivered in accordance with the terms of this Agreement, other than the Deed or any other document required to fulfill the condition in Section 4.2.3 of this Agreement.    
(b)Gap Closing.   Buyer acknowledges and agrees that the Close of Escrow may be effectuated through a “gap” or “New York style” closing, which means that the Close of Escrow may occur without the concurrent or prior recordation of the Deed, so long as the Title Company has issued, or irrevocably committed to issue, the Title Policy in accordance with the terms and conditions of this Agreement.
(c)Postponing Event.  Notwithstanding anything stated to the contrary in this Agreement, to the extent a Postponing Event has occurred on a Key Performance Date or the business day immediately prior to a Key Performance Date, such Key Performance Date shall automatically be extended until the date that is two (2) business days following a Postponing Event Cure and delivery of written notice by either Buyer or Seller to the other of such Postponing Event Cure.  Further, and notwithstanding anything to the contrary contained herein, in the event the Postponing Event (a) results in the then scheduled Closing Date being extended by greater than thirty (30) days, either party shall have the right to terminate this Agreement by notifying the other of such election prior to the completion of a Postponing Event Cure.  Upon a termination of this Agreement as set forth in this Section 15.21, Escrow Holder shall disburse the Deposit to Buyer, and, upon such disbursement, this   Agreement shall be null and void and of no further force or effect and neither party shall have any rights or obligations against or to the other except for those provisions hereof which by their terms expressly survive the termination of this Agreement.
For purposes hereof, the terms below shall have the following definitions:

40

“Postponing Event” shall mean an event, development, condition or state of facts that: (a) prevents Federal Express and the United Parcel Service from being able to pick up packages from, or deliver packages to, Buyer, Seller, Escrow Holder or the applicable legal counsel of any of the foregoing, or (b) results in the closure of the Escrow Holder’s  or Title Company’s offices; provided that it shall not be a Postponing Event if a replacement escrow agent within the same national title insurance company agrees to act as escrow agent pursuant to the terms of the Purchase Agreement at no additional cost or liability to either party, or (c) the closing of the local recording office or the inability of the local recording office to record, and, in either case, the Title Company is unable or unwilling to issue the Title Policy under Section 4.2.3 of this Agreement.
“Postponing Event Cure” shall mean with respect to any Postponing Event (i) described in clause (a) of the definition thereof, the resumption of pick-up and overnight deliveries by any nationally recognized overnight courier, (ii) described in clause (b) of the definition thereof, the reopening of the Escrow Holder’s and Title Company’s offices, or (iii) described in clause (c) of the definition thereof, the reopening of such local recording office.
“Key Performance Date” shall mean, (x) with respect to clause (a) of the definition of “Postponing Event”, the Closing Date or the business day prior to the Closing Date, and (y) with respect to all other clauses of the definition of “Postponing Events”, the Closing Date.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written.
[Signatures on following pages]

41

			
	"BUYER"
	
	GRANITE TOWER LLC, a Delaware limited
liability company
	
	By: /s/ Michael Winston

	Name: MICHAEL WINSTON

	Title: AUTHORIZED SIGNATORY

S-1

																		
	“SELLER”
						
	KBSII GRANITE TOWER, LLC,
a Delaware limited liability company
						
	By:	KBSII REIT ACQUISITION XVIII, LLC,
a Delaware limited liability company, 
its sole member
						
		By:	KBS REIT PROPERTIES II, LLC,
a Delaware limited liability company,
its sole member
						
			By:	KBS LIMITED PARTNERSHIP II,
a Delaware limited partnership,
its sole member
						
				By:	KBS REAL ESTATE INVESTMENT TRUST II, INC.,
a Maryland corporation,
its general partner
						
					By:	/s/ Charles J. Schreiber, Jr.
Charles J. Schreiber, Jr.,
Chief Executive Officer

S-2

			
	AGREED TO THIS 23rd
DAY OF JULY, 2021,
AS TO PROVISIONS RELATING TO
ESCROW HOLDER:

	
	COMMONWEALTH LAND TITLE
INSURANCE COMPANY
	
	By: /s/ Joy Eaton

	Its: VP

S-3

LIST OF EXHIBITS AND SCHEDULES
									
	EXHIBIT A		Description of Real Property
	EXHIBIT B		Description of Personal Property
	EXHIBIT C-1		List of Contracts
	EXHIBIT C-2		List of Leases
	EXHIBIT D		Form of Tenant Estoppel Certificate
	EXHIBIT E		Form of Deed
	EXHIBIT F		Form of Assignment of Leases, Contracts and Bill of Sale
	EXHIBIT G		Form of FIRPTA Affidavit
	EXHIBIT H		Form of Tenant Notice
	EXHIBIT I		Form of Owner’s Affidavit
	EXHIBIT J		Form of Bring Down Certificate
	EXHIBIT K		Form of Hotel Owner Estoppel
	EXHIBIT L		Utility Deposits
	EXHIBIT M		Form of Assignment and Assumption of Purchase Agreement
	EXHIBIT N		Property Information
	EXHIBIT O		Form of Contractor’s Certificate
	EXHIBIT P		Ongoing Work
	EXHIBIT Q		Owner Deposits
	SCHEDULE 1-1		Description of New and Pending Lease Transactions (Buyer’s Responsibility)
	SCHEDULE 1-2		Description of New and Pending Lease Transactions (Seller’s Responsibility)
	SCHEDULE 2		Disclosures

EXHIBIT A
Description of Real Property
Units 1, 1A, 1B, 1C and 5, Block 95 Condominiums
According to the Amended and Restated Master Declaration of Block 95 Condominiums recorded December 19, 2005 under Reception No. 2005215222, as amended by Amended and restated First Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded October 7, 2010 at Reception No. 2010115794, Second Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded March 21, 2011 at Reception No. 2011031047, Third Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded October 22, 2013 at Reception No. 2013154449, Fourth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded March 5, 2015 at Reception No. 2015028233, Fifth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded September 28, 2017 at Reception No. 2017128174, and Sixth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded April 29, 2021 at Reception No. 2021082293, and the Amended and Restated Condominium Map thereof recorded December 19, 2005 under Reception No. 2005215223, as amended by First Amendment to the Amended and Restated Condominium Map for Block 95 Condominiums recorded February 12, 2008 under Reception No. 2008017796, and as amended by Second Amendment to the Amended and Restated Condominium Map for Block 95 Condominiums recorded April 29, 2021 at Reception No. 2021082294 in the records of the Clerk and Reorder of the City and County of Denver, State of Colorado.
A-1

EXHIBIT B
Description of Personal Property

Miscellaneous Equipment

									
	Quantity		Item
	1		Butter mallet
	2		Safety glasses
	1		Crescent wrench, 8"
	1		Combination square
	2		Pipe wrench, 14"
	1		Ball Pein Hammer
	3		Face shield
	1		Fold-up hex key set, 3 piece
	1		Grove pliers, 16"
	1		Hack saw
	1		Loffset hex wrench
	1		Screw remover set, one-way
	1		Wood saw
	3		Aligning pry bar
	1		Standard imperial tube cutter
	2		Hook spanner wrenches, adjustable
	2		Flourescent hand lamps
	2		Grease gun
	1		Structural wrench with offset head
	1		Tin snips
	1		Ball hex screw driver set, 8 piece
	1		Crescent wrench, 15"
	1		Slotted & Phillips screw driver set, 9 piece
	1		Punch set, 7 piece
	1		Fish tapes
	1		Insulated screw driver set, 6 piece
	1		Nut drivers set
	2		Ratchet-cut tube cutter
	1		T-handle hex key set, 8 piece
	2		Standard 45 degree flaring toll
	1		Crescent wrench, 18"
	1		High-leverage cable cutter
	1		Rigid pipe cutter, no. 1-2
	1		Locking plier set, 5 piece
	1		Strap wrench
	2		Pipe wrench, 24"
	1		File set, 8 piece
	1		Ratcheting wrench, 8 pierce
	1		Pipe wrench, 36"
	1		Comb wrench set, 10 piece
	1		Dial-a-charge charging cylinder

B-1

									
	142		Bins with assorted bolts, nuts and washers from 1/4" to 
1/2" x 4
	4		Reversing relays
	36		Pull out drawers with assorted nut, bolts, screws, wire 
ties & anchors
	12		Electric damper motors for garage fans
	2		Watts rebuilding kids for regulator
	1		Emergency oxygen tank
	7		VAV Controller, reverse acting
	10		Honeywell new heating stats
	10		Honeywell new cooling stats
	4		Smith electric motors, 3/4 hp 208/230/460 AO for garage 
fans
	1		Safety lock-out center
	1		Fiberglass 3-legged ladder, 6 ft.
	1		Watts water regulator, 2"
	1		Hoosier hydraulic crane
	2		Fiberglass 3-legged ladder, 10ft
	1		Hand pallet jack
	1		Reliance motor for fans, 25 hp
	1		PACO pump and motor, 10 hp
	2		Pump and motor, 3 hp
	1		SQ-D type AVPQ-1 switch gear
	1		US Motor, 40 hp
	1		Lincoln motor, 40 hp
	4		SQ-D 4000 amp busways
	1		Reliance motor for fans, 100 hp
	1		Lincoln motor, 100 hp
	1		Blue giant electric pallet jack
	1		Dwyer magnehelic
	1		Proto retaining rings plier set
	1		Super temp - check II
	1		Number/letter stamps set
	1		Proto Metric hex driver sockets
	1		Socket set, (ACE) 3/8"
	5		Nut driver set, insulated
	1		Hole saw set
	1		Cutting board
	1		Drill press
	1		Hand truck
	1		Electric drill
	1		Proto Standard hex driver sockets
	1		Floor jack
	1		Sockets, 1/2" to 1" drives set
	1		Heat guns
	2		Wet/dry vacuum, 5 gallon
	1		Bench grinder
	1		Proto drive socket set, 1/2"
	1		Angle sander grinder
	1		Microsonic stethoscope

B-2

									
	2		Minuteman rapid air fans
	1		Saw all
	1		Proto torque wrench, 1/2"
	1		Fluke digital multimeter
	1		Honeywell Delta sensor tester
	2		Twin stepladders, fiberglass 6"
	1		Oxyacetylene outfit
	1		Adjustable extension gasket cutter
	1		Band saw
	1		Black & Decker impact drill
	2		Wet/dry vacuum, 55 gallon
	1		Master meter for inches of water pressure
	1		Air/acetylene torch kit
	1		Air compressor, 30 gal
	1		Skill Cordless crill
	1		Electronic combusion efficiency tester
	1		Goodway chiller tube cleaner
	1		Knaack rolling tool box
			
	3		Mapp gas
	1		Pry bar
	4		Hold-E-ZEE screw drivers
	1		Scraper
	1		Long Arm L-shapped hex key set
	1		Pry bar set
	1		Scrapper
	1		Drill bit 1/16" to 1/4", 26 pieces
	1		Light Bulb Changer w/ Extension Pole
	1		Fluke Multi Meter with clamps
	1		Drain cleaning machine, 5/16", 25'
	1		Fiberglass Ladder - 4 ft.
	1		Fiberglass Ladder - 6 ft.
	1		Rotary Tool
	1		Vice Bench
	1		Rotary hammer drill
	1		Lift - 40'
			
	1		Plier, Tongue & Groove 10"
	1		Pocket Thermometer
	3		Extension Cords
	2		Shovel Drain Spade
	1		Torch Brazing
	1		Screwdriver Set (7 piece)
	2		Stand Light 1000W Nema
	1		Beam Clamp 2 Tons
	1		Hand Truck
	1		Thermometer (-25 to 999)
	1		Magnifier Light 100W
	1		Camera snake with extension
	1		Hoist Chain 1 ton

B-3

									
	1		Pressure Washer
	1		Hotsy Pressure Washer
			
	4		Multi-bit Screw driver
	1		Measuring Tape
	1		Knot Wire Cup Brush
	1		Screwdriver Bit Set
	1		Socket set, (ACE) 3/8"
	1		T-260 Tool Set
	1		Swaging Tool
	1		Drill Bit Set
	1		2" Plane Bench
	1		General Purpose Cutter
	1		Heavy Duty Cable Cutter
	1		Tap/Die Set
	1		Torque Wrench
	1		1 Ton Trolley
	10		Emergency Go Bags (Small)
	3		Space Heaters
	2		Emergency Go Bags (Large)
	1		Tripod Ladder - 8 ft.
	1		Soldering Iron
	1		Thermometer
	1		Impact Wrench, 1/2"
	1		Data Logger
	1		Inspection Mirror (for Vehicles)
	1		Cable For Tube Punch Machine
	1		Air Circulator, 30"
	1		Circuit Tracer
	1		ProPress Plumbing Machine
	1		IAQ Analyzer
	1		Extech Power Meter (THD Meter)
			
	1		3 Ton Trolley
	1		Wire stripper
	1		T&G Pliers
	1		Combination wrenches
	1		Curved claw hammer
	1		Thermal imaging camera
	2		Air Circulators
	2		Deburring tools
	1		Rotarty pump transfer
	2		AC Window units
	1		File Stand for prints
	1		Arc Flash Kit
	3		Fall protection kits
	1		Face Shield
	1		Adjustable Wrench
	3		AC Voltage Current Detector
	1		Drain Cleaner tool kit

B-4

									
	1		Battery Charger
	1		Adjustable Ladder
			
	5		4-way Stem Key
	1		Retractable Blade Knife
	3		Retractable Blade Utility Knife
	3		Fold Up Hex Wrench
	1		6 in 1 Screwdriver
	3		6" Slip Joint Plier
	3		Screwdriver
	3		10" Tongue and Groove plier
	3		12' Tape Measure
	1		12' Power tape rule
	2		Ear Muffs
	3		All Purpose Plier
	3		8" Adj Wrench
	3		7" Diag Plier
	2		3/4" Impact Socket
	3		LED Headlamp
	3		10" Pump Plier
	2		9" Level Torpedo
	3		8" Long nose plier
	3		Leather Tool Belt Large
	3		Knife Insulators
	1		Tamper proof Bit driver
	1		Sledge Hammer 10 lbs
	3		Drive a Matic nut driver set
	3		Hex Wrench
	3		8" Sidecut Plier
	3		Electricians Pouch
	1		Propane Torch
	3		7 Piece Screwdriver Set
	1		3/4" Handle Hinged
	2		Extension Cords 50 Ft
	1		Extension Cords 100ft
	1		Safety Cabinet
	1		Welded Steel Dolly 55 gal
	1		4 1/2" Angle Grinder
	1		Jumbo Drum 55gal
	1		Wet/Dry Vac Head
	1		20Gal Wet Dry Vac
			
	4		Hex Key set folding  SAE 9 PC
	2		Nut Driver
	2		Pocket Thermometer
	1		Infrared Laser Thermometer
			
			
	3		Dell Inspiron 3847 Desktop Computer
	1		HP ProBook Laptop

B-5

									
			
			
	1		Salamader Heater
	1		Pump and Motor 3hp
	2		Mapp gass
			
			
	1		Sink Rooter
	1		Drain Rooter
	2		WGT Vacuums
	1		Cart
			Orange Cones
			
			
	Computer Other
	Quantity		Item
			
	1		HP 970CXI Color Deskjet Printer (engineering 8th floor 
unity)
	1		HP 940C Color deskjet printer (engineering 8th floor 
office)
			
			
	1		HP Color Printer/Fax (Security)
			
	1		HP MFPM447 Printer (Randy Office)
			
			
	Computer PC's
	Quantity		Item
	1		Juster speakers (Randy)
	1		Viewsonic 15" LCD Monitor (FOC Unity)
	2		Viewsonic 15" LCD Monitor (Engineering)
	1		Dell Dimension XPS P133, 133 mhz 32 ram (engineering 
8th floor)
	1		Clone 2.8ghz 512 ram 80 + 6hdd Windows 2000 sp3 
(Randy)
	1		APC Back-UPS CS 500VA (office UPS)
	1		Acer 17" LCD display (Admin Desk)
	1		APC Smart-UPS 1000VA (Office)
			
	1		3 Com OfficeConnect Dual Speed Hub
			
	1		Dell Monitor - LCD 22 inch monitors 1680 x 1050 
(Randy's)
	2		Dell PC's 755 Optiplex (Unity PC's)
			
	1		Backup UPS XC Battery
	1		Granite Basic USFF Optiplex 760 (Randy)

B-6

									
	1		Upgraded Unity Primary machine in FOC
	1		HP Touchsmart PC (Shop EMS)
			
	2		Microsoft Keyboards (Tim, Cheryl)
	3		LG W2242TE 22" Widescreen LCD Monitors (Front, 
Randy & Tim)
	1		Dell Optiplex 760 USFF Desktop Computer (Tim)
	1		Dell Optiplex 760 USFF Desktop Computer (Admin 
Desk)
	1		Dell Optiplex 760 USFF Desktop Computer (Shop)
	1		Dell E4300 Laptop (Cheryl)
			
	1		Desktop Switch (Security)
	1		Computer Speakers (Randy)
	1		Samsung 2333T Monitor (Bill)
	1		Dell Inspiron 560 Computer (Bill)
			
	1		Dell 7390 10211U 8/256/13.3RT Laptop
			
	Copier
	Quantity		Item
	1		Konica Minolta Copier
			
			
	Facsimile Machines
	Quantity		Item
			
	Telephone System
	Quantity		Item
	1		Phone System
			
	Electric Office Equipment
	Quantity		Item
	1		Refrigerator (engineering)
	1		Laminator
	1		Labelmaker
	1		Microwave (security)
	1		Microwave (office)
	1		Digital Camera (security)
	1		Weather Radio
	1		Refrigerator (Office)
	1		Dishwasher
	1		Toaster
	4		I-Phones (4s model) Engineers
			
	1		Radio System (15 radios)
			
	1		DVD Player (Conf Room)

B-7

									
	1		TV Cart (Conf room)
	1		LCD TV (Conf room)
			
	1		Refrigerator (security)
	1		Microwave (engineering)
			
	1		Digital Camera (office)
			
	1		Refrigerator (security)
			
			
	Office Furniture
	Quantity		Item
	1		Desk (Tony)
	5		Filing cabinets, black (engineering)
	2		Filing cabinets, tan (engineering)
	1		Filing cabinet, gray
	3		Tables
	4		Pots, medium (office)
	2		Desks (engineering)
	1		Credenza (Randy)
	1		Round table, small (Randy)
	1		Bookshelf (Randy)
	2		Pots, large (office)
			
	1		Bookcases (office)
	7		Guest chairs (office)
	4		Pots, small (office)
	2		Filing Cabinets, small (office)
	2		Filing cabinets, large (office)
	2		Pots, small gloss (office)
	4		Desks (office)
	12		Conference Room Chairs
	14		Pots, bronze, small, with stand (lobby)
	2		Pots, bronze, large, with stand (lobby)
	2		Task Chairs (office)
	1		Chair (Karla's Office)
	1		Sofa (office)
	1		Granite top Sofa Table (Office)
	1		Conference Room Table
			
	4		Folding Tables
	6		Barrier Crowd Control
	3		Trash Cans
	2		Chairs (Randy & Engineer Office)
	1		Storage Cabinet (Security)
	1		Workstation for Engineering
			
	1		Metal Shelf (office storage)
			

B-8

									
	1		Desk (extra office)
			
	1		3 Seat Sofa (Main Lobby)
	2		Simone Lounge Chairs (Main Lobby)
	1		Turn Coffee Table (Main Lobby)
	1		Turn Tall Side Table (Main Lobby)
	1		Artist Studio Rug (Main Lobby)
	1		Low Height Side Table (Plaza Level)
	1		Rowen Sofa Sectional Sofa (Plaza Level Lobby) two single arm w/corner unit
	2		Walnut Lounge Chairs (Plaza Level Lobby)
	1		Medium Coffee Table (Plaza Level Lobby)
	37		Training Tables (3rd Floor Conference)
	138		Training Chairs (3rd Floor Conference)
	1		Lecturn (3rd Floor Conference)
	3		Platform Double Table (3rd Floor Booth)
	1		Sectional Sofa (3rd Floor Lounge) Two singles together with corner unit
	2		Clutch Lounge Chair (3rd Floor Lounge)
	1		Medium Coffee Table (3rd Floor Lounge)
	2		Wingback Lounge Chair (3rd Floor Lounge)
	1		Low Height Side Table (3rd Floor Lounge)
	1		Rectangular Conference Table Bar Height (3rd Floor Lounge)
	11		Jump Mini Stool Bar Height (3rd Floor Lounge)
	1		Dark Grey (6'6" x 9'8") Rug
	4		Bean Lounge Chair (3rd Floor Game Area)
	2		Solid Wood End Table 16" (3rd Floor Game Area
	2		Solid Wood End Table 20" (3rd Floor Game Area
	2		Lyze Armchair
	1		Wind Table (3rd Floor Patio)
	6		Lyze Side Chairs (3rd Floor Patio)
	1		Outdoor Lounge set, sofa, coffee table, 2 chairs (3rd Floor Patio)
	1		West Elm Rug (Black)
	3		Elements Rugs
	1		Amazon Rug
	3		Set of 4 Plates (West Elm Brand)  White
	3		Set of 4 Bowls (West Elm Brand)  Black
	3		Set of 4 Mugs (West Elm Brand)  Black and White
	6		Iced Tea Glasses (3rd Floor)
	6		High Ball Glasses (3rd Floor)
	6		Double Old Fashioned (3rd Floor)
	6		Modern Red Wine (3rd Floor)
	2		Sets of 20 Stainless Steel (3rd Floor)
	4		6.5"H Faux Succulents (3rd Floor)
	1		5'H Faux Fig Plant (3rd Floor)
	1		Weave Basket (3rd Floor)
	1		39" Faux Rubber Tree (3rd Floor)
	1		Wood Planters Beluga Gray (3rd Floor)
	2		12"H Faux Potted Succulent (3rd Floor)
	1		Metal Table Top Planter (3rd Floor)

B-9

									
	1		Forest Cache Pots (Teal) (3rd Floor)
	1		Rug (9X12 Surya Rex)
	1		Rug (9X13 Quartz)
	1		Rug (9X12 Tibetan)
	1		Summit Kegerator (3rd Floor)
	1		Solid Refrigerator 24"
	1		15" Marvel Low Profile Built-in Ice Machine
	1		GE 18.6 Cu Ft, 33W Counter Depth Refrigerator
	2		ADA 24" 800 Series Dishwasher
			
			
	Works of Art
	Quantity		Item
	1		Artwork (Mgmt office)
	2		Conference Room Artwork
			
	13		Artwork, framed
	2		Artwork, framed (Rich Clarkson photographs)
			
			
	1		Rising Sun Grownup (yellow and black)
	1		Curacao (blue black red)
	1		Below the Sea (white blue black)
	1		Radiance (yellow orange red)
	1		Le Mirage (white red black brush stroks)
	1		Reaching Sky (white black brown)
	1		Connectivity Grownup (Black lines, blue fill color  white background)
	1		The bigger picture (white clouds, blue, mountains yellow)
	4		Lge Abstract Paintings
			
	Signs
	Quantity		Item
	1		Tenant Monument Sign
			
	Unlicensed Mobile Equipment
	Quantity		Item
	1		Golf Cart
	SECURITY SYSTEM
	Quantity		Item
	2		Computers
	8		Computer/Video Monitors
	8		Video Monitors
	32		CCTV Cameras
	1		C-Cure 8000 Access Control System
	14		Proxy HID Card Readers
	1		Key Trak Key Control Computer System
			
	1		HP Lazerjet Pro 200 Color Printer

B-10

									
			
	1		Exacq Vision NVR System
			

B-11

EXHIBIT C-1
List of Contracts
						
	CONTRACTOR	SERVICE
	Advantage Security, Inc.	Security
	Advantage Security, Inc. Off Duty Police	Traffic Control  Officer
	Angus AnyWhere	Work Order/Preventive Maintenance
	ATIS Elevator Inspections, LLC	Elevator Inspections
	Bob Popp Building Services	Snow Removal
	Bob Popp Building Services	Window Washing
	Bristol Botanics	Exterior Landscape
	Bristol Botanics	Interior Landscaping
	Captivate	Elevator Screens

C-1

						
		
	Comcast Business	3rd Floor Amenity Phone Lines
	ESCO (Energy Services of Colorado)	Automation System
	Geneva Capital, LLC	Fitness Center Equipment
	Haynes Mechanical Systems, Inc.	HVAC Proactive Preventative Maintenance Agreement
	Integra/Allstream	Phone Service
	Integrity Fire Safety Services	Fire Alarm Monitor/Testing
	Jones Lang LaSalle	Leasing Services Agreement
	Jones Lang LaSalle	Project Managmeent
	Transwestern	Management Agreement
	KBSII / TW Mezz Denver Hotel	Hotel Parking License Agreement
	Master Klean Janitorial	Towel Services
	Master Klean Janitorial	Janitorial                                                                                        Day Porter
	Miller Mechanical	Plumbing Repairs
	Nest Health Connections	Fitness Instruction

C-2

						
		
	Terminix Pest Control	Pest Control
	Pacific Office Automation	Copier Maintenance Agreement
	Phillips Mechanics	Electrical Repairs
	Reidy Metal	Metal Cleaning
	SP Plus Corporation	Parking Garage Management
	ThyssenKrupp Elevator Corporation	Elevator
	UL Verification Services, Inc.	Building Air Quality
	Wagner Power Systems	Generator Maintenance
	 	 
	One Time Agreements	
	Western Paper Distributors, Inc. aka High Country Chemical Supp	Janitorial Supplies
	 	 
	Consulting Agreement	
	Columbine Engineering	Mechanical/Electrical Consulting
	Moye/White	Legal Services
		
	All Copy Products	Copier Maintenance Agreement

C-3

						
		
	BCER	MEP Services
	Metro State Fire	Fire Alarm Monitor/Testing
	Reidy Metal	Metal Cleaning
	Haynes Mechanical Systems, Inc.	HVAC Proactive Preventative Maintenance Agreement
	VTI Security	Security Access System
	1 Able Elevator Inspector	Elevator Inspector

C-4

EXHIBIT C-2
List of Leases

												
	SUITE	TENANT NAME	LEASE DATE	AMENDMENTS
	100	Dazbog Coffee	11/30/2010	Amendment 1 dtd 7/29/2013
	 	 	 	Amendment 2 dtd 6/20/2019
	 	 	 	Amendment 3 dtd 5/10/2021
	 	 	 	 
	150	Tag Restaurant Group, LLC (dba BuBu Restaurant)	8/2/2019	Amendment 1 dtd 11/23/2020
	 			Delivery Date Certificate dtd 6/8/2021
	 	 	 	 
	400/900/1100/1200/1300	Occidental Petroleum / Anadarko	7/30/2002	Amendment 1 dtd 9/10/2002
	1400/1500/1600/1700			Amendment 2 dtd 7/23/2004
	 			Amendment 3 dtd 11/1/2004
	 			Amendment 4 dtd 12/31/2004
	 			Amendment 5 dtd 4/20/2005
	 			Amendment 6 dtd 5/18/2005
	 			Amendment 7 dtd 6/15/2005
	 			Amendment 8 dtd 11/15/2005
	 			Amendment 9 dtd 2/16/2007
	 			Amendment 10 dtd 9/11/2007
	 			Amendment 11 dtd 11/9/2007
	 			Amendment 12 dtd 3/3/2008
	 			Amendment 13 dtd 10/6/2011
	 		Amendment 14 dtd 11/13/2012
	 	 		Amendment 15 dtd 6/5/2013
	 	 		Amendment 16 dtd 8/17/2015
	 	 		Amendment 17 dtd 12/19/2018
	 	 		Amendment 18 dtd 5/14/2020
	 			Amendment 19 dtd 12/29/2020
	 			 
	1800	Western Midstream Partners, LP, a Delaware limited partnership	12/29/2020	Delivery Date Certificate dated 5/1/2021
	 	 	 	 
	2100	Jackson Kelly PLLC, a West Virginia professional limited liability company	5/30/2001	Amendment 1 dtd 6/27/2002
	 		Amendment 2 dtd 10/19/2004
	 			Amendment 3 dtd 3/18/2011
	 		 	Amendment 4 dtd 8/2/2016
	 		 	 

C-1

												
	2120	Uplift Energy LLC, a Colorado limited liability company dba Uplift Energy Strategy	3/2/2020	Delivery Date Certificate dtd 5/1/2020
	 	 	 	 
	2300	Causey Demgen & Moore P.C. a Colorado corporation	12/7/2018	Delivery Date Certificate dtd 7/1/2019
	 		 
	2400/2500	Personal Capital Corporation and Personal Capital Advisors Corporation, Delaware corporations	4/19/2017	Lease Guaranty dtd 4/19/2017
	 		Delivery Date Certificate dtd 6/2017
	 		Amendment dtd 12/21/2018
	 			Delivery Date Certificate dtd 7/9/2019
	 			Consent of Landlord dtd 8/7/2020
	 	 	 	 
	2520	Judge Technical Services, Inc. a Delaware corporation	6/7/2019	Delivery Date Certificate dtd 10/1/2019
	 		 
	 	 	 	 
	2600	Robinson Waters & D'Dorisio, P.C. a	5/19/1987	Amendment 1 dtd 6/1/1991
	 	Colorado professional corporation		Amendment 2 dtd 9/1/1995
	 			Assignment, Assumption & Consent & 3rd
	 			Amendment dtd 2/15/1997
	 	 	 	Guaranty (Slivka) dtd 2/15/1997
	 	 	 	Guaranty (Robinson) dtd 2/15/1997
	 	 	 	Guaranty (Waters) dtd 2/15/1997
	 	 	 	Guaranty (Panasci) dtd 2/15/1997
	 	 	 	Guaranty (O'Dorisio, Jr) dtd 2/15/1997
	 	 	 	Amendment 4 dtd 6/1/2003
	 	 	 	Amendment 5 dtd 3/11/2004
	 			Amendment 6 dtd 5/11/2004
	 			Amendment 7 dtd 11/15/2004
	 			Amendment 8 dtd 9/16/2008
	 			Amendment 9 dtd 7/13/2009
	 	 		Amendment 10 dtd 6/14/2016
	 	 	 	 
	2700/2870	Bankers' Bank of the West, a Colorado corporation	12/16/2013	Amendment 1 dtd 2/13/2014
	 		Amendment 2 dtd 10/5/2018
	 	 	 	 
	2750	Integris Partners, Ltd., a Colorado limited liability company	4/28/2008	Amendment 1 dtd 6/7/2013
	 	 	Amendment 2 dtd 11/29/2013
	 		 	Amendment 3 dtd 10/14/2019
	 		 	 
	2800	Mountain View Financial Solutions, a Delaware	11/14/2018	Delivery Date Certificate dtd 6/1/2019
	 	limited liability company	 	Lease Guaranty dtd 11/14/2018

C-2

												
			 	 
	2820/2850	Kovacs Systems LLC, a Colorado Limited	6/3/2020	Delivery Date Certificate dtd 6/15/2020
	 	liability company dba	 	 
	 	iSALESCRM	 	 
	 	 	 	 
	2860	Clive Funding, Inc., a Utah corporation	6/18/2012	Amendment 1 dtd 2/18/2013
	 	Utegra Financial Partners, Inc., a Colorado		Amendment 2 dtd 9/16/2015
	 	corporation, and UFP Equity Holdings, LLC,	 	Commencement Agreement dtd 12/29/215
	 	a Colorado limited liability company	 	Commencement Agreement dtd 8/1/2012
	 		 	Stipulation Resolution in place 6/26/2020
	 	 	 	 
	2870	Alexander Benefits Consulting, LLC	7/17/1998	Guaranty dtd 7/17/1998
	 	a Colorado limited liability company		Amendment 1 dtd 12/7/2004
	 			Amendment 2 dtd 9/8/2009
	 			Amendment 3 dtd 12/2/2011
	 			Amendment 4 dtd 1/11/2017
	 	 	 	 
	2900/2950/2980	Everwest Real Estate Partners, LLC	2/27/2015	Delivery Date Certificate dtd 6/2015
	 	a Colorado limited liability company	 	Amendment 1 dtd 12/4/2018
	 	 	 	Assignment & Assumption dtd 2/2/2018
	 	 	 	Amendment 2 dtd 3/4/2019
	 		 	Delivery Date Certificate dtd 4/2019
	 			Amendment 3 dtd 6/17/2019
	 		 	Storage License Agreement dtd 1/28/2019
	 		 	 
	3000	ViewRay, Inc. a Delaware corporation	2/25/2021	NONE
	 			 
	 	 	 	 
	LICENSE	Level 3	5/1/1999	Amendment 1 dtd 6/2/2005
	 	 	 	Amendment 2 dtd 2/1/2008
	 	 	 	Amendment 3 dtd 4/18/2019
	 	 	 	 
	LICENSE	Cogent Communications	2/2/2000	Amendment 1 dtd 6/2/2005
	 	 	 	Amendment 2 dtd 12/1/2010
	 	 	 	Amendment 3 dtd 3/5/2015
	 	 	 	Amendment 4 dtd 5/15/2020

C-3

												
				
	 	 	 	 

	LICENSE	ICG/Level 3 Communications	11/19/1998 & 1/7/2003	Amendment 1 dtd 10/13/2006
	 	 	 	Amendment 2 dtd 1/23/2012
	 	 	 	Amendment 3 dtd 6/29/2016
	 	 	 	Amendment 4 dtd 4/18/2019
	 	 	 	Jbox Amendment dtd 2/28/2012
	 	 	 	Jbox Amendment dtd 3/29/2018
	 	 	 	Jbox Amendment dtd 5/6/2019
	 	 	 	 
	LICENSE	MCI/MFS/Verizon	2/1/2000	Amendment 1 dtd 6/20/2006
	 	 	 	Amendment 2 dtd 12/7/2010
	 	 	 	Amendment 3 dtd 10/21/2015
	 	 	 	Amendment 4 dtd 11/11/2020
	 	 	 	 
	LICENSE	TCG Colorado	4/1/2001	Amendment 1 dtd 2/14/2003
	 	 	 	Amendment 2 dtd 9/12/2006
	 	 	 	Amendment 3 dtd 2/10/2012
	 	 	 	Amendment 4 dtd 6/11/2016

C-4

EXHIBIT D
Form of Tenant Estoppel Certificate
(Attached)
D-1

TENANT ESTOPPEL CERTIFICATE
The undersigned (“Tenant”) hereby certifies to ________________________________, a ______________________ (“Landlord”), ____________________, a ___________________, and its successors and assigns (collectively, “Buyer”), and _____________ and its successors and assigns or any lender making a loan to  be secured by the Premises (collectively, “Lender”), as of the date of this estoppel certificate (“Estoppel Certificate”):
A.Tenant is the Lessee under that certain Lease dated ________________ relating to __________________ (the “Premises”), together with any amendments thereto as listed in Exhibit “A” (collectively, the “Lease”).  Except as set forth in Exhibit A, the Lease has not been amended or modified in any way.
B.The Lease has not been assigned, nor have the Premises been sublet in whole or in part, except for the following [if no exceptions are stated, there are NONE]:_______________________________________________________________.
C.There are no other agreements, oral or in writing, between Landlord and Tenant with respect to the Premises excepted as identified above.
D.The Lease is in full force and effect according to its terms and is the valid and binding obligation of Tenant.
E.To Tenant’s actual knowledge, no default exists under the Lease by Landlord nor, to Tenant’s actual knowledge, does any state of facts exist which with the passage of time or the giving of notice, or both, could constitute a default under the Lease.
F.To Tenant’s actual knowledge, Tenant has no claim or demand against the Landlord.
G.Monthly base rent is equal to $______ and additional rent for operating expenses or common area maintenance charges payable under the Lease is currently $___________ per month, and have been paid through _________________, 2021.  
H.Tenant’s security deposit held by Landlord is $______________________.  [Tenant has delivered a lease bond/letter of credit to Landlord in the amount of $_______].
I.Except as hereafter stated, Tenant has no options to extend the Lease or to lease additional space at the Property, and the Tenant has no right of refusal as to leasing additional space [if no options or rights of refusal are stated, there are NONE]: ____________________________________________________________________________________________________________.
J.Tenant has no options or rights of refusal to purchase any part of the Property.
K.The term of the Lease commenced on ____________________ and expires on _______________________.

L.The Premises contain ________ rentable square feet.
M.All conditions under the Lease to be satisfied by Landlord as of the date of this Agreement (including, without limitation, all work, if any, to be performed by Landlord in the Premises or at the Property) have been satisfied, and all contributions, if any, required to be paid by Landlord under the Lease to date for improvements to the Premises have been paid, except as hereafter stated [if no exceptions are stated, there are NONE]:_______________________ ___________________________________________________________________________________________________________________________________________________________.
N.Tenant is in possession of the Premises and is fully obligated to pay and is paying the rent and other charges due under the Lease and is fully obligated to perform and is performing all other obligations of Tenant under the Lease, except as hereafter stated [if no exceptions are stated, there are NONE]: ____________________________________________.
O.Tenant is not entitled to any discounting, abatement, credit or offsetting of rents, and there are no existing charges, defenses, claims, counterclaims or offsets which Tenant has against the enforcement of the Lease by Landlord or in any other way relating to the Lease, except as hereafter stated [if no discounts, abatements, or offsets are stated, there are NONE]:______________________________________________________________________.
P.Except as hereafter stated, no rent has been paid more than one month in advance of the due date and no security has been deposited with the Landlord [if no advance rents or security deposits are stated, there are NONE]:________________________________________.
Q.Tenant has the right to use a total of _____ parking spaces at the Property of which total ______ are assigned spaces and ______ are unassigned spaces.
R.There are no actions, whether voluntary or otherwise, pending or threatened against the Tenant under the bankruptcy or insolvency laws of the United States or any similar state laws.
S.Tenant intends that a faxed or PDF copy of this Estoppel Certificate shall constitute an original copy of this Estoppel Certificate for all purposes.
Tenant acknowledges that this Estoppel Certificate is being given in order to induce Buyer to purchase the property of which the Premises are a part, and to take on the obligations of Landlord.  Buyer and Landlord are entitled to rely upon this Estoppel Certificate.  Tenant further acknowledges that this Estoppel Certificate is being given in order to induce Lender to make a loan to be secured by the property of which the Premises are a part.  Lender is entitled to rely upon this Estoppel Certificate.  
Dated: __________________, 2021

						
	“TENANT”
		
	By:	
		
		(Print Name)      (Title)

Exhibit A

Lease and Amendments
D-5

EXHIBIT E
Form of Deed
(Attached)
E-1

[FORM – PLEASE COPY - DO NOT EDIT]

When recorded return to:
______________________________________________________________________________

SPECIAL WARRANTY DEED
[Statutory Form - C.R.S. § 38-30-113]

[__] [, a [_] ("Grantor"), whose street address is [___], for Ten and 00/100 Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, hereby sells and conveys to [__], whose street address is [__], the real property in the City and County of Denver, and State of Colorado described on Exhibit A attached hereto and made a part hereof, with all its appurtenances (including, without limitation, the rights of Grantor, if any and without any representation or warranty of any kind, in and to that certain license granted in (a) Ordinance No. 29, Series of 1982 recorded July 2, 1985 at Reception No. 033658, and Ordinance No. 280, Series of 1989 recorded November 27, 1990 at Reception No. 900109230, and (b) Ordinance No. 3, Series of 1981 recorded July 11, 1985 at Reception No. 037798 [Note – foregoing language to be included only if licenses are also insured in Buyer’s Title Policy]), and warrants the title to the same against all persons claiming under Grantor, subject to the matters set forth on Exhibit B attached hereto and made a part hereof.

The street address for the foregoing property is: [__].

Signed as of this ________ day of __________, 20__.

[__]], 
a [__]]

By:___________________________________
Name: ________________________________
Title: _________________________________

STATE OF ______________ )
 ) ss.
COUNTY OF ____________ )

The foregoing instrument was acknowledged before me this _____ day of __________, 20_ by _________________], as ___________________ of _________________, a __________________________________].

Witness my hand and official seal.

My commission expires: ___________________________

_____________________________
Notary Public

3

EXHIBIT A
TO
SPECIAL WARRANTY DEED
LEGAL DESCRIPTION

A-1

EXHIBIT B
TO
SPECIAL WARRANTY DEED
TITLE EXCEPTIONS

A-1

EXHIBIT F
Form of Assignment of Leases and
Contracts and
Bill of Sale
(Attached)
F-1

ASSIGNMENT OF LEASES AND CONTRACTS AND BILL OF SALE
This Assignment of Leases and Contracts and Bill of Sale (this “Assignment”) is executed and delivered as of the ____ day of _________, 2021 (the “Closing Date”) pursuant to that certain Purchase and Sale Agreement and Escrow Instructions (“Agreement”) dated ________, 2021, by and between _____________________________, a _____ ___________________ (“Seller”), and _______________________, a _____________________ (“Buyer”), covering the real property described in Exhibit A attached hereto (“Property”).
1.    Sale of Personalty.  For good and valuable consideration, Seller hereby sells, transfers, sets over and conveys to Buyer the following (the “Personal Property”):
(a)    Tangible Personalty.  All of Seller’s right, title and interest, if any, in and to all the furniture, fixtures, equipment, and other tangible personal property listed on Exhibit B attached hereto or otherwise located in or on the Property to the extent owned by Seller; and
(b)    Intangible Personalty.  All the right, title and interest of Seller, if any, in and to assignable licenses and permits relating to the operation of the Property, assignable guaranties and warranties from any contractor, manufacturer or other person in connection with the construction or operation of the Property, all assignable permits, licenses, approvals, consents, development rights, vested rights, entitlements, impact fee credits, certificates of occupancy, and authorizations issued by any governmental or quasi-governmental authority or regulatory bureau or agency relating to the development, operation, or use of the Property, all surveys, architectural, engineering, or other plans and specifications, site plans, plats, other graphics and the work product of all professionals, agreements with providers of utility services, and any other consents or approvals which Seller may now or hereafter possess as to the Property, and any other intangible personal property rights used in connection with the Property, including, without limitation, service marks, logos, trade names (including “Granite Tower”), website domains, uniform resource locators (URLs), and telephone numbers, but specifically excluding any right, title or interest of Seller in any trademarks, service marks and trade names of Seller (including, without limitation, the name “KBS” or any derivative thereof, or any name that includes the word “KBS” or any derivative thereof) and with reservation by Seller to use such name in connection with other property owned by Seller in the vicinity of the Property.
2.    Assignment of Leases and Contracts.  For good and valuable consideration, Seller hereby assigns, transfers, sets over and conveys to Buyer, and Buyer hereby accepts the following:
(a)    Leases.  All of the Seller’s right, title and interest in and to all tenant leases relating to the Property, including, without limitation, the tenant leases listed in Exhibit C-1 and Exhibit C-2 attached hereto and all security deposits, guaranties, and any non-cash security for tenant obligations under the Leases, including, but not limited to, any letters of credit and lease bonds delivered by tenants and any security interests in favor of Seller granted by any tenant (“Leases”);
(b)    Contracts and Agreements.  Seller’s right, title and interest in and to the contracts and agreements described in Exhibit D-1 and Exhibit D-2 attached hereto (the “Contracts”).

F-2

3.    Assumption.  Buyer hereby assumes the obligations of Seller under (a) the Leases listed on Exhibit C-1 attached hereto arising from and after the Closing Date, (b) the Leases listed on Exhibit C-2 attached hereto whether arising before or after the Closing Date, (c) the Contracts listed on Exhibit D-1 attached hereto arising from and after the Closing Date, (d) the Contracts listed on Exhibit D-2 attached hereto arising before or after the Closing Date, and (e) that certain leasing agreement dated ______________, entered into by and between Seller and ____________, but only to the extent of any leasing commissions hereafter payable thereunder arising out of the lease of space in the Property by Buyer after the date of this Assignment, and shall defend, indemnify and hold harmless Seller from and against any liability, damages, causes of action, expenses, and attorneys’ fees incurred by Seller by reason of the failure of Buyer to fulfill, perform, discharge, and observe its obligations with respect to the Leases or the Contracts to the extent Buyer received a credit at closing with respect to any of such obligations under the Leases and/or Contracts.
4.    Agreement Applies.  Except as may otherwise be provided in the Agreement, the Contracts and Leases are being assigned and transferred, and the Personal Property is being transferred, to Buyer on an “as is,” and “where is” basis, with all faults, and without any representation or warranty, all of which Seller hereby disclaims, all as more particularly set forth in Section 11.1 of the Agreement, which Section shall be, and hereby is, incorporated herein by reference.
5.    Counterparts.  This Assignment may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument, with the same effect as if all parties had signed the same signature page.  The parties intend that faxed or PDF format signatures constitute original signatures binding on the parties.   The signature page of a counterpart may be detached therefrom without impairing the legal effect of the signature(s) thereon provided such signature page is attached to a counterpart identical thereto.
6.    Attorneys’ Fees.  In any action between the parties to enforce any of the terms or provisions of this Assignment, the prevailing party in the action shall be entitled to recover from the non-prevailing party, in addition to damages, injunctive relief or other relief, and its reasonable costs and expenses, including, without limitation, costs and reasonable attorneys’ fees (including on appeal).
7.    Merger.  This Assignment and the Agreement contain the entire understanding between the parties relating to their subject matter.  All prior and contemporaneous agreements and understandings, whether oral or written, are superseded by this Assignment and the Agreement.  This Assignment may only be modified in writing executed by both Buyer and Seller.  Nothing contained in this Assignment is intended to terminate or affect the validity of any of the representations or warranties contained in the Agreement.
8.    Joint and Several Liability.  All obligations and liabilities of Buyer under this Assignment shall be joint and several as to each of the individuals or entities who compose Buyer.
9.    Miscellaneous.  This Assignment shall be binding upon and shall inure to the benefit of the parties hereto, their heirs, executors, administrators, successor-in-interest and assigns.  If any 
F-3

term or provision of this Assignment shall be held invalid or unenforceable, the remainder of this Assignment shall not be affected.  This Assignment shall be construed in accordance with and governed by the laws of the State of Colorado.  Nothing in this Assignment shall impair, limit or lessen any of the rights of the parties with respect to the provisions of the Agreement which were intended to survive the Closing Date.  Nothing in this Assignment, express or implied, is intended to confer upon any person or entity, other than the parties hereto and their respective successors and assigns, any rights or remedies.
F-4

IN WITNESS WHEREOF, the undersigned have caused this instrument to be executed as of the date written above.
[Signature Pages to Follow]
F-5

SELLER:
_____________________________
a____________________________

BUYER:
_____________________________
a____________________________
F-6

EXHIBIT A
DESCRIPTION OF PROPERTY
[ATTACHED]
F-7

EXHIBIT B
DESCRIPTION OF TANGIBLE PROPERTY
[ATTACHED]
F-8

EXHIBIT C-1
LIST OF LEASES UNDER WHICH BUYER ASSUMES
OBLIGATIONS AFTER THE CLOSING DATE
[This schedule will include a list of all Leases which exist on the date of the Agreement, but specifically excluding the Leases listed on Schedule 1-1 and Schedule 1-2 attached to the Agreement.]
[ATTACHED]
F-9

EXHIBIT C-2
LIST OF LEASES UNDER WHICH BUYER ASSUMES
OBLIGATIONS BEFORE AND AFTER THE CLOSING DATE
[This schedule will include a list of (a) all Leases set forth on Schedule 1-1 and Schedule 1-2 to the Agreement, if any, (b) all Leases entered into after the date of the Agreement in accordance with the terms of the Agreement, and (c) all Lease amendments, expansions and renewals entered into by Seller in accordance with the terms of the Agreement.]
[ATTACHED]
F-10

EXHIBIT D-1
LIST OF CONTRACTS UNDER WHICH BUYER ASSUMES
OBLIGATIONS AFTER THE CLOSING DATE
[This schedule will include all contracts set forth on Exhibit C attached to the Agreement that Buyer does not elect to have Seller terminate as provided in the Agreement and any new service contracts entered into by Seller in accordance with the terms of the Agreement.]
[ATTACHED]
F-11

EXHIBIT D-2
LIST OF CONTRACTS UNDER WHICH BUYER ASSUMES
OBLIGATIONS BEFORE AND AFTER THE CLOSING DATE
[This schedule will include any new construction contracts entered into by Seller in connection with the completion of tenant improvement work for tenants under (a) the Leases set forth on Schedule 1-1 and Schedule 1-2 to the Agreement, if any, (b) all Leases entered into after the date of the Agreement in accordance with the terms of the Agreement, and (c) all Lease amendments, expansions and renewals entered into by Seller in accordance with the terms of the Agreement.]
[ATTACHED]
F-12

EXHIBIT G
Form of FIRPTA Affidavit
(Attached)
G-1

FIRPTA CERTIFICATE
__________________ (“Member”) is the sole owner of ________________ (“Seller”).  Seller, a disregarded entity for U.S. tax purposes, is the transferor of certain real property more particularly described on Exhibit A attached hereto (the “Property”).
Section 1445 of the Internal Revenue Code of 1986, as amended (the “Code”) provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person.  For U.S. tax purposes (including Section 1445 of the Code), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity.  To inform the transferee that withholding of tax will not be required in connection with the disposition of the Property pursuant to that certain Purchase and Sale Agreement and Escrow Instructions dated as of ______________, 2021, by and between ___________________, a __________ (“Buyer”) and Seller, the undersigned certifies the following on behalf of Member:
1.    Member is not a foreign corporation, foreign Company, foreign trust or foreign estate, as those terms are defined in the Code and the regulations promulgated thereunder;
2.    Member is not a disregarded entity as defined in Treasury Regulations §1.1445-2(b)(2)(iii),
3.    Member’s U.S. employer identification number is __________, and
4.    Member’s address is:  800 Newport Center Drive, Suite 700, Newport Beach, California 92660.
It is understood that this certificate may be disclosed to the Internal Revenue Service and that any false statement contained herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined the foregoing certification and, to the best of my knowledge and belief, it is true, correct and complete, and I further declare that I have authority to sign this document on behalf of Member.
Date:  ________________, 2021
						
		

G-2

Exhibit A
Legal Description
(Attached)
G-3

EXHIBIT H
Form of Tenant Notice
(Attached)
H-1

NOTICE TO TENANTS
[Date]
[Project Name]
[Address]
[City/State/ZIP]
Dear Tenant:
Notice is hereby given to the tenants of ______________________ (the “Property”) that ________________________________________, a ________________________________ (“Seller”), the current owner of the Property, has sold the Property to _______________________, a _____________________________ (“Buyer”) effective [date of takeover].  Buyer has assumed all of the obligations of landlord under your lease, including any obligations with respect to your security deposit, if any, which has been transferred to Buyer.
From and after the date of this letter, all payments due under the Lease, and any notices that are to be provided to the Landlord under the Lease should be directed to Landlord at:
______________________________
______________________________
______________________________
Additionally, _________________________ and its members, managers, employees, agents, affiliates, subsidiaries, mortgagee, managing agent, contractors, successors, and assigns should be added as additional insureds on the commercial general liability, commercial automobile liability, and umbrella or excess liability insurance policies maintained by Tenant and the endorsements evidencing this coverage should be delivered to the above address promptly.
						
		Sincerely,
“SELLER”
a    

		“BUYER”
a    

H-2

EXHIBIT I
Form of Owner’s Affidavit
(Attached)

I-1

PROPERTY:
COUNTY:
STATE:
________________________, a ___________________ (“Seller”), as seller, and ____________________, a ______________________ (“Buyer”), as buyer, are parties to that certain Purchase and Sale Agreement and Escrow Instructions (the “Purchase Agreement”) dated ________, 20__, as the same has been amended and modified, relating to the improved real property (the “Real Property”) referred to in Exhibit “A” attached hereto and made a part hereof.
In connection with the consummation of the transactions contemplated by the Purchase Agreement, Seller hereby represents and warrants to ______ Title Insurance Company the following:
Seller is a ____________ organized and existing under the laws of the State of ____________.
To Seller’s actual knowledge, (i) Seller’s ___________ agreement is in full force and effect, and (ii) no proceedings are pending for the dissolution of the Seller.
To Seller’s actual knowledge, the leases described on Exhibit “B” attached hereto constitute all of the written leases affecting the Real Property with the current tenants of the Real Property.
To Seller’s actual knowledge, except as disclosed in Exhibit ”C” attached hereto and made a part hereof, (a) there is no capital improvement work currently being constructed (or that was constructed during the last 6 months) on the Real Property that is the subject of a written contract with Seller which could give rise to a mechanic’s or materialman’s lien on the Real Property, and (b) Seller has not entered into any contracts for the furnishing of labor, materials, or services for construction purposes with respect to the Real Property to be furnished subsequent to the date of this affidavit.
Seller shall not hereafter cause any encumbrances or other instruments to be recorded against the Property (other than the recording of a deed (the “Deed”) transferring fee title to the Real Property to ___________) through the date the Deed is recorded in _________ County, __________.
For purposes hereof, the “actual knowledge” of Seller shall be limited to the actual knowledge (and not implied, imputed, or constructive) of ________________, with no duty of inquiry.  Notwithstanding anything contained herein to the contrary, the representations and warranties set forth in this Owner’s Affidavit shall only survive the closing of the transactions contemplated by the Purchase Agreement until ____________, 20__, after which date this Owner’s Affidavit shall be of  no further force or effect and _____ Title Insurance Company shall have no further rights hereunder (notwithstanding that one or more of the representations and/or warranties set forth herein may prove to be incorrect).  This Owner’s Affidavit is being executed for the sole and exclusive benefit of _____Title Insurance Company and no other party or person shall have any rights hereunder.
Executed as of __________, 20__
[SIGNATURES ON NEXT PAGE]

I-2

SELLER:
    
    

I-3

EXHIBIT A
LEGAL DESCRIPTION
ATTACHED

EXHIBIT B
LIST OF LEASES
ATTACHED

EXHIBIT C
IMPROVEMENT WORK
ATTACHED

EXHIBIT J
Form of Bring Down Certificate
(Attached)

SELLER’S BRING DOWN CERTIFICATE
(________________)

    Pursuant to that certain Purchase and Sale Agreement and Escrow Instructions dated as of ___________, 20__ (the "Agreement"), by and between ____________________, a _____________ ("Purchaser"), and ______________, a ____________________ (“Seller"), Seller hereby certifies to Purchaser that, except as set forth in Schedule 1 attached hereto, all of Seller's representations and warranties contained in [Section 11.1] of the Agreement are true and correct in all material respects as of the Close of Escrow (as defined in the Agreement), subject to all terms and conditions set forth in the Agreement, including, without limitation, the provisions of [Sections 11.1 and 15.6] of the Agreement.

(SEE ATTACHED SIGNATURE PAGE)

SELLER:
__________________________
a ________________________

By: ________________________
Name: _____________________
Its: ________________________

Schedule 1
Disclosures
(Attached)

EXHIBIT K
Form of Hotel Owner Estoppel

GRANITE TOWER LLC, a Delaware limited liability company, 
{address]
Re: Amended and Restated Master Declaration of Block 95 Condominiums, recorded December 19, 2005 at Reception No. 2005215222, Amended and Restated First Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded October 7, 2010 at Reception No. 2010115794, Second Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded March 21, 2011 at Reception No. 2011031047, Third Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded October 22, 2013 at Reception No. 2013154449, Fourth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded March 5, 2015 at Reception No. 2015028233, and Fifth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded September 28, 2017 at Reception No. 2017128174, and Sixth Amendment to Amended and Restated Master Declaration of Block 95 Condominiums recorded April 29, 2021 at Reception No. 2021082293 (the “Declaration”)

Ladies and Gentlemen:
Pursuant to Section 18.1 of the Declaration, the undersigned, the Owner of Unit 2 of Block 95 Condominiums hereby certifies to GRANITE TOWER LLC, a Delaware limited liability company, its successors and assigns, to the best of its knowledge, without inquiry:
    (a)    That the terms and provisions of this Declaration are unmodified and are in full force and effect, or, if modified, identifying any such modifications.
    (b)    There is no existing default under the Declaration by the Owner of Unit 1, the Owner of Unit 5 or the Association (including, without limitation any default with respect to the operation of the Central Plant or the Parking Garage).
    (c)    The undersigned Owner is not entitled to receive or demand from the Association or the Owner of Unit 1 or the Owner of Unit 5 any monies, or, if there is any such sum, specifying the nature and amount thereof and method of computation.
    (e)    The undersigned Owner has not performed nor is performing work, the cost of which is chargeable in whole or in part to Owner of Unit 1 or the Owner of Unit 5 under the provisions of the Declaration that has not yet been charged to the Owner of Unit or the Owner of Unit 5, except as follows: __________________________.
    (f)    The undersigned Owner is not asserting, and does not know of any set-offs, claims, counterclaims, or defenses against the enforcement of the obligations under the Declaration of the Owner of Unit 1 or the Owner of Unit 5, except as follows: __________________________..

    (g)    The undersigned Owner has not requested that a matter under the Declaration or relating to the Block 95 Condominiums or any of them be submitted to arbitration.
    (h)    The undersigned Owner has received the use of all parking spaces in the Parking Garage to which it is entitled under the Declaration.
    (i)    The undersigned Owner is receiving the tons of cooling capacity of Chilled Medium to which it is entitled under the Declaration.
    (j)    The undersigned Owner has not elected its right to “Opt Out” of Chilled Water Medium or other service under Section 6.1(l) of the Declaration. 
    (h)     The undersigned Owner has not suffered a loss, including business interruption, resulting from any interruption of service involving operation of the Central Plant.  
    Capitalized terms not otherwise defined herein have the meaning set forth in the Declaration.

                    Sincerely,

                    [The Owner of Unit 2, the Hotel Owner]
17062339_v1

EXHIBIT L
Utility Deposits
NONE.

L-1

EXHIBIT M
Form of Assignment and Assumption of Purchase Agreement
(Attached)

M-1

ASSIGNMENT AND ASSUMPTION OF PURCHASE AGREEMENT

    This Assignment and Assumption of Purchase Agreement (“Assignment”) is entered into between ________________ (“Assignor”), and ________________ (“Assignee”), as of _________ __, 20__ (“Effective Date”).
RECITALS
    A.    Pursuant to the terms of that certain Purchase and Sale Agreement and Escrow Instructions dated _______, 20__ by and between _____________ (“Seller”), as seller, and Assignor, as buyer, as amended (the “Purchase Agreement”), Assignor agreed to acquire the Property (as such term is defined in the Purchase Agreement) commonly referred to as ______________.
    B.    Assignor desires to assign, without recourse, representation or warranty, all of its rights, benefits, liabilities and obligations arising under the Purchase Agreement (and related documents) to Assignee, and Assignee desires to assume all of said rights, benefits, liabilities and obligations subject to the terms of this Assignment.
        NOW, THEREFORE, in consideration of the foregoing promises, the mutual undertakings of the parties set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties, the parties agree as follows:
        1.    Recitals.  The above recitals are incorporated herein by reference.
        2.    Assignment and Assumption.  Assignor hereby transfers, assigns and conveys to Assignee, without recourse, representation or warranty, express or implied, all of Assignor’s rights, interests, liabilities and obligations in, to and under the Purchase Agreement (and related documents).  Assignee hereby assumes all such rights, interests, liabilities and obligations, and joins in all representations, warranties, releases, and indemnities, of Assignor under the Purchase Agreement (and related documents).  Assignor agrees it shall not be released from its obligations under the Purchase Agreement as a result of this Assignment, and Assignee agrees that its acquisition of the Property pursuant to the Purchase Agreement shall be subject to all terms and conditions thereof, including without limitation all release and as-is provisions of the Purchase Agreement.  Notwithstanding the foregoing, (a) Seller shall have the right to deal exclusively with Assignee with respect to all matters pertaining to and/or arising out of the Purchase Agreement, (b) Assignor’s approval or consent shall not be required in connection with any amendment or modification to the Purchase Agreement hereafter entered into by and between Seller and Assignee, and (c) any and all amendments to the Purchase Agreement hereafter entered into by and between Seller and Assignee shall be binding on Assignor. 
        3.    Successors and Assigns.  This Assignment shall be binding upon and inure to the benefit of the parties’ successors and assigns.
        4.    Counterparts.  This Assignment may be executed in any number of counterparts, each of which shall be deemed an original, but all of which when taken together 
M-2

shall constitute one and the same instrument.  Each counterpart may be delivered by facsimile transmission.  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.
Executed as of the date set forth above.

                        ASSIGNOR: 

                        _______________

                        By:     _____________________________
                        Its:     _____________________________

                        ASSIGNEE:

                        _______________

                        By:     _____________________________
                        Its:     _____________________________
M-3

EXHIBIT N
Property Information
1.General Property information – include project literature, photographs, floor plans, etc.
2.Real Property, sales, and other tax information for the current year (including evidence of payment), along with past four years’ statements or TRIM notices and appeal information (if applicable) and past four years’ sales tax returns.
3.Rent Roll for current period.
4.Property operating statements for current period and prior three years, including year to date actuals.
5.Current year operating budget.
6.Schedule of capital expenditures completed over the past five years.
7.Prior year and year-to-date General Ledger.
8.Accounts Receivable Report.
9.Standard Lease form.
10.List of all utility companies, contract person, address, telephone number, and account numbers including gas, electric, water, sewer, telephone, and waste removal.
11.All Leases, including amendments, lease summaries, and all correspondence between tenants and owner and manager.
12.Most recent “as built” ALTA Survey.
13.All stamped and final “as built” architectural, construction, and any other drawings, renderings, plans, and specifications for building(s).
14.Updated title report together with copies of all  title exceptions.
15.Copies of all licenses, permits, consents, and approvals relating to the Property.
16.Articles of Incorporation, By-Laws, partnership documents, and any other documents relative to any Property owners’ associations affecting the Property and any licenses or rights to use any improvements on or near the Property.
17.Warranty and Guaranty Agreements for services, equipment, or materials.
18.A completed schedule and inventory of Personal Property and equipment located on the Property.
19.All environmental site assessments or other environmental inspection reports.
20.All engineering or other reports as to the physical condition of the Improvements.
21.Mechanical inspection reports.
N-1

22.Fire inspection reports.
23.All insurance policies (other than title insurance policies) and list of insurance claims relating to the Property.
24.All Operational Contracts.
25.All engineering, soil, environmental, geotechnical, zoning, access, and similar reports or documents relating to the Property and prepared by or for Seller.
26.Contact information for site and additional due diligence requests.
27.Maintenance work orders for the past 12 months and a list of capital improvements performed within the past 24 months.
28.Condominium – 2021 Budget and financials for the association.
29.Tenant Billing Statements for the current month
30.Parking – 2021 Budget, prior year financials and the parking allocations per lease and per billing by tenant.
31.Photographs of the property
32.Office Building CAD Files and Parking Garage As-Builts

N-2

EXHIBIT O
Form of Contractor’s Certificate
(Attached)

O-1

Contractor’s Certificate

The undersigned, ____________ (the "Contractor"), is a party to that certain [Construction Contract] dated ____________ (the "Construction Contract"), by and between Contractor and ____________, a _______________ (the “Transferor”), in connection with that certain real property commonly known as _________________  (the “Property”).  Transferor has advised Contractor that Transferor intends to transfer the Property to _________, a ______________  (the “Transferee”), on a closing date of _____________ (the “Closing Date”) and, in connection with such transfer of the Property, Transferor intends to transfer and assign the Construction Contract to Transferee and all of Transferor’s rights and obligations thereunder.  In connection with Transferor’s transfer of the Property to Transferee and Transferor’s assignment of the Construction Contract to Transferee, Contractor certifies and represents the following:
1.    The Contractor consents to the assignment of the Construction Contract (and all warranties arising out of the Construction Contract) to Transferee based on Contractor’s understanding that, upon the assignment by Transferor to Transferee of Transferor’s interest under the Construction Contract, Transferee shall have the right to enforce all of the terms and conditions of the Construction Contract and all warranties thereunder and shall have all responsibilities and liabilities of the “Owner” under the Construction Contract, including payment of all amounts due and owing to Contractor for work performed pursuant thereto.
2.    As of the Closing Date: 
(a) the total amount payable under the Construction Contract (including any amounts already paid), including all change orders (“Change Orders”) and/or claims for additional costs or extension of time submitted by the Contractor (“Claims”) is $_______________, 
(b) the Transferor has paid to Contractor a total amount of $______________ with respect to the Construction Contract, and 
(c) the maximum amount owing under the Construction Contract for all work completed, work in progress and future work to be completed is $_______________________. 
3.    Attached hereto at Exhibit “A” is a true, correct and complete copy of the Construction Contract, and the same has not been amended or modified.  There are no Change Orders to the Construction Contract or Claims except as attached in Exhibit “A” attached hereto.
Executed as of ______________, 20__.  

[SIGNATURES FOLLOW ON NEXT PAGE]

O-2

CONTRACTOR:
_____________________,
a ______________________

By:                        
Name:                        
Its:                        

O-3

JOINDER
The undersigned acknowledges receipt of a copy of the Contractor’s Certificate to which this Joinder is attached, and, except as set forth below, acknowledges and agrees that, from and after the Closing Date, the undersigned shall have no further rights under the Construction Contract; provided, however, the undersigned reserves and retains (i) all of its rights under the Construction Contract with respect to any event or matter which occurred or accrued prior to the Closing Date, and (ii) all rights it may have under the Construction Contract for matters which occur or accrue on or after the Closing Date only to the extent necessary to defend itself from any claim with respect thereto.  The undersigned recognizes that, as of the Closing Date, the undersigned shall not have the right to amend the Construction Contract or waive Transferee’s rights under the Construction Contract.
Executed as of ____________, 20__.

______________________
______________________
______________________
O-4

Exhibit “A”

Construction Contract, Change Orders and Claims

(Attached)

EXHIBIT P
Ongoing Work
Existing Improvement Contracts

•Bubu Café/Lobby and Amenity floor – final invoices paid in 2021 under Swinerton’s contract dated 5/16/2019

•CT2/CT3 Fluid Cooler Replacement - Contract is with Haynes Mechanical and is dated 10/1/2020.

•18th Floor Restroom Remodel - Contract is with Tenant Improvement Construction Corporation dated 2/2/2021.  

•30th Floor Restroom Remodel - Contract is with Tenant Improvement Construction Corporation dated 4/15/2021.  

•Western Midstream Partners TI project - Contract is with Tenant Improvement Construction Corporation dated 4/29/2021.  

•Viewray, Inc. TI project - Contract is with Tenant Improvement Construction Corporation dated 4/15/2021.  

EXHIBIT Q

Owner Deposits

NONE.

SCHEDULE 1-1
Description of New and Pending Lease Transactions (Buyer’s Responsibility)
NONE.

SCHEDULE 1-2
Description of New and Pending Lease Transactions (Seller’s Responsibility)
# 400 – Anadarko TI’s =         $21,036,972.73

Anadarko Restroom Upgrades    $2,239,992.00

Anadarko Heat Panel Upgrades.    $1,359,996.00

•Stub Rent – ViewRay’s Lease Commencement Date is 9/1/2021.  Monthly Rent is $50,173.  Buyer to receive a credit at Closing for the Stub Rent attributable from the Closing Date to Lease Commencement Date if the Closing occurs prior to 9/1/2021.

•Free Rent – Buyer to receive a credit at Closing for Free Rent shown in the chart below for periods from and after the Closing Date.

SCHEDULE 2
Disclosures
•Oxy has $10,048 on their account as a credit for prior year taxes that was just recently invoiced due to the tax refund.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00336-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00336-of-00352.parquet"}]]