Document:

Document

Exhibit 10.6

OFFICE LEASE
between
BOF II MD 77 UPPER ROCK LLC,
(Landlord)
and
AURINIA PHARMA U.S., INC.
(Tenant)
77 UPPER ROCK CIRCLE
Rockville, Maryland

 
Certain identified information has been excluded from this exhibit because it both (i) is not material and (ii) would be competitively harmful if publicly disclosed.

OFFICE LEASE
INDEX
SECTION    PAGE
						
	1.    LEASED PREMISES.
	1

	2.    TERM.
	1

	3.    acceptance of premises, CONSTRUCTION OF WORK.
	2

	4.    RENT.
	2

	5.    ADDITIONAL RENT FOR INCREASES IN OPERATING EXPENSES.
	4

	6.    ADDITIONAL RENT FOR INCREASES IN REAL ESTATE TAX EXPENSES.
	9

	7.    USE OF PREMISES.
	11

	8.    MAINTENANCE.
	13

	9.    ALTERATIONS BY TENANT.
	13

	10.    EQUIPMENT.
	16

	11.    ALTERATIONS, EQUIPMENT AND OTHER PROPERTY BELONGING TO LANDLORD/REMOVAL OF PERSONAL PROPERTY/RESTORATION OF PREMISES.
	16

	12.    ENTRY FOR INSPECTIONS, REPAIRS AND INSTALLATIONS.
	17

	13.    SERVICES AND UTILITIES.
	17

	14.    RULES AND REGULATIONS.
	19

	15.    INDEMNITY.
	19

	16.    TENANT’S RESPONSIBILITY FOR DAMAGE.
	20

	17.    LIABILITY FOR DAMAGE TO PERSONAL PROPERTY OR PERSON.
	20

	18.    FIRE AND OTHER CASUALTY.
	20

	19.    TENANT INSURANCE.
	22

	20.    RELEASE OF CLAIMS AND WAIVER OF SUBROGATION.
	23

	21.    CONDEMNATION.
	24

	22.    DEFAULTS AND REMEDIES.
	24

	23.    RIGHT OF LANDLORD TO CURE TENANT’S DEFAULT.
	27

	24.    WAIVER.
	28

	25.    HOLDING OVER.
	28

	26.    SUBORDINATION.
	29

	27.    ASSIGNMENT AND SUBLETTING.
	30

	28.    TRANSFER BY LANDLORD.
	32

	29.    ESTOPPEL CERTIFICATES.
	32

	30.    COVENANTS OF LANDLORD.
	33

	31.    WAIVER OF JURY TRIAL.
	33

	32.    BROKERAGE.
	33

	33.    CERTAIN RIGHTS RESERVED BY LANDLORD.
	34

	34.    NOTICES.
	34

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	35.    MODIFICATIONS.
	35

	36.    SECURITY DEPOSIT.
	35

	37.    HAZARDOUS MATERIALS.
	35

	38.    LIMITATION ON LANDLORD LIABILITY.
	37

	39.    NEW PROVIDER INSTALLATIONS.
	37

	40.    SIGNAGE.
	38

	41.    PARKING.
	38

	42.    BANKRUPTCY
	39

	43.    MISCELLANEOUS PROVISIONS.
	40

EXHIBITS
EXHIBIT A – FLOOR PLAN OF PREMISES
EXHIBIT B – [RESERVED]
EXHIBIT C – WORK LETTER
EXHIBIT D – OPTION TO EXTEND
EXHIBIT E – RIGHT OF FIRST OFFER 
EXHIBIT F – OPTION TO TERMINATE 
EXHIBIT G – GUARANTY
EXHIBIT H – TENANT’S RESERVED PARKING AREA AND MARKING
EXHIBIT I – CLEANING SPECIFICATIONS
EXHIBIT J – FORM OF SNDA

 

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LEASE
THIS LEASE is made and entered into as of this 12th day of March, 2020 (the “Effective Date”), by and between BOF II MD 77 UPPER ROCK LLC, a Delaware limited liability company (“Landlord”) and AURINIA PHARMA U.S., INC., a Delaware corporation (“Tenant”).  Landlord and Tenant are sometimes each referred to individually as a “Party” and collectively as the “Parties”.
In consideration of the rents hereinafter reserved and the agreements hereinafter set forth, Landlord and Tenant mutually agree as follows:
1.    LEASED PREMISES.
Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, approximately 30,531 square feet of rentable area, on the seventh (7th) floor of the office building (the “Building”) situated at 77 Upper Rock Circle, Rockville, Maryland, as shown on the plan attached hereto as Exhibit A (hereinafter referred to as the “Premises”).  The rentable area of all office space in the Building is approximately [redacted] square feet.  The rentable area of the Building has been measured in accordance with the Building Owners and Managers Association (BOMA) Standard Method of Measurement (ANSI/BOMA Z65.1-2017), Method A.  The rentable area of the Premises and the rentable area of the Building as set forth in this Section 1 are hereby stipulated and agreed to by Landlord and Tenant shall be used for all purposes of this Lease and shall not be subject to remeasurement unless there is a physical change in the size of the Premises.
2.    TERM.
A.    The term of this Lease (the “Initial Term”) shall commence on the date Landlord delivers possession of the Premises to Tenant (the “Possession Date”). The “Commencement Date” of this Lease shall be the earlier of: (1) the date on which the Work (as defined in Exhibit C attached to this Lease) in the Premises is Substantially Completed (as defined in Exhibit C attached to this Lease), or (2) September 1, 2020.  The “Rent Commencement Date” of this Lease shall be the same as the Commencement Date.  Landlord shall deliver possession of the Premises to Tenant in the condition described in Section 3 below on the Effective Date.
B.    During the period from the Possession Date to the day immediately prior to the Commencement Date, all terms and conditions of this Lease shall apply, other than payment of Annual Base Rent and Additional Rent for increases in Operating Expenses and increases in Real Estate Tax Expenses.
C.    The Initial Term shall end at 11:59 p.m. on the last day of the one hundred thirty second (132nd) full calendar month after the Commencement Date (the “Expiration Date”), unless the Term terminates sooner pursuant to any other provision of this Lease or pursuant to law.  The term “Lease Year” as used in this Lease shall mean the first and each successive period of twelve (12) full calendar months following the Commencement Date.  If the 
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Commencement Date occurs on a day other than the first (1st) day of a calendar month, then the portion of such partial month from and after the Commencement Date shall be added to the first (1st) Lease Year, so that the first Lease Year shall end on the last day of the calendar month in which the first anniversary of the Commencement Date occurs.  The Initial Term and any extensions thereof shall be referred to as the “Term”.  Once the Commencement Date occurs, Landlord and Tenant shall execute a letter agreement or amendment to this Lease specifying the Possession Date, the Commencement Date, the Rent Commencement Date, the Expiration Date, the Lease Years (and corresponding rent amounts), and any other relevant information that is determinative of the foregoing dates.
3.    acceptance of premises, CONSTRUCTION OF WORK.   
Tenant acknowledges that: (1) EXCEPT FOR THE CONSTRUCTION ALLOWANCE AS EXPRESSLY PROVIDED IN EXHIBIT C ATTACHED HERETO, TENANT HAS INSPECTED AND ACCEPTS THE PREMISES AND THE BUILDING IN AN "AS IS, WHERE IS" CONDITION, (2) THE PREMISES, BUILDING AND IMPROVEMENTS COMPRISING THE SAME ARE SUITABLE FOR THE PURPOSE FOR WHICH THE PREMISES ARE LEASED AND, EXCEPT AS OTHERWISE EXPRESSLY HEREIN PROVIDED, LANDLORD HAS NOT MADE AND HEREBY DISCLAIMS ANY AND ALL WARRANTIES, REPRESENTATIONS, COVENANTS, AND AGREEMENTS WITH RESPECT TO THE MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF THE PREMISES, (3) THE PREMISES ARE IN GOOD AND SATISFACTORY CONDITION, AND (4) EXCEPT AS OTHERWISE EXPRESSLY HEREIN PROVIDED, AND EXCEPT FOR THE CONSTRUCTION ALLOWANCE AS EXPRESSLY PROVIDED IN EXHIBIT C ATTACHED HERETO, NO REPRESENTATIONS AS TO THE REPAIR OF THE PREMISES, NOR PROMISES TO ALTER, REMODEL OR IMPROVE THE PREMISES HAVE BEEN MADE BY LANDLORD.  The taking of possession of the Premises shall be conclusive evidence that Tenant accepts the Premises and that the Premises were in good condition at the time possession was taken except for items that are Landlord’s responsibility under Section 8.  Notwithstanding the foregoing, Landlord represents and warrants to Tenant that the Building, including the Premises and base building systems and structure are currently in compliance with all applicable laws, ordinances, rules, regulations, directives, orders and requirements of all governmental, quasi-governmental and regulatory authorities and agencies including, without limitation, police, fire, health and environmental authorities or agencies responsible for enforcing local, state and federal law with regard to the base building and the Premises.  In addition, Landlord warrants to Tenant the “as-is” condition of the Premises and the base building is in compliance with the aforesaid rules, regulations, laws, including but not limited to all Environmental Laws (defined in Section 37.B below), the Americans With Disabilities Act and the most modern ASHRAE standard for fresh air mix.  In the event a circumstance in the base building and/or Premises is defined, discovered, identified and/or reported by Tenant or Landlord that is not in compliance with the aforesaid conditions, Landlord shall provide Tenant, at no expense to Tenant, a remedy to resolve said condition.
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4.    RENT.
Tenant shall pay to Landlord the following rent under this Lease, “Annual Base Rent”, “Monthly Base Rent” and “Additional Rent”, all as more fully set forth in this Section 4 and Sections 5 and 6:
A.    Annual base rent (“Annual Base Rent”), payable in equal monthly installments (“Monthly Base Rent”) as follows:   
												
	Lease Year	Annual Base Rent	Monthly Base Rent	Per Rentable
Square Foot
	1*	$1,007,523.00	$83,960.25	[redacted]
	2*	$1,030,115.94	$85,843.00	[redacted]
	3	$1,053,319.50	$87,776.63	[redacted]
	4	$1,077,133.68	$89,761.14	[redacted]
	5	$1,101,253.17	$91,771.10	[redacted]
	6	$1,125,983.28	$93,831.94	[redacted]
	7	$1,151,324.01	$95,943.67	[redacted]
	8	$1,177,275.36	$98,106.28	[redacted]
	9	$1,203,837.33	$100,319.78	[redacted]
	10	$1,231,009.92	$102,584.16	[redacted]
	11	$1,258,487.82	$104,873.99	[redacted]

The first installment of Monthly Base Rent (for the twelfth (12th) month of the Initial Term) shall be paid on the execution and delivery of this Lease by Tenant, and like installments shall be paid, in advance, on or before the first day of each calendar month during the Term from and after the Commencement Date.    
*Notwithstanding the foregoing provisions of this Section 4.A., Landlord hereby agrees to: (1) abate the payments of Monthly Base Rent and Additional Rent (e.g., Tenant’s Share of Increases in Operating Expenses and Tenant’s Share of Increases in Real Estate Tax Expenses) for the entire Premises for the first eleven (11) months of the first (1st) Lease Year (Lease months 1 – 11), and (2) abate the payments of Monthly Base Rent and Additional Rent (e.g., Tenant’s Share of Increases in Operating Expenses and Tenant’s Share of Increases in Real Estate Tax Expenses) for only 5,000 square feet of rentable area of the Premises (for avoidance of doubt, Monthly Base Rent and Additional Rent will be due and payable for the remaining 25,531 square feet of rentable area of the Premises) for following ten (10) months thereafter (Lease months 12 – 21) (collectively, the “Rent Abatement”).
B.    “Additional Rent” shall consist of all other sums of money (except Annual Base Rent and Monthly Base Rent) as shall become due from Tenant under this Lease.
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C.    Tenant will pay all rent without notice, demand, deduction, set-off or counterclaim.  Payments of rent for any fractional calendar month shall be prorated.  All payments required to be made by Tenant to Landlord hereunder shall be payable to:  BOF II MD 77 Upper Rock LLC, c/o Bridge Investment Group, Five Concourse Parkway, Suite 500, Atlanta GA 30328, Attn: Property Management, or at such other address as Landlord may specify from time to time by written notice delivered in accordance herewith.  The obligation of Tenant to pay Base Rent and other sums to Landlord and the obligations of Landlord under this Lease are independent obligations.  Tenant acknowledges that late payment by Tenant to Landlord of any rent due hereunder will inconvenience Landlord and cause Landlord to incur costs not contemplated by this Lease.  Therefore, if Tenant fails to pay any installment of Monthly Base Rent or Additional Rent to Landlord on or before the date when such rent is due and payable, and such failure continues for five (5) days after written notice to Tenant, Tenant shall pay to Landlord, as Additional Rent, for each month or part thereof until such payment is made, an administrative late payment fee equal to five percent (5%) of the amount due, which sum Landlord and Tenant acknowledge and agree fairly represents Landlord’s cost and expense in carrying and processing delinquent accounts.  If Landlord at any time or times accepts any rent after it has become due and payable, such acceptance shall not excuse, delay at subsequent times, or constitute a waiver of, any of Landlord’s rights under this Lease.
D.    Tenant shall pay rent to Landlord, in accordance with written instructions to be delivered by Landlord to Tenant no later than [redacted] prior to the first date rent is due hereunder, or to such other address as directed by Landlord upon delivering no less than [redacted] prior written notice to Tenant. 
5.    ADDITIONAL RENT FOR INCREASES IN OPERATING EXPENSES.
A.    Subject to the Rent Abatement, commencing the Rent Commencement Date, for each Calendar Year (or partial Calendar Year) during the Term, Tenant shall pay to Landlord, as Additional Rent, Tenant’s Share of Increases in Operating Expenses (hereinafter defined).  “Tenant’s Share of Increases in Operating Expenses” for each Calendar Year shall equal the product obtained by multiplying Tenant’s Proportionate Share (as defined in this Section 5.A.) times the amount by which Operating Expenses (as defined in Section 5.E.) for the Building for such Calendar Year exceeds Base Operating Expenses (as hereinafter defined); provided, however, that for the Calendar Year during which the Term ends, Tenant’s Share of Increases in Operating Expenses shall be prorated based upon the actual number of days the Lease was in effect during such Calendar Year.  “Tenant’s Proportionate Share” shall equal a fraction, the numerator of which is the rentable square footage of the Premises and the denominator of which is the rentable square footage of all office space in the Building, as reasonably adjusted by Landlord in the future for changes in the physical size of the Premises or the Building.  As of the Effective Date, Tenant’s Proportionate Share equals [redacted].  “Base Operating Expenses” is defined as the amount of Operating Expenses for Calendar Year 2020.
B.    Prior to determination of the actual amount of Tenant’s Share of Increases in Operating Expenses for any Calendar Year commencing with the Calendar Year immediately after the Calendar Year in which the Rent Commencement Date occurs, Tenant shall make 
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monthly installment payments toward such share on an estimated basis, based on Landlord’s reasonable estimate of the amount, if any, by which Operating Expenses for such Calendar Year will exceed Base Operating Expenses.  Tenant shall pay Landlord on the first day of each month of such Calendar Year one-twelfth (1/12th) of Landlord’s estimate.
C.    After the end of each Calendar Year commencing with the Calendar Year immediately after the Calendar Year in which the Rent Commencement Date occurs, Landlord shall determine the amount of Operating Expenses for the Calendar Year in question and the amount of the increase (if any) in Operating Expenses for such Calendar Year over the amount of Base Operating Expenses.  Landlord shall provide Tenant with a reasonably detailed statement (the “Operating Expense Statement”) of this determination, including Tenant’s Share of Increases in Operating Expenses for the Calendar Year.  Landlord shall use reasonable efforts to deliver the Operating Expense Statement to Tenant no later than [redacted] after the end of each Calendar Year.  Within [redacted] after delivery of the Operating Expense Statement for each Calendar Year, Tenant shall pay to Landlord any deficiency between the amount shown as Tenant’s Share of Increases in Operating Expenses for such Calendar Year and the estimated payments made by Tenant toward such amount in accordance with Section 5.B.  In the case of excess estimated payments, Tenant shall be credited with the excess toward subsequent Base Rent and Additional Rent payments, unless the Term has expired, in which event, provided that Tenant has fulfilled all of its obligations hereunder,  Landlord shall deliver such excess to Tenant within [redacted] after the later to occur Tenant providing Landlord with its forwarding address or delivery of the Operating Expense Statement.
D.    The term “Operating Expenses” means all costs and expenses incurred during the Calendar Year in managing, operating and maintaining (including cleaning, protecting, servicing and repairing) the Building (including the Premises) and the land upon which it is situated (the “Land”, and the Land and the Building, including any parking areas made available for the Building, shall be collectively referred to as the “Property”), as determined by Landlord in accordance with generally accepted accounting principles applied consistently from year to year.  Without in any way limiting the generality of the foregoing, such costs and expenses shall include but shall not be limited to utilities, trash removal, telephone service, insurance, janitorial services and supplies, cleaning service and supplies, security service and supplies, reasonable labor costs (including social security taxes, contributions and fringe benefits including retirement and pension plans), all management expenses either paid directly by Landlord or reimbursed to the management agent for the Building, specifically based on the individual(s) assigned with the management and operation of the Building, including salaries, benefits, office supplies and occupancy costs, legal fees and accounting expenses, charges under maintenance and service contracts, repair and maintenance of heating, ventilating and air conditioning equipment, all costs of applying, reporting, commissioning and re-commissioning the Building or any part thereof to seek or renew certification under any Green Building Standard (as defined in Section 7) applicable to the Building, insurance endorsements applicable to green buildings (including without limitation coverage in order to repair, restore, replace and re-commission the Building for certification or recertification in accordance with Green Building Standards), management fees, business taxes and licenses, including personal property taxes on Landlord’s or the management agent’s property used in the operation or 
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management of the Building, a pro rata share attributable to the Building of the costs of operating, maintaining and repairing the Garage (but only to the extent such costs are related solely to any portion of the Garage that is not exclusively for residential parking), and all other costs and expenses of operating and maintaining the Building including any Permitted Capital Expenditures.  As used herein, the term “Permitted Capital Expenditures” are any and all costs or expenses, which are required to be capitalized for federal income tax purposes, that are incurred by Landlord in connection with any repairs, improvements or replacements related to (a) any labor-saving or energy-saving device or other equipment installed or used in the Building that is intended to reduce, or reduce increases in, Operating Expenses, (b) any requirement of Law first applicable to the Building after the Effective Date. The cost of each such Permitted Capital Expenditure, together with reasonable interest (as determined by Landlord) or any financing charges incurred in connection therewith, shall be amortized over the useful life thereof and only that portion attributable to such Calendar Year shall be included in Operating Expenses for such Calendar Year during the remainder of the Term (as same may be extended or renewed from time to time).  
E.    Notwithstanding the foregoing, Operating Expenses shall not include:  (i) Real Estate Tax Expenses (as defined in Section 6 below), together with any other tax which would be excluded under the definition of Real Estate Tax Expenses as set forth in Section 6; (ii) payments of principal and interest on any mortgages, deeds of trust or other encumbrances upon the Building; (iii) leasing commissions; (iv) costs of preparing, improving or altering space for any new or renewal tenant; (v) management fees to the extent they exceed fair market management fees paid to unrelated third party management companies; (vi) costs of leasing or other brokerage commissions, legal, space planning, construction, and other expenses incurred or concessions given in procuring tenants for the Building or incurred solely with respect to individual tenants or occupants of the Building, and any payments made to relocate or remove from the Building any existing tenants; (vii) except for the amortized cost of Permitted Capital Expenditures, as expressly provided above, capital improvements, and capital expenditures or amounts paid for rental of equipment that if purchased by Landlord would be a capital improvement; (viii) non-cash items, such as deductions for depreciation and amortization of the Building and the Building equipment (other than Permitted Capital Expenditures), interest on capital invested (other than Permitted Capital Expenditures), bad debt losses, rent losses and reserves for such losses, and reserves for repairs, maintenance and replacements; (ix) costs of painting, redecorating, or other services or work performed for the exclusive benefit of any tenant or occupant; (x) salaries, wages, or other compensation paid to officers or executives of Landlord; (xi) salaries, wages, or other compensation or benefits paid to employees of Landlord who are not assigned full-time to the operation, management, maintenance, or repair of the Property; provided however, Operating Expenses may include Landlord’s reasonable allocation of wages, salary, or other compensation or benefits paid to any employee to the extent such employee is assigned or devotes services on a part-time basis to the operation, management, maintenance, or repair of the Building; (xii) Landlord’s costs incurred on a shared basis with other properties, such as centralized accounting costs, unless the allocation is made on a reasonable and consistent basis that fairly reflects the share of any costs attributable to the Building; (xiii) costs of marketing, advertising and public relations and promotional costs associated with the promotion or leasing of the Building and costs of signs in or on the 
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Building identifying the owners, managers or leasing agents of the Building; (xiv) original construction costs of the Building and any expenses for replacements arising from defects in the original construction of the Building; (xv) any costs, fines or penalties incurred by reason of (1) Landlord’s failure to timely pay when due any Operating Expense, Real Estate Tax Expense or other amount expressly excluded from Operating Expenses hereunder, or (2) the violation by Landlord, or any other tenant, of any Law, including, but not limited to, the removal of Hazardous Materials from the Property caused by Landlord or any other tenant of the Property, or costs to cure any violation of Laws in effect on or before the Effective Date related to the general use of the Property (including, without limitation, Laws governing fire, life, safety and disabilities) in each instance only to the extent in excess of the amount that would have been included in Operating Expenses in the absence of such failure or violation by Landlord; (xvi) costs incurred in connection with disputes with tenants, other occupants, or prospective tenants, or costs and expenses incurred in connection with negotiations or disputes with leasing agents, purchasers or Mortgagees (as defined in Section 26) of the Building; (xvii) costs incurred in connection with the sale, financing, refinancing, mortgaging, selling or change of ownership of all or any part of, or interest in, the Property; (xviii) costs incurred by Landlord which are associated with the operation of the business of the legal entity which constitutes Landlord (such as trustee’s fees, annual fees, corporate or partnership organization or administration expenses (including resident agent fees)), including legal entity formation and legal entity accounting; (xix) general overhead and general administrative expenses and accounting, record-keeping and clerical support of Landlord or the management agent not directly related to the operation of the Building; (xx) costs or expenses of utilities directly metered to tenants and costs of utilities incurred directly by retail tenants in the Building; (xxi) ground rent, other than items which would be included in Operating Expenses in the absence of such ground lease; (xxii) costs of any “tap fees” or one time lump sum sewer or water connection fees for the Building; (xxiii) political or charitable contributions; (xxiv) acquisition costs for sculpture, paintings and other art objects; and (xxv) costs for goods and services and materials to an entity related to or affiliate of Landlord, but only to the extent such costs exceed compensation based on an arm’s length fair market transaction of the same nature.
F.    If during any Calendar Year, including the 2020 Calendar Year (the “Base Year”), Landlord does not perform any work or service (the cost of which would be included in Operating Expenses if performed by Landlord) for any tenant of the Building which has undertaken to perform such work or service itself, in lieu of performance by Landlord, but reimbursed by Landlord, Operating Expenses shall include the amount of such reimbursement.   
G.    Notwithstanding the provisions of this Section 5, commencing with the Calendar Year after the Base Year (hereinafter, the “First Controllable Expense Year”) and for each Calendar Year thereafter, Operating Expenses shall not include Controllable Expenses (as hereinafter defined) in excess of the Controllable Expense Maximum (as hereinafter defined)  applicable to such Calendar Year.  If Controllable Expenses in any Calendar Year (commencing with the First Controllable Expense Year and continuing for each year thereafter) exceed the applicable Controllable Expense Maximum (which shall be appropriately prorated for the Calendar Year in which the Expiration Date occurs), the excess Controllable Expenses shall be carried forward and treated as a Controllable Expense (subject to the then applicable 
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Controllable Expense Maximum) in each subsequent Calendar Year until the excess is used, or this Lease expires, whichever occurs first (and Tenant shall not be required to pay any such unused excess upon expiration of this Lease).  “Controllable Expenses” shall mean all Operating Expenses other than those expenses attributable to: (i) taxes, assessments and other governmental or quasi-governmental charges, (ii) insurance, (iii) utilities, (iv) fuel oil, (v) snow and ice removal; (vi) Permitted Capital Expenditures; and (vii) any other expenses that are beyond the reasonable control of Landlord.
The “Controllable Expense Maximum” for each Calendar Year (commencing with the First Controllable Expense Year) shall mean the Controllable Operating Expenses for the Base Year  (actual or grossed up pursuant to Section 5.H., as applicable), increased by five percent (5%) per annum on a cumulative basis, such that the Controllable Expense Maximum for any Calendar Year shall be a multiple of the Controllable Expenses for the First Controllable Expense Year (actual or grossed up pursuant to Section 5.H., as applicable), as follows:
						
	Period	Multiple
	First Controllable Expense Year	1.0500
	Next Calendar Year	1.1025
	Next Calendar Year	1.1576
	Next Calendar Year	1.2155

and so on.
H.    Nothing contained in this Section 5 shall be interpreted at any time to reduce the Annual Base Rent or Monthly Base Rent payable by Tenant under this Lease.
I.    If the Building is less than [redacted]  occupied during any part of a Calendar Year, including the Base Year Operating Expenses for such Calendar Year shall mean the amount obtained by adjusting the actual Operating Expenses for such Calendar Year to a [redacted]  Building occupancy level, such adjustment to be made by adding to the actual Operating Expenses during such Calendar Year such additional costs (but only those costs which vary according to occupancy) as would have been incurred if the Building had been [redacted]  occupied, as reasonably determined by Landlord.
J.    If Landlord elects to utilize a fiscal year of twelve (12) calendar months (“Fiscal Year”), in lieu of the Calendar Year to calculate Tenant’s Share of Increases in Operating Expenses, each and every reference in this Section 5 to Calendar Year shall be read to mean Fiscal Year.  Landlord shall give written notice to Tenant of its election to utilize a Fiscal Year for all purposes under this Section 5.  Such notice shall also indicate the first day of Landlord’s Fiscal Year.  After Landlord gives notice of its election to calculate Tenant’s Share of Increases in Operating Expenses on a Fiscal Year in lieu of a Calendar Year basis, the amount of Tenant’s Share of Increases in Operating Expenses for the period commencing on the first day of the Calendar Year in which Landlord’s election is made and the day before the first day of the Fiscal Year (“Stub-Period”) shall be prorated in accordance with the intent of this Section 5 by Landlord (and the amount of Base Operating Expenses shall be correspondingly pro-rated), 
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and Tenant shall pay Tenant’s Share of Increases in Operating Expenses for such Stub-Period within thirty (30) days of rendition of a bill therefor.  In no event, however, shall any change from a Calendar Year to another Fiscal Year have any adverse effect on Tenant’s obligations under this Section 5.
6.    ADDITIONAL RENT FOR INCREASES IN REAL ESTATE TAX EXPENSES.
A.    Subject to the Rent Abatement, commencing on the Rent Commencement Date, and thereafter for each Calendar Year (or partial Calendar Year) during the Term, Tenant shall pay to Landlord, as Additional Rent, Tenant’s Share of Increases in Real Estate Tax Expenses (hereinafter defined).  “Tenant’s Share of Increases in Real Estate Tax Expenses” for the Calendar Year shall equal the product obtained by multiplying Tenant’s Proportionate Share times the amount, if any, by which Real Estate Tax Expenses (as defined in Section 6.E.) for such Calendar Year exceeds Base Real Estate Tax Expenses (as hereinafter defined); provided, however, that for the Calendar Year during which the Term ends, Tenant’s Share of Increases in Real Estate Tax Expenses shall be prorated based upon the actual number of days the Lease was in effect during such Calendar Year.  “Base Real Estate Tax Expenses” is defined as the amount of Real Estate Tax Expenses for Calendar Year 2020.     
B.    Prior to determination of the actual amount of Tenant’s Share of Increases in Real Estate Tax Expenses for any Calendar Year, Tenant shall make monthly installment payments toward such share on an estimated basis, based on Landlord’s reasonable estimate of the amount, if any, by which Real Estate Tax Expenses for the Calendar Year will exceed Base Real Estate Tax Expenses.  Tenant shall pay Landlord on the first day of each month of the Calendar Year one-twelfth (1/12th) of Landlord’s estimate.
C.    After the end of each Calendar Year, Landlord shall determine the amount of Real Estate Tax Expenses for the Calendar Year and the amount of the increase (if any) in Real Estate Tax Expenses for the Calendar Year over the amount of Base Real Estate Tax Expenses.  Landlord shall provide Tenant with a reasonably detailed statement (the “Real Estate Tax Expense Statement”) of this determination, including Tenant’s Share of Increases in Real Estate Tax Expenses for the Calendar Year.  Within [redacted] after the delivery of the statement for each Calendar Year, Tenant shall pay to Landlord any deficiency between the amount shown as Tenant’s Share of Increases in Real Estate Tax Expenses for the Calendar Year and the estimated payments made by Tenant toward such amount in accordance with Section 6.B.  In the case of excess estimated payments, Tenant shall be credited with the excess toward subsequent payments of Base Rent and Additional Rent, unless the Term has expired in which event Landlord shall pay such excess to Tenant within [redacted] after delivery of the Real Estate Tax Expense Statement.
D.    The term “Real Estate Tax Expenses” shall mean (i) all taxes and assessments, general or special, ordinary or extraordinary, foreseen or unforeseen, assessed, levied, or imposed upon the Building or the Land or assessed, levied or imposed upon the fixtures, machinery, equipment or systems, in, upon or used in connection with the operation of the Building or the Land under the current or any future taxation or assessment system or modification of, supplement or substitute for such system, and whether or not based on or 
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measured by the receipts or revenues from the Building or the Land (including all taxes and assessments for public improvements or any other purpose and any gross receipts or similar tax), and (ii) any tax, fee, levy or assessment, however characterized, on Landlord, the Premises, the Building, or the rent payable hereunder, in the nature of a sales tax, an arena, ballpark, convention center or other public facility or business improvement district tax or fee, a use tax or any other tax or fee.  For the purpose of this Section 6: (1) Real Estate Tax Expenses shall include all expenses incurred by Landlord in obtaining or attempting to obtain a reduction of such taxes, rates or assessments, including, without limitation, legal fees, which may, in Landlord’s sole discretion, be paid pursuant to a contingent fee arrangement based on savings; and (2) Real Estate Tax Expenses shall not include any net income taxes, estate or inheritance taxes, any transfer, recordation or capital stock tax, taxes on Tenant’s personal property, or taxes on the value of leasehold improvements owned by Tenant or any other tenant at the Building, but such personal property taxes and taxes on the value of said Tenant owned leasehold improvements shall be the sole obligation of Tenant and shall be paid by Tenant as and when due pursuant to applicable law and, in any event, no later than [redacted] after notice from Landlord or the applicable taxing authority that such taxes are due and payable.
E.    Nothing contained in this Section 6 shall be interpreted at any time to reduce the Annual Base Rent or Monthly Base Rent payable by Tenant under this Lease.
F.    In the event of any change by the taxing body in the period in which any of the Real Estate Tax Expenses are levied, assessed or imposed, Landlord shall make appropriate adjustments with respect to computing Real Estate Tax Expenses provided Tenant is not thereby unduly prejudiced.  
G.    If Landlord elects to utilize a Fiscal Year in lieu of the Calendar Year to calculate Tenant’s Share of Increases in Real Estate Tax Expenses, each and every reference in this Section 6 to Calendar Year shall be read to mean Fiscal Year.  Landlord shall give written notice to Tenant of its election to utilize a Fiscal Year for all purposes under this Section 6.  Such notice shall also indicate the first day of Landlord’s Fiscal Year.  After Landlord gives notice of its election to calculate Tenant’s Share of Increases in Real Estate Tax Expenses on a Fiscal Year in lieu of a Calendar Year basis, the amount of Tenant’s Share of Increases in Real Estate Tax Expenses for the Stub-Period shall be prorated in accordance with the intent of this Section 6 by Landlord (and the amount of Base Real Estate Tax Expenses shall be correspondingly prorated), and Tenant shall pay Tenant’s Share of Increases in Real Estate Tax Expenses for such Stub-Period within [redacted] of rendition of a bill therefor. Absent change by the taxing authority, Landlord agrees not to alter the method of calculating Tenant’s Share of Increases in Real Estate Tax Expenses more than once in each twelve (12) month period.  In no event, however, shall any change from a Calendar Year to another Fiscal Year have any adverse effect on Tenant’s obligations under this Section 6.
H.    If any tax or fee included within the foregoing definition of Real Estate Tax Expenses is levied, assessed, or imposed in such manner that the amount required to be paid by Tenant is not readily ascertainable because the tax or fee relates to more than the Building or 
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the rents payable with respect thereto, then Tenant shall pay an equitably estimated share of the total tax or fee, as reasonably determined by Landlord.
I.    If the Building is less than [redacted]  occupied during any part of a Calendar Year, Real Estate Taxes for such Calendar Year shall be adjusted to reflect a [redacted]  Building occupancy level.  
7.    USE OF PREMISES.
A.    Tenant shall use and occupy the Premises solely for general (non-medical and non-governmental) office purposes, in accordance with the use permitted under applicable zoning regulations and in compliance with all applicable present and future laws, ordinances, orders, codes, rules and regulations (collectively, “Laws”), and for no other purpose.  If any Law requires an occupancy or use permit or license for the Premises or the operation of any business conducted therein, Tenant shall obtain and keep current such permit or license at Tenant’s own expense and shall promptly deliver a copy thereof to Landlord.  Tenant shall not use or operate the Premises in any manner that will cause the Building or any part thereof not to conform with Landlord’s certification, if any, of the Building from time to time pursuant to the U.S. EPA’s Energy Star rating, the Green Building Initiatives Green Globe for Continental Improvement of Existing Buildings (Green GlobesTM CIEB), the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) rating system, or BOMA International’s 360 Performance Program, or any present or future comparable rating, certification or performance program (“Green Building Standards”).
A.1    Landlord hereby acknowledges and agrees that it shall be responsible for compliance with all laws, ordinances, regulations and directives of any authority having jurisdiction over the Building and/or Land, including the Americans With Disabilities Act of 1990 (49 U.S.C. Section 12101 et seq.) and regulations and guidelines promulgated thereunder, as all of the same may be amended from time to time (collectively, the “ADA”)  and fire/life safety requirements, with respect to all common areas of the Building in effect as of the Commencement Date.  In addition, the parties acknowledge that the ADA establishes requirements under Title III of the ADA (“Title III”) pertaining to business operations, accessibility and barrier removal, and that such requirements may or may not apply to the Premises or Building depending on, among other things: (1) whether Tenant’s business operations are deemed a “place of public accommodation” or a “commercial facility”; (2) whether compliance with such requirements is “readily achievable” or “technically infeasible”; and (3) whether a given alteration affects a “primary function area” or triggers so-called “path of travel” requirements.  Tenant has prepared or reviewed any plans and specifications for improvements for construction in the Premises and has independently determined that such plans and specifications are in conformance with the ADA Accessibility guidelines and other requirements of the ADA.  Tenant further acknowledges and agrees that to the extent that Landlord has prepared, reviewed or approved any of Tenant’s plans and specifications, such action shall in no event be deemed a representation or warranty that the same comply with the requirements of the ADA.  Tenant shall be responsible for the cost of all Title III compliance and costs 
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in connection with the Premises and shall also be responsible for the cost of any so-called Title III “path of travel” requirements triggered by construction activities or alterations in the Premises.  Tenant shall be solely responsible for all other requirements under the ADA relating to Tenant or any affiliates or persons or entities related to Tenant, operations of any of them, or the Premises, including, without limitation, requirements under Title I of the ADA pertaining to Tenant’s employees.

A2    If Tenant receives any notices alleging a violation of the ADA relating to any portion of the Building or Premises (including any governmental or regulatory actions or investigations regarding non-compliance with ADA), then Tenant shall notify Landlord in writing within ten (10) days of such notice and provide Landlord with copies of any such notice.

B.    Tenant shall not use or occupy the Premises or use the Building for any unlawful, disorderly, or hazardous purpose, or in a manner which will obstruct or interfere with the rights of other tenants, or their invitees, or in any way injure or annoy them.  Tenant shall not conduct or permit any activity, or place any equipment, in or about the Premises (or conduct or permit any activity by itself or its employees, agents, contractors or invitees in or about the Building) which shall in any way increase the rate of insurance premiums on the Building or the property kept in the Building, or conflict with fire laws or regulations or with any insurance policy on the Building or such property.  To maintain proper air balancing and pressurization, Tenant shall keep all of its suite entry doors closed except as actually used for ingress or egress.  Landlord shall have the right to prescribe the maximum weight and position of safes and other heavy equipment or fixtures that Tenant desires to install in the Premises, and any consulting fees or other expenses incurred by Landlord regarding same will be at Tenant’s expense, the same to be paid as Additional Rent within [redacted] after the rendition of a bill therefor.
C.    Without limiting Landlord’s responsibilities set forth in Section 13.A, Landlord maintain a temperature in the Building within the temperature range and in such amounts normally or usually furnished, in comparable office buildings in Rockville, Maryland.  Tenant shall not block or cover any of the heating, ventilation or air conditioning ducts in the Premises.  Without limiting Landlord’s repair and maintenance obligations set forth in Section 8, Tenant shall keep all equipment in the Premises in good condition and repair (hard plumbed with copper lines for all water connections) and immediately remove any water discharged or spilled from same.  Tenant shall regularly monitor the Premises for the presence of mold or mildew or for any conditions that reasonably can be expected to contribute to the growth of mold or mildew (collectively, the “Mold and Mildew Conditions”), including, but not limited to, evidence of water leaks or excessive humidity in the Premises, a failure or malfunctioning in the heating, ventilation or air conditioning system serving the Premises and inoperable doors or windows in the Premises , and Tenant shall immediately notify Landlord in writing of:  (i) any visible signs of mildew or mold growth in the Premises, and (ii) any Mold and Mildew Conditions in the Premises.
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8.    MAINTENANCE.
A.    Subject to Tenant’s obligations under Section 8.B below, Landlord, at its sole cost and expense (except and to the extent that any cost or expense is a permitted Operating Expense hereunder) shall make any and all repairs, maintenance and replacements to the base Building, including the Building roof and Building structure (e.g., the Building’s slab and load-bearing columns and walls) and the Building’s mechanical, electrical, plumbing, HVAC and fire and life safety systems, and to the common areas of the Building and the Garage, and shall keep the base Building and the common areas of the Building, including the fitness facility and conference center, clean, neat and in good order, repair and condition and in compliance with all Laws.  Notwithstanding anything herein to the contrary, Landlord shall not be responsible for any repair or maintenance which is caused in whole or in part by the act or omission of Tenant or its agents, contractors, employees, or guests.  In the event of such repair or maintenance caused by the act or omission of Tenant, Tenant shall pay for such repair or maintenance upon demand from Landlord and shall indemnify, defend, protect and hold harmless Landlord against any and all loss, cost or liability in connection therewith.  Landlord shall have a reasonable time after written notice from Tenant to perform necessary repairs or maintenance.  Tenant hereby waives and releases any right to make repairs at Landlord’s expense, which may be provided at common law or pursuant to any law, statute, or ordinance now or hereafter in effect.
B.    Subject to Landlord’s obligations under Section 8.A above, Tenant, at its sole cost and expense, shall make any and all repairs, maintenance and replacements to the Premises and the improvements, fixtures and systems therein, and shall keep the Premises clean, neat and in good order, repair and condition and in compliance with all Laws, provided that Tenant shall not be obligated to make any capital improvements relating to the Premises unless required due to Tenant’s use of the Premises for purposes other than typical office use.  Tenant shall give Landlord prompt written notice of any defects or damage to the structure of, or equipment or fixtures in, the Building or any part thereof.  At the expiration or other termination of the Term, Tenant shall, at its sole cost and expense, surrender the Premises broom clean and in good order and condition, ordinary wear and tear and damage by the elements, and fire and other casualty not required to be insured by Tenant excepted, and with removal of items as required by Section 11.  To the extent that Tenant’s use or uses of the Premises or Alterations thereto (beyond typical office use) or Tenant’s manner of operation creates a need or requirement under applicable Laws (including, without limitation, the ADA) to modify or alter the Premises, supporting facilities, or access thereto, or the manner of operation, maintenance and repair thereof, Tenant shall be fully responsible for the costs to undertake such changes, and in addition, to fully comply with the requirements of Section 9 below.
9.    ALTERATIONS BY TENANT.
A.    Following the completion of the Work, Tenant shall not make or permit any improvements, alterations, fixed decorations, substitutions or modifications, structural or otherwise, including, but not limited to the installation or modification of carpeting, partitions, 
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counters, doors, air conditioning ducts, plumbing, piping, lighting fixtures and wiring of any kind, hardware, locks, ceilings and window and wall coverings (collectively, “Alterations”), to the Premises or to the Building without the prior written consent of Landlord (both as to whether the Alterations may be made at all and as to how and when they may be made), which consent shall not be unreasonably withheld, conditioned or delayed.  Tenant, at its sole cost and expense, shall provide Landlord with a copy of the original or revised full-floor architectural, mechanical, electrical and plumbing plans (“Tenant Alteration Plans”) for the floor or floors on which the Alterations are to be made, revised by the Building architect and engineers to show Tenant’s proposed Alterations, which plans shall be in form and substance reasonably acceptable to Landlord.  Approval by Landlord of Tenant’s Alteration Plans shall not constitute implication, representation or certification by Landlord that Tenant’s Alteration Plans are accurate, sufficient, efficient, or in compliance with insurance requirements or applicable Laws, including building code compliance and the ADA, the responsibility of which belongs solely with Tenant.
B.    Tenant shall pay to Landlord a construction supervisory fee in an amount not to exceed [redacted] of the cost of any Alterations, as additional rent due and payable within [redacted] after Landlord approves such Alterations.  In addition, Tenant agrees that any costs incurred by Landlord to consult its architects, engineers or other consultants, prior to giving its consent, shall be Additional Rent due and payable by Tenant to Landlord within [redacted] after rendition of a bill therefor.
C.    Alterations may be made only at Tenant’s expense, by contractors or subcontractors reasonably approved by Landlord, and only after:  (i) Tenant has obtained any necessary permits from governmental authorities having jurisdiction and furnished copies of the permits to Landlord, and (ii) Tenant has submitted complete plans and specifications to Landlord, and Landlord has given Tenant its prior, express written approval, if required, as provided above.  All Alterations shall be performed (a) in a good, workmanlike, first class and prompt manner, (b) at such times and in such manner as Landlord may reasonably designate, and (c) in accordance with Landlord’s Construction Rules and Regulations in effect from time to time (and any reasonable modifications thereto).  Tenant shall diligently and continuously pursue all Alterations to completion.  Landlord shall have the right to supervise the performance of any Alterations, but shall have no obligation to manage or supervise same, and shall have no liability or responsibility for the proper performance thereof by Tenant’s contractors.  Tenant shall require any contractor of Tenant performing Alterations to carry and maintain, at no expense to Landlord, the commercially reasonable insurance required by Landlord.  
D.    Landlord may require that Tenant obtain and deliver to Landlord written and unconditional waivers of mechanics’ and materialmen’s liens upon the Land and the Building for all work, labor and services to be performed, and materials to be furnished, in connection with any Alterations, signed by all contractors, subcontractors and materialmen to become involved in any Alterations.  If any mechanic’s or materialmen’s lien is filed against the Premises, the Building or the Land for work or materials done for or furnished to Tenant, or claimed to have been done for or furnished to Tenant, the lien shall be discharged by Tenant 
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within [redacted] thereafter, solely at Tenant’s expense, by payment thereof or by filing any bond required by law.  Tenant shall indemnify and hold Landlord harmless from any and all liens, claims, damage and expenses (including reasonable attorneys’ fees), to persons or property including, without limitation, the Building, which may arise from the making of any Alterations.  If any Alteration is made without the prior written consent of Landlord, if required, Landlord may correct or remove the Alteration at Tenant’s expense, said expense being an item of Additional Rent due [redacted] after rendition of a bill therefor.  Following completion of any Alterations, Tenant shall deliver to Landlord a complete set of “as built” plans showing the Alterations, or shall reimburse Landlord for any reasonable expense incurred by Landlord in causing the Building plans to be modified to reflect the Alterations.  The cost of “as-built” plans, if incurred by Landlord, shall be Additional Rent due and payable from Tenant within [redacted] after rendition of a bill therefor.  During construction or installation of any Alteration, Landlord shall have the right to inspect the Premises at all times.  Upon substantial completion of any Alterations, Tenant shall assign to Landlord, on a non-exclusive basis, all warranties obtained with respect to such Alterations.
E.    Copies of required building permits or authorizations shall be obtained by Tenant at its expense and copies thereof shall be provided to Landlord prior to commencement of construction.  No locks, bolts or access control mechanisms of any kind shall be installed on the entrance doors or within the Premises that are not keyed or coded to the Building master key or access system.  Tenant shall reimburse Landlord for the cost of the Building engineer’s time and services (if applicable) provided after Building Hours (as defined in Section 13.A.) in connection with Alterations and any other reasonable costs actually incurred by Landlord in connection with the Alterations, as additional rent due and payable within [redacted] after Landlord delivers an invoice(s) therefor.  Landlord shall not be liable for any damages or losses caused by Tenant’s contractors, and, subject to Section 20 below, Tenant agrees to pay any and all expenses, claims or damages to person or property which may arise directly or indirectly by reason of making any Alterations.
F.    Following the completion of the Work, all wiring, cabling or conduit and/or cable bundles installed in the Premises or the Building by or at the request of Tenant shall be deemed Alterations, and, accordingly, subject to all of the applicable terms and conditions of this Lease.
G.    Notwithstanding the foregoing, Landlord’s consent shall not be required for any Alterations which are strictly cosmetic in nature and (i) do not modify or affect the Premises' or Building's structure, roof systems, or the electrical, plumbing, heating, ventilation and air conditioning, mechanical, security, life safety or other systems serving the Building and/or Project, (ii) are not visible from the exterior of the Premises, (iii) do not require the issuance of a building permit, (iv) do not involve penetrations to any portion of the Building, including, without limitation, the roof and/or roof membrane of the Building, and (v) otherwise comply with Laws (collectively, "Cosmetic Alterations"); provided that the aggregate cost of any such Cosmetic Alterations does not exceed [redacted] in any twelve (12) month period during the Term (except for paint and floor coverings in the Premises, which shall not require Landlord’s consent, regardless of cost; provided, however, all such paint and floor coverings shall be 
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consistent with the Building Standard (as defined in Section 13A.)).  Tenant shall give Landlord not less than thirty (30) days prior written notice of any Cosmetic Alterations ("Cosmetic Alterations Notice") for which Landlord’s consent is not required, which Cosmetic Alterations Notice shall be accompanied by reasonably adequate evidence that such Cosmetic Alterations meet the criteria contained in this Section 9.G, and Landlord shall be permitted to enter the Premises to post notices of non-responsibility and other like notices or to observe the work performed by or on behalf of Tenant.  Cosmetic Alterations shall be deemed to constitute Alterations for all purposes under this Lease (except that Landlord's consent shall not be required so long as the foregoing provisions have been satisfied, and Tenant shall not be required to pay to Landlord any of the expenses described in Section 9.B above with respect to any Cosmetic Alteration).
10.    EQUIPMENT.
Tenant shall not install or operate in the Premises or Building any equipment or other machinery, other than desktop computers and printers, facsimile machines, radios, televisions, clocks, standard size office copiers and other machines that are used by tenants in modern first-class office buildings in Rockville, Maryland without:  (a) first obtaining the prior, express, written consent of Landlord (who may condition such consent upon the payment by Tenant of Additional Rent in compensation for additional utilization of the water, heating, plumbing, air-conditioning, or electrical systems of the Building or additional wiring needed for the equipment or machinery), and (b) securing any necessary permits from governmental authorities and utility companies and furnishing copies to Landlord.  
11.    ALTERATIONS, EQUIPMENT AND OTHER PROPERTY BELONGING TO LANDLORD/REMOVAL OF PERSONAL PROPERTY/RESTORATION OF PREMISES.
A.    Any Alterations and other improvements and any equipment, machinery, fixtures, furniture, furnishings and other property installed or located in the Premises or the Building by or on behalf of Landlord or Tenant:  (a) shall during the Term be the property of Tenant, and (b) shall remain upon and be surrendered to Landlord with the Premises as a part thereof at the end of the Term; provided, however, that, Tenant shall at its sole cost and expense, remove, prior to the end of the Term, Tenant’s Personal Property and repair any and all damage to the Premises and Building caused by the installation, use and/or removal thereof (and if Tenant fails to repair such damages, then Tenant shall reimburse Landlord as Additional Rent upon demand for the cost of repairing any damage to the Premises or Building caused thereby).  In no event, however, and without limitation, shall Tenant be required to remove (i) any of the initial Work performed or installed pursuant to the Work Letter, (ii) any Alterations (other than Required Removal Alterations), or (iii) any of Tenant’s cabling and security system equipment.  “Required Removal Alterations” shall mean Alterations that (A) are not commonly found in similar office buildings in Rockville, Maryland, (ii) are expensive to remove, and (iii) were identified by Landlord in writing as “Required Removal Alterations” at the time Landlord consented to such Alterations pursuant to Section 8 above.  “Tenant’s Personal Property” shall mean any trade fixtures, furniture or other property now or hereafter placed in or on, but not 
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affixed to, the Premises.  Tenant shall have the right at its option either to remove or leave in place any or all of Tenant’s workstations and/or other systems furniture; provided, however, that Tenant may not remove them if paid for by Landlord out of the Work Allowance (defined in the Work Letter).
B.    Any property belonging to Tenant or any other person which is left in the Premises for any reason after the expiration or earlier termination of the Term shall be deemed to have been abandoned.  In such event, Landlord shall have the right to declare itself owner of such property and to dispose of it in whatever manner Landlord considers appropriate, and, with respect to any such property that Tenant was required to remove, Tenant shall pay to Landlord, as Additional Rent, the cost of such disposal together with any and all expenses and damages which Landlord may sustain by reason of Tenant’s failure to remove the property, and Tenant shall not have any right to compensation or claim against Landlord as a result of any such disposal.
12.    ENTRY FOR INSPECTIONS, REPAIRS AND INSTALLATIONS.
Tenant will permit Landlord or any Mortgagee, or their respective agents, brokers, employees or contractors, upon no less than twenty four (24) hours’ prior written notice (except in the event of an emergency) to Tenant (which may be delivered by email to: [redacted]), to enter the Premises at all times, without charge to Landlord or without diminution of rent payable by Tenant, to examine, inspect, photograph, operate, maintain and protect the Building or the Premises, to make such repairs as in the judgment of Landlord may be deemed necessary to maintain or protect the Premises or the Building, or to make installations related to the construction of tenant improvements or alterations being performed by Landlord for other tenants of the Building (but limited to the extent any such improvements or alterations for other tenants do not reduce Tenant’s usable square footage in the Premises and cannot be seen within the Premises), or to exhibit the same to prospective purchasers or lenders at any reasonable time or to prospective tenants during the last twelve (12) months of the Term or at any time during the pendency of an uncured Default.  Landlord shall use reasonable efforts to not materially interfere with Tenant’s business during any entry into the Premises, and, except in the case of an emergency, Landlord and Tenant shall reasonably agree on the time for such entry.  It is expressly understood that the Premises do not include any mechanical, electrical, telephone and similar rooms which service the Building; janitor closets; elevator, pipe and other vertical shafts and ducts; flues; stairwells (except any stairwells exclusively serving the Premises); and the area above the acoustical ceiling.
Notwithstanding the foregoing provisions of this Section 12, (i) in the event of an emergency, Landlord may enter the Premises without notice and make whatever repairs are necessary to protect the Premises or the Building without any liability whatsoever resulting from such entry, and (ii) Landlord may enter the Premises without notice for routine janitorial service, cleaning and maintenance.
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13.    SERVICES AND UTILITIES.
A.    Landlord shall manage, operate and maintain the Building in the manner set forth in this Lease, and otherwise in a manner consistent with the standards for similar first-class office buildings in Rockville, Maryland (the “Building Standard”), the costs of which shall be included in Operating Expenses (except as otherwise expressly provided herein).  Subject to the terms herein, Landlord shall provide the following facilities and services to Tenant in accordance with the Building Standard, the cost of which shall be included in Operating Expenses (except as otherwise expressly provided herein): (i) at least one elevator subject to call at all times, including Sundays and Holidays (having lock-off capabilities installed for Tenant’s card readers); (ii) central heating and air conditioning from 8:00 a.m. until 6:00 p.m. Monday to Friday and from 8:00 a.m. until 1:00 p.m. on Saturdays, exclusive of Holidays (i.e., New Year’s Day, Martin Luther King, Jr. Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Day, and any other Federal holiday) (“Building Hours”), during the seasons of the year when these services are normally and usually furnished and within the temperature range and in such amounts normally or usually furnished, in comparable office buildings in Rockville, Maryland and that meet the specifications described on Exhibit H attached hereto.  In order to reduce Operating Expenses and energy consumption, HVAC will be available to tenants on Saturdays from 8:00 a.m. to 1:00 p.m. at no additional expense by providing written notice to Landlord by 1:00 p.m. the preceding day.  Landlord shall provide heat and air conditioning at other times at Tenant’s expense, provided Tenant delivers to Landlord written notice by 1:00 p.m. on weekdays for after-hour service on the next weekday, by 1:00 p.m. the day before a Holiday for service on a Holiday, and by 1:00 p.m. on Friday for after-hour service on Saturday, or for service on Sunday.  Such after-hour, Holiday or special weekend service shall be charged to Tenant at Landlord’s actual direct cost, from time to time, without markup per hour per floor, and the same shall be an item of Additional Rent due thirty (30) days after rendition of a bill therefor; (iii) Building standard cleaning service consistent with the Building Standard and consistent with the cleaning specifications attached hereto as Exhibit I; (iv) electricity sufficient for the Building standard electrical capacity and all Building standard HVAC.  The cost for Tenant’s electricity usage will be included without overhead or profit, administrative charge or mark-up of any kind in the Operating Expenses for the Building based upon the rates actually paid by Landlord to the utility supplier; (v) rest room facilities and necessary lavatory supplies, including running water at the points of supply provided for general use of other tenants in the Building, and routine maintenance, painting, and electrical lighting service for all public areas and special service areas of the Building in such manner as Landlord deems reasonable; and (vi) access to the Building on a full-time, twenty-four (24) hour basis, subject to such regulations as Landlord may reasonably impose for security reasons.  Landlord at its expense shall provide to Tenant five (5) access cards per each 1,000 rentable square feet comprising the Premises.  Upon request, Landlord shall provide replacement or additional cards at Tenant’s expense.  Tenant shall require an access card for each individual employee working in the Premises and shall not permit access cards to be shared.
B.    No later than the Commencement Date, Landlord, at its cost and expense and not as an Operating Expense, shall install security card key locks and readers on all sides of the 
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Building and security key locks and readers via the lobby main entrance and service corridor access points accessing the Building’s main lobby.  Tenant hereby acknowledges and agrees that Landlord is not providing any security services with respect to the Premises and that Landlord shall not be liable to Tenant for, and Tenant hereby waives any claim against Landlord with respect to, any loss by theft or any other damage suffered or incurred by Tenant in connection with any unauthorized entry into the Premises or any other breach of security with respect to the Premises.
C.    Any failure by Landlord to furnish the foregoing services shall not render Landlord liable in any respect for damages to either person or property, not be construed as an eviction of Tenant, nor cause an abatement of rent, nor relieve Tenant from Tenant’s obligations hereunder provided, however, that Landlord shall use good faith efforts to restore such failure so long as such failure is within Landlord’s reasonable control.   If any public utility or governmental body shall require Landlord or Tenant to restrict the consumption of any utility or reduce any service for the Premises or the Building, Landlord and Tenant shall comply with such requirements whether or not the utilities and services referred to in this Section 13 are thereby reduced or otherwise affected, without any reduction or adjustment of rent hereunder.  Notwithstanding the foregoing, if for reasons not caused by Tenant, or any of its employees or agents, any interruption or stoppage of any services that Landlord is required hereunder to provide to the Building shall continue for more than [redacted] (or [redacted] if caused by an Unavoidable Delay) and shall render more than [redacted] of the Premises untenantable for general office purposes and Tenant shall actually cease to conduct business in such portion of the Premises, then the Base Rent payable hereunder for such unusable portion of the Premises shall be abated for the period beginning on the [redacted] (or the [redacted] if caused by an Unavoidable Delay) of such failure (but no earlier than five (5) business days after Landlord receives written notice of such interruption from Tenant) and shall continue until the earlier of the date that (i) Tenant again uses such portion of the Premises, or (ii) such portion of the Premises is again usable.  
D.    At Landlord’s request from time to time, but not more than once annually, Tenant shall submit to Landlord energy and water consumption data, including total usage and total charges as they appear on Tenant’s electric, gas, water and other utility bills, in format required by applicable Laws, Green Building Standards or otherwise reasonably acceptable to Landlord.
14.    RULES AND REGULATIONS.
Tenant and its agents and invitees shall abide by and observe all rules and regulations as may be promulgated from time to time by Landlord for the operation and maintenance of the Building, provided that such rules or regulations are reasonable and are not inconsistent with the provisions of this Lease.  Nothing contained in this Lease shall be interpreted to impose upon Landlord any duty or obligation to enforce any such rules and regulations, or the provisions contained in any other lease, against any other tenant, and Landlord shall not be liable to Tenant for violation of these rules, regulations, or lease provisions by any other tenant, its employees, agents, licensees, contractors or invitees.  Additionally, to the extent that Landlord provides any 
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amenities, including, but not limited to, a fitness center or a conference center, Tenant agrees to abide by and observe all reasonable rules and regulations as may be promulgated from time to time by Landlord with respect thereto. 
15.    INDEMNITY. 
A.    Except to the extent caused by the negligence or willful misconduct of Landlord or any Landlord Parties (defined below), Tenant shall indemnify, defend and hold harmless Landlord, its members, partners, parents, affiliates, subsidiaries, the managing agent for the Building, and their respective officers, directors, agents and employees (“Landlord Parties”), Landlord Invitees (as defined in Section 17) and any Mortgagees (as defined in Section 26) from and against any and all claims, loss, expense, damage or liability, including reasonable attorneys’ fees, resulting from:  (i) the possession, use, occupancy, management, repair, maintenance or control of the Premises or any portion thereof by Tenant, its licensees, subtenants, contractors or invitees, or any of their respective agents or employees (collectively, “Tenant Invitees”), (ii) any Alterations constructed by Tenant or its contractors, or (iii) any willful or negligent act or omission on the part of Tenant or Tenant Invitees.
B.    Except to the extent caused by the negligence or willful misconduct of Tenant, Landlord shall indemnify, defend, and hold harmless Tenant, its members, partners, parents, affiliates, subsidiaries, and their respective officers, directors, agents and employees (the “Tenant Parties”) from and against any and all claims, loss, expense, damage, or liability, including reasonable attorneys’ fees, resulting from: (i) the possession, use, occupancy, management, repair, maintenance or control of the common areas of the Building by Landlord or the Landlord Parties, or (ii) any willful or negligent act or omission on the part of Landlord or any of the Landlord Invitees. 
16.    TENANT’S RESPONSIBILITY FOR DAMAGE.
Any and all injury, breakage or damage to the Building, arising from any cause, done by Tenant or its agents, contractors, employees and visitors, or by individuals and persons making deliveries to or from the Premises (as long as such deliveries were requested by Tenant, its agents or employees), except as provided for in Section 20, shall be repaired by Landlord at the sole expense of Tenant (which expense shall be deemed Additional Rent).  Payment of the cost of such repairs by Tenant shall be due as additional rent with the next installment of Monthly Base Rent after Tenant receives a bill for such repairs from Landlord.  This provision shall not be in limitation of any other rights and remedies which Landlord has or may have in such circumstances.
17.    LIABILITY FOR DAMAGE TO PERSONAL PROPERTY.
All property, including but not limited to office furniture, personal effects and automobiles, of Tenant or Tenant Invitees, or of any other person, in or on the Premises or the Building, shall be and remain at the sole risk of Tenant or such Tenant Invitee or person.  Landlord and its employees, agents, licensees, contractors or invitees (collectively, “Landlord Invitees”) shall not be liable for any damage to or theft or loss of such property, whether or not 
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caused by the act or omission of any person, including Landlord or Landlord Invitees, or by the bursting, leaking or overflowing of water, sewer, steam or sprinkler pipes, heating or plumbing fixtures, air conditioning or heating failure, gas odors or noise, or any other act or thing.  Furthermore, Landlord and Landlord Invitees shall not be liable for the interruption of or loss to Tenant’s business that may result from any of the acts or causes described above.  
18.    FIRE AND OTHER CASUALTY.
If the base Building is damaged by fire or other casualty and if this Lease is not terminated by Landlord or Tenant (as provided below), Landlord shall diligently repair the damage to the base Building to substantially the same condition as existing immediately prior to the damage, and Landlord shall have no obligation to repair damage to or replace tenant improvements (including any Tenant Work or Alterations), Tenant’s Personal Property or any other property owned by Tenant and located in the Premises, and the Lease shall not terminate.  If (a) the entire Premises are rendered untenantable by reason of any such damage, Annual Base Rent and Additional Rent shall abate for the period from the date of the damage to the earlier of (i) the date Tenant has substantially completed its restoration work, or (ii) ninety (90) days after the date the damage to the base Building is repaired as reasonably determined by Landlord, and Tenant is allowed into the Premises to commence construction of its restoration work, or (b)only a part of the Premises are so rendered untenantable, Annual Base Rent and Additional Rent shall abate for the same period in the proportion that the area of the untenantable part bears to the total area of the Premises; provided, however, that in all events Tenant shall pay rent with respect to any portion(s) of the Premises actually used by Tenant and provided further, that if prior to the date when all the damage has been repaired part of the Premises so damaged are rendered tenantable and shall be used or occupied by or through Tenant, then the amount by which Annual Base Rent and Additional Rent abates shall be apportioned for the period from the date of such actual or available use or occupancy to the date when all the damage has been repaired as reasonably determined by Landlord.  Tenant hereby waives any right under applicable Law to terminate this Lease in the event of a casualty, and no compensation or reduction of rent shall be paid or allowed by Landlord for inconvenience, annoyance, or injury to Tenant’s business arising from the fire or other casualty or the need to repair the Premises or the Building.
No later than [redacted] after any material fire or other casualty to the Building, Landlord shall deliver to Tenant a written opinion of a qualified professional selected by Landlord setting forth the estimated time to restore the base Building to substantially the condition it was in prior to such casualty (the “Restoration Estimate”).  If (a) the Restoration Estimate indicates that the base Building cannot be fully repaired within [redacted] after the date of the casualty, (b) Landlord was maintaining property insurance customary for similar buildings, but insurance proceeds, plus the Landlord’s deductible, are insufficient to pay the full cost of repair and restoration, and Landlord terminates leases relating to at least [redacted]  of the Building, or (c) zoning or other applicable Laws or regulations do not permit such repair or restoration, then Landlord, at its option, may give Tenant, within sixty (60) days after the fire or other casualty, written notice of 
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termination of this Lease and, in the event such notice is given, this Lease and the Term shall terminate (whether or not the Term shall have commenced) upon the expiration of [redacted] from the date of delivery of such notice with the same effect as if the date of expiration of the [redacted] were the date initially fixed for expiration of the Term, and all rent shall be apportioned as of such date.  
Additionally, if the Restoration Estimate indicates that the base Building cannot be fully repaired within [redacted] after the date of the fire or other casualty, then Tenant shall have the right to terminate this Lease, but only by delivering written notice of termination to Landlord within [redacted] after delivery of the Restoration Estimate, in which event this Lease and the Term shall terminate (whether or not the Term shall have commenced) upon the expiration of [redacted] from the date of delivery of Tenant’s notice with the same effect as if the date of expiration of the [redacted] were the date initially fixed for expiration of the Term, and all rent shall be apportioned as of such date.  In addition, if Landlord fails to fully restore the base Building on or before the later of (i) [redacted] after the date of the fire or other casualty, or (ii) [redacted] after the date set forth in the Restoration Estimate, then Tenant shall have the right to terminate this Lease, but only by delivering written notice of termination to Landlord within [redacted] after the date such termination option right arose, in which event this Lease and the Term shall terminate (whether or not the Term shall have commenced) upon the expiration of [redacted] from the date of delivery of such notice with the same effect as if the date of expiration of the [redacted] were the date initially fixed for expiration of the Term, and all rent shall be apportioned as of such date.
19.    TENANT INSURANCE; LANDLORD INSURANCE.  
A.    Tenant, at Tenant’s expense, shall obtain and maintain in effect at all times during the Term insurance policies providing at least the following insurance coverage: (i) Special Form-Causes of Loss (formerly “all risk”) coverage insurance for all tenant improvements in the Premises (including any Tenant Work and Alterations), Tenant’s Personal Property and all other property in the Premises for not less than full replacement value.  Any and all proceeds of such insurance shall be used only to repair or replace the items so insured; (ii) a commercial general liability insurance policy protecting Landlord, Tenant, the managing agent of the Building and any Mortgagee (as hereinafter defined) against any liability for bodily injury, personal injury, death or property damage occurring upon, in or about the Premises or the Building, or arising from any of the items set forth in Section 15 against which Tenant is required to indemnify Landlord on an occurrence ISO form, including, without limitation, bodily injury and death, property damage, personal injury, products and completed operations liability and contractual liability coverage for the performance by Tenant of its obligations under this Lease, with a single limit of at least [redacted] and an annual aggregate of at least [redacted], and with a limit of not less than [redacted] with respect to damage to property in any one occurrence.  Landlord may require Tenant, at Tenant’s expense, to increase the type or limits of said insurance during the Term, provided that such coverage is consistent with industry standards for first class office buildings in Rockville, Maryland; (iv) automobile liability insurance providing coverage for owned, hired and non-owned automobiles at a 
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minimum limit of [redacted]  each accident; (v) Workers’ Compensation coverage: Statutory.  Employers’ liability coverage at a minimum limit of [redacted] bodily injury each accident.
B.    All insurance policies required to be obtained and maintained by Tenant under this Lease must:  (i) be issued by insurance companies reasonably approved by Landlord, licensed to do business in the State of Maryland, and having a rating of no less than A/XI by A.M Best Co., (ii) [omitted]; (iii) be written as primary policy coverage and not contributing with or in excess of any coverage which Landlord or its mortgagees may carry; (iv) contain an express waiver of any right of subrogation by the insurance company against Landlord, its mortgagees and their respective agents and employees; (v) in the case of Tenant’s commercial general liability policy and Tenant’s property insurance relating to the Work and Alterations (but not Tenant’s Personal Property), name Landlord, the managing agent of the Building and any Mortgagee as additional insureds, and (vi) if available, provide that the policy may not be cancelled, not renewed, or materially changed unless Landlord shall have received at least thirty (30) days prior written notice of cancellation or non-renewal or material change.  Tenant shall deliver to Landlord ACORD certificates of insurance, at least [redacted] before access to the Premises is provided to Tenant or Tenant’s Invitees and at least [redacted] before the expiration of the expiring policies previously furnished.  Any insurance required of Tenant under this Section 19 may be carried under a blanket policy covering the Premises and other locations of Tenant, provided Tenant shall deliver to Landlord an ACORD certificate of insurance evidencing each blanket policy, or other evidence satisfactory to Landlord of blanket coverage and provided further, that said blanket policy shall specifically set forth the amount of insurance allocated to Tenant’s insurance requirements under this Lease.  Neither the issuance of any such insurance policy nor the minimum limits specified in this Section 19 with respect to Tenant’s insurance coverage shall be deemed to limit or restrict in any way Tenant’s liability arising under or out of this Lease.
C.    In the event of increases in the insurance rates for fire insurance or other insurance carried by Landlord due to (i) activity or property on or about the Premises, (ii) activity or property of Tenant or Tenant Invitees on or about the Building, or (iii) for improvements to the Premises other than Building standard improvements, Tenant shall be liable for such increases and shall reimburse Landlord immediately upon demand therefor.  Statements by an insurance company or by the applicable insurance rating bureau that such increases are due to such activity, equipment or improvements shall be conclusive evidence for determining said liability of Tenant.
D.    Landlord shall obtain and maintain in effect at all times during the Term insurance policies providing at least the following insurance coverage: (i) Special Form-Causes of Loss (formerly “all risk”) coverage insurance for the base Building, including the Building structure and base Building systems; and (ii) a commercial general liability insurance policy protecting Landlord against any liability for bodily injury, personal injury, death or property damage occurring upon, in or about the Building, on an occurrence ISO form, including, without limitation, bodily injury and death, property damage, personal injury, products and completed operations liability.
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20.    RELEASE OF CLAIMS AND WAIVER OF SUBROGATION.
Notwithstanding any provision of this Lease to the contrary, to the fullest extent permitted by Law, Landlord and Tenant each hereby releases (and on behalf of its respective insurer or insurers waives any right of subrogation with respect to) the other, and the other’s respective employees, agents, contractors or licensees from any claims for damage or loss to the Premises, the Building, any property contained therein, or any other property, including business interruption, due to hazards covered by policies of insurance obtained or which are required to be obtained pursuant to this Lease, to the extent of the injury or loss covered or which should have been covered thereby, assuming that any deductible shall be deemed to be insurance coverage, and such release and waiver shall be effective regardless of the cause of the damage or loss (including the negligence of Landlord or Tenant or any of their respective employees, agents, licensees or contractors).  Tenant shall obtain from its subtenants a similar release of claims and waiver of subrogation against Landlord, its employees, agents, licensees and contractors, and Tenant shall procure (and shall cause its subtenants to procure) an appropriate clause in, or endorsement on, any property insurance policy required by this Lease, pursuant to which the insurance company waives subrogation as provided in this Section 20.  The insurance policies required by this Lease shall contain no provision that would invalidate or restrict the releases and waivers set forth in this Section 20. 
21.    CONDEMNATION.
If the whole or a substantial part of the Premises, the Building or the Land is taken or condemned by any governmental authority for any purpose (or is granted to any governmental authority in lieu of condemnation, such granting being deemed a condemnation for purposes of this Lease), Landlord shall have the right at its sole discretion to terminate this Lease upon delivering notice of termination to Tenant, such notice to be delivered no later than [redacted] after receipt of notice of such Taking, and upon the timely delivery of such termination notice by Landlord, the Term shall terminate as of the date title vests in the authority, and rent shall be apportioned as of that date.  If a taking or condemnation of greater than [redacted] of the Premises leaves the balance of the Premises unusable for general office purposes, and Landlord does not provide Tenant with alternative space in the Building acceptable to Tenant, in its sole but reasonable judgment, then Tenant shall have the right to terminate this Lease upon delivering notice of termination to Landlord within [redacted] following Landlord’s delivery of notice of such taking or condemnation, in which event this Lease shall terminate as of the date title vests in the authority, and rent shall be apportioned as of that date.  Landlord shall use good faith efforts to obtain from the government authority a reasonable period of time for Tenant to vacate the Premises.
If this Lease is not terminated as provided above in this Section 21, then, provided that at least some portion of the Premises is taken, the rent shall be equitably adjusted as of the date title vests in the authority and this Lease shall otherwise continue in full force and effect.  For purposes of this Section 21, a substantial part of the Premises, the Land or the Building shall be considered to have been taken or condemned if, in the sole opinion of Landlord, the taking or condemnation shall render it commercially impracticable for Landlord to permit this Lease to 
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continue or to continue operating the Building.  Tenant shall have no claim against Landlord arising out of the taking or condemnation, or arising out of the cancellation of this Lease, or for any portion of the amount that may be awarded as damages as a result of any taking or condemnation or for the value of any unexpired portion of the Term or for any property other than Tenant’s Personal Property, and Tenant hereby assigns to Landlord all its rights, title and interest in and to any such award; provided, however, that in the event of a total taking, Tenant may assert any claim it may have against the condemning authority for compensation for Tenant’s Personal Property and for any relocation expenses compensable by statute, and receive such awards therefor as may be allowed in the condemnation proceedings if such awards shall be made in addition to and stated separately from the award made for the Land, the Building and the Premises.  Landlord shall have no obligation to contest any taking or condemnation.
22.    DEFAULTS AND REMEDIES.
A.    The occurrence of any one or more of the following events shall be a “Default”:
(i)    If Tenant refuses or fails to take possession of the Premises within thirty (30) days after the Possession Date;
(ii)    If Tenant fails to pay any installment of Annual Base Rent or Additional Rent, or any other charge required to be paid by Tenant hereunder, when the same shall become due and payable, and such failure continues for [redacted] after written notice from Landlord; provided, however, that Landlord shall not be obligated to provide Tenant with more than [redacted] notices per each consecutive 12 month period during the Term (and if Landlord is not obligated to provide any such written notice, then a Default shall occur if Tenant fails to pay any installment of Annual Base Rent, Additional Rent, or any other charge required to be paid by Tenant herein when due within [redacted] from the due date);
(iii)    If Tenant fails to comply with the provisions of Section 7, Section 19, Section 26 or Section 29 and such failure continues for [redacted] following written notice from Landlord therefor;
(iv)    If Tenant enters into an Assignment or Subletting in violation of Section 27; provided, however, Tenant shall have [redacted] following Landlord’s written notice to Tenant of such Default to cure such Default under this subsection.
(v)    If:  (a) Tenant becoming insolvent, as that term is defined in Title 11 of the United States Code (the “Bankruptcy Code”), or under the insolvency laws of any state (the “Insolvency Laws”); (b) a filing of a voluntary petition by Tenant under the provisions of the Bankruptcy Code or Insolvency Laws; (c) a filing of an involuntary petition against Tenant as the subject debtor under the Bankruptcy Code or Insolvency Laws, which is not dismissed within [redacted] of filing; or (d) Tenant’s making or consenting to an assignment for the benefit of creditors or a composition of creditors;
(vi)    If Tenant fails to perform or observe any other term, provision, covenant, condition or requirement of this Lease (not hereinbefore specifically referred to) on the part of 
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Tenant to be performed or observed, and such failure shall continue for [redacted] after written notice from Landlord (except that such [redacted] period shall be extended for such additional period of time as may reasonably be necessary to cure such default, only if such default, by its nature, cannot be cured within such [redacted]  period, and Tenant is, at all times thereafter, in the process of diligently curing the same, provided in all events such default is cured within [redacted] from the date of Landlord’s written notice, and provided further that Tenant delivers to Landlord written reports, no less frequently than weekly, specifying in reasonable detail Tenant’s diligent efforts to cure the default and the estimated date for cure); or
(vii)    If Tenant shall cause or suffer three (3) monetary defaults within any twenty-four (24) month period, and notwithstanding any subsequent cure of such defaults.
B.    Upon the occurrence of a Default, Landlord shall have the right, at its election, then or at any time thereafter during the time the Default remains uncured either:
(i)    To give Tenant written notice of Landlord’s intent to terminate this Lease on the date of the notice or on any later date specified in the notice, and on such date Tenant’s right to possession of the Premises shall cease and this Lease shall thereupon be terminated;
(ii)    To give Tenant written notice of Landlord’s intent to terminate Tenant’s right to possession of the Premises (without terminating this Lease), on the date of the notice or on any later date specified in the notice, and on such date Tenant’s right to possession of the Premises shall cease; or
(iii)    Without demand or notice, to reenter and take possession of all or any part of the Premises, and expel Tenant and those claiming through Tenant, and remove the property of Tenant and any other person, either by summary proceedings or by action at law, in equity or otherwise, without being deemed guilty of trespass and without prejudice to any remedies for nonpayment or late payment of rent or for breach of covenant.
The provisions of this Section 22 shall operate as a notice to quit, any other notice to quit or of Landlord’s intention to reenter the Premises or terminate this Lease being hereby expressly waived.  If Landlord elects to reenter under this Section 22.B, Landlord may terminate this Lease, or, from time to time without terminating this Lease, may relet all or any part of the Premises as agent for Tenant for such term or terms and at such rental and upon such other terms and conditions as Landlord may in its sole discretion deem acceptable, with the right to make Alterations and repairs to the Premises.  No such reentry or taking of possession of the Premises by Landlord shall be construed as an election on Landlord’s part to terminate this Lease unless notice of such intention is decreed by a court of competent jurisdiction at the instance of Landlord.  If Landlord has regained possession of the Premises, whether or not Landlord elected to terminate this Lease, Landlord shall use commercially reasonable efforts to relet the Premises.
C.    If Landlord terminates this Lease, terminates Tenant’s right to possession of the Premises, or reenters the Premises pursuant to Section 22.B above, Tenant shall remain liable for:  (i) any unpaid rent due at the time of termination, plus interest thereon from the due date at the annual rate of [redacted] above the prime rate of interest announced by Bank of America 
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(or any other institutional lender Landlord may designate by written notice to Tenant for such purpose) from time to time; provided, however, that if such interest is limited by law to a lesser amount, Landlord shall be entitled to the maximum amount of interest permitted by law (the “Default Interest Rate”), (ii) damages in an amount equal to the sum of the Annual Base Rent, Additional Rent and any other sums provided for in this Lease from the time of termination until the date this Lease would have expired had such termination not occurred; (iii) any and all reasonable expenses (including all disbursements, brokerage fees (prorated based on the remaining Term of this Lease and the term of any replacement lease) and attorneys’ fees) incurred by Landlord in reentering and repossessing the Premises, in making good any Default by Tenant, in painting, altering, repairing or dividing the Premises, in protecting and preserving the Premises by use of watchmen and caretakers and in reletting the Premises; and (iv) any other amount necessary to compensate Landlord for any other detriment caused Landlord by Tenant’s failure to perform its obligations under this Lease or that in the ordinary course of things would likely result therefrom, less (v) the net proceeds received by Landlord from any reletting prior to the date this Lease would have expired if it had not been terminated.  Tenant agrees to pay to Landlord the amount so owed above for each month during the Term, at the beginning of each such month.  Any suit brought by Landlord to enforce collection of such amount for any one month shall not prejudice Landlord’s right to enforce the collection of any such amount for any subsequent month.  In addition to the foregoing, and without regard to whether this Lease has been terminated, Tenant shall pay to Landlord all costs incurred by Landlord, including reasonable legal fees, in connection with the enforcement of this Lease, whether or not Landlord institutes legal proceedings in connection therewith.  Tenant’s liability shall survive the institution of summary proceedings and the issuance of a warrant or writ thereunder.  If for any period of reletting, Landlord obtains sums in excess of the Annual Base Rent and Additional Rent due from the Tenant, any such sum shall be the sole property of the Landlord and the Tenant will not be entitled to a credit therefor.  If all or a portion of the Premises are relet by Landlord together with other areas, Landlord shall have the right to allocate the amount of rental therefrom between the Premises (or such portion thereof) and such other areas.
D.    If Landlord terminates this Lease, terminates Tenant’s right to possession of the Premises, or reenters the Premises pursuant to Section 22.B above, Landlord shall have the right at any time, at its sole option, to require Tenant to pay to Landlord on demand, as liquidated and agreed final damages in lieu of Tenant’s liability under Section 22.C above: the sum of (A) all unpaid rent and other sums due under this Lease through the date of Landlord’s demand, plus (B) (i) the then present cash value of the Annual Base Rent, Additional Rent and all other sums which would have been payable under this Lease from the date of such demand to the date when this Lease would have expired if it had not been terminated, minus (ii) the then fair market rental value of the Premises for the same period; provided, however, that if such damages are limited by law to a lesser amount, Landlord shall be entitled to prove as liquidated damages the maximum amount permitted by law.
In making the foregoing computation for liquidated damages, the then present cash value of the Annual Base Rent, Additional Rent and all other sums which would have been payable under this Lease from the date of demand to the date this Lease would have expired if it had not 
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been terminated shall be deemed to be the sum which, if invested at [redacted] simple interest, would produce such Annual Base Rent, Additional Rent and other sums over the period of time in question, and the then cash rental value of the Premises shall be deemed prima facie to be the rental realized upon a reletting, similarly discounted, if reletting can be accomplished by Landlord within a reasonable time after such Lease termination.  For purposes of determining the rent that would have been payable under this Lease, Tenant’s obligations for Operating Expenses and Real Estate Tax Expenses shall be projected, based upon the average rate of increase, if any, in such items from the Rent Commencement Date through the date of termination.  Nothing herein shall be construed to affect or prejudice Landlord’s right to prove, and claim in full, unpaid rent accrued prior to termination of this Lease plus interest thereon at the Default Interest Rate.
E.    In the event of any Default, Landlord shall be entitled to enjoin such Default and shall have the right to invoke any right or remedy allowed at law, in equity, or otherwise, as if reentry, summary proceedings or other specific remedies were not provided for in this Lease.
F.    Landlord hereby waives any statutory or other lien Landlord may have on Tenant’s personal property located in the Building.
G.    All rights and remedies of Landlord under this Lease shall be cumulative and, unless expressly provided in this Lease to the contrary, are not exclusive of any other rights and remedies provided to Landlord now or hereafter existing under law.
23.    RIGHT OF LANDLORD TO CURE TENANT’S DEFAULT.
If Tenant defaults in the making of any payment or in the doing of any act required to be made or done under this Lease by Tenant, and such default is a violation of Laws or insurance requirements, presents an imminent danger to persons or property, or becomes a Default, then Landlord, after giving Tenant [redacted] notice (except in the case of an emergency when no additional notice shall be required),  may, but shall not be required to, make such payment or do such act, and the expense thereof, if made or done by Landlord, with interest thereon at the Default Interest Rate from the date paid by Landlord shall be paid by Tenant to Landlord and shall constitute Additional Rent hereunder due and payable with the next payment of Monthly Base Rent; but the making of such payment or the doing of such act by Landlord shall not operate to cure the default or to estop Landlord from the pursuit of any remedy to which Landlord would otherwise be entitled.
24.    WAIVER.
No failure by either Party to insist upon the strict performance by the other Party of any provision of this Lease or to exercise any right or remedy for default hereunder, and no acceptance by Landlord of full or partial rent during the continuance of any such default shall constitute a waiver of the default or of the provision, and no default shall be waived or modified except by a written instrument executed by Landlord or Tenant, as the case may be.  No waiver of any default or compromise or settlement of any proceeding instituted by either Party shall 
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affect or alter this Lease or constitute a waiver of any of its provisions, but each and every provision of this Lease shall continue in full force and effect with respect to any other then existing or subsequent default.  No payment by Tenant, or receipt by Landlord, of a lesser amount than the correct Monthly Base Rent or Additional Rent shall be deemed to be other than a payment on account, nor shall any endorsement or statement on any check or letter accompanying any check for payment of rent or any other amounts owed to Landlord be deemed to effect or evidence an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord’s right to recover the balance of the rent or other amount owed or to pursue any remedy provided in this Lease or at law.  No reentry by Landlord, and no acceptance by Landlord of keys from Tenant, shall operate as a termination of this Lease or a surrender of the Premises.
25.    HOLDING OVER.
If Tenant does not surrender to Landlord possession of the Premises in substantially the condition required by Section 8 and Section 11 (the “Surrender Condition”) on or before the expiration or earlier termination of the Term, then Landlord may deem Tenant to be occupying the Premises as a tenant from month-to-month, at a monthly rental, payable on a per diem basis, equal to: (1) [redacted]  of the Monthly Base Rate in effect for the last full month of the Term for the first [redacted] of any such holding over, and (2) [redacted]  of the Monthly Base Rent in effect the last full month of the Term for the remaining period of any such holding over, and subject to all the other provisions of this Lease as applicable or adjusted to a month-to-month tenancy, including Tenant’s obligation to pay Additional Rent for Tenant’s Share of Increases in Operating Expenses and Tenant’s Share of Increases in Real Estate Tax Expenses.  If Tenant shall hold over after the expiration of the Term or extension period thereof, and if Landlord shall desire to regain possession of the Premises promptly at the expiration of the Term or extension period thereof, then notwithstanding the foregoing provisions of this Section 25, Landlord, at its option, may forthwith reenter and take possession of the Premises by any legal process in effect in the jurisdiction in which the Building is located, and Landlord may exercise any other remedies it has under this Lease or at law or in equity, including an action for wrongfully holding over.  If Tenant surrenders possession of the Premises, but not substantially in the condition required by Section 8 and Section 11 (the “Surrender Condition”), and such failure continues for ten (10) days after Tenant’s receipt of written notice from Landlord, then Landlord shall have the rights set forth in Section 11.B.
26.    SUBORDINATION.
This Lease is subject and subordinate to the lien of any and all mortgages (which term “mortgages” shall include both construction and permanent financing and shall include deeds of trust and similar security instruments) of Landlord’s mortgage lenders (“Mortgagee”), which may now or hereafter encumber or otherwise affect the Land or the Building, or Landlord’s leasehold therein, and to any and all renewals, extensions, modifications, recastings or refinancings thereof.  This clause shall be self-operative and no further instrument of subordination need be required by any Mortgagee or trustee.  Nevertheless, if requested by Landlord, Tenant shall execute and deliver any certificate or other document confirming such 
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subordination within [redacted] after Landlord’s request.  Tenant agrees that if any proceedings are brought for the foreclosure of any such mortgage, Tenant, if requested to do so by the purchaser at the foreclosure sale, shall attorn to the purchaser, shall recognize the purchaser as the landlord under this Lease, and shall make all payments required hereunder to such new landlord without any deduction or set-off of any kind whatsoever (other than those expressly provided for in this Lease).  Tenant agrees that upon such attornment to a Mortgagee or purchaser, such Mortgagee or purchaser shall not be (1) bound by any payment of Monthly Base Rent or additional rent for more than [redacted]  in advance, (2) liable for any act or omission or warranty of any prior landlord (including Landlord), (3) liable for (a) the breach of any representation or warranty made by any prior landlord (including Landlord), (b) any obligation relating to construction of improvements by any prior landlord (including Landlord), or (c) any release of Hazardous Materials not caused by such Mortgagee after such attornment, (5) liable for return of Security Deposit, except to the extent the Security Deposit has actually been received by the mortgagee, or (6) subject to any offsets or defenses which Tenant might have against any prior landlord, provided, however, that after succeeding to Landlord’s interest under this Lease, such purchaser shall perform in accordance with the terms of this Lease all obligations of Landlord arising after the date such purchaser acquires title to the Building.  
Tenant waives the provisions of any law or regulation, now or hereafter in effect, which may give or purport to give Tenant any right to terminate or otherwise adversely affect this Lease and the obligations of Tenant hereunder in the event that any such foreclosure or termination or other proceeding is prosecuted or completed.  Anything contained in the provisions of this Section 26 to the contrary notwithstanding, any Mortgagee may at any time subordinate the lien of its mortgage to the operation and effect of this Lease without obtaining the Tenant’s consent thereto, by giving the Tenant written notice thereof, in which event this Lease shall be deemed to be senior to such mortgage without regard to their respective dates of execution, delivery and/or recordation among the Land Records of the State of Maryland, and thereafter such Mortgagee shall have the same rights as to this Lease as it would have had, were this Lease executed and delivered before the execution of such mortgage. 
Landlord acknowledges that, as of the Effective Date, Landlord has a contract to sell the Building to a transferee within [redacted] after the Effective Date.  After the closing on such sale, the transferee will be the “Landlord” under this Lease.  Within [redacted]  after the Effective Date, Landlord shall obtain and deliver to Tenant a subordination and non-disturbance agreement substantially in the form attached hereto as Exhibit J (the “SNDA”) with Landlord’s Lender.  For purposes of this paragraph, “Landlord’s Lender” shall mean the mortgagee of the Building after the closing on the sale of the Building contemplated in this paragraph, provided, if such sale does not occur, “Landlord’s Lender” shall mean the mortgagee of the existing Landlord that has a mortgage or deed of trust secured by the Building.  If Landlord has not delivered to Tenant the SNDA from Landlord’s Lender within [redacted] after the Effective Date, Tenant shall have the right at its option to terminate this Lease by sending written notice of such election prior to the time Landlord delivers the SNDA.  Notwithstanding anything herein contained to the contrary, Tenant's obligation to subordinate this Lease to any future mortgage shall be conditioned on Tenant’s receipt of a nondisturbance agreement in form and substance reasonably acceptable to Tenant.
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27.    ASSIGNMENT AND SUBLETTING.
A.    Except at otherwise provided in Section 27.E or Section 27.F below, Tenant shall not, without the prior written consent of Landlord, which consent shall not be unreasonably withhold, conditioned or delayed, in each instance:  (i) assign or otherwise transfer, mortgage or otherwise encumber this Lease or any of its rights hereunder (any of the foregoing in this clause (i) shall be deemed to be, and shall hereinafter be referred to as, an “Assignment,” and the respective third party an “Assignee”), or (ii) sublet the Premises or any part thereof, or permit the occupancy or use of the Premises or any part thereof (whether by sublease, license, concession or otherwise) by any persons other than Tenant, its agents or employees (any of the foregoing in this clause (ii) shall be deemed to be, and shall hereinafter be referred to as, a “Sublease”, and the respective third party a “Subtenant”) (each, a “Transfer”).  Without limitation, Landlord shall be deemed to be reasonable in disapproving a proposed Assignment or Sublease if: (i) the transferee is of a character or reputation or engaged in a business which is not consistent with the quality of the Building; (ii) the transferee is either a governmental agency or instrumentality thereof; (iii) the transferee is not a party of reasonable financial worth and/or financial stability in light of the responsibilities involved under this Lease on the date consent is requested; (iv) the Transfer may result in a significant increase in the use of the utilities, services or Common Areas of the Project; (v) the proposed assignee or sublessee is an existing tenant of the Building, is currently negotiating with Landlord for space in the Building, or has received a lease proposal from Landlord (in each case, directly or via a broker) for space in the Building and/or the Project during the [redacted] immediately prior to Tenant’s request for Landlord’s consent; (vi) the proposed Transfer would cause a violation of another lease for space in the Building, or would give an occupant of the Building a right to cancel its lease; (vii) the Monthly Base Rent being charged by the Tenant under any sublease or assignment (excluding any concessions, incentives, free rent or abatements offered by Tenant under such sublease or assignment) is less than [redacted] of the base rent Tenant owes Landlord under this Lease; or (viii) Tenant is in Default of this Lease.
B.    If Tenant requests Landlord’s consent to an Assignment or Sublease, and delivers to Landlord Tenant’s proposed form of Assignment or Sublease, as applicable,  and such other documents or information reasonably requested by Landlord regarding such Transfer, Landlord shall, no later than [redacted] after written notice to Landlord, approve or disapprove of the proposed Assignment or Sublease and, in the case of Landlord’s disapproval, Landlord shall indicate with reasonable specificity Landlord’s reason(s) for such disapproval.  If Landlord fails to respond within such [redacted] period, and such failure continues for [redacted] after a second notice is delivered to Landlord, such failure shall be deemed to constitute Landlord’s disapproval of the proposed Assignment or Sublease.
C.    In connection with Landlord’s approval of any Assignment or Sublease, Tenant and the Assignee or Subtenant (as the case may be) shall execute and deliver a commercially reasonable form of Consent therefor.  If Tenant Defaults hereunder with respect to any Sublease, Tenant hereby assigns to Landlord the rent due from any Subtenant of Tenant and hereby authorizes each such Subtenant to pay said rent directly to Landlord.  The consent by Landlord to any Assignment or Sublease to any party shall not be construed as a waiver or 
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release of Tenant under the terms of any covenant or obligation under this Lease, nor shall the collection or acceptance of rent from any such Assignee or Subtenant constitute a waiver or release of Tenant of any covenant or obligation contained in this Lease, nor shall any such Assignment or Sublease be construed to relieve Tenant from obtaining the consent of Landlord to any further Assignment or Sublease.  Tenant shall be responsible for any costs and expenses, including legal fees, incurred by Landlord in connection with any proposed or purported Assignment or Sublease, whether or not such Assignment or Sublease is actually concluded; such costs and expenses shall be Additional Rent due at the time and as a condition of Landlord’s consent to such Assignment or Sublease.  Each Assignee and Subtenant hereunder shall comply with the terms and conditions of this Lease, including without limitation Section 7, and in no event shall any Assignment or Sublease to be construed to modify any provision of this Lease.
D.    If Landlord gives Tenant its consent to such Assignment or Sublease of all or a portion of the Premises to a third party (excluding Permitted Transfers or Permitted Occupancies), then [redacted] of any monthly rent or other payment paid to Tenant as the result of any such Assignment or Sublease which is in excess of the rent (either on a square foot or aggregate basis) then payable by Tenant under the Lease, and after first recovering on a cash basis all reasonable and ordinary out of pocket third party transaction costs incurred by Tenant related to such Assignment or Sublease (e.g., brokerage fees, legal fees and improvement allowances and other concessions), shall be paid by Tenant to Landlord, monthly, as Additional Rent.  During the term of such Assignment or Sublease, Tenant, at Landlord’s request, within [redacted] after the end of each -annual period, shall provide Landlord with annual statements, certified by Tenant’s chief financial officer, stating the amounts received by Tenant from such Assignment or Sublease during such annual period.
E.    Notwithstanding anything to the contrary set forth in this Section 27, upon delivering no less than [redacted] prior written notice (“Permitted Transfer Notice”) to Landlord, Tenant shall have the right, without Landlord’s consent to assign this Lease or to sublet all or any part of the Premises to any of the following entities (each, a “Permitted Transferee”, and each such assignment of sublease, a “Permitted Transfer”) which immediately after the Permitted Transfer, in the case of an assignment, assumes all of Tenant’s liabilities, duties and obligations hereunder and has a tangible net worth (i.e., exclusive of good will) no less than the tangible net worth of Tenant immediately prior to the date of such assignment: (i) any successor corporation or other entity resulting from a merger or consolidation of Tenant; (ii) any purchaser of all or substantially all of Tenant’s assets; or (iii) an affiliate, subsidiary, or parent of Tenant, or to any person or entity which controls, is controlled by, or is under common control with Tenant (“control” meaning, with respect to a corporation, the right to exercise, directly or indirectly, more than 50% of the voting rights attributable to the shares of the controlled corporation, and with respect to a person or entity that is not a corporation, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled person or entity).  At Landlord’s request, Tenant shall provide sufficient detail for Landlord to determine that the proposed transfer constitutes a Permitted Transfer, and Tenant upon request shall provide Landlord with additional information regarding the proposed transfer as reasonably requested by Landlord.
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F.    Notwithstanding anything to the contrary set forth in this Section 27, upon delivering no less than [redacted] prior written notice to Landlord, Tenant shall have the right, without Landlord’s consent to allow is subcontractors, clients, customers and business partners to occupy all or a part of the Premises from time to time for the purpose of doing business with Tenant without the need to have a sublease agreement (“Permitted Occupancies”).
G.    Anything contained in the foregoing provisions of this Section 27 to the contrary notwithstanding, neither Tenant nor any other person having an interest in the possession, use, occupancy or utilization of the Premises (or any portion thereof) shall enter into any Assignment or Sublease for use, occupancy or utilization of the Premises (or any portion thereof) or any Sublet Space (i) which provides for rental or other payment for such use, occupancy or utilization based, in whole or in part, on the net income or profits derived by any person from the Premises (or any portion thereof) or any Sublet Space (other than an amount based on a fixed percentage or percentages of receipts or sales).  In no event may Tenant enter into a collateral assignment of this Lease or grant a security interest in any fixtures in the Premises. Any attempted or purported Assignment and any attempted or purported Sublease in violation of this Section 27 shall be null and void ab initio and shall not confer any rights upon any purported Assignee or Subtenant.
H.    No Assignment or Sublease shall affect any of Tenant’s rights or options under this Lease, including Tenant’s rights under Exhibit D (Option to Extend), Exhibit E (Right of First Offer), or Exhibit F (Option to Terminate).
28.    TRANSFER BY LANDLORD.
Landlord may freely sell, assign or otherwise transfer all or any portion of its interest in this Lease, the Premises or the Building, and in the event of any such sale, assignment or other transfer, the transferring Landlord, and any successor or affiliate of such party, shall automatically be relieved of all of its obligations under this Lease accruing from and after the date of such sale, assignment or transfer, and Tenant shall thereafter be bound to such purchaser, assignee or other transferee, as the case may be, with the same effect as though the latter had been the original Landlord hereunder.
29.    ESTOPPEL CERTIFICATES.
Tenant shall, without charge, at any time, and from time to time, upon [redacted] notice to Tenant, execute, acknowledge and deliver to Landlord a written estoppel certificate in the form reasonably determined by Landlord, certifying to Landlord, any mortgagee (or prospective mortgagee), assignee (or prospective assignee) of a mortgagee, or any purchaser (or prospective purchaser) of the Building or any interest therein, or any other person designated by Landlord, as of the date of such estoppel certificate, the following:  that this Lease is in full force and effect, the date to which rent has been paid, that, to Tenant’s knowledge, Landlord is not in default hereunder (or specifying in detail the nature of Landlord’s default), the termination date of this Lease and such other factual matters pertaining to this Lease as may be reasonably requested by Landlord; and any other factual information reasonably requested.
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30.    COVENANTS OF LANDLORD.
Landlord covenants that it has the right to make this Lease, and that if Tenant shall pay all Annual Base Rent and Additional Rent and perform all of Tenant’s obligations under this Lease, Tenant shall, during the Term and subject to the provisions of this Lease, quietly occupy and enjoy the Premises without interruption or hindrance by Landlord.
31.    WAIVER OF JURY TRIAL.
TO THE MAXIMUM EXTENT PERMITTED BY LAW, TENANT AND LANDLORD WAIVE ANY RIGHT TO TRIAL BY JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER ARISING OUT OF ANY CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING OUT OF THIS LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.  Although such jury waiver is intended to be self-operative and irrevocable, Landlord and Tenant each further agrees, if requested, to confirm such waivers in writing at the time of commencement of any such action, proceeding or counterclaim.  If Landlord commences any detainer suit, summary proceedings or other action seeking possession of the Premises, Tenant agrees not to interpose by consolidation of actions, removal to chancery or otherwise, any counterclaim, claim for set-off, recoupment or deduction of rent, or other claim seeking affirmative relief of any kind (except a mandatory or compulsory counterclaim which Tenant would forfeit if not so interposed).
32.    BROKERAGE.
Landlord and Tenant each represents and warrants to the other that (except as hereinafter set forth) neither of them has employed any broker in carrying on any negotiations relating to this Lease.  Landlord represents that it has employed Transwestern as its broker; Tenant represents that it has employed Jones Lang LaSalle Brokerage, Inc., as its broker.  Landlord shall pay the commission of each broker listed in this Section 32 pursuant to separate agreement(s).  Landlord and Tenant shall each indemnify and hold harmless the other from any claim for brokerage or other commission arising from or out of any breach of the foregoing representation and warranty.  Any representation or statement by a leasing company, broker, or any third party (or employee thereof) engaged by Landlord as an independent contractor which is made with regard to the Premises or the Building shall not be binding upon Landlord nor serve as a modification of this Lease, and Landlord shall have no liability therefor, except to the extent such representation is also contained herein or is approved in writing by Landlord.
33.    CERTAIN RIGHTS RESERVED BY LANDLORD.
Landlord shall have the following rights, exercisable without notice and without liability to Tenant for damage or injury to property, person or business and without effecting an eviction, constructive or actual, or disturbance of Tenant’s use or possession of the Premises or giving rise to any claim for set-off or abatement of rent: (A) to change the Building’s name or street address; (B) to install, affix, maintain and remove any and all signs on the exterior or interior of the 
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Building; (C) to reasonably designate and/or approve or disapprove, prior to installation, all window shades, blinds, awnings, window ventilators and other similar equipment, and to reasonably approve or disapprove all internal lighting that may be visible from the exterior of the Building; (D) to decorate or to make repairs, alterations, additions or improvements, whether structural or otherwise, in and about the Building or the Land or any part thereof, and for such purposes to enter the Premises, and, during the continuance of any such work, to temporarily close doors, entry ways, common or public spaces and corridors in the Building, parking and access roads, and to interrupt or temporarily suspend Building services and facilities, all without affecting any of Tenant’s obligations hereunder, so long as the Premises are reasonably accessible; (E) to retain control over all common areas; and (F) to install security cameras and devices and other security technology (whether developed prior to or after the Effective Date).  Landlord shall exercise the rights described in this Section 33 in a manner consistent with the Building Standard and shall use commercially reasonable efforts not to unreasonably interfere with Tenant’s business operations.  Notwithstanding the foregoing, if Landlord’s exercise of any of the rights in this Section 33 results in Tenant’s inability to use all or any part of the Premises for its business operations, then the rent payable by Tenant hereunder shall abate, in whole or in part (based on the portion of the Premises so affected), during such interference.
34.    NOTICES.
No notice, request, consent, approval, waiver or other communication which may be or is required or permitted to be given under this Lease shall be effective unless the same is in writing and is delivered in person, by nationally recognized overnight courier, addressed as follows: if to Landlord: BOF II MD 77 Upper Rock LLC, c/o Bridge Investment Group, Five Concourse Parkway, Suite 3100, Atlanta, GA 30328, Attn:  Asset Management; with a copy to: Bridge Investment Group, Five Concourse Parkway, Suite 3100, Atlanta, GA 30328, Attn:  [redacted]; and if to Tenant: Aurinia Pharma U.S., Inc., at the Premises, Attn: Executive Vice President, Internal Operations & Strategy; with a copy to: Arent Fox LLP, 1717 K Street, NW, Washington, DC 20006 Attn: [redacted].  Either party may change such address only by notice in accordance with this Section 34.  Such notices and other communications shall be deemed to have been given at the time of delivery or attempted delivery during normal business hours.  All payments of rent required to be made by the terms of this Lease and any other payments that may become due from Tenant to Landlord hereunder shall be made to Landlord at the address specified in this Section 34, or to such other person or at such other address as Landlord may, from time to time, designate in a notice to Tenant.  Any payments of rents other than in cash shall not be considered rendered until honored as cash by Landlord’s banker.  Each party may modify the address of email notices to such party upon notice to the other party in accordance with this Section 34.
35.    MODIFICATIONS.
If any Mortgagee requires that modifications to this Lease be obtained, and provided that such modifications:  (i) do not adversely affect Tenant’s use of the Premises as herein permitted, (ii) do not increase the rent and other sums required to be paid by Tenant hereunder, (iii) do not increase any of Tenant’s obligations hereunder (other than in a de minimis manner), and (iv) do not reduce any of Tenant’s rights hereunder (other than in a de minimis manner), Landlord shall 
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submit such required modifications to Tenant, and Tenant shall negotiate such modification in good faith.
36.    SECURITY DEPOSIT.  
A security deposit in the amount of [redacted] (the “Security Deposit”) shall be delivered to Landlord no later than two (2) business days after the execution and delivery of this Lease by Tenant and Landlord.  The Security Deposit shall be held by Landlord as security for the performance of Tenant’s obligations under this Lease.  The Security Deposit is not an advance rental deposit or a measure of Landlord’s damages in case of Tenant’s default.  Upon each occurrence of a Default, Landlord may use all or part of the Security Deposit to pay delinquent payments due under this Lease, and the cost of any damage, injury, expense or liability caused by such Default, without prejudice to any other remedy provided herein or provided by law.  In the event Landlord applies any part of the Security Deposit as provided for hereinabove, Tenant shall pay Landlord on demand the amount that will restore the Security Deposit to its original amount, and Tenant’s failure to do so shall be a Default.  Landlord’s obligation respecting the Security Deposit is that of a debtor, not a trustee; no interest shall accrue thereon.  The Security Deposit shall be paid to Tenant when Tenant’s obligations under this Lease have been completely fulfilled.  Landlord shall be released from any obligation with respect to the Security Deposit upon transfer of this Lease and the Premises to a person or entity assuming Landlord’s obligations under this Section 36.  Tenant agrees that it will not assign or encumber or attempt to assign or encumber the monies deposited with Landlord as the Security Deposit and that Landlord and its successors and assigns shall not be bound by any such actual or attempted assignment or encumbrance.  The unused portion of the Security Deposit will be returned to Tenant within [redacted] after the expiration of the Term (or earlier termination of this Lease), or otherwise in compliance with applicable Laws, provided that Tenant has fully and timely performed its obligations under this Lease.
37.    HAZARDOUS MATERIALS.
A.    As used in this Section 37, “Hazardous Materials” means: (i) any substance designated pursuant to Section 311(b)(2)(A) of the Federal Water Pollution Control Act; (ii) any element, compound, mixture, solution or substance designated pursuant to Section 102 of the Comprehensive Environmental Response, Compensation and Liability Act; (iii) any hazardous waste having the characteristics identified under or listed pursuant to Section 3001 of the Solid Waste Disposal Act; (iv) any toxic pollutant listed under Section 307(a) of the Federal Water Pollution Control Act; (v) any hazardous air pollutant listed under Section 112 of the Clean Air Act; (vi) any imminently hazardous chemical substance or mixture with respect to which the Administrator of the United States Environmental Protection Agency has taken action pursuant to Section 7 of the Toxic Substances Control Act; (vii) any substance, waste or other material considered hazardous, dangerous or toxic under any state or local or any other federal laws, codes, ordinances or regulations; and (viii) any petroleum and petroleum product, including crude oil or any fraction thereof, which is not specifically listed or designated as a Hazardous Materials under Subsections (i) through (vii) of this Section 37, as well as natural gas, natural gas 
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liquids, liquefied natural gas and synthetic gas usable for fuel and mixtures of natural gas and such synthetic gas.
B.    As used in this Section 37, the term “release” means any intentional or unintentional spilling, leaking, pumping, emitting, emptying, discharging, escaping, leaching, dumping or disposing of any Hazardous Materials.  As used in this Section 37, the term “Environmental Laws” shall mean and refer to the entirety of the federal acts, portions of which are referenced in Subparagraphs (i) through (vi) of Section 37.A. and all other federal and all state and local laws, ordinances, orders, regulations and directives relating to or in any way concerning the environment, now or at any time hereafter enacted, and as may be amended from time to time.
Tenant hereby covenants and agrees that Tenant shall: (i) not generate, use, store or release (or allow the generation, use, storage or release of) any Hazardous Materials in or about the Premises or other portions of the Building in violation of any Environmental Laws; provided, however, that Tenant’s use and storage of ordinary office equipment, ordinary office supplies and ordinary cleaning supplies necessary to Tenant’s occupancy of the Premises shall be permitted as long as the foregoing is in compliance with this Lease and all Environmental Laws, and provided further that Tenant shall give prompt written notice to Landlord of any violation of any applicable Environmental Laws by Tenant, its subtenants, assigns or Tenant Invitees whether or not a citation or notice of violation has been issued by any applicable governmental authority, and provided further that Tenant shall take all steps necessary at its sole cost and expense in accordance with all applicable Environmental Laws to remedy any such violation and shall give prompt written notice to Landlord of such steps which Tenant plans to take and those which Tenant does take; (ii) at its own expense, promptly take all steps necessary to contain and/or otherwise remedy as Landlord reasonably may direct any release of Hazardous Materials on or about the Premises, other portions of the Building and/or the environment at or from the Premises and/or at or from the Building and any resultant damage to property, persons and/or the environment, resulting from Tenant’s violation of any provision of this Section 37, but without granting hereby any rights to Tenant not otherwise specifically granted to Tenant under this Section 37; (iii) upon expiration or earlier termination of the Term, render to Landlord the Premises and any other areas that may have been adversely affected by a release (at or about the Premises) of Hazardous Materials in clean condition and free from the presence and contamination of any Hazardous Materials; and reimburse Landlord in full for any cost incurred by Landlord in connection with environmental audits or inspections, which Landlord shall have the right to conduct by itself or by its duly authorized agents, employees and/or contractors at or about the time of the expiration or earlier termination of the Term or from time to time during the Term; or (iv) to the extent permissible by applicable Environmental Laws, Tenant shall accept full responsibility for and protect, defend, indemnify and save harmless Landlord, Landlord Parties, Landlord Invitees and any Mortgagees from and against any and all claims, actions, suits, losses, damages, liability and expenses of any character including costs of investigation and remediation, consequential damages, loss of rent with respect to the Premises or with respect to any other portion of the Building, fines or penalties, and legal fees in connection with but not limited to:  loss of life, personal or bodily injury, disease, sickness, mental distress and/or damage to any property including or resulting during or subsequent to the Term from or out of 
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any conduct, activity, act, omission or operation involving the use, handling, generation, treatment, storage, disposal, management or release of any Hazardous Materials in or from the Premises, to the extent same is not caused by Landlord.
Nothing contained in this Section 37 shall be deemed to modify or affect Landlord’s obligations under Section 3 above.
38.    LIMITATION ON LANDLORD LIABILITY.
Notwithstanding any provision to the contrary contained herein, the liability of Landlord (and of any successor Landlord) arising out of or in any way connected with this Lease, the Premises, the Building or the Land, the relationship of Landlord and Tenant, or Tenant’s use or occupancy of the Premises, or any claim of injury or damage shall be limited to the lesser of (a) the interest of Landlord in the Building (including insurance proceeds), or (b) the equity interest Landlord would have in the Building if the Building (including insurance proceeds) were encumbered by third party debt in an amount equal to [redacted] of the value of the Building (calculations of equity shall be made as of the initial date Tenant notifies Landlord of the actual or alleged default or other claim), and Tenant shall look solely to the estate and property of Landlord in and to the Building in connection therewith.  No properties or assets of Landlord other than the estate and property of Landlord in and to the Building and no property owned by any Landlord Party shall be subject to levy, execution or other enforcement procedures for the satisfaction of any judgment (or other judicial process) or for the satisfaction of any other remedy of Tenant, nor shall any Landlord Party have any personal liability hereunder.
39.    NEW PROVIDER INSTALLATIONS.
Tenant and its telecommunications companies, including local exchange telecommunications companies and alternative access vendor services companies, shall have the right of access to and within the Building, for the installation and operation of telecommunications systems, including voice, video, data, Internet, a satellite dish, and any other services provided over wire, fiber optic, microwave, wireless, and any other transmission systems (“Telecommunications Services”), for part or all of Tenant’s telecommunications within the Building and from the Building to any other location upon receipt of Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed.  All providers of Telecommunications Services shall be required to comply with the rules and regulations of the Building, applicable Laws and Landlord’s policies and practices for the Building.  Tenant acknowledges that Landlord shall not be required to provide or arrange for any Telecommunications Services and that Landlord shall have no liability to Tenant or to any assignees claiming by, through, or under Tenant, any subtenants claiming by, through, or under Tenant, and any of their respective agents, contractors, employees, and invitees, in connection with the installation, operation or maintenance of Telecommunications Services or any equipment or facilities relating thereto.  Tenant, at its cost and for its own account, shall be solely responsible for obtaining all Telecommunications Services. Any installation of a satellite dish at the Building shall (in addition to the terms herein) be subject to Landlord’s rules and agreements for installation and use of satellites and related equipment (which rules and agreements are hereby incorporated into this Lease by this reference) and provided that the same does not 
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interfere with any existing, similar equipment maintained on such roof or in such Building, Tenant shall have the right, at its sole cost and expense, to place upon the roof of the Building one standard-size telecommunication dish as reasonably necessary for the operations of Tenant.  Any related telecommunications equipment (together with such telecommunications dish, the “Satellite Equipment”) that is not required to be located on the roof shall be placed within the Premises.  Prior to any such installation, the specifications and location of such Satellite Equipment (and any other equipment related to Telecommunications Services) shall be subject to Landlord’s reasonable prior express written approval.  Landlord may establish reasonable rules relating to the positioning of such Satellite Equipment on the roof or other locations at or near the Building, as well as the manner of installation and removal thereof so as to not interfere with the structural integrity of the roof or the rights of other Building tenants whose satellite equipment was installed prior to the installation of Tenant’s Satellite Equipment (provided that Tenant’s Satellite Equipment is only for receiving ordinary television signals and not any other type of transmission).  Tenant shall be responsible to insure that the installation, maintenance and removal and operation of such Satellite Equipment (a) complies with this Lease and all Laws, rules and regulations applicable thereto, and (b) will not interfere with or adversely affect the operation of any other tenant, including any electrical or mechanical equipment thereof, located within the Building, and Tenant agrees, at its sole cost and expense, to repair any damage to the Building associated with the installation, maintenance or removal of the Satellite Equipment (and any other equipment related to Telecommunications Services).  Tenant will be responsible for any damage to the Building and/or personal injury arising from Tenant’s or Tenant’s agents’ acts or omissions.  Other than the foregoing, there shall be no additional Lease costs associated with such rooftop rights during the Term of this Lease, including any Option Terms (as defined in Exhibit D).  All other provisions of the Lease shall apply to the Satellite Equipment.  Notwithstanding the foregoing, in the event the Satellite Equipment (and any other equipment related to Telecommunications Services) is not removed by Tenant upon the expiration of this Lease, then Landlord, at Landlord’s option, shall (i) become the rightful owner of the Satellite Equipment (and any other equipment related to Telecommunications Services) and Tenant will execute necessary documentation to evidence the conveyance of the Satellite Equipment to Landlord, or (ii) Landlord shall be entitled to remove and dispose of the Satellite Equipment at Tenant’s sole cost and expense.
40.    SIGNAGE.
Landlord shall provide Tenant with Building standard suite entry signage and signage on the Building’s monument sign, at Landlord’s reasonable expense. Additionally, Landlord, at its expense, shall display Tenant’s name on the Building directory in the size and style of lettering used by Landlord.  Tenant requested changes to the directory during the Term shall be at Tenant’s expense.  Subject to availability, if Tenant leases at least [redacted]  full floors in the Building, Tenant shall have the right, at its sole cost and expense, to maintain a sign on the Building’s exterior façade, the size and specifications of which shall be subject to Landlord’s reasonable prior written approval and all other applicable Laws. 
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41.    PARKING.
During the Term, including any Option Terms, Landlord will make available to Tenant, at no additional charge, parking for (i) not more than [redacted] automobile parking spaces (on a nonexclusive non-reserved basis) in the garage (“Garage”) serving the Building for each [redacted] rentable square feet in the Premises, and (ii) [redacted] reserved parking spaces (“Reserved Spaces”).  The Reserved Spaces shall be located immediately adjacent to the nearest available entrance to the Building in the Garage (in the area shown on Exhibit H attached hereto), and shall be evidenced by marking with a painted marker.  Landlord will pay the cost of painting the reserved markings with the designation, “Tenant Reserved.”  In connection therewith, Landlord may provide Tenant with parking permits, badges, or some other means of identifying Tenant’s employees or guests that are permitted to park in the Garage pursuant to this Lease (hereinafter, a “Permit”), which Permits shall be subject to Landlord’s parking rules and regulations, which may be issued, amended and modified by Landlord from time to time.  In addition to the parking rights described above, subject to availability, and with Landlord’s prior written approval, exercised in good faith, Tenant’s employees shall have the right to use additional parking space in the Garage at no additional charge. The use of all parking areas in the Garage shall be subject to all rules and regulations reasonably adopted by Landlord or the parking garage operator from time to time.  It is understood and agreed that the Landlord does not assume any responsibility for, and hereby disclaims all liability for, and shall not be held liable for, any damage or loss to any automobiles parked in the Garage or for any personal property located therein, or for any injury sustained by any person in or about the Garage. 
42.    BANKRUPTCY 
In the event Tenant shall become a debtor under Chapter 7 of the Bankruptcy Code, or a petition for reorganization or adjustment of debts is filed concerning Tenant under Chapter 11 or Chapter 13 of the Bankruptcy Code, or a proceeding is filed under Chapter 7 and is converted to Chapter 11 or Chapter 13, the duly appointed Trustee or Tenant may not assume or assign this Lease unless at the time of the requested assumption or assignment the Trustee or Tenant, as the case may be, promptly (1) cures all defaults under this Lease and pays all monetary obligations required under the Lease, including without limitation all Monthly Base Rent and Additional Rent and any pro rata cost of services that may have been due prior to the date of assumption or assignment, (2) compensates Landlord for monetary damages incurred as a result of such defaults including Landlord’s attorney fees and expenses as may be allowable under the Bankruptcy Code or applicable law, (3) provides “adequate assurance of future performance” on the part of Tenant as debtor in possession or of the assignee of Tenant, and (4) complies with all other requirements of the Bankruptcy Code.  This Lease may be terminated in accordance with this Section if the foregoing criteria for assumption or assignment are not met.  “Adequate assurance of future performance,” as used in this Section, shall mean that all of the following minimum criteria must be met:  (A) Tenant’s (or assignee’s, if applicable) gross receipts in the ordinary course of business during the thirty (30) day period immediately preceding the initiation of the case under the Bankruptcy Code must be greater than two (2) times the next monthly installment of Monthly Base Rent and Additional Rent; (B) both the average and median of Tenant’s (or assignee’s) monthly gross receipts in the ordinary course of business during the six 
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(6) month period immediately preceding the initiation of the case under the Bankruptcy Code must be greater than two (2) times the next monthly installment of Monthly Base Rent and Additional Rent; (C) Tenant or assignee must pay its estimated pro rata share of the cost of all services performed or provided by Landlord for the benefit of Tenant (whether directly or through agents or contractors) in advance of the performance or provision of such services; (D) Tenant or Trustee must agree that Tenant’s or the assignee’s business shall be conducted in a first-class manner, and that no liquidating sale, auction or other non-first-class business operation shall be conducted in the Premises; (E) Tenant or Trustee must agree that the use of the Premises as stated in this Lease shall remain unchanged and that no prohibited use shall be permitted; (F) Tenant or Trustee must agree that the assumption or assignment of this Lease shall not violate or affect the rights of other tenants in the Building; (G) Tenant or Trustee must pay to Landlord at the time the next monthly installment of Monthly Base Rent is due, in addition to such installment, an amount equal to the monthly installments of Monthly Base Rent and Additional Rent due for the next two (2) months thereafter, such amount to be held as a security deposit; and (H) all assurances of future performance specified in the Bankruptcy Code must be provided.  In addition to the foregoing, Tenant or Trustee shall provide Landlord a minimum thirty (30) days prior written notice, unless a shorter period is agreed to in writing by the parties, of any proceeding relating to any assumption or assignment of this Lease.
43.     MISCELLANEOUS PROVISIONS.
A.    Benefit and Burden.  Except as otherwise expressly set forth herein, the provisions of this Lease shall be binding upon, and shall inure to the benefit of, the parties hereto and each of their respective successors and assigns.
B.    Governing Law.  This Lease shall be construed and enforced in accordance with the laws of the State of Maryland without giving effect to the choice of law rules thereof.  Tenant hereby consents to the jurisdiction of any court in the State of Maryland (whether a federal or Maryland state court) with respect to any legal action, proceeding or claim arising out of or in any way connected with this Lease, the Premises, the Building or the Land, the relationship of Landlord and Tenant hereunder, Tenant’s use or occupancy of the Premises, or any claim of injury or damage.  Tenant further waives any right, claim or power, under the doctrine of forum non conveniens or otherwise, to transfer any such action filed by Landlord to any other court.
C.    No Partnership.  Nothing contained in this Lease shall be deemed or construed to create a partnership or joint venture of or between Landlord and Tenant, or to create any other relationship between the parties other than that of landlord and tenant.
D.    No Representations by Landlord.  Neither Landlord nor any agent of Landlord has made any representations or promises with respect to the Premises or the Building except as herein expressly set forth, and no rights, privileges, easements or licenses are granted to Tenant except as herein expressly set forth herein.  Without limiting any of Landlord’s representation, warranties or covenants expressly contained in this Lease, Tenant has relied on Tenant’s inspections and due diligence in entering into this Lease, and not on any representations or warranties of Landlord concerning the condition or suitability of the 
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Premises or the Building for any particular purpose.  Tenant hereby waives any claims, based on frustration of purpose or otherwise, that the Building or the Premises, or any portion of either, is not suitable for the purposes of this Lease.  Except as may otherwise be expressly provided in this Lease, the leasing of the Premises does not include in the right to use the roof, janitorial closets, parking areas or other non-common or non-public areas of the Building.
E.    Attorneys’ Fees.  If either party should prevail in any litigation instituted by or against the other related to this Lease, the prevailing party, as determined by the court, shall receive from the non-prevailing party all costs and reasonable attorneys' fees (payable at standard hourly rates) incurred in such litigation, including costs on appeal, as determined by the court. 
F.    Deletion of Text.  The deletion of any printed, typed or other portion of this Lease or any draft of this Lease shall not evidence an intention to contradict such deleted portion.  Such deleted portion shall be deemed not to have been inserted in this Lease.
G.    Pronouns.  Feminine or neuter pronouns shall be substituted for those of the masculine form, and the plural shall be substituted for the singular number, in any place or places in this Lease in which the context may require such substitution or substitutions.  For convenience Landlord and Tenant have each been referred to in neuter form in this Lease.
H.    Captions.  The captions used herein are for convenience of reference only and are not part of this Lease, and shall in no way be deemed to define, limit, describe, or modify the meaning of any provision of this Lease.
I.    Meaning of Including.  Whenever the word “including” is used herein, it shall be deemed to mean “including but not limited to.”
J.    Invalidity of Particular Provisions.  If any term or provision of this Lease or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remaining terms and provisions of this Lease, 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 not be affected thereby, and each term and provision of this Lease shall be valid and enforced to the fullest extent permitted by law.
K.    Execution.  This Lease may be executed in several counterparts, but all counterparts shall constitute one and the same legal document.  Execution and delivery of this Lease by .pdf scan shall have the same effect as delivery of an original signed Lease.
L.    Mortgagee.  Tenant shall accept performance of any of Landlord’s obligations hereunder by any Mortgagee.  No Mortgagee not in possession of the Premises or the Building shall have any liability hereunder.
M.    Certain Obligations to Survive.  Tenant’s obligation to pay Annual Base Rent, Additional Rent and any other sums of money due and payable to Landlord under the terms of this Lease shall survive the expiration or earlier termination of the Term.
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N.    Interest on Arrears.  In every case where the Tenant shall fail to pay any installment of rent when due or shall pay an amount which is thereafter determined, estimated or found to be less than the amount properly due, and such failure continues for [redacted] after written notice from Landlord to Tenant, the Tenant shall pay interest, compounded monthly, at the Default Interest Rate on the unpaid amount or deficiency from the date such payment was due through the date paid.
O.    Calendar Year.  The term “Calendar Year” as used in this Lease shall mean a year commencing on the first day of January.
P.    No Light or Air Easement.  Any diminution or shutting off of light, air or view by any structure which is now or may hereafter be erected on lands adjacent to the Building shall in no way affect this Lease or impose any liability on Landlord.  Noise, dust or vibration or other incidents to new construction of improvements on lands adjacent to the Building, whether or not owned by Landlord, shall in no way affect this Lease or impose any liability on Landlord.  Tenant agrees that in such event, Tenant shall not be entitled to any action, claim or relief, including without limitation rent reduction or abatement, or termination of this Lease.
Q.    Prohibited Persons and Transactions.  Tenant represents and warrants to Landlord that: (i) Tenant is not, and shall not during the Term of this Lease become, a person or entity with whom Landlord is restricted from doing business under the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, H.R. 3162, Public Law 107-56 (commonly known as the “USA Patriot Act”) and Executive Order Number 13224 on Terrorism Financing, effective September 24, 2001 and regulations promulgated pursuant thereto, including, without limitation, persons and entities named on the Office of Foreign Asset Control Specially Designated Nationals and Blocked Persons List (collectively, “Prohibited Persons”); and (ii) Tenant is not currently conducting any business or engaged in any transactions or dealings, or otherwise associated with, any Prohibited Persons in connection with the use or occupancy of the premises.
R.    Consequential Damages.  Notwithstanding any other provision of this Lease to the contrary, in no event shall Landlord be liable for punitive or consequential damages hereunder; and in no event shall Tenant be liable for punitive or consequential damages hereunder, except in the event of a holding over by Tenant
S.    Confidentiality.  Each of Landlord and Tenant, on behalf of itself and its respective agents and representatives, expressly recognizes that the economic terms of this Lease and any Assignment or Sublease hereunder are confidential, and that neither party, nor its agents or representatives may disclose any such economic terms, provided that nothing herein shall prohibit either party from disclosing the terms of this Lease or the terms of any Assignment or Sublease hereunder to the extent reasonably necessary to comply with any Laws, or any valid legal process or reporting requirement, or to the extent in connection with either party’s respective bona fide business purposes, and in such events disclosure may be made to, among others, prospective and actual purchasers, investors, partners, lenders, assignees, subtenants, accountants, auditors, attorneys, brokers, and other consultants who agree to keep same confidential.
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T.    Unavoidable Delays.  Except for Tenant’s obligation to: (i) pay Rent (or any other charges/expenses due hereunder), (ii) maintain insurance, (iii) exercise its renewal option herein; and/or (iv) surrender the Premises to Landlord upon expiration or termination of this Lease, if either party is delayed in performing any of its obligations under this Lease due to Unavoidable Delays, then the time for performance of such obligation shall be excused for the period of such delay or extension and extended for a period equal to the period of such delay or prevention.  “Unavoidable Delays” shall mean any delay, interruption or prevention due to strikes; labor disputes; shortages of material, labor or utility services; acts of God; governmental restrictions or inaction; enemy action; civil commotion; acts of terrorism; fire; floods; severe adverse weather; casualty; or other causes beyond the reasonable control of Landlord or Tenant, as the case may be.
U.    Authority.  Each Party represents and warrants that the person signing this Lease on such Party’s behalf is duly authorized to sign on behalf of and to bind such Party and that this Lease is a duly authorized obligation of such Party.
V.    Consents and Approvals.  If Tenant seeks approval by or consent of Landlord and Landlord fails to give such consent or approval, Tenant shall not be entitled to any damages for any withholding or delay of such approval or consent by Landlord.
W.    Time of the Essence.  Time is of the essence with respect to the provisions of this Lease.
X.    Qualified Rents.  The parties intend that all payments made to Landlord under this Lease will qualify as rents from real property for purposes of Section 512(b)(3) of the Internal Revenue Code of 1986, as amended (“Qualified Rents”), if Landlord, in its sole discretion, advises Tenant that there is any risk that all or any part of payments made under this Lease will not qualify as Qualified Rents, Tenant agrees (i) to cooperate with Landlord to restructure in such manner as may be necessary to enable such payments to be treated as Qualified Rents, and (ii) to permit an assignment of this Lease, in each case provided such restructuring or assignment of this Lease will not have a material adverse economic impact on Tenant.
Y.    Construction of Lease.  The terms and provisions of this Lease represent the results of negotiations between Landlord and Tenant, each of which is a sophisticated party and each of which has been represented or been given the opportunity to be represented by counsel of its own choosing, and neither of which has acted under any duress or compulsion, whether legal, economic or otherwise.  Consequently, the terms and provisions of this Lease shall be interpreted and construed in accordance with their usual and customary meanings, and Landlord and Tenant each waives the application of any rule of law that ambiguous or conflicting terms or provisions contained in this Lease are to be interpreted or construed against the landlord or the party who prepared the executed Lease or any earlier draft of the Lease.  Landlord's submission of this Lease to Tenant for examination or signature by Tenant does not constitute a reservation of or an option to lease and is not effective as a lease or otherwise until Landlord and Tenant both execute and deliver this Lease.  
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Z.    Entire Agreement.  This Lease, and any exhibits and addenda attached hereto, contain and embody the entire agreement of the parties hereto, and no representations, inducements or agreements, oral or otherwise, between the parties not contained in this Lease or in the exhibits or addenda, if any, shall be of any force or effect.  This Lease may not be modified, changed or terminated in whole or in part in any manner other than by an agreement in writing duly signed by the party to be charged therewith.
BB.  Generator. Tenant shall, subject to the terms of this Lease (including Section 9), at its sole cost and expense, be permitted to install a back-up generator serving the Premises, and to utilize any and all existing conduit pathways for wire pulls, in a location to be mutually agreed upon by Landlord and Tenant, each acting in good faith.  During the Lease Term, Tenant shall, at its sole cost and expense, maintain, repair, and replace such back-up generator, and Landlord shall have no liability therefor.  At the expiration or earlier termination of this Lease, Tenant shall, at its sole cost and expense, remove the back-up generator (including any related equipment and concrete pads) and restore any and all damage to the Building, caused by the installation, use, maintenance, repair and removal thereof (to Landlord’s reasonable satisfaction).
 [SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as a deed under seal as of the day and year first written.
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                     LANDLORD:

BOF II MD 77 UPPER ROCK LLC, 
a Delaware limited liability company 

By:    BOF II JV 77 Upper Rock LLC,
    a Delaware limited liability company
Its:    Sole and Managing Member

By:      Bridge Office Fund II GP LLC,
    a Delaware limited liability company 
Its:    Managing Member

                         By:    /s/ John R. Ward____________________
                         Name: John R. Ward
    Its: Manager

                     TENANT:

AURINIA PHARMA U.S., INC., 
a Delaware corporation  

                         By:    /s/ Max Donley______________________
                         Title:    EVP, Internal Operations & Strategy_____

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EXHIBIT A
FLOOR PLAN OF PREMISES
[redacted]

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EXHIBIT B
[Reserved]

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EXHIBIT C
WORK LETTER
THIS WORK LETTER (“Work Letter”) is entered into as of the Effective Date of the Lease by and between Landlord and Tenant.

RECITALS

A.    Concurrently with the execution of this Work Letter, Landlord and Tenant have entered into the Lease (“Lease”).  The completion of the improvements as provided herein is defined as the “Tenant Work”.  All terms not defined herein have the same meaning as set forth in the Lease.

B.    In order to induce Tenant to enter into the Lease and in consideration of the mutual covenants in the Lease, and hereinafter contained, Landlord and Tenant agree as follows:

I.    Construction Representatives:

Landlord appoints the following person(s) as Landlord’s representative (“Landlord’s Representative”) to act for Landlord in all matters covered by this Work Letter:
        
        [redacted]

Tenant appoints the following person(s) as Tenant’s representative (“Tenant Representative”) to act for Tenant in all matters covered by this Work Letter.
        
        [redacted]

All communications with respect to the matters covered by this Work Letter are to be made to Landlord’s Representative or Tenant’s Representative, as the case may be, in writing, in compliance with the notice provisions of the Lease.  Either party may change its representative under this Work Letter at any time by written notice to the other party in compliance with the notice provisions of the Lease.

II.    Tenant Improvement Allowance:

    Landlord agrees to provide to Tenant an allowance with respect to the Premises of up to a total of [redacted] (the “Tenant Improvement Allowance”), based on [redacted] per rentable square foot of the Premises.  Tenant agrees that at least [redacted] of the Tenant Improvement Allowance may be applied toward the cost of all (i) design (e.g., architectural and engineering fees) and construction (including the cost of any permitted signage) (collectively, the “Construction Costs”) and (ii) all construction management fees; and that no more than [redacted] of the Tenant Improvement Allowance may be applied toward (i) the cost to purchase and install furniture, fixtures and equipment, including Tenant’s security system, (ii) the cost to 
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purchase and install Tenant’s telecommunication cabling and equipment, (iii) so-called “soft costs” (including permitting fees), and (iv) upon written notice to Landlord, the next coming Base Rent due under the Lease.  Any portion of the Tenant Improvement Allowance not used by Tenant in accordance with the terms of this Work Letter within [redacted] after the Effective Date of the Lease shall be deemed forfeited by Tenant.  All of the Tenant Work paid for by Landlord shall be the property of Landlord and shall be depreciated by Landlord.

Tenant, with Landlord’s approval, not to be unreasonably withheld, conditioned or delayed, shall engage a qualified general contractor to perform Tenant’s leasehold improvements pursuant to a separate written agreement between Tenant and the general contractor, and Tenant shall promptly provide Landlord with a copy of such agreement.  Such general contractor will perform the construction of the Premises on behalf of Tenant.  Tenant shall cause its general contractor to meet with the Landlord’s agent as Landlord reasonably deems necessary to inform the various parties of the design, to assure compliance with the terms of the Lease, to coordinate construction of the Premises, to participate in walk-throughs, punch lists, etc. or for any other reason reasonably deemed necessary by Landlord.  Landlord will further have the right to enter the Premises during construction thereof at any time and from time to time to inspect the Tenant Work for compliance with the provisions hereof and the Tenant Construction Documents.  Landlord will charge a [redacted] supervisory fee for construction administration/coordination (based on the hard construction costs payable to Tenant’s general contractor), which shall be paid out of the Tenant Improvement Allowance.  If Landlord engages a third party architect, engineer, or similar consultant to review Tenant’s Tenant Construction Documents (as defined in Section VI hereof) (e.g., the Tenant Work affects base Building structure and/or systems, etc.), any cost incurred by Landlord shall be considered included in the supervisory fee and Tenant will not be responsible for these costs.  Landlord shall have no obligation to manage the construction process and shall have no responsibility for any delays or cost overruns.  With the exception of the [redacted]  supervisory fee, there shall be no other fee or charge to Landlord in connection with the Tenant Work, including any fee or charge for utilities or for the use of the loading dock or freight elevator during construction or in connection with Tenant’s move into the Building.

III.    Test Fit: 

Landlord hereby acknowledges it has received from Tenant a test-fit plan (the “Test Fit”) for the Premises.  Landlord hereby agrees to pay an allowance of up to [redacted] per rentable square foot of the Premises for the development of the Test Fit.

IV.    Tenant Improvement Allowance Payment:

A.    Prior to commencement of construction of Tenant’s improvements to the Premises, Tenant shall furnish Landlord with an estimate of Tenant’s total Construction Costs, as described in Schedule C-1 attached hereto.  Landlord shall pay Tenant (or at Tenant’s option, Landlord shall pay directly Tenant’s consultant(s), general contractor, subcontractors and/or other vendors) the Tenant Improvement Allowance, less retainage of [redacted] for interim invoices, based on submission of monthly invoices by Tenant to Landlord.  Each invoice shall list Construction Costs and other permitted costs Tenant (or Landlord) has previously paid along 
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with copies of each invoice with interim and/or final lien waivers from each consultant, contractor, subcontractor or other vendor(s) in a form reasonably acceptable to Landlord.  Landlord will pay Tenant (or at Tenant’s option, Landlord shall pay directly Tenant’s consultant(s), general contractor, subcontractors and/or other vendors) no later than [redacted] after each Tenant invoice is submitted in accordance with the terms of this paragraph.  If the total Construction Costs are more than the Tenant Improvement Allowance, (a “Shortfall”), Tenant shall be responsible for all costs above and beyond the Tenant Improvement Allowance after the Tenant Improvement Allowance has been exhausted.

B.    If Landlord fails to pay Tenant any portion of the Tenant Improvement Allowance when due under this Work Letter, and such failure continues for [redacted] or more consecutive [redacted]  following Landlord’s receipt of written notice from Tenant, Tenant shall have the right to offset the unpaid portion of the Tenant Improvement Allowance against the next coming Base Rent due under the Lease.

V.    Schedule of Critical Dates:

The following is a schedule of certain dates relating to Landlord’s and Tenant’s respective obligations with respect to construction of the leasehold improvements for the Premises.  These dates, the specific references (e.g. the “Tenant Construction Documents Delivery Date”) and the respective obligations of Landlord and Tenant are more fully described in Section VI below.  Because the Commencement Date will be no later than October 1, 2020, regardless of any delays by Tenant, Tenant’s failure to meet one or more of the dates set forth below shall not give rise to any penalty against Tenant or otherwise affect either party’s rights or obligations under this Lease.  However, if Landlord fails to meet one or more of the dates set forth below, and such failure delays Tenant’s completion of the Tenant Work, then the October 1, 2020 date set forth in Section 2.A of the Lease shall be moved back one day for each day of such delay.

All references to days in this Section V mean business days unless otherwise noted.

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	Reference	Responsible Party	Due Date

	“Tenant Program and Space Plan Delivery Date”
	Tenant	May 8, 2020
	“Tenant Space Plan Final Review Date”
	Landlord	Within 5 days after Tenant submits Tenant Program and Space Plan
	“Tenant Construction Documents
Delivery Date”
	Tenant	May 8, 2020
	“Tenant Construction Documents
Review Date”
	Landlord	Within 10 days after Tenant submits Construction Documents
	“Tenant Construction Documents
Revision Date”
	Tenant	Within 5 days after Tenant receives Landlord’s comments on Construction Documents

VI.    Landlord and Tenant Pre-Construction Obligations:

A.    Landlord hereby approves FORM Architects as the architect which Tenant intends to enter into a contract for (the “Design Contract”) the Tenant Construction Documents (defined below).  The architect and Tenant’s MEP Engineer (GPI/Greenman-Pedersen, Inc.) shall each be registered and licensed to practice in the State of Maryland.  Tenant shall provide Landlord with a copy of the executed Design Contract.  

B.    By no later than the Tenant Space Plan Delivery Date, Tenant shall deliver to Landlord the information described in Section VIII below regarding Tenant’s desired leasehold improvements (such information being hereinafter called the “Tenant Program”), and Tenant shall cause its architect to submit to Landlord a space plan based on the Tenant Program (the “Space Plan”), which Space Plan will be used to prepare the Tenant Construction Documents (as defined below.  Landlord shall review the Space Plan by no later than the Tenant Space Plan Final Review Date and shall have the right to approve the Space Plan, which approval shall not be unreasonably withheld.

C.    Upon Landlord’s approval of the Space Plan, Tenant will endeavor to cause its architect and engineer to prepare and deliver to Landlord no later than the Construction Documents Delivery Date a complete set of coordinated architectural, structural, mechanical, electrical and plumbing engineering construction drawings and specifications sufficient to obtain a building permit and competitive bids, including the information described in Section VII below (the “Tenant Construction Documents”).  The Tenant Construction Documents shall be delivered in hard-copy, PDF and CAD/Revit (or similar software) format.  

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D.    On or before the Tenant Construction Documents Review Date, Landlord will review the Construction Documents and shall notify Tenant, in writing, of its approval of the Tenant Construction Documents, or of any changes to the Tenant Construction Documents reasonably required by Landlord.  As part of Landlord’s review of the Tenant Construction Documents, Landlord’s architect and engineer may review the Tenant Construction Documents to determine if Tenant’s design negatively impacts on the base Building systems and such review is not intended to evaluate the accuracy or effectiveness of Tenant’s design.  As provided above, such reviews shall be at Landlord’s sole cost and expense and shall be paid out of the one percent (1%) Landlord supervisory fee. 

E.    Any approval by Landlord of, or consent by Landlord to, any drawings, specifications or other items to be submitted to and/or reviewed by Landlord pursuant to the Lease will be strictly limited to an acknowledgment of approval or consent by Landlord thereto, and such approval or consent will not constitute the assumption by Landlord of any responsibility for the accuracy, sufficiency or feasibility of any plans, specifications or other items and will not imply any acknowledgement, representation or warranty by Landlord that the design is safe, feasible, structurally sound or will comply with any legal or governmental requirements, and Tenant will be responsible for all of the same.  Furthermore, neither Landlord’s approval of the Outside Contractor, nor Landlord’s review of the Tenant Work, will impose upon Landlord any liability for defects in materials or workmanship in connection with the Tenant Work and Tenant will look solely to the Outside Contractor to correct or remedy any such defects.   

F.    Upon receipt of Landlord’s comments to the Tenant Construction Documents, Tenant will cause its architect to revise the Tenant Construction Documents to incorporate Landlord’s comments and shall resubmit the Tenant Construction Documents to Landlord prior to commencing with any construction.  Notwithstanding the foregoing, compliance with codes and ordinances within the Premises shall be the responsibility of Tenant and Tenant’s architect.  Upon receipt of the Landlord’s approval of the Tenant Construction Documents, Tenant will cause the Tenant Construction Documents to be submitted for the applicable building or construction permit at Tenant’s sole cost and expense (subject to the application of the Tenant Improvement Allowance).  Prior to the commencement of the Tenant Work, Landlord must be provided with copies of such permits.

G.    The Tenant, architect, engineer, contractors and vendors shall comply with the requirements of the building rules and regulations.  

H.    On the Possession Date, Landlord shall deliver the Premises to Tenant for Tenant’s construction of the Premises and for Tenant’s vendors to install cabling, furniture, fixtures and equipment.

VII.    Certain Provisions Relating to Construction:

A.    Prior to construction commencement, Tenant shall obtain the prior written consent of Landlord as to the general contractor to be used by Tenant (the “Outside Contractor”), which 
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consent shall not be unreasonably withheld, conditioned or delayed.  Landlord hereby approves [redacted]  as Tenant’s Outside Contractor.  Tenant will be required to execute a contract (the “Construction Contract”), on a standard AIA Document or other form reasonably approved by Landlord, with the selected Outside Contractor for the construction of the Premises.  Unless Landlord reasonably disapproves (with reasonably specificity) the Construction Contract within five (5) business days after a copy has been delivered to Landlord, the proposed Construction Contract shall be deemed approved by Landlord.  The Construction Contract will in all events include (i) a copy of the Building construction rules and regulations set forth on Schedule C-2 Attached hereto, and (ii) copies of the documents necessary for payment as described in this Work Letter.  Tenant and Outside Contractor will certify to Landlord (by providing documentation thereof) the total cost of the Tenant Work contained in the Construction Contract.  In the event the total cost of the Tenant Work contained in the Construction Contract exceeds the Tenant Improvement Allowance (the “Excess”), Tenant shall be solely liable for such Excess.  The Construction Contract will provide, among other provisions, that the Tenant notify the Landlord in writing, and provide them with sufficient time to review and approve, of any material change in the Tenant Work after the Landlord Approval Date of the Tenant Construction Documents.    

The Outside Contractor shall use or select Landlord approved subcontractors who may carry out work related to the following critical Building systems: (iii) fire alarm tie-in and programming, (iv) Building controls (v) roofing and (vi) keying, provided that the fees charged are competitive.  Landlord shall have the right to reasonably approve major subcontractors, and if Landlord fails to disapprove (with reasonably specificity) any prospective subcontractor within [redacted] after notice, such subcontractor(s) shall be deemed approved by Landlord.

B.    It shall be Tenant’s responsibility to ensure that the Outside Contractor shall (i) conduct its work in such a manner so as not to unreasonably interfere with any other construction occurring on or in the Building or the Premises; (ii) comply with the rules and regulations relating to the construction activities on or in the Building, and such other reasonable rules and regulations, as may be promulgated from time to time by Landlord; and (iii) maintain such insurance as set forth in Section 19 of the Lease.  Landlord retains the right to make periodic inspections to assure conformity with the rules and regulations and with the Tenant Construction Documents.  The Outside Contractor shall perform no work which causes interference with the normal business operations of other tenants in the Building.

C.    Tenant shall indemnify and hold harmless Landlord from and against any and all losses, damages, costs (including costs of suits and reasonable attorneys’ fees), liabilities, or causes of action arising out of or relating to the work of the Outside Contractor, including, but not limited to mechanics’, materialmen’s or other liens or claims (and all costs or expenses associated therewith) asserted, filed or arising out of any such work, unless and to the extent caused by the negligence or willful misconduct of Landlord, its agents, contractors or employees.  All materialmen, contractors, artisans, mechanics, laborers and other parties hereafter contracting with Tenant for the furnishing of any labor, services, materials, supplies or equipment with respect to any portion of the Premises are hereby charged with notice that they must look solely to Tenant for payment for same.  Without limiting the generality of the foregoing, Tenant shall 
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repair or cause to be repaired at its expense all damage caused by the Outside Contractor, its subcontractors or their employees.  Any costs incurred by Landlord to repair any damage caused by the Outside Contractor or any costs incurred by Landlord in requiring the Outside Contractor’s compliance with the rules and regulations in Paragraph 2(ii) above will become the obligation of Tenant under this Lease.

D.    Unless Landlord otherwise agrees, the Outside Contractor shall not have access to the Premises, or be allowed to commence work therein, until Landlord releases and Tenant and Tenant’s Outside Contractor accept the Premises pursuant to this Lease.  Landlord and Tenant will cooperate in good faith to document any deficiencies or incomplete items relative to the Premises so as not to cause any delay in work of the Outside Contractor.  Landlord will provide, at Tenant expense and at Tenant’s written request, any after-hours HVAC or building personnel (i.e. security) requested by the Outside Contractor or required by the building rules and regulations at the Landlord’s then standard rates.  For purposes of this paragraph, “after hours” means after 6:00 p.m. (Monday – Friday) or after 2:00 (Saturday) or on Sundays or holidays when the Building is closed.

E.    The Tenant Work shall be deemed to be “Substantially Completed” upon the later of: (i) issuance of a temporary certificate of occupancy or certificate of occupancy or other documentation allowing Tenant to occupy the Premises for the permitted use issued by the appropriate governmental authority or (ii) the date upon which the Tenant Work is fully completed (but not including completion of minor final “punch list” items).

F.    [Intentionally Omitted]

G.    The failure of Tenant to comply with the requirements of this Section VII, which continues after the applicable notice and cure period in the Lease, shall constitute a default by Tenant under this Lease.

H.    Upon completion of the Tenant Work, Tenant shall furnish, or cause Tenant’s Outside Contractor to furnish, all close-out documentation, as described in Schedule C-3 attached hereto, and as-built drawings, in form and substance acceptable to Landlord, for the benefit of Landlord and Tenant, certifying to the compliance of the work constructed by the Tenant’s Outside Contractor with the Construction Documents.

VIII.    Information Required on Tenant Drawings and Specifications:

A.    MINIMUM INFORMATION REQUIRED OF THE SPACE PLAN:

The Space Plan shall provide architectural floor plans of the Premises.  The Space Plan will be labeled, titled and dated and will be drawn at scale.  The following information will be provided in the Space Plan:

1.    Architectural Information:
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    Floor, room and area identification
    Dimensions of rooms and areas
    Partition locations
    Location and swing of all doors
    Millwork and cabinetry locations
    Furniture locations

2.    Structural Information:

    Location and approximate weight of all heavy equipment
    Any design elements which may modify the base Building structural, architectural, mechanical, electrical or plumbing systems will be identified at this time for Landlords review.

B.    MINIMUM INFORMATION REQUIRED OF TENANT CONSTRUCTION DOCUMENTS:

The completed Tenant Construction Documents will include Architectural, Structural, Mechanical, Electrical, Plumbing, Fire Protection and Fire Alarm sheets (only if required by the Authority Having Jurisdiction), including specifications, details and elevations necessary to fully describe the leasehold improvements.  The Tenant Construction Documents will be prepared, sealed and stamped by a registered architect and structural, mechanical, electrical and plumbing engineer in the State of Maryland.  

Tenant architect must furnish Landlord with a complete set of drawings in hard-copy, PDF and CAD/Revit/SketchUp (or similar software) format.  Tenant architect will include all information on the plan sheets so that users do not have to refer to separate specification booklets to obtain information.  At a minimum, the Tenant Construction Documents will include the following information drawn at scale:

1.    Floor Plan with the location and type of all partitions.

2.    Location and type of all doors with hardware and keying information.

3.    Location and type of glass partitions, windows and framing.

4.    Location of server/telecom room (note HVAC and electrical requirements).

5.    Critical dimensions necessary for construction.

6.    Location of all electrical items (outlets, switches, etc.).

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7.    Reflected ceiling plan showing location and switching of all lighting, exit signs, emergency lighting and life safety devices.

8.    Location and type of all other electrical items, including security and data/voice communication work.

9.    Location and type of equipment that will require special electrical requirements (i.e., dedicated circuits, data, GFI, etc.).  Provide manufacturers specifications for use and operation.

10.    Electrical panel schedule with total rated electrical design load calculation in watts.

11.    Location, weight per square foot and description of any exceptionally heavy equipment or filing system exceeding 50 pounds per square foot live load.

12.    Requirement for any special air conditioning, ventilation or exhaust. 

13.    Reflected ceiling plan showing location of all HVAC equipment.

14.    Mechanical equipment schedule indicating sizes, specifications and characteristics of all equipment.

15.    [Intentionally Omitted].

16.    Location, type and color of floor covering.

17.    Location, type and color of wall finishes.

18.    Location, type and color of all other finishes.

19.    Location and type of plumbing (including all fixtures).

20.    Location and type of break room equipment and millwork.

21.    All millwork and built-in equipment fully dimensioned.

22.    Corridor doors and frames and all work required in the corridor.

23.    Bracing or support of special walls, glass partitions, etc.

24.    All connections to or modifications of the base Building structural, mechanical, electrical, plumbing, fire protection and fire alarm systems.

25.    All new mechanical, electrical and plumbing metering devices or systems.
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SCHEDULE C-1

ESTIMATE OF TENANT’S TOTAL CONSTRUCTION COSTS

[redacted]
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SCHEDULE C-2

BUILDING CONSTRUCTION RULES AND REGULATIONS
Owner hereby sets forth the following rules and regulations governing the Work to be done by the Contractor, its employees and any and all subcontractors employed by the Contractor, and the Contractor hereby agrees to comply with these rules and regulations and any changes thereto which may reasonably be made by Owner.  Contractor further agrees to see to it that any and all subcontractors employed by the Contractor comply with the same.  These Owner rules and regulations are in addition to the Contractor’s rules and regulations which they are to prepare, present, keep current and follow at all times.  
1.    Permits and Codes
All licenses necessary for the prosecution of the Work shall be secured and paid for by the Contractor prior to commencement of the Work.  Contractor shall comply with all applicable codes, laws, and regulation pertaining to their respective work including safety and health regulations.  Contractor shall maintain a safe workplace (free from trip hazards, etc.) at all times.
2.    Work Area
Before commencing any of the Work, the Contractor shall erect construction barriers acceptable to Owner between the area where the Work is being conducted (the “Work Area”) and any public areas at and around the building in which the Work is constructed (“Project Site”).  The Contractor will keep the Work Area closed from public view until completion and occupancy by Tenant.  The Contractor shall perform all construction activities and all storage of materials inside the Work Area.  No tools, equipment, materials or supplies are permitted to be stored outside of the Work Area.  
3.    Keys and Locks
The Owner will provide the Contractor with one key to the tenant’s space and one access card to the Building.  Both shall be returned prior to final payment or as required per the Building’s Rules and Regulations.  A fee may be charged for lost keys or access cards.  The Contractor shall provide Owner with keys (including Control Keys required to remove and re-key cores) to all locks installed on or in the Work Area.  Owner shall be provided access to the Work Area at all times.  Near the Contractor’s completion of the work and/or tenant occupancy, Owner will re-key all “construction” keyed locks to work on the building master key system.  The Contractor is responsible for securing the Work Area and all Building rooms when not in use.  Any Building rooms found unsecured and unoccupied may result in a fine or the Contractor being removed from the Project.
4.    Common Areas
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The Contractor shall carefully protect all existing property and improvements, including walls, ceilings, floors, and finishes applied to such walls, floors, ceilings, and furniture / fixtures, along the entire pathway for its deliveries of materials and movement of workers or equipment.  The Contractor shall repair (at its sole cost) or pay for repair or replacement of any damage to existing property and improvements caused by Contractor or its agents or subcontractors.  The Contractor will not perform any construction activities or store any materials outside the Work Area.  Alterations to multi-tenant corridors and public areas (e.g., door cut-in) shall either be complete within the first week of construction or a visual barrier (approved by Owner) shall be erected at Contractor’s expense.  No modifications of the Owner’s premises (common areas), including cutting / patching, shall be permitted without the prior written consent of the Owner.
5.    Service Elevator
The Contractor shall have reasonable access to use of the service elevator, however any request for exclusive use of the service elevator shall be scheduled by the Contractor with the Owner.  Typically, all major material, equipment, gang box, and tool stocking and removal is required to be performed on off-hours at no additional cost to the Owner.  Only tools/materials carried by hand, in buckets, or on work-belts may be transported during normal working hours.
Any work or hauling of materials or trash shall be conducted so as to leave the public corridors and elevator lobbies unobstructed at all times.  At no time may the Contractor or its subcontractors block the service elevator open.  In the event that Contractor or its subcontractors causes any damage to the service elevator or lobbies, the Contractor will bear the total cost of all repairs.  
The service elevator will be provided to the Contractor free of charge during off-hours.  The Contractor is not allowed on any of the passenger elevators serving the Building at any time.  The Contractor is to familiarize itself with the accessibility, space limitations and loading restrictions of the service elevator prior to use.  Contractor will be responsible for any extra costs incurred by the Owner resulting from or in connection with the improper use of the service elevator by Contractor (or its employees or subcontractors).
6.    Water and Electricity During Construction
    Sources of water and electricity (in reasonable quantities for lighting, portable power tools, drinking water, water for testing, and other such common uses during construction) will be made available to the Contractor by the Owner without cost to the Contractor.  The Contractor shall make all connections or furnish any necessary extensions to or from such sources and shall be responsible for promptly removing the same upon completion of the Work.  Exposed piping, hoses, or extension cords may not be run through common areas.  The tenant’s sink, not the restrooms, should be used for obtaining water.
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    The Contractor acknowledges that sources of water and electricity may be interrupted by the Owner from time to time.  The Owner will coordinate all such interruptions with the Contractor however, the Owner will not be responsible for any disruptions to the Work as a result thereof.   
7.    Sanitary Facilities
    Sanitary facilities will be furnished to the Contractor by Owner.  The Contractor shall use only those facilities specifically provided or designated by the Owner.  All costs associated with clean-up or damage of any kind shall be the responsibility of the Contractor.
8.    Dusty Work
    The Contractor shall notify Owner prior to the commencement of any extremely dusty work (e.g., sheetrock cutting, sanding, extensive brooming, etc.) such that Contractor may arrange for additional filtering capacity on the affected HVAC equipment.  If possible, Contractor shall place the Work Area in negative pressure.  Failure to make such prior notification will result in the Contractor absorbing any costs associated with returning any HVAC equipment and any other existing improvements damaged by dust to their original condition.  
The Contractor is responsible for protecting the Building HVAC system in the Work Area.  The Contractor shall provide temporary replaceable media type construction filters on units in accordance with the Owner’s Standards.  All filters shall be inspected by the Contractor on a regular basis and replaced as required to maintain the equipment in clean and “like-new” condition through the Work.  Upon completion of the Work, the Contractor will be responsible for removing all temporary filters and installing all new filters per the Owner’s standards.  If the Contractor neglects to remove the temporary filters or install the permanent filters, the Owner reserves the right to replace these filters and back charge the Contractor for all associated costs.  
9.    Disposition of Materials
    Any and all unused construction materials shall be disposed of by the Contractor in the same manner as waste or unwanted material, except as may otherwise be directed by Owner or required by authorities having jurisdiction.  No dumping of any construction materials (including paint, taping mud, grout, floating compounds, etc.) is allowed in building facilities or on the premises.  The Contractor shall provide its own dumpster(s) in a location designated by the Owner.  If it is determined by the Owner that the trash is not being disposed of promptly or properly, the Owner may cause such trash to be removed at the Contractors expense.  
10.    Clean-up
    The Contractor shall at all times, on a day-to-day basis, keep the Work Area, common areas, service elevator and other areas of the Project Site free from accumulations of 
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waste material, debris or rubbish caused by or incidental to the Work.  Use of the Buildings’ trash receptacles is prohibited.
    The Contractor will provide “walk-off mats” at the entrance to the Work Area and will keep such mats clean to prevent tracking of debris into the common areas or other areas of the Project Site.  The Contractor shall sweep the floor daily.  A floor sweeping compound shall be used to keep dust to a minimum.  
Upon completion of the Work, the Contractor shall promptly remove from the Work Area all tools, scaffolding, surplus materials, trash, and debris, and shall “final clean” the Work Area and any areas of the Project Site dirtied during construction.  Any debris, rubbish, materials, or equipment left outside the Work Area may be disposed of by Owner and the Contractor shall be responsible for promptly reimbursing Owner for the cost thereof.
11.    Working Hours
    Certain operations must be performed outside the normal working hours (7am to 6pm, Monday through Friday) to prevent the disturbance or interruption of normal business operations.  These operations include, but are not limited to:
A.    Drilling or cutting of any concrete structural member (specifically slabs).
B.    Sanding, chiseling, or leveling of the concrete structure.
C.    Any work which generates noise or vibration which may be disruptive to normal office procedures elsewhere in the Project Site.
D.    Any work that creates an odor that is disruptive to Owner and/or its tenants.
E.    Material / Equipment stocking (see Deliveries).
F.    Life Safety System testing.
G.    Any other work that is disruptive to Owner and/or its tenants.
    
    The Owner reserves the right to stop all Work at any time if noise or odors generated from such Work disturbs the tenants.   
    The Contractor is responsible for exhausting the Work Area.  It may be necessary to exhaust via the Building’s general exhaust system.  The Contractor is to coordinate this work with the Owner.  Any cost associated with running the Building’s HVAC system after hours is the Contractors responsibility.  
12.    Workman Conduct
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    No loud or abusive language or actions or the playing of music will be tolerated.  It will be the responsibility of the Contractor to enforce this regulation on a day-to-day basis and/or in response to specific complaints from tenants or Owner.  Contractor shall not engage in any labor practice that may delay or otherwise impact the work of any other Contractor of the Building.
    No smoking is permitted in the Building at any time.  Contractors caught smoking in the Building will be removed from the premises.
    Contractors are not permitted to enter any areas of the Building other than those areas designated by the Owner.  Contractors found in non-approved areas may be subject to removal from the premises and the Project.    
13.    Electrical Panel Changes
    All additional electrical circuits added to existing electrical panels or any new circuits added to new electrical panels will be appropriately marked as to the area and/or equipment serviced by the circuit(s) in question.  All electrical panels which have covers removed for any reason (e.g., so as to allow the addition of new circuits) or any new electrical panels that are installed shall be left at the end of each day with all panel covers properly in place and all panel doors securely closed.  Under no circumstances will power serving other tenants’ premises or other areas of the Project Site be shut off without the specific advance written approval of Owner.
14.    Special Elevator Services
    Any work or repair that necessitates or involves utilizing the elevator to perform work (including work on/in the elevator) must be scheduled in advance with Owner.  
    Sufficient notice regarding such proposed activities should be given so as to allow Owner to arrange with the elevator service contractor to provide personnel to perform or supervise such activities.
    Under no circumstances should the Contractor permit their personnel to utilize the elevator for any purpose other than the approved transport of materials and/or personnel.  Contractor will be responsible for any extra costs incurred by the Owner resulting from or in connection with such use of the elevators by the Contractor (or its employees or subcontractors).
15.    Welding/Cutting Torch Use
    No welding, burning or cutting torch work is to be performed at the Project Site without the prior approval of Owner.  If such approval is granted by Owner, the Contractor must have a firewatch, fire blankets, and a fire extinguisher present in the Work Area at all times when the equipment is being used.  Additionally, the Contractor may, at Owner’s request, be required to perform any such work after-hours because of the fumes which may be associated with such welding/cutting torch usage.
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16.    Spraying of Varnishes/Lacquer in the Project Site
    No varnishes/lacquers or similar products are to be sprayed in the Project Site without the prior approval of the Owner.  Because of their potential combustible nature, this type of work should normally be done off-site.  Anyone found spraying these compounds in or around the Project Site without the prior written approval of the Owner will be required to cease such work.
17.    Draining of Sprinkler Lines
    Any Work that will involve the draining of a sprinkler line or otherwise affect the Project Site’s sprinkler system must be approved in writing in advance by Owner and must be performed after hours, unless fire watch is provided by Contractor, at no cost or expense to Owner, upon Owner’s prior written approval.  In all instances where this is done, it is the Contractor’s responsibility to ensure that the system is fully operational when the sprinkler contractor is not present and specifically working on the system.
18.    Deliveries
    All deliveries and/or pick-ups by the Contractor or its vendors must be made through the designated loading areas.  All delivery vehicles are governed by a 20 minute parking limitation during normal working hours.  All deliveries must be coordinated with the Owner so as to not cause any delays or impede on the progress of others.  Matters of the Building will take precedence over Contractor matters in the event of scheduling or other potential conflicts.
19.    Parking
    On-site parking may be available to the Contractor and its subcontractors.  Parking is to be coordinated with the Owner.  Contractors parked in unauthorized areas will be subject to booting or towing without warning at the vehicle owner’s expense.  Handicap parking stalls should not be used/blocked for loading or unloading under any circumstances.  Notwithstanding the foregoing, Owner is not obligated to provide any parking spaces for Contractor or its subcontractors.
20.    Material Safety Data Sheets
    All materials that have any potential for hazard (paints, glues, polishes, solvents, etc.) must have their associated MSDS sheets available at the Project Site during the performance of the Work.
21.    Posting of These Construction Rules and Regulations:
    A copy of these Construction Rules and Regulations, acknowledged and accepted by the Contractor, must be posted at the Project Site in a location clearly visible to all workers.  It is the Contractor’s responsibility to instruct its employees and all subcontractors to familiarize themselves with these rules and regulations and to enforce compliance at all times.
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22.    Fire Alarm System
    Should a Contractor’s Work include welding, the use of a cutting torch, or any other activity that might interfere with the fire alarm system or otherwise trigger or effect the fire alarm system, the Contractor must receive prior written approval from the Owner at least 48 hours prior to commencing such activity.  Owner at its reasonable discretion shall select the time of day for such operations.  All work must be scheduled so that the fire alarm system is returned to service by the end of each day.  If the system cannot be returned to service, the Contractor must supply fire watch personnel at its cost until such time that it is returned to service.  
    The Contractor shall take any and all steps to prevent accidental triggering of the fire and smoke detection devices within or adjacent to the Work Area and at the Project Site.  Such steps shall not include disconnecting any such devices, but rather shall involve the installation of dust barriers around smoke detectors, etc.  The Contractor must cover and uncover smoke detectors daily to avoid accidental activation of the fire alarm system.  The Contractor is responsible for all costs associated with the activation of the fire alarm system by the Contractors and its subcontractors.  
23.    Light Bulbs and Ballasts
    The Contractor is responsible for ensuring that all light fixtures in the Work Area are working properly, are of the same temperature (Kelvin) and are fully lit upon completion of the Work.  This includes replacement of tubes and ballasts as required in light fixtures that are replaced, added, or repositioned.
24.    Non-Compliance
    In addition to other rights and remedies afforded to Owner under the Contract Documents, non-compliance with these regulations will result in the possible barring of the Contractor from current or future activities at the Project Site.  Any costs incurred by Owner resulting from the Contractor’s non-compliance (including the activities of any of the Contractor’s employees or subcontractors) will be billed to the Contractor or set off against future payments to the Contractor in connection with the Work.
25.    Damaged Property
All costs associated with replacing, repairing, or cleaning any property which have been damaged during the performance of the Work will be billed to the Contractor or set off against future payments to Contractor in connection with the Work.  Contractor shall be responsible for the protection of their work and the areas adjacent to their work.
26.    Tools and Materials
Tools or materials will not be loaned to construction personnel at any time.  No flammable, highly combustible, or hazardous materials will be allowed on site.  All gang boxes, tool boxes, tool chests, and other containers are subject to reasonable inspection 
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when moving in or out of the Building.  Contractor / subcontractors shall be responsible for the security of their materials, tools, etc.  The Owner will not be responsible for loss or damage to Contractors tools, materials or equipment whether such loss or damage is alleged or actual.  
27.    Doors
Doors to all work areas, including mechanical and electrical closets, will remain closed at all times.  Propping doors open is expressly prohibited.
In the event that doors/frames are painted or touched up, all hardware and any associated data/rating plates are to be protected (taped off) prior to finishing.  
28.    Signs
Contractor shall not be permitted to post identifying signage or advertising within the Building or visible from outside the Building.
29.    Building Standards
It is the responsibility of the Contractor to be fully knowledgeable of the Building Standards.  Contractor is to confirm Building Standards with the Owner prior to commencement of the Work..  Materials, equipment, and/or quality of work which do not meet the Building Standards will be corrected at Contractor’s sole expense.
30.    As-built Drawings
“As-builts Drawings” shall be maintained by the Contractor.  At the end of the construction period, “As-built Drawings” should be transmitted to the Owner in full size hard copy and PDF format.  The architect shall provide CAD (.dwg), or similar format, as-built plans to Owner.
31.    Hazardous Substances
    Contractor certifies that, to its actual knowledge upon exercising reasonable diligence, no asbestos containing materials, PCBs or other substances regulated as hazardous substances are present in any materials used by Contractor. 
No flammable or explosive fluids or materials shall be kept or used with the Building except in areas approved by the Owner.  Flammable and explosive fluids or materials must be transported in standard safety containers.  
32.    Field Office 
The Contractor shall provide a field office and means of communication for its exclusive use.  Such field office and means of communication shall be at the Contractor’s sole cost and located within the Work Area.   
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33.    As-Is Condition 
Contractor accepts that the Work Area is being delivered in “as-is” condition and that it is the sole responsibility of the Contractor’s and its subcontractors upon mobilization.
34.    Approved/Required Subcontractors 
The Contractor is to contract with Owner approved/required subcontractors for certain trades as defined by the lease agreement between Tenant and Owner.  The Contractor is to confirm with the Owner the approved/required subcontractors prior to bidding out the Work.    
35.    System Testing 
The Owner must witness the pressure testing of any systems that tie into the fire suppression, domestic water, condenser water or hot water before each system is enclosed or put into operation.  It is the Contractors responsibility to schedule the testing with the Owner and subcontractors.    
36.    Structural Support 
Equipment and materials are not permitted to be secured or supported to framing, ductwork, piping, or conduit. Items that may not be attached include but are not limited to: bracing for walls, ceiling grid, lights, cabling, conduits, piping, hangers, etc.  All such items must be secured or supported directly to the structure.  The Contractor will be responsible for repairing any damage caused by unacceptable attachment.
The Contractor shall be responsible for the structural integrity of the Building during its material stockpiling and Work.  The Contractor is to disperse materials/equipment loads evenly throughout the Work Area so as to avoid concentrated loads in a single area.   
37.    Capping and Sealing 
All piping, holes, cores, etc. must be capped or sealed when not in use.  This includes drain and vent lines.  The Contractor is responsible for any damage caused by failure to cap or seal the equipment or areas.  
38.    Coring 
The Building structure has limitations on where any penetrations may occur.  The Contractor shall x-ray/scan the area where the penetration is to occur.  The Owner is to approve the penetration location after the completion of the x-ray/scanning and prior to coring.  The Contractor is to properly protect the area below the penetration and is responsible for cleaning all debris.  All such work is to be coordinated with the Owner.   
All cores are to be fire stopped per code.  All existing cores not being reused are to be filled to match existing conditions.   
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39.    Fire Extinguishers 
The Contractor is responsible for providing an adequate number of NFPA fire extinguishers for the Work Area.  All fire extinguishers are to be serviced and maintained in accordance with NFPA requirements.   
41.    Inspections 
The Contractor is responsible for scheduling all inspections with the city and other entities associated with the Work and delivery of all partial, temporary and final Certificates of Occupancy based upon the construction schedule.  
42.    Equipment Access 
The Contractor will ensure its work in no way blocks or impedes access to equipment, valves, clean-outs, dampers, panels, points of entry, etc.  Essentially, any equipment needing access by others in the future shall not be blocked.    
43.    Owner Review 
After all major construction is complete and before ceiling tiles are installed the Contractor must coordinate with the Owner a visual inspection and approval of the overhead plenum spaces.  This same requirement pertains to second siding walls and any chases opened as a result of the Work.  It is the Contractor’s responsibility to schedule this walkthrough in a timely fashion.  Failure to do so may result in having to re-open and expose these areas.  Note that in particular the Landlord will be looking to ensure all debris has been removed, proper access to equipment is provided, materials are installed per the drawings and specifications, etc.  
44.    Supervision 
Contractor shall employ a competent superintendent, as approved in writing by Owner, from the commencement of construction through Substantial Completion and acceptance of the Work.  The superintendent shall be in charge of the construction of the Work at all times.  Contractor shall provide the superintendent with such assistants as are necessary to properly execute and coordinate all phases of the Work.  The superintendent and such assistants shall be in attendance at the Project Site at all times during the performance of the Work.  The superintendent shall represent Contractor, and communications given to the superintendent by Owner shall be as binding as if given to Contractor.  Contractor shall, upon written request from Owner, replace the superintendent or any other member of Contractor's staff with a person satisfactory to Owner, but shall not otherwise re-assign the superintendent or replace the superintendent without Owner’s consent.
45.    Meetings  
The Contractor shall hold weekly Project Meetings or as designated by the Owner.  Subsequent to the Project Meeting, Contractor will be responsible for issuing weekly meeting minutes 
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documenting attendees and all items discussed.    
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SCHEDULE C-3

CLOSE-OUT DOCUMENTATION

At a minimum, the close-out documents will include the following:
1.    As-built drawings in hard-copy and PDF format
2.    Punch list completion with Tenant approval
3.    Certified Test & Balance Report
4.    Keying plan and schedule
5.    Operation & maintenance manuals
6.    Warranties & guarantees
7.    Updated project directory
8.    Certificate of Occupancy
9.    Certificate of Substantial Completion (AIA Document G704)
10.    Final Application and Certificate for Payment (AIA Document G702) with subcontractor final release of liens
11.    Continuation Sheet (AIA Document G703) with full schedule of values.
12.    Conditional/unconditional lien waivers from consultants, contractors, subcontractors, vendors, etc.

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EXHIBIT D
OPTION TO EXTEND
A.    A.    Landlord hereby grants to Tenant [redacted] options to extend the Term (each, an  “Option to Extend”) for period of [redacted], each (each, an “Option Term”), provided (i) there is no uncured monetary Default on the date Tenant delivers the Option Notice, (ii) Tenant is occupying no less than [redacted] of the Premises for its business purposes, and (iii) Tenant exercises the Option to Extend as set forth below.  The applicable Option Term, if exercised, shall commence on the day following the Expiration Date or the last day of the first Option Term, as applicable, with no gap.  Tenant may exercise each Option to Extend only by delivering written notice of exercise (“Option Notice”) to Landlord no later than [redacted], and no earlier than [redacted] prior to the Expiration Date or the last day of the first Option Term, as applicable (the “Exercise Deadline”).  Time is of the essence with respect to delivery of the Option Notice.  If Tenant exercises either or both of the Options to Extend in accordance with the provisions hereof, then the Term shall be extended accordingly.  Except as otherwise expressly provided herein, each Option Term shall be upon the same terms, covenants and conditions as set forth herein with respect to the immediately preceding portion of the Term.  All references in this Lease to the Term shall be construed to mean the initial Term and the Option Term or Terms, unless the context clearly indicates that another meaning is intended.  For purposes of this Lease, no distinction is made between the terms "extend" and "renew," or any variations thereof.
Tenant shall have the right to extend the Term of this Lease pursuant to this Exhibit D with respect to less than the entire Premises; provided that the portion of the Premises that Tenant elects to lease contains either all or approximately one-half of the rentable area on the floor or floors that Tenant will continue to lease.  In such event, Tenant's Option Notice shall specify the portion of the Premises Tenant elects to retain, and the Rent to be paid by Tenant with respect to the applicable Option Term shall be based on the rentable area of such portion of the Premises.  On the commencement of the Option Term, Tenant shall surrender the portion of the Premises for which the Term is not to be extended in the condition required under the Lease.  
B.    Promptly following Landlord’s timely receipt of the Option Notice, Landlord and Tenant shall commence negotiations concerning the amount of annual base rent (including annual escalations) which shall be payable during each year of the Option Term, it being intended that such annual base rent for the Option Term shall be equal to [redacted] of the prevailing fair market rent for the Premises as of the applicable renewal commencement date, and, in addition, Tenant shall be provided with prevailing market concessions (including without limitation, tenant improvement allowances, free rent, and other concessions, if applicable) being offered in the market and in determining such base rent and concessions, all other relevant factors for comparable space and comparable tenants in comparable buildings located in Rockville, Maryland (“Comparable Buildings”) shall be taken into account.  The base year for purposes of the Additional Rent payable by Tenant under Section 5 of the Lease shall be [redacted].  The parties shall have [redacted] after Landlord’s receipt of the Option Notice in which to agree on the Base Rent (including annual escalations) which shall be payable during 
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each year of the applicable Option Term, and the amount of any tenant improvement allowance and any other prevailing market concessions.  The parties shall be obligated to conduct such negotiations in good faith.  Among the factors to be considered by the parties during such negotiations shall be (i) the general office rental market for Comparable Buildings, (ii) rental rates then being obtained by building owners of other Comparable Buildings, (iii) the rental rates then being obtained by Landlord for comparable office space, in “as is” condition, in the Building, (iv) concession packages then being obtained by other building owners with respect to comparable tenants for other Comparable Buildings, (vi) concession packages then being obtained by Landlord for comparable office space in “as-is” condition in the Building, and (vii) the brokerage commission, if any, to be paid in connection with such Option Term.  For purposes of this Exhibit D, the term “fair market rent” shall be defined as set forth in this Section, including without limitation, the related fair market concessions, abatements and allowances, if any.
If, during such [redacted] period referred to above, the parties are unable to agree on the Base Rent and any other economic terms payable, including concessions, or applicable during the Option Term, then Tenant shall have the right at its option either (i) to rescind the exercise of the Option to Extend by sending Landlord written notice of such rescission election no later than f[redacted]  after the expiration of such [redacted], or (ii) to have the fair market rent determined in accordance with the procedure set forth below, taking into consideration the factors described above.  If Tenant does not elect to rescind the Option to Extend, within [redacted] after the expiration of such [redacted] period, each party shall appoint a real estate broker which is unaffiliated with either party (each, a “Rental Broker” and collectively, the “Rental Brokers”) who shall be a member of the National Association of Realtors or the Greater Washington, D.C. Association of Realtors, and shall have at least [redacted] relevant experience in office rentals in the Rockville, Maryland area.  If either Landlord or Tenant fails to appoint a Rental Broker within such [redacted] period, then the other party shall have the power to appoint the Rental Broker for the party that so failed.  The two Rental Brokers appointed by the parties shall determine, within [redacted] after appointment, the then fair market rent and concessions that will be applicable to the Premises for the Option Term.  If the two (2) Rental Brokers appointed by the parties agree on a fair market rent and concessions, such fair market rent and concessions shall be used as the fair market rent and concessions for the Renewal Term.  If the Rental Brokers reach different determinations of the fair market rent and/or concessions, then the two (2) Rental Brokers together shall appoint a third broker with the same qualifications (“Third Broker”) within [redacted] after the end of the [redacted] determination period.  All three (3) Rental Brokers shall attempt to agree within [redacted] on the fair market rent and concessions for the Option Term, and if they are unable to so agree within such [redacted] period, the Third Broker shall select one of the fair market rental determinations (including concessions) of the original two (2) Rental Brokers, and such selection shall be final and conclusive. Landlord and Tenant shall each bear the cost of its Rental Broker and shall share equally the cost of the Third Broker.

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EXHIBIT E
CONTINUING RIGHT OF FIRST OFFER
A.    Provided that: (1) no Default has occurred and is continuing, (2) Tenant’s right to possession of the Premises has not been terminated, and (3) more than [redacted] are then remaining in the Initial Term (as of the date of the Expansion Space Offer Notice, as defined below), then prior to the Expiration Date (the “ROFO Option Period”), Tenant shall have the right at its option (the “Tenant’s Expansion Option”), from time to time, to lease any space located on the [redacted] floor of the Building (the “Expansion Space”), subject to, and in accordance with the terms of this Exhibit E.  Notwithstanding Tenant’s Expansion Option, Landlord (its agents and representatives), shall have the right, but not the obligation, to market, advertise and make offers to third parties for the leasing of all or any part of the Expansion Space, subject to Tenant’s rights under this Exhibit E.  If at the time of a Trigger Event (defined below) there are fewer than [redacted]  remaining in the Initial Term, Landlord shall nevertheless be required to comply with its notice obligations set forth below, but in order for Tenant to exercise Tenant’s Expansion Option, Tenant must first exercise its Option to Extend pursuant to Exhibit D.

B.    For purposes of this Exhibit E, a “Trigger Event” means (i) Landlord sending to any third-party prospective tenant, in connection with any portion of the Expansion Space, a prospect requested second round lease proposal after Landlord having first already delivered a first round lease proposal to such prospective tenant, (ii) Landlord sending a counter offer to any third-party prospective tenant, in connection with any portion of the Expansion Space, after Landlord having first already received a bona fide letter of intent or term sheet from such prospective tenant, (iii) Landlord receiving and countersigning a letter of intent or term sheet from a prospective tenant, (iv) if the Expansion Space is vacant and leasable, or (v), if Landlord, in its sole but reasonable discretion, anticipates that the Expansion Space may become available for Tenant to lease within the next nine (9) months.  Immediately following a Trigger Event, Landlord shall deliver written notice to Tenant (an “Expansion Space Offer Notice”) describing the Expansion Space and indicating the anticipated delivery date of the Expansion Space.  If Tenant desires to lease the Expansion Space, Tenant shall send Landlord written notice (“Expansion Space Election Notice”) of such election no later than [redacted] after Tenant’s receipt of the Expansion Space Offer Notice.  Tenant shall not have the option to lease less than all of the Expansion Space.  If Tenant does not deliver the Expansion Space Election Notice to Landlord within such [redacted] period, then Tenant’s right to lease that portion of the Expansion Space described in the Expansion Space Offer Notice shall automatically terminate, be null and void, and be of no further force and effect and Tenant shall have no further rights regarding the applicable Expansion Space described in the Expansion Space Offer Notice.   

C.    In the event that Tenant timely and properly exercises Tenant’s Expansion Option, commencing on the date Landlord delivers possession of the Expansion Space to Tenant (but no earlier than the anticipated delivery date specified by Landlord in the Expansion Space Offer Notice), the Expansion Space shall be added to the Premises, and Tenant shall lease the Expansion Space in its “as is” condition on all of the same terms and conditions as the existing 
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Premises, for a term that is coterminous with the Term, except that the Monthly Base Rent for the Expansion Space shall be based on the rentable area of the Expansion Space, and shall at all times be the same (on a per rentable square foot basis) as the Monthly Base Rent for the initial Premises, and (ii) Landlord shall provide Tenant with (1) an abatement of Monthly Base Rent, and (2) an improvement allowance, based on the abatement and improvement allowance provided for the initial Premises (but prorated based on the remaining term of the Lease from and after the commencement date for the Expansion Space).  Without limitation, commencing on the commencement date for the Expansion Space, Tenant’s obligation to pay Additional Rent under Sections 5 and 6 of the Lease shall apply (on a per rentable square foot basis) to the Expansion Space.

D.    Promptly following Tenant’s exercise of Expansion Option for any Expansion Space, Landlord and Tenant shall execute and deliver an amendment to the Lease adding the Expansion Space to the Premises and consistent with the terms and conditions of this Exhibit E, but the failure to do so shall not affect either party’s rights or obligations relating to the Expansion Space.

E.  Time is of the essence with respect to Landlord’s and Tenant’s rights and obligations in this Exhibit E.

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EXHIBIT F
OPTION TO TERMINATE
A.    Provided that: (1) no uncured Default has occurred and is continuing, and (2) Tenant’s right to possession of the Premises has not been terminated, and provided that Tenant timely delivers (i) the Termination Notice (as set forth herein); and (ii) the Termination Fee (as set forth herein), then Tenant shall have the option to terminate this Lease effective as of the date (the “Effective Early Termination Date”) designated by Tenant that is no earlier than the last day of the [redacted] of the Initial Term (the “Termination Option”), subject to all of the conditions set forth in this Exhibit.  Tenant must provide Landlord with Tenant’s written notice of Tenant's intention to terminate this Lease (the “Termination Notice”) by delivering such written Termination Notice to Landlord no later than 5:00 p.m. Eastern Time on the date that is [redacted] prior to the Effective Early Termination Date (the “Termination Notice Deadline”).
B.    Within [redacted] after Tenant delivers the Termination Notice, Tenant shall remit to Landlord the sum of: (i) one (1) month of Monthly Base Rent (at the Monthly Base Rent rate in effect as of the Early Termination Date), plus (ii) the total amount of all unamortized leasing commissions paid by Landlord in connection with this Lease, plus (iii) the total amount of all unamortized Construction Allowance(s) provided by Landlord to Tenant in connection with this Lease, plus (iv) the total amount of all unamortized Rent Abatement, (collectively, the “Termination Fee”).  The unamortized amounts described in clauses (ii), (iii) and (iv) shall be calculated using an interest rate of [redacted] per annum and based on the then-remaining portion of the [redacted] Initial Term.  At Tenant’s request, Landlord shall promptly provide Tenant with the amounts of the leasing commissions paid by Landlord in connection with this Lease and with Landlord’s reasonably detailed calculation of the Termination Fee based on one (1) or more possible Effective Early Termination Dates designated by Tenant in Tenant’s request notice to Landlord.  If Tenant does not timely (as set forth herein) provide Landlord with the Termination Notice and the Termination Fee, then Tenant’s Termination Option shall automatically expire, be null and void and of no further fore or effect. 
C.    If Tenant timely and properly exercises its Termination Option and otherwise complies with the terms of this Exhibit, then the Early Termination Date would be effective as if such date had been the Expiration Date under this Lease.  In the event Tenant timely and properly exercises the Termination Option, then Tenant shall continue to pay Monthly Base Rent and all additional rent, and otherwise comply with all of its obligations herein, through the Early Termination Date, when Tenant’s right of occupancy of the Premises shall also terminate and when Tenant agrees to vacate, surrender, and leave the Premises to Landlord in the condition prescribed in this Lease.  Accordingly, Tenant shall be liable and responsible for its obligations and liabilities under the Lease accruing prior to the Early Termination Date.  In the event Tenant fails to timely deliver the Termination Notice and the full amount of the Termination Fee, as set forth above, then this Lease shall remain in full force and effect. Tenant and Landlord hereby agree that time is of the essence with respect to Tenant’s exercise of the Termination Option.
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EXHIBIT G
GUARANTY 
    This LEASE GUARANTY (the "Lease Guaranty") is executed as of the 12th day of March, 2020, by Aurinia Pharmaceuticals, Inc., a Canadian corporation ("Guarantor"), for the benefit of BOF II MD 77 UPPER ROCK LLC, a Delaware limited liability company ("Landlord"), with reference to the following facts:

    A.    Pursuant to that certain Lease on or about of even date herewith (the "Lease"), Landlord has agreed to lease to AURINIA PHARMA U.S., INC., a Delaware corporation (“Tenant”) that certain Premises described in the Lease (all capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Lease).

    B.    As a condition to entering into the Lease with Tenant, Landlord has required that Guarantor guarantee the obligations of Tenant under the Lease in accordance with the terms of this Lease Guaranty.

    NOW, THEREFORE, in consideration of Landlord’s agreement to enter into the Lease and as a material inducement to Landlord to do so, Guarantor covenants and agrees with Landlord as follows:

ARTICLE 1  - REPRESENTATIONS AND WARRANTIES

    Guarantor makes the following representations and warranties which shall be continuing representations and warranties until this Lease Guaranty expires in accordance with the provisions contained herein:

    1.1    Existence and Rights.  Guarantor is a corporation duly incorporated and validly existing under the laws of the Province of Alberta without limitation as to the duration of its existence and is in good standing.  Guarantor has corporate powers and adequate authority, rights and franchises to own its property and to carry on its business as now owned and carried on and is duly qualified and in good standing in each jurisdiction in which the property owned by it or the business conducted by it makes such qualification necessary, and Guarantor has the corporate power and adequate authority to make and carry out this Lease Guaranty.

    1.2    Lease Guaranty Authorized and Binding.  The execution, delivery and performance of this Lease Guaranty are duly authorized and do not require the consent or approval of any governmental body or other regulatory authority; are not in contravention of, or in conflict with, any law or regulation or any term or provision of the constitutive documents and agreements of Guarantor; and this Lease Guaranty is a valid and legally binding obligation of Guarantor enforceable in accordance with its terms.

    1.3    No Conflict.  The execution and delivery of this Lease Guaranty are not, and the performance of this Lease Guaranty will not be, in contravention of, or in conflict with, any 
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agreement, indenture or undertaking to which Guarantor is a party or by which it or any of its property is or may be bound or affected and do not, and will not cause any security interest, lien or other encumbrance to be created or imposed upon any such property.

    1.4    Financial Condition.  Guarantor’s financial statements, as set forth in the December 31, 2018 Annual Report, which have heretofore been submitted in writing by Guarantor to Landlord in connection herewith, are true and correct and fairly present the financial condition of Guarantor for the period covered thereby.  Since the date of said financial statements, there has been no materially adverse change in Guarantor’s financial condition.  

    1.5    Solvency.  The execution and delivery of this Lease Guaranty will not (i) render Guarantor insolvent under generally accepted accounting principles or render it Insolvent (as defined below), (ii) leave Guarantor with remaining assets which constitute unreasonably small capital given the nature of Guarantor’s business, and (iii) result in the incurrence of Debts (as defined below) beyond Guarantor’s ability to pay them when and as they mature.  For the purposes of this Section 1.5, "Insolvent" means that the present fair salable value of assets is less than the amount that will be required to pay the probable liability on existing Debts as they become absolute and matured.  For the purposes of this Section 1.5, "Debts" includes any legal liability for indebtedness, whether matured or unmatured, liquidated or unliquidated, absolute, fixed or contingent.

    1.6    Financial or other Benefit or Advantage.  Guarantor hereby acknowledges and warrants that it has derived or expects to derive a financial or other benefit or advantage from the Lease.

    1.7     Guarantor's Assumption of Guaranty Risks.  Guarantor is fully aware of the financial condition of Tenant.  Guarantor delivers this Lease Guaranty based solely upon Guarantor's own independent investigation and in no part upon any representation or statement of Landlord with respect thereto.  Guarantor is in a position to and hereby assumes full responsibility for obtaining any additional information concerning Tenant's financial condition as Guarantor may deem material to Guarantor's obligations hereunder and Guarantor is not relying upon, nor expecting Landlord to furnish Guarantor, any information in Landlord's possession concerning Tenant's financial condition.  By acceptance hereof, Landlord and Guarantor agree that Guarantor hereby knowingly accepts jointly and severally the full range of risk encompassed within a guaranty contract, such as this Lease Guaranty, that includes a "Continuing Guaranty," which risk includes, without limitation, the possibility that Tenant will incur additional indebtedness for which Guarantor may be liable hereunder after Tenant's financial condition or ability to pay its lawful debts when they fall due has deteriorated.

ARTICLE 2 - AGREEMENTS

    2.1    Lease Guaranty.  Guarantor hereby unconditionally and irrevocably guarantees (i) the due and punctual payment of rent and all other amounts due under or required to be made under the Lease, including, without limitation, reimbursement of Landlord’s expenses in connection with a default under the Lease (and all renewals, extensions, modifications and rearrangements thereof), and (ii) the full and faithful performance of all of the terms, covenants, conditions and agreements contained in the Lease (and all renewals, extensions, and modifications thereof) (collectively, the "Guaranteed Obligations").  

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(a)    The Guaranteed Obligations shall not be modified, reduced, or exonerated in any manner other than pursuant to an express written agreement executed by Landlord.  Therefore, as an example and not in any way of limitation, a subsequent modification of the Lease or of Tenant's obligations thereunder pursuant to court order or operation of law or through any reorganization case concerning Tenant (whether by reason of the rejection or assignment of the Lease, any limitation of the amount of Landlord's allowed claim in such case, or otherwise) shall not affect the obligation of Guarantor to pay and perform the Guaranteed Obligations in full compliance with the terms of the Lease, irrespective of any modification, reduction, or exoneration of Tenant's obligations under the Lease.

    2.2    Obligations Absolute.  The obligations of Guarantor hereunder shall remain in full force and effect without regard to, and shall not be affected or impaired by the following, any of which may be taken without the consent of, or notice to, Guarantor, nor shall any of the following give Guarantor any recourse or right of action against Landlord:

    (a)    Any express or implied amendment, modification, renewal, addition, supplement, extension (including, without limitation, extensions beyond the Term) or acceleration of or to any of the Lease;

    (b)    Any exercise or non-exercise by Landlord of any right or privilege under this Lease Guaranty or the Lease;

    (c)    Any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to Guarantor or Tenant, or any guarantor (which term shall, for the purposes of this Lease Guaranty, include any other party at any time directly or contingently liable for any of the Tenant’s obligations under the Lease) or any affiliate of Tenant, or any action taken with respect to this Lease Guaranty by any trustee or receiver, or by any court, in any such proceeding, whether or not Guarantor shall have had notice or knowledge of any of the foregoing;

    (d)    Any release or discharge of the Tenant from its liability under the Lease or any release or discharge of any guarantor or of any other party at any time directly or contingently liable for the Guaranteed Obligations;

    (e)    Any assignment or other transfer of the Lease or this Lease Guaranty in whole or in part; and/or

    (f)    Any acceptance of partial performance of the Guaranteed Obligations.

    2.3    Waivers.  Guarantor unconditionally waives any defense to the enforcement of this Lease Guaranty, including, without limitation:

    (a)    All presentments, demands for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, and notices of acceptance of this Lease Guaranty;

    (b)    Any right to require Landlord to proceed against Tenant or any guarantor at any time or to proceed against or exhaust any security (including the security deposit, if any) held by Landlord at any time or to pursue any other remedy whatsoever at any time;

    (c)    Any defense arising by reason of any invalidity or unenforceability of all or any portion of the Lease or any disability of Tenant or any guarantor or of any manner in which 
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Landlord has exercised its rights and remedies under the Lease, or by any cessation from any cause whatsoever of the liability of Tenant or any guarantor;

    (d)    Any defense based upon an election of remedies by Landlord;

    (e)    Any duty of Landlord to advise Guarantor of any information known to Landlord regarding the financial condition of Tenant and all other circumstances affecting Tenant’s ability to perform its obligations to Landlord, it being agreed that Guarantor assumes the responsibility for being and keeping informed regarding such condition or any such circumstances;

    (f)    Any rights of subrogation, reimbursement, exoneration, contribution and indemnity, and any rights or claims of any kind or nature against Tenant which arise out of or are caused by this Lease Guaranty, and any rights to enforce any remedy which Landlord now has or may hereafter have against Tenant and any benefit of, and any right to participate in, any security (including the security deposit, if any) now or hereafter held by Landlord, until all of the Guaranteed Obligations have been fully paid and performed; and

    (g)    Guarantor consents and agrees that Landlord shall be under no obligation to marshal any assets in favor of Guarantor or any of them, or against or in payment of any or all of the Guaranteed Obligations.

    2.4    Independent and Separate Obligations.  The obligations of Guarantor hereunder are independent of the obligations of Tenant under the Lease and, in the event of any default hereunder, a separate action or actions may be brought and prosecuted against Guarantor whether or not Guarantor is the alter ego of Tenant and whether or not Tenant is joined therein or a separate action or actions are brought against Tenant.  Landlord’s rights hereunder shall not be exhausted until all of the Guaranteed Obligations have been fully paid and performed.

    2.5    Payments and Performance.  Guarantor agrees that whenever Guarantor shall make any payment to Landlord or otherwise perform any of the Guaranteed Obligations hereunder on account of the liability hereunder, Guarantor will deliver such payment or tender such performance to Landlord at the address provided in Section 3.9 below or at such other address as may be required by Landlord and notify Landlord in writing that such payment is made or performance tendered under this Lease Guaranty for such purpose.  It is understood that Landlord, without impairing this Lease Guaranty, may apply payments from Tenant to the Guaranteed Obligations or to such other obligations owed by Tenant to Landlord in such amounts and in such order as Landlord in its complete discretion determines.  No payment made hereunder by Guarantor to Landlord shall constitute Guarantor as a creditor of Landlord.

    2.6    Continuing Obligations.  In the event of the dissolution of any one of the Guarantors, this Lease Guaranty shall continue in effect in any dissolution, receivership or “winding up,” until such time as such Guarantor’s administrators, receivers, or trustees shall revoke the same as to transactions thereafter entered into by Landlord with or for the account of Tenant.  The revocation of this Lease Guaranty by any one or more of the Guarantors, or by the administrators, receivers or trustees of any such Guarantor, shall not affect the continuing liability hereunder of such of the Guarantors as do not give notice of revocation.

    2.7    Acknowledgment of Separate Actions.  Guarantor acknowledges and agrees that any final determination by a court of competent jurisdiction of the amount of the Guaranteed Obligations or any obligations and liabilities owing by Tenant or Guarantor to Landlord shall be conclusive and binding upon Guarantor irrespective of whether Guarantor was a party to the suit or action in which such determination was made.
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ARTICLE 3  - MISCELLANEOUS

    3.1    Exercise of Remedies; Successors; Etc.  No delay or failure by Landlord to exercise any remedy against Tenant or Guarantor will be construed as a waiver of that right or remedy.  All remedies of Landlord are cumulative.  If Guarantor consists of more than one person or entity, the obligations hereunder shall be joint and several. When the context in which the words are used in this Lease Guaranty indicates that such is the intent, words in the singular number shall include the plural and vice-versa.  If any one or more of the provisions of this Lease Guaranty should be determined to be illegal or unenforceable, all other provisions shall remain effective.  The Guarantor shall not have the right to assign any of its rights or obligations under this Lease Guaranty.

    3.2    Governing Law; Consent to Jurisdiction.  This Lease Guaranty shall be governed by and construed in accordance with the laws of the state where the Premises is located.  As part of the consideration for Landlord's entering into the Lease with Tenant, Guarantor hereby agrees that all actions or proceedings arising directly or indirectly hereunder may, at the option of Landlord, be litigated in courts within the state of where the premises is located, and Guarantor hereby expressly consents to the jurisdiction of any local, state or federal court located within the state of where the premises is located and service of process may be made by personal service upon Guarantor wherever Guarantor may be then located, or by certified or registered mail directed to Guarantor at Guarantor's last known address, or otherwise in accordance with applicable law.

    3.3    Assignability by Landlord.  Landlord may, at any time and from time to time, assign, conditionally or otherwise, all of the rights of Landlord, under the Lease and under this Lease Guaranty, whereupon such assignee shall succeed to all rights of Landlord hereunder.  Landlord, or each successor landlord, may give written notice to Guarantor of any such assignment, but any failure to give, or delay in giving, such notice shall not affect the validity or enforceability of any such assignment.

    3.4    Demands.  Each demand by Landlord for performance or payment hereunder shall be in writing and shall be made in the manner set forth in Section 3.9 below.  

    3.5    Term.  The obligations of Guarantor under this Lease Guaranty shall continue in full force and effect so long as any obligations under the Lease remain due to Landlord, and said obligations are subject to revival and renewal pursuant to Section 2.6 hereof.

    3.6    MUTUAL WAIVER OF JURY TRIAL.  BECAUSE DISPUTES ARISING IN CONNECTION WITH COMMERCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT TRIER OF FACT AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAW TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.  EACH OF THE PARTIES HERETO SPECIFICALLY WAIVES SUCH PARTY'S RIGHT TO TRIAL BY JURY OF ANY CAUSE OF ACTION, CLAIM, CROSS-CLAIM, COUNTERCLAIM, THIRD PARTY CLAIM OR ANY OTHER CLAIM (COLLECTIVELY "CLAIMS") ASSERTED BY LANDLORD AGAINST TENANT OR GUARANTOR, OR BY TENANT OR GUARANTOR AGAINST LANDLORD, LANDLORD'S WAIVER HEREUNDER BEING EVIDENCED BY ITS ACCEPTANCE OF THIS LEASE GUARANTY.  THIS WAIVER EXTENDS TO ALL SUCH CLAIMS, INCLUDING, WITHOUT LIMITATION, CLAIMS WHICH INVOLVE PERSONS OR ENTITIES OTHER THAN LANDLORD, TENANT, AND 
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GUARANTOR; CLAIMS WHICH ARISE OUT OF OR ARE IN ANY WAY CONNECTED TO THE RELATIONSHIP BETWEEN LANDLORD AND TENANT OR GUARANTOR; AND ANY CLAIMS FOR DAMAGES, BREACH OF CONTRACT ARISING OUT OF THE GUARANTEED OBLIGATIONS OR THIS AGREEMENT, SPECIFIC PERFORMANCE, OR ANY EQUITABLE OR LEGAL RELIEF OF ANY KIND.
        
WITH REFERENCE TO THE FOREGOING WAIVER, GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION THEREFOR AND THAT SUCH WAIVER BY GUARANTOR IS A MATERIAL INDUCEMENT FOR LANDLORD ENTERING INTO THE TRANSACTIONS COVERED BY THE LEASE AND THIS LEASE GUARANTY.

    3.8    Severability.  Wherever possible each provision of this Lease Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Lease Guaranty shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Lease Guaranty.

    3.9    Notices.  All notices and demands hereunder shall be deemed to have been duly given if personally delivered or mailed by United States registered or certified mail, with return receipt requested, postage prepaid to the parties at the following addresses (or at such other addresses as shall be given by written notice by any party to the others) or if deposited with a nationally recognized overnight courier requiring a signed receipt for delivery thereof, with all charges prepaid, and shall be deemed complete upon any such mailing or deposit:

        To Guarantor:            Aurinia Pharmaceuticals, Inc. 
1203-4464 Markham Street
Victoria, British Columbia T5S 2H5
                        Attention: Chief Financial Officer

To Landlord:     BOF II MD 77 Upper Rock LLC
c/o Bridge Investment Group
Five Concourse Parkway, Suite 3100
Atlanta, GA 30328
Attn: Asset Management

with a copy to:        Bridge Investment Group
Five Concourse Parkway, Suite 3100
Atlanta, GA 30328
Attn: [redacted]                          

    3.10    Complete Agreement.  This Lease Guaranty supersedes any prior negotiations, discussions or communications between Guarantor and Landlord and constitutes the entire agreement between Landlord and Guarantor with respect to the Guaranteed Obligations.

[SIGNATURE ON FOLLOWING PAGE]

[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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    IN WITNESS WHEREOF, the undersigned has executed this Lease Guaranty as of the date first above written.
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                GUARANTOR:

                AURINIA PHARMACEUTICALS, INC., 
                An Alberta Corporation 

            By:__/s/ Max Donley_____________
Name: Max Donley            
Title:    EVP                

G-8
AFDOCS//21459967

EXHIBIT H
RESERVED SPACES

[redacted]

H-1
AFDOCS//21459967

EXHIBIT I
CLEANING SPECIFICATIONS

[redacted]
I-1
AFDOCS//21459967

EXHIBIT J
FORM OF SNDA

[redacted]
J-1
AFDOCS//21459967Document

Exhibit 10.7

OFFICE LEASE
BETWEEN:
TC EVOLUTION LIMITED PARTNERSHIP
AND: 
AURINIA PHARMACEUTICALS INC. 

TABLE OF CONTENTS

						
		Page
	Part 1 DEFINITIONS/SCHEDULES	5

	1.1    Defined Terms
	5

	1.2    Schedules
	13

	Part 2 INTENT	13

	2.1    Net Lease
	13

	Part 3 PREMISES, TERM	13

	3.1    Demise
	13

	Part 4 RENT AND ADDITIONAL RENT	13

	4.1    Covenant to Pay Rent
	13

	4.2    Basic Rent
	13

	4.3    Certification of Rentable Area.
	14

	4.4    Additional Rent
	14

	4.5    Payment of Additional Rent
	16

	4.6    Method of Payment
	16

	4.7    Dispute as to Costs
	16

	4.8    Security Deposit
	17

	Part 5 ALLOCATIONS OF HVAC COSTS AND ELECTRICAL COSTS	17

	5.1    Allocation of HVAC Costs
	17

	5.2    Allocation of Electrical Costs
	17

	Part 6 USE OF PREMISES AND TENANT COVENANTS	17

	6.1    Permitted Business
	17

	6.2    Conduct of Business
	17

	6.3    Display of Name of Tenant
	17

	6.4    No Canvassing
	17

	6.5    Operations by Tenant
	17

	6.6    Relocation of the Premises
	18

Certain identified information has been excluded from this exhibit because it both (i) is not material and (ii) would be competitively harmful if publicly disclosed.

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	6.7    Energy Conservation
	19

	6.8    Alterations made by Landlord
	19

	Part 7 USE OF COMMON AREAS AND FACILITIES	19

	7.1    Non-exclusive Use
	19

	7.2    Management and Control by Landlord
	19

	7.3    Parking
	21

	Part 8 REPAIR	21

	8.1    Landlord’s Repair
	21

	8.2    Tenant’s Repair
	21

	8.3    Abatement of Rent
	21

	8.4    Termination in Event of Damage
	22

	8.5    Certificate of Architect
	22

	8.6    Diligence and Quality
	23

	8.7    Landlord’s Approval
	23

	8.8    Landlord’s Right to do Tenant’s Repair
	23

	Part 9 UTILITIES AND ADDITIONAL SERVICES	23

	9.1    Utilities
	23

	9.2    Limitation of Liability
	23

	9.3    Tenant not to Overload Utility and Service Facilities
	24

	9.4    Additional Services
	24

	9.5    Extra Operating Costs
	24

	Part 10 SUBORDINATION, ATTORNMENT AND STATUS STATEMENT BY TENANT	24

	10.1    Subordination and Attornment
	24

	10.2    Status Statement
	24

	Part 11 INSURANCE AND INDEMNITY	25

	11.1    Landlord’s Insurance
	25

	11.2    Tenant’s Insurance
	25

	11.3    Waiver of Subrogation, Cross-Liability, Co-Insurance
	26

	11.4    Proceeds of Tenant’s Insurance
	26

	11.5    No Alienation of Proceeds
	26

	11.6    Landlord’s Right to Insure for Tenant
	26

	11.7    Limitation of Liability
	27

	11.8    Indemnification of Landlord
	27

	11.9    Tenant’s Contractor’s Insurance
	27

	11.10    Acts Conflict With or Increase Insurance
	27

	11.11    Cancellation of Insurance
	28

	11.12    Tenant’s Property at its Risk
	28

	11.13    Survival
	28

	Part 12 ASSIGNMENT AND SUBLETTING	28

	12.1    Landlord’s Consent
	28

	12.2    Standards for Consent
	28

	12.3    Terms and Conditions of Transfer
	29

	12.4    Documentation for Transfer
	29

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	12.5    Excess Consideration on Transfer
	29

	12.6    Landlord’s Right to Terminate
	30

	12.7    Assignment by Operation of Law
	30

	12.8    Acceptance of Rent
	30

	12.9    No Advertising
	30

	12.10    Corporate Ownership
	30

	12.11    Time to Complete Transfer
	30

	12.12    Remedy of the Tenant
	30

	12.13    Assignment by Landlord
	30

	12.14    Permitted Transferee
	31

	Part 13 WASTE, GOVERNMENTAL AND ENVIRONMENTAL REGULATIONS	31

	13.1    Waste or Nuisance
	31

	13.2    Governmental, Insurance Underwriters’ and Environmental Regulations
	31

	Part 14 DELIVERY OF AND ACCEPTANCE OF PREMISES	32

	14.1    Delivery of and Acceptance of Premises
	32

	14.2    No Representation
	33

	Part 15 LEASEHOLD IMPROVEMENTS AND TRADE FIXTURES	33

	15.1    Installation and Changes by Tenant
	33

	15.2    Removal of Installations and Restoration by Tenant
	34

	15.3    Title on Abandonment
	34

	15.4    Not to Overload Floors
	34

	15.5    Tenant to Discharge All Liens
	34

	Part 16 DEFAULT OF TENANT	35

	16.1    Tenant’s Default
	35

	16.2    Bankruptcy or Insolvency of Tenancy
	35

	16.3    Landlord may Perform Tenant’s Obligations
	36

	16.4    Right to Relet
	37

	16.5    Reentry Without Termination
	37

	16.6    Damages
	37

	16.7    Acceleration of Rent
	37

	16.8    Expenses for Remedying Breach
	37

	16.9    Interest on Overdue Monies
	38

	16.10    No Exemption from Distress
	38

	16.11    New Lease
	38

	Part 17 REMEDIES OF LANDLORD AND WAIVER	38

	17.1    Remedies Cumulative
	38

	17.2    No Waiver
	38

	17.3    Injunctive Relief
	38

	Part 18 ACCESS BY LANDLORD	38

	18.1    Right of Entry
	38

	18.2    Roof and Walls
	39

	18.3    Excavation
	39

	Part 19 RULES AND REGULATIONS	39

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	19.1    Landlord May Make
	39

	Part 20 LANDLORD’S COVENANTS AND OBLIGATIONS	40

	20.1    Taxes
	40

	20.2    Quiet Enjoyment
	40

	20.3    Interior Climate Control
	40

	20.4    Janitor Service
	40

	20.5    Maintain Common Areas and Facilities
	40

	Part 21 OVERHOLDING	40

	21.1    No Tacit Renewal
	40

	Part 22 OPTIONS TO EXTEND	41

	22.1    Options to Extend
	41

	Part 23 MISCELLANEOUS	41

	23.1    Accord and Satisfaction
	41

	23.2    No Partnership
	42

	23.3    Unavoidable Delay
	42

	23.4    Partial Invalidity
	42

	23.5    Joint and Several Liability
	42

	23.6    Registration
	42

	23.7    Notice
	42

	23.8    No Modification
	43

	23.9    Successors and Assigns
	43

	23.10    Number and Gender
	43

	23.11    Headings and Captions
	43

	23.12    Confidentiality
	44

	23.13    Obligations as Covenants
	44

	23.14    Entire Agreement
	44

	23.15    Time is of the Essence
	44

	23.16    Governing Law
	44

THIS LEASE dated August 12, 2020 is between:
TC EVOLUTION LIMITED PARTNERSHIP
(“Landlord”)
AND
AURINIA PHARMACEUTICALS INC.
(“Tenant”)
BACKGROUND
A.    The Landlord is the beneficial owner of the Land on which the Building is located.

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B.    0922010 B.C. Ltd. is the registered owner of the Lands, holding registered title as bare trustee for and on behalf of the Landlord. 
C.    The Landlord has agreed to lease a portion of the Building to the Tenant on the terms and conditions set out below.
AGREEMENTS
For good and valuable consideration, the receipt and sufficiency of which each party acknowledges, the parties covenant and agree as follows:
Part 1

DEFINITIONS/SCHEDULES
1.1    Defined Terms
.  In this Lease:
(a)    “Additional Rent” means all sums of money to be paid by the Tenant, whether to the Landlord or otherwise, under this Lease except Basic Rent;
(b)    “Additional Services” means the services and supervision supplied by the Landlord and referred to in paragraph 9.5 or in any other provision as Additional Services and any other services which from time to time the Landlord supplies to the Tenant which are additional to the services which the Landlord has agreed to supply pursuant to the provisions of this Lease and to like provisions of other leases of the Building.
(c)    “Affiliate” of any of the parties hereto means any corporation which is Controlled by or which Controls that party or any other corporation Controlled by, or which Controls, that corporation, whether the Control be direct or indirect;
(d)    “Architect” means an independent qualified architect employed by dHKarchitects Inc. or such other independent qualified architect from time to time named by the Landlord with whom the Tenant has no reasonable objection;
(e)    “Basic Rent” means the basic rent set out in paragraph 4.2(a)(i);
(f)    “BOMA Method” means the Building Owners and Managers Association method of measurement for office buildings titled, “Office Buildings: Standard Methods of Measurement (ANSI/BOMA A65.1-2017);
(g)    “Building” means the buildings, structures, facilities and other improvements erected, or to be erected, on the Land, and includes any other buildings, structures, facilities and improvements constituting an expansion of the Building but specifically excludes any residential building(s) constructed on the Land;
(h)    “Capital Tax” means the tax or excise, if any, imposed upon the Landlord on account of the capital of the Landlord as such amount is allocated by the Landlord to the Land and the Building, based upon the Landlord’s determination of the fair market value thereof in proportion to the fair market value of all of the capital assets of the Landlord within the jurisdiction of the taxation authority, with capital considered to include capital stock, retained earnings, contributed and other surpluses, loans, advances, and other liabilities 

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and such other items as are included in the tax base of the tax on capital under the relevant tax law, as amended or substituted from time to time;
(i)    “Commencement Date” means the first day after the Fixturing Period has expired;
(j)    “Common Areas and Facilities” means those areas and facilities which may be furnished in or near the Building for the non-exclusive common use of, or the common benefit of, tenants and other occupants of the Building, their employees, agents, customers and other invitees and others designated by the Landlord from time to time, which areas and facilities are designated as such by the Landlord, which designation may be changed from time to time and which include without limitation, common entrances, lobbies, access stairways and corridors, common washrooms, elevators and escalators and rooftop patio, but excluding any parking areas located on the Land or serving the Building;
(k)    “Control”, “Controls” and “Controlled” includes, without limitation:
(i)    the right to exercise a majority of the votes which may be cast at a general meeting of a corporation, 
(ii)    the right to elect or appoint, directly or indirectly, a majority of the directors of a corporation or other persons who have the right to manage or supervise the management of the affairs and business of the corporation, and
(iii)    any change in the general partners of a partnership, including the resignation of a partner;
(l)    “Delivery Conditions” comprise the following:
(i)    the Landlord’s Work has been substantially completed as certified by the Architect; and
(ii)    not less than 3 months have elapsed from the date of delivery to the Tenant of the Delivery Notice;
(m)    “Delivery Notice” means the written notice given by the Landlord to the Tenant containing the anticipated Possession Date;
(n)    “Fixturing Period” means period commencing on the Possession Date and ending on the date that is [redacted] after the Possession Date;
(o)    “GST” means the tax presently levied under Part IX of the Excise Tax Act (Canada) or as may be amended or substituted from time to time and includes any sales tax, multi-stage sales tax, value added tax, consumption tax or any other tax, levy, duty or assessment levied in lieu thereof or in addition thereto from time to time;
(p)    “Hazardous Substance” means any substance which, when released into the Building or any part thereof, or into the natural environment, is likely to cause, at any time, material harm or degradation to the natural environment or material risk to human health, and includes, without limitation, any flammables, explosives, radioactive materials, asbestos, polychlorinated biphenyls, chlorofluorocarbons, hydro chlorofluorocarbons, urea formaldehyde foam insulation, radon gas, chemicals known to cause cancer or other toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, petroleum and petroleum products, or any substance declared to be hazardous 

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or toxic or a pollutant, dangerous good, deleterious substance, effluent, hazardous waste or special waste, or words of similar meaning under any laws now or hereafter enacted, which affect or apply to the Building, the Landlord, the Tenant, or any of them;
(q)    “HVAC Costs” with reference to the whole or any part of the Building means all costs of heating, ventilating, air conditioning and humidity control of the Building or the specified part, and includes, but is not limited to, cost of fuel, water, electricity, operation of air distribution and cooling equipment, cost of maintenance of facilities and systems related to heating, ventilating, air conditioning, humidity control of the Building or any part, labour, materials, non-capital repairs, maintenance, service and other such costs, and depreciation (computed in accordance with generally accepted accounting principles in the Province of British Columbia) of the capital cost of fixtures and equipment used therefor which by their nature require periodic replacement or substantial repair or replacement, reasonably attributable to the heating, ventilating or air conditioning or humidity control of the Building or the specified part, and the reasonable cost incurred by the Landlord in making an allocation of the costs with reference to any specified part;
(r)    “Initial Term” means the period of 10 years commencing on the Commencement Date;
(s)    “Land” means the land civically known as 2615-2629 Douglas Street, Victoria, BC and legally described in Schedule 2;
(t)    “Landlord” means the party described as such above and its successors and assigns;
(u)    “Landlord’s Work” means the work to be completed by the Landlord as set out in Part A of Schedule 5; 
(v)    “Lease” means this Lease and all its Schedules, as amended from time to time;
(w)    “Lease Year” means a period of 12 consecutive calendar months during the Term ending on the last day of the financial year of the Landlord, except that:
(i)    the first Lease Year begins on the first day of the Term and ends on the last day of the financial year of the Landlord in which the first day of the Term occurs, and may be a period less than 12 consecutive calendar months,
(ii)    the last Lease Year begins on the first day of the financial year of the Landlord during which the last day of the Term occurs and ends on the last day of the Term, and may be a period less than 12 consecutive calendar months, and
(iii)    if the Landlord changes its financial year and gives notice to the Tenant of the first and last days of the new financial year, the period between the last day of the old financial year and the last day of the new financial year will be a Lease Year and will be a period less than 12 consecutive calendar months, and the next Lease Year will follow consecutively;
(x)    “Leasehold Improvements” means all fixtures, trade fixtures, improvements, installations, alterations and additions from time to time made, erected or installed by, or on behalf of, the Tenant in the Premises, with the exception of furniture and equipment not of the nature of fixtures, but includes all partitions however fixed (including floor to ceiling moveable partitions) and includes all wall-to-wall carpeting with the exception of carpeting laid over vinyl tile or other finished floor and affixed so as to be readily removable without damage;

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(y)    “Mortgage” means a mortgage or charge (including a deed of trust and mortgage securing bonds and all other indentures supplemental thereto) on or in respect of the Land or Building or any part of them, and includes all renewals, modifications, consolidations, replacements and extensions;
(z)    “Mortgagee” means the mortgagee or trustee for bondholders, as the case may be, named in a Mortgage;
(aa)    “Normal Business Hours” means the hours from 7 a.m. to 6 p.m., Monday to Friday, inclusive, of each week, holidays excepted, or such other hours and days as may be specified in Schedule 3 from time to time;  
(bb)    “Operating Costs” means the aggregate (without duplication) of all costs and expenses incurred by or on behalf of the Landlord for the ownership, operation, maintenance, repair, replacement and management of the Building and the Land, or any part of the Building or the Land, whether contemplated at the time of execution of this Lease or otherwise including, without limitation, all costs and expenses of:
(i)    all insurance which the Landlord is obligated to obtain, and any other insurance the Landlord or its Mortgagee elects to obtain, in respect of any risk or casualty, including public liability, property damage and loss of rental income insurance,
(ii)    HVAC Costs to the extent not allocated as provided in paragraph 5.1,
(iii)    cleaning, painting, janitorial services, including snow and ice removal, window cleaning, maintaining and servicing electric light fixtures and replacing bulbs, tubes, starters, and ballasts, garbage and waste collection and disposal,
(iv)    all charges for public services and utilities which are not separately metered in respect of individual tenants, including hot and cold water, gas, electricity, sewer (sanitary and storm),
(v)    communications, information facilities, sound, visual, lighting, public address and musical broadcasting systems,
(vi)    policing, supervision, traffic control and security and life supporting systems,
(vii)    the cost of operating and repairing elevators, escalators or any other device for passenger or goods transportation,
(viii)    fees and other remuneration payable for operating, maintenance, promotion, engineering, legal and accounting services, and other consulting and professional services, and if those services are performed by individuals employed by the Landlord, they will include, subject to subparagraph (xxix) below, remuneration of those individuals including fringe benefits, unemployment insurance and pension plans but excluding administrative costs and expenses except as specified in subparagraph (xv) below,
(ix)    building supplies and the rental equipment used by the Landlord in maintenance and operating services and the reasonable rental value from time to time of space utilized by the Landlord in connection with the operation or maintenance of the Building,

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(x)    depreciation or amortization (computed by the Landlord in accordance with accounting principles generally accepted in British Columbia) of furnishings, fixtures, equipment, machinery, facilities, systems and property which by their nature require periodic or substantial repair or replacement, but excluding structural repair or replacement,
(xi)    repairs and replacements to, and maintenance of, the Building including, but not limited to, the cost of gardening, landscaping and outdoor area maintenance and equipment, maintenance and repair of the roof of the Building and the surface of the exterior walls of the Building, but excluding structural repairs,
(xii)    GST on goods and services provided by or on behalf of the Landlord,
(xiii)    costs otherwise attributable to capital account for improvements, machinery or equipment which are intended to reduce Operating Costs,
(xiv)    all costs incurred in acquiring, installing, operating, maintaining, revising repairing, restoring, renewing and replacing any energy conservation, fire safety, sprinkler and life safety systems and equipment for the Building, and for effecting any improvements to the Building made to comply with any changes in insurance or legal requirements from and after the Commencement Date, including any applicable laws or regulations governing, among other things, air pollution, air quality and environmental control standards, and for investigating, testing, monitoring, controlling, removing, disposing, enclosing, encapsulating or abating any Hazardous Substance in, on, under or above the Building or the Land or any part of either of them which, in the Landlord’s opinion, or in the opinion of any regulating authority having jurisdiction, is or may be harmful to or hazardous to any person or to the Building or the Land or any part thereof,
(xv)    a management fee equal to the amount paid by the Landlord to an independent qualified professional property manager in respect of the management of the Land and the Building, which fee shall be in keeping with the industry standard for buildings of a similar size, age and location, and shall not, in any event, exceed 5% of the aggregate of all Basic Rent payable by the tenants of the Building, and
(xvi)    license, permit and inspection fees,
but does not include:
(xvii)    costs of alterations, improvements or betterments to the Premises (unless requested in writing by the Tenant) or to the premises of other tenants,
(xviii)    costs of correcting structural defects in or inadequacy of the initial design or construction of the Building,
(xix)    cost of the initial stock of tools and equipment for operation, repair and maintenance of the Land or the Building acquired prior to the Commencement Date,
(xx)    expenses directly resulting from the negligence of another tenant or occupant of the Land or the Building or from the negligence of the Landlord, its agents, servants or employees, or others for whom it is in law responsible,

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(xxi)    the expense of services provided to other tenants of the Land or the Building which are not provided to the Tenant,
(xxii)    costs related directly or indirectly to environmental laws, regulations or ordinances of any governmental authority having jurisdiction,
(xxiii)    any damage or loss resulting from any casualty normally insured against by owners of a first class project,
(xxiv)    costs of repairs to and replacements of structural elements of the Building including foundations, structural sub-floors, bearing walls, columns, beams and structural components of the roof (including the roof membrane),
(xxv)    costs of additions or expansions to the Building,
(xxvi)    legal fees, space planners' fees, real estate brokers' leasing commission, take-over costs, advertising expenses and all other leasing expenses incurred in connection with the original development or original leasing of the Building or future leasing of the Land or the Building,
(xxvii)    any bad debt loss, rent loss or reserves for bad debts or rent loss,
(xxviii)    costs associated with the operation of the business of the entity which constitutes the Landlord as the same are distinguished from the costs of operation of the Land and the Building, including accounting and legal matters, costs of defending any lawsuits with any mortgagee (except as the actions of the Tenant may be in issue) costs of selling, syndicating, financing, mortgaging or hypothecating any of the Landlord's interest in the Land or the Building, costs of any disputes between the Landlord and its employees (if any) not engaged in the operation of the Land or the Building, disputes of the Landlord with the management of the Land or the Building, or fees or costs paid in connection with disputes with other tenants,
(xxix)    the wages of any employee (including fringe benefits, unemployment insurance and pension plans) who does not (A) devote substantially all of his or her time to the Land and the Building in which case a proportionate share of such wages will be included in Operating Costs based on the time devoted to the Land and the Building in relation to work not devoted to the Land and the Building, or (B) perform their tasks on-site at the Land or the Building,
(xxx)    fines, penalties and interest not arising as a result of any act or omission of the Tenant,
(xxxi)    Capital Tax payable by the Landlord, 
(xxxii)    extraordinary costs or costs of a capital nature required to comply with environmental laws, regulations or ordinances of any governmental authority having jurisdiction,
(xxxiii)    other costs incurred by, or on behalf of, or at the request of, an individual tenant or tenants which result in a benefit to that tenant and which are not of general application to tenants of the Building,
(xxxiv)    costs incurred by the Landlord solely to lease premises in the Building, including costs of installation of demising walls and refurbishing vacant premises and 

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wages and compensation reasonably allocated by the Landlord for purposes of leasing premises in the Building,
(xxxv)    any cost or expense to the extent to which the Landlord is paid or reimbursed by any person (other than by tenants paying their respective proportionate share of Operating Costs), including the cost of work or services performed for any tenant at such tenant’s cost as Additional Services, the cost of any item reimbursed to the Landlord by insurance proceeds and the costs recovered from tenants as a result of any act, omission, default or negligence of that tenant by reason of a breach by such tenant of provisions of its lease, and
(xxxvi)    debt service incurred by the Landlord,
and the following shall be deducted from Operating Costs:
(xxxvii)    the proceeds of insurance recovered by the Landlord applicable to damage, the cost of repair of which was included in the calculation of Operating Costs paid by the Tenant; and
(xxxviii)    amounts recovered as a result of direct charges to the Tenant and other tenants, in each case to the extent that the cost thereof was included in the calculation of Operating Costs.
If any of the Operating Costs apply disproportionately to one or more tenants of the Building then the Landlord, acting reasonably, may allocate all or a portion of those costs to the tenant to whom the costs disproportionately apply.  Similarly, if any of the Operating Costs apply to the Land as a whole or a portion thereof and are not separately allocated to a Building or the Premises, then the Landlord, acting reasonably, may allocate a portion of those costs to the Operating Costs.  If at any time during any Lease Year, less than 95% of the Building is occupied, the Landlord will have the right to reasonably allocate the amount of any expense included in Operating Costs that is related to tenant occupancy amongst the tenants in occupation so that the Landlord will fully recover its expenditure for those costs. All costs and expenses that constitute Operating Costs and are of a capital nature, as determined in accordance with generally accepted accounting principles, shall be amortized and recovered on a straight line basis by the Landlord over the useful life of the item or service in accordance with generally accepted accounting principles;
(cc)    “Permitted Business” means the permitted business described in paragraph 6.1;
(dd)    “Possession Date” means the date on which the Landlord delivers possession of the Premises to the Tenant with all Delivery Conditions satisfied;
(ee)    “Premises” means the premises forming part of the third floor of the Building shown in bold outline on Schedule 1 and comprising approximately 18,615 square feet of Rentable Area.  The exterior faces of all adjoining corridor and outside walls, all areas below the upper surface of the subfloor and above the undersurface of the roof structure any stairways or passageways to other premises, stacks, shafts, pipes, conduits, ducts or other Building facilities or systems supplied by the Landlord for use in common with other tenants are expressly excluded from the Premises;  
(ff)    “Prime Rate” means the annual rate of interest announced at the relevant time by the Royal Bank of Canada as a reference rate in effect for determining interest rates on Canadian dollar commercial loans made by it in Canada;

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(gg)    “Rent” means Basic Rent and Additional Rent;
(hh)    “Rentable Area” means the “Rentable Area” (as defined in the BOMA Method) of a tenant’s premises expressed in either square feet or square meters, determined in accordance with the BOMA Method;
(ii)    “Security Deposit” means the deposit as defined in paragraph 4.8; 
(jj)    “Service Areas” means the area of the corridors, elevator lobbies, service elevator lobbies, refuge area, washrooms, air-cooling rooms, fan rooms, janitor’s closets, telephone and electrical closets and other closets on a floor serving the premises leased or available for leasing to tenants on such floor;
(kk)    “Taxes” means all taxes, rates, duties, levies and assessments whatsoever, whether municipal, parliamentary or otherwise, levied, imposed or assessed against the Building or the Land or any part of either of them or upon the Landlord in respect of them or in respect of the use and occupation thereof by any competent authority, including, without limitation:
(i)    those levied, imposed or assessed for education, schools and local improvements,
(ii)    all costs and expenses (including legal and other professional fees) reasonably incurred by the Landlord in good faith in contesting, resisting or appealing any taxes, rates, duties, levies or assessments, and
(iii)    any and all taxes which may in the future be levied in lieu of taxes as set out above provided such taxes relate to the value of the Building or the Land or any part of either of them,
but excluding:
(iv)    taxes and license fees in respect of any business carried on by tenants and occupants of the Building including the Landlord, and
(v)    income or profit taxes on the income of the Landlord to the extent those taxes are not levied in lieu of taxes, rates, duties, levies and assessments against the Building or the Land or any part of either of them or upon the Landlord in respect of them;
(ll)    “Tenant Delays” means any one or more delays caused by a breach of this Lease by the Tenant or any commercially unreasonable or negligent acts or omissions of the Tenant or those persons for whom the Tenant is responsible at law, including, but not limited to, delays in providing information or approving plans and specifications, or by changes in the work ordered by the Tenant;
(mm)    “Tenant Improvement Allowance” means an improvement allowance payable by the Landlord to the Tenant in the sum of $50.00 multiplied by the Rentable Area of the Premises plus GST for the construction and installation of the Tenant’s Work;  
(nn)    “Tenant’s Proportionate Share” means a fraction the numerator of which is the Rentable Area of the Premises and the denominator of which is the Total Rentable Area; 

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(oo)    “Tenant’s Work” means the work to be performed by the Tenant in the Premises as set out in and in accordance with Part B of Schedule 5;
(pp)    “Term” means the Initial Term together with any renewals or extensions thereof;
(qq)    “Total Rentable Area” means the total Rentable Area of the Building, whether rented or not, calculated as if the Building were entirely occupied by tenants renting whole floors and which is estimated to be, as of the date of this Lease, [redacted]; and  
(rr)    “Unavoidable Delay” means a delay in performance of an act or compliance with a covenant caused by any event beyond the reasonable control of the party obligated to perform or comply, except a delay caused by lack of funds or other financial reason.
1.2    Schedules
.  The following Schedules form part of this Lease: 
Schedule 1 - PLAN OF PREMISES
Schedule 2 - LEGAL DESCRIPTION OF THE LAND
Schedule 3 - RULES AND REGULATIONS
Schedule 4 - ADDITIONAL PROVISIONS
Schedule 5 - LANDLORD’S WORK AND TENANT’S WORK
Schedule 6 - DESIGNATED PARKING STALLS

Part 2

INTENT
2.1    Net Lease
.  The Tenant will pay to the Landlord duly and punctually all Rent without any deduction, abatement or set-off whatsoever, it being the intention of the Landlord and the Tenant that this Lease is to be a completely carefree net lease to the Landlord except as otherwise set forth herein.  All expenses, costs, payments and outgoings incurred in respect of, or relating to, the Premises, the Building or the Land, whether or not referred to in this Lease, and whether or not within the present contemplation of the Landlord or the Tenant, will be borne by the Tenant so that Rent will be absolutely net to the Landlord except as otherwise specifically provided in this Lease.
Part 3

PREMISES, TERM
3.1    Demise
.  The Landlord leases the Premises to the Tenant for the Term, and the Tenant leases the Premises from the Landlord, on and subject to the covenants and agreements contained in this Lease.
Part 4

RENT AND ADDITIONAL RENT
4.1    Covenant to Pay Rent

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.  The Tenant covenants to pay when due Rent and all other costs and charges payable by it under this Lease.
4.2    Basic Rent
.
(a)    During the Term, the Tenant will pay to the Landlord, at the office of the Landlord or at such other place in Canada as the Landlord designates from time to time in writing, in lawful money of Canada and without deduction, set-off or abatement, the aggregate of:
(i)    Basic Rent as follows: 
						
	In year 1 of the Initial Term to the end of year 2 of the Initial Term inclusive	[redacted]per square foot of Rentable Area of the Premises

	In year 3 of the Initial Term to the end of year 5 of the Initial Term inclusive	[redacted]per square foot of Rentable Area of the Premises

	In year 6 of the Initial Term to the end of year 8 of the Initial Term inclusive	[redacted]per square foot of Rentable Area of the Premises

	In year 9 of the Initial Term to the end of year 10 of the Initial Term inclusive	[redacted]per square foot of Rentable Area of the Premises

(ii)    Additional Rent as specified in paragraph 4.4; and
(iii)    All GST assessed upon or as a direct result of the payment of Rent under this Lease and such GST will not be considered to be Rent, but the Landlord will have the same rights and remedies for non-payment of GST as it has for non-payment of Rent.
(b)    The Landlord reserves the right to adjust the Total Rentable Area at any time to give effect to any structural or other change in the Building which affects the Total Rentable Area and which adjusted Total Rentable Area has been certified by an independent qualified surveyor employed by J.E. Anderson & Associates or such other independent qualified surveyor designated by the Landlord from time to time with whom the Tenant has no reasonable objection, in a certificate addressed to the Landlord and the Tenant.
(c)    All Rent will accrue from day to day, and if for any reason it is necessary to calculate Rent for less than one year or one month, an appropriate adjustment will be made pro rata on a daily basis to compute the Rent for that irregular period.
4.3    Certification of Rentable Area.
  The Rentable Area of the Premises and the Total Rentable Area shall be certified by an independent qualified surveyor employed by J.E. Anderson & Associates or such other independent qualified surveyor designated by the Landlord from time to time with whom the Tenant has no reasonable objection, in a written certificate addressed to the Landlord and the Tenant and delivered within 60 days after the Commencement Date and such certification shall, except for manifest error and except as to determinations of interpretation of this Lease, be binding on the parties hereto for all purposes of this Lease (including without limitation, any adjustments to Basic Rent, the calculation of the Tenant’s Proportionate Share and the calculation of the Tenant Improvement Allowance).  Following the certification of the Rentable Area of the Premises, the Rent shall be adjusted retroactive to the Commencement Date.  Notwithstanding the foregoing, the Rentable Area of the Premises shall not, in any 

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event, be increased by more than one percent of the estimated 18,615 square feet of Rentable Area of the Premises. 

4.4    Additional Rent
.
(a)    Additional Rent consists of:
(i)    the Tenant’s Proportionate Share of the Operating Costs; 
(ii)    the Tenant’s Proportionate Share of Taxes;
(iii)    the HVAC Cost allocated to the Premises as set out in paragraph 5.1; 
(iv)    the costs of all utilities as provided in paragraph 9.1; and
(v)    all other sums of money required under this Lease to be paid to the Landlord by the Tenant whether or not designated as Additional Rent other than Basic Rent.
(b)    In each Lease Year the Tenant will pay as Additional Rent, and discharge when they become payable, all taxes, rates, duties and assessments and other charges that may be levied, rated, charged or assessed against the Leasehold Improvements (including, without limitation, trade fixtures) and furniture, equipment or facilities of the Tenant on or comprising part of the Premises, and every tax and licence fee in respect of every business or activity conducted on or from the Premises, or in respect of their use or occupancy by the Tenant and every assignee, subtenant, licensee or other person conducting business on or from the Premises, whether they are charged by a municipal, provincial, federal, school or other body and whether separately assessed by such authority or allocated by the Landlord, acting reasonably;
(i)    The Tenant will indemnify and save harmless the Landlord against payment for all losses, costs, charges, expenses and other liabilities arising from all the taxes, rates, duties, assessments and licence fees referred to in this paragraph 4.4(b) and all taxes which may in the future be levied in lieu of them, and any losses, costs, charges and expenses suffered by the Landlord may be recovered by the Landlord in the same manner as Rent in arrears; and
(ii)    On request of the Landlord the Tenant will deliver promptly to the Landlord receipts for payment of all taxes, rates, duties, assessments and other charges in respect of all Leasehold Improvements, trade fixtures, furniture, equipment and facilities of the Tenant on the Premises which were payable up to 1 year prior to the request, and will also deliver before the 21st day of January in each year to the Landlord if requested, evidence satisfactory to the Landlord of payment of all of them for the last preceding calendar year.
(c)    If any of the amounts referred to in paragraphs 4.4(a) or 4.4(b) is not paid at the time required under this Lease, it will be collectible as Additional Rent with the next instalment of Rent falling due, but nothing in this Lease suspends or delays the payment of any amount of money when it becomes payable, or limits any other remedy of the Landlord.
(d)    The Tenant will pay to the Landlord GST as required under this Lease, and if there is no specific provision relating to a payment of GST, the following applies:

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(i)    GST will be paid either at the same time and in the same manner as monthly payments of Rent are payable, or at the time the taxing authority in respect of GST requires them to be paid by the Landlord or the Tenant, whichever is earlier;
(ii)    if a specific assessment of GST is unknown for whatever reason or the Landlord has not estimated a monthly payment of GST, under paragraph 4.4(d)(iii) and any amount of GST is not paid in accordance with this Lease, then the Tenant will pay the amount of GST to the Landlord within 5 business days of receipt of notice from the Landlord specifying the amount of the GST;
(iii)    the Landlord will, acting reasonably, estimate the amount of GST to be paid in advance with monthly payments of Rent for the period to which the estimate applies; and any necessary adjustment after the period in question will be made in the same manner as Additional Rent.  All GST will be calculated and paid without regard to any input tax credits, set-offs, exceptions, exemptions or deductions to which the Landlord is or may be entitled.  All payments of GST will be collectible as Additional Rent and the Landlord will have the same rights and remedies for nonpayment of GST as it has for nonpayment of Rent.
4.5    Payment of Additional Rent
.
(a)    Whenever the Tenant is to pay an amount of money referable to a period of time wholly or partly within a Lease Year the Landlord will, acting reasonably, estimate the amount payable by the Tenant before the beginning of the Lease Year and the Tenant will pay to the Landlord that amount in equal consecutive monthly instalments in advance during the Lease Year with the other Rent payments provided for in this Lease.  The Landlord may reasonably adjust its estimates and the amount payable by the Tenant from time to time during the Lease Year.
(b)    Within 90 days after the end of each Lease Year the Landlord will make a final determination of the Tenant’s Proportionate Share of the Operating Costs for the Lease Year, the Tenant’s Proportionate Share of Taxes for the Lease Year, and will furnish the Tenant with a statement of the Operating Costs, Taxes, utilities and HVAC Costs attributable to the Premises for the relevant financial year or years of the Landlord, and all other amounts referred to in paragraph 4.4 paid or payable for any relevant period and in each case the amount of such costs payable by the Tenant relating to the Lease Year and showing in reasonable detail the information necessary for the determination of the costs and the calculation of the Tenant’s allocated portion or Tenant’s Proportionate Share of the amount. 
(c)    If the amounts determined under paragraph 4.5(b) exceed the sum of the instalments paid by the Tenant for the relevant period, the Tenant will pay to the Landlord as Additional Rent within 30 days after the date of delivery of the statement by the Landlord the excess without interest or, if the sum of the instalments paid by the Tenant during the preceding Lease Year exceed the amounts calculated under paragraph 4.5(b), the Landlord will credit the Tenant, without interest, with the amount against the next ensuing payments due by the Tenant under paragraph 4.5(a), and if there are no ensuing payments the amount will be paid to the Tenant immediately, without interest.
4.6    Method of Payment

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.  The Tenant shall pay the Landlord by way of electronic funds transfer amounts equal to the monthly payments for Basic Rent and Additional Rent, as estimated by the Landlord, such payments to be made on the dates that they accrue due under this Lease. 
4.7    Dispute as to Costs
.  The Landlord shall keep all records relating to any expenditure included within the definition of Operating Costs or Taxes for a period of 48 calendar months following the end of the Lease Year in which such expenditure was incurred, and such records shall be made available to the Tenant upon request at no cost to the Tenant.  Any dispute with respect to the Landlord's final determination of the Tenant's Proportionate Share of Operating Costs or the Tenant’s Proportionate Share of Taxes or any other sums payable under this Lease shall be resolved by the parties through consultation in good faith within [redacted].  However, if the dispute cannot be resolved within such [redacted]period, the parties shall submit the disputed matter to an independent chartered accountant, selected by both the Landlord and the Tenant, both acting reasonably, who shall audit such costs and expenses in dispute and whose decision shall, except for manifest error and except as to determinations of interpretation of this Lease, be final and binding on the parties. If there is a variance of three percent or more between the decision of the chartered accountant and the Landlord's final determination of the costs and expenses in dispute, the Landlord shall pay the costs of such audit and shall credit any overpayment toward the next Rent payment due.  If there is a variance of less than three percent between the decision of the chartered accountant and the Landlord’s final determination of such costs and expenses in dispute, the Tenant shall pay the costs of such audit.
4.8    Security Deposit
.  Intentionally deleted.
Part 5

ALLOCATIONS OF HVAC COSTS AND ELECTRICAL COSTS
5.1    Allocation of HVAC Costs
.  The HVAC Costs relating to all of the premises will be allocated by the Landlord among all tenants of the Building proportionately on the basis of the Rentable Areas of their respective premises.  If there is a dispute as to the amount or the items included in calculating the HVAC Costs attributable to the Premises, a certificate of an independent qualified mechanical engineer employed by Avalon Mechanical Consultants Ltd. or such other independent qualified mechanical engineer designated by the Landlord from time to time with whom the Tenant has no reasonable objection (whose fee will be borne equally by the Landlord and the Tenant), verifying the costs for the period covered by the certificate will, except for manifest error and except as to determinations of interpretation of this Lease, be conclusive.
5.2    Allocation of Electrical Costs
.  If the electrical consumption and other electrical costs of the Tenant on the Premises are not separately metered and charged, the Landlord will cause a calculation of the electrical costs attributable to the Premises to be made in accordance with good engineering practices which will be the basis of the Landlord’s invoice.  If there is a dispute as to the amount, a certificate of an independent qualified electrical engineer employed by AES Engineering Ltd. or such other independent qualified electrical engineer designated by the Landlord from time to time with whom the Tenant has no reasonable objection (whose fee will be borne equally by the Landlord and the Tenant), verifying the costs for the period 

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covered by the certificate will, except for manifest error and except as to determinations of interpretation of this Lease, be conclusive.
Part 6

USE OF PREMISES AND TENANT COVENANTS
6.1    Permitted Business
.  The Tenant will use the Premises solely for general office purposes and any other purposes directly related thereto as permitted by applicable zoning, and the Tenant will not use the Premises or permit them to be used for any other purpose without the Landlord’s prior written consent.  Without limiting the foregoing, the Tenant will not use the Premises for an unlawful purpose.  
6.2    Conduct of Business
.  The Tenant will conduct its business in the Premises in a first class and reputable manner befitting the Building and consistent with good business practice.
6.3    Display of Name of Tenant
.  The Tenant will be permitted to display its name on the directory listing board located in the main lobby of the Building (if such a directory board is provided by the Landlord) and on the exterior side of the entry door to the Premises using the Building standard identification format and materials.  Each sign or lettering will contain only the name of the Tenant and will be subject to the approval of the Landlord with respect to design, size and specific location.  All signage will be installed at the expense of the Tenant and the Landlord reserves the right to install the signage as an Additional Service.  Other than as otherwise specifically contemplated in Schedule 4, the Tenant will not be permitted to erect any additional signage, unless it obtains the prior written approval of the Landlord.  
6.4    No Canvassing
.  The Tenant will not permit any canvassing, soliciting or peddling related to its business in the Building.
6.5    Operations by Tenant
.
(a)    Without limiting the generality of its other obligations under this Lease, the Tenant will operate the Premises in a good, efficient and business-like manner and will keep the Premises neat and clean.
(b)    In regard to the use and occupancy of the Premises, the Tenant will at its expense:
(i)    maintain the Premises in a clean, orderly and sanitary condition and free of insects, rodents, vermin and other pests,
(ii)    keep any garbage, trash, rubbish or other refuse in suitable containers within the interior of the Premises until removed and will permit removal of garbage, trash, rubbish or other refuse on a daily basis,
(iii)    intentionally deleted,

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(iv)    keep all mechanical apparatus free of vibration and noise which may be transmitted beyond the Premises,
(v)    comply with all laws, ordinances, rules and regulations of governmental authorities concerning or related to the Building or the Premises, or any of them, including without limitation, those dealing with the construction, repair, maintenance, operation, use and occupancy of the Premises and those referred to in paragraph 13.2(a), 
(vi)    comply with all rules and regulations and policies established by the Landlord from time to time for the Building of which the Tenant has been notified in writing, provided that such rules and regulations and policies shall not (A) discriminate against the Tenant, (B) materially or unreasonably interfere with or restrict the Tenant’s conduct of its business or the Tenant’s use or enjoyment of the Premises, or (C) derogate from any of the Tenant’s rights under this Lease,
(vii)    not permit any machines selling merchandise, food, beverages or other goods or services or entertainment, 
(viii)    comply with all reasonable requests and demands of the Landlord relating to energy conservation in the Building, provided that such requests and demands shall not discriminate against the Tenant,
(ix)    intentionally deleted,
(x)    not place or maintain any merchandise, trash, refuse or other articles in any vestibule or entry of the Premises, on the footwalks or corridors adjacent thereto or elsewhere on the exterior of the Premises so as to obstruct any part of the Common Areas and Facilities,
(xi)    not cause or permit odours, gases, dust, fumes, vapours, steam or water to emanate from the Premises,
(xii)    not install or allow on the Premises or anywhere in the Building or the Land any transmitting device, aerial, antenna, communications system or satellite receiver or transmitter, or
(xiii)    not receive or ship articles of any kind except in the designated loading areas and in accordance with the Landlord’s regulations.
6.6    Relocation of the Premises
.  Intentionally deleted. 
6.7    Energy Conservation
.  The Tenant covenants with the Landlord:
(a)    that the Tenant will cooperate with the Landlord in the conservation of all forms of energy in the Building, including without limitation the Premises;
(b)    that the Tenant will comply with all laws, by-laws, regulations and orders relating to the conservation of energy and affecting the Premises or the Building;

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(c)    that the Tenant will at its own cost and expense comply with all reasonable requests and demands of the Landlord made with a view to such energy conservation provided that such requests are made in accordance with good management practice and would be made by a prudent owner of like property of like age, and provided further that such requests and demands shall not discriminate against the Tenant; and
(d)    that any and all costs and expenses paid or incurred by the Landlord in complying with such laws, by-laws, regulations and orders, so far as the same will apply to or reasonably be apportioned to the Building by the Landlord, will be included in the Landlord’s Operating Costs for the purposes of paragraph 1.1(bb).
The Landlord will not be liable to the Tenant in any way for any loss, costs, damages or expenses whether direct or consequential paid, suffered or incurred by the Tenant as a result of any reduction in the services provided by the Landlord to the Tenant or to the Building as a result of the Landlord’s compliance with such laws, by-laws, regulations or orders.
6.8    Alterations made by Landlord
.  Where the Landlord is required by law or a competent authority to make alterations to the Premises as a result of a change in applicable laws that occurs from and after the Commencement Date, then in each year of the Term after completion of such alterations (but not after the cost thereof has been repaid to the Landlord), the Tenant will pay to the Landlord not less than the current amortized portion, calculated on a straight line basis over the useful life of all costs to the Landlord of making such alterations, and if the Landlord is required to make similar alterations to other portions or areas of the Building the cost of so doing will be reasonably apportioned by the Landlord to each of the premises.
Part 7

USE OF COMMON AREAS AND FACILITIES
7.1    Non-exclusive Use
.  The Tenant and its officers, employees, customers and other invitees, in common with others designated by the Landlord, or otherwise entitled, shall have a non-exclusive license, irrevocable during the Term (but subject to any Landlord remedies for Tenant default contemplated hereunder), to use the Common Areas and Facilities at all times during the day and night for the purposes from time to time permitted or designated by the Landlord, acting reasonably, but subject to the exclusive management and control of the Common Areas and Facilities by the Landlord.  
7.2    Management and Control by Landlord
.
(a)    The Landlord has the exclusive right to manage and control the Building, and from time to time to establish, modify and enforce reasonable rules and regulations regarding the use, maintenance and operation of the Building generally, and the Common Areas and Facilities specifically, and the Tenant, its officers, employees, customers and other invitees will observe the rules and regulations of which the Tenant has been notified in writing, provided that such rules and regulations and policies shall not (i) discriminate against the Tenant, (ii) materially or unreasonably interfere with or restrict the Tenant’s conduct of its business or the Tenant’s use or enjoyment of the Premises, or (iii) derogate in any material way from any of the Tenant’s rights under this Lease,

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(b)    Without limitation, the Landlord has the right in the management and control of the Building and the Land to:
(i)    construct, maintain and operate lighting facilities and heating, ventilating, humidity control and air conditioning and energy conservation systems, 
(ii)    supervise and police the Common Areas and Facilities,
(iii)    temporarily or permanently close off all or part of the Common Areas and Facilities at such times as in the reasonable opinion of the Landlord are advisable, and provided, in the case of permanent changes, the tenants of the Building are not materially, adversely affected thereby,
(iv)    convey, modify and terminate easements or other rights pertaining to the use or maintenance of all or part of the Building, so long as access to and from the Building is not materially and adversely affected,
(v)    close off all or part of the Building for maintenance, repair, reconstruction or construction, but the Landlord will use reasonable efforts to minimize the period of closure and any material interference with the operation of the Tenant’s business at the Building,
(vi)    employ all persons including supervisors and managers required for the management and control of the Building and the Tenant acknowledges that the Building may be managed by the Landlord or such other person or persons as the Landlord from time to time designates, 
(vii)    designate the entrances, areas and times where and when loading of goods is to be done,
(viii)    at the Tenant’s cost, supervise and regulate the delivery and shipping of merchandise, supplies, furniture and fixtures to and from the Premises in such manner as in the sole judgment of the Landlord is necessary for the proper operation of the Premises and the Building,
(ix)    designate the kind of container to be used for garbage and waste and the manner and the times and places at which it will be placed for collection,
(x)    change from time to time the area, level, location, arrangement or use of any part or parts of the Common Areas and Facilities, but not if a change results in a material and permanent interference with access to the Premises by the Tenant’s licensees and a material interference with the operation of the Tenant’s business,
(xi)    subdivide and sell portions of the Land provided that such action does not result in a material and permanent interference with access to the Premises by the Tenant and a material interference with the operation of the Tenant’s business, 
(xii)    make alterations to, construct additional improvements to or demolish portions of the Building, and
(xiii)    do such other acts with reference to the Building as the Landlord considers advisable with a view to improving the usefulness and convenience of the Common Areas and Facilities for the Tenant and others entitled to use them.

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In exercising its rights under this paragraph 7.2, the Landlord will not materially adversely affect the Tenant’s access to and from the Premises, the Building or the Land, the Landlord will not materially adversely affect the Tenant’s use and enjoyment of the Premises, and the Landlord will use reasonable commercial efforts to minimize any inconvenience to the Tenant or interference with the operation of the Tenant’s business at the Building. 
7.3    Parking
.  The Tenant acknowledges that the parking areas located on the Land or serving the Building are not part of the Common Areas and Facilities and the Landlord will not be required to directly manage any parking area on the Land or serving the Building for the benefit of tenants or their invitees or make available parking for the benefit of the Tenant or its invitees, except as may be set out in Schedule 4.  
Part 8

REPAIR
8.1    Landlord’s Repair
.  The Landlord will, subject to the Tenant’s compliance with this Lease, receipt by the Landlord of insurance proceeds under its various policies of insurance in respect of the Building and the provisions of paragraph 8.4, at all times during the Term, keep the Common Areas and Facilities in a reasonable state of repair, as a prudent owner of a reasonably similar commercial development would do, having regard to the size, age and location of the Building, including but not limited to foundations, roofs, exterior walls (excluding fronts of premises and glass in premises set aside by the Landlord for leases to tenants of the Building), structural sub-floors, bearing walls, columns, beams and other structural elements thereof, and the systems provided for bringing utilities to the Premises.
8.2    Tenant’s Repair
.  The Tenant will at its cost, subject to paragraph 8.4:
(a)    keep the Premises in good and substantial state of repair to the standards of first class premises, including all Leasehold Improvements and all furniture, equipment and other facilities (including, without limitation, wiring, piping, lighting and plumbing fixtures, operating equipment and those portions of the plumbing, sprinkler and HVAC systems which are not part of the Common Areas and Facilities) located on, in, under, above or which directly serve the Premises, all glass and utilities in the Premises, but with the exception of structural elements of the Premises and reasonable wear and tear excepted; 
(b)    upon reasonable notice by the Landlord to the Tenant (not less than 48 hours), except in emergency situations where no notice will be required, permit the Landlord to enter and view the state of repair, and repair as required above, according to notice in writing, and leave the Premises in a good and substantial state of repair as required above; and
(c)    if any part of the Building, including, without limitation, structural elements thereof and any part of the Common Areas and Facilities, becomes damaged or destroyed through the wilful act, negligence, or omission of the Tenant or any of its officers, employees, customers or other invitees, reimburse the Landlord for the cost of repairs or replacement promptly upon demand.
8.3    Abatement of Rent

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.  If there is damage to the Premises, or the Building, which prevents use of or access to the Premises or the supply of services essential to the Premises and if the damage is such that the Premises or a part of the Premises is rendered not reasonably capable of use by the Tenant for the conduct of its business for a period of time exceeding [redacted],
(a)    unless the damage was caused by the negligence of the Tenant or an assignee, subtenant, concessionaire, licensee or an officer, employee, customer or other invitee of any of them, the Basic Rent for the period beginning on the occurrence of the damage until at least a substantial part of the Premises is again reasonably capable of use and occupancy for the purpose aforesaid will abate in the proportion that the area of the part of the Premises rendered not reasonably capable of use by the Tenant for the conduct of its business bears to the Rentable Area of the Premises; and
(b)    unless this Lease is terminated under paragraph 8.4, the Landlord or the Tenant or both, as the case may be (according to the nature of the damage and their respective obligations to repair), will repair the damage with all reasonable diligence, but any abatement of Basic Rent to which the Tenant is entitled under this paragraph will not extend beyond the date by which, in the reasonable opinion of the Landlord, the Tenant should have completed its repairs with reasonable diligence after the Landlord’s repairs have been completed.
8.4    Termination in Event of Damage
.
(a)    The Landlord, by written notice to the Tenant given within 60 days of the occurrence of catastrophic damage to the Building, may terminate this Lease:
(i)    if the Building is damaged by any cause and in the reasonable opinion of the Landlord either cannot be repaired or rebuilt with reasonable diligence within 180 days after the occurrence of the damage; or
(ii)    if the Premises are damaged by any cause and the damage is such that the Premises or a substantial part of the Premises are rendered not reasonably capable of use by the Tenant for the conduct of its business and in the reasonable opinion of the Landlord cannot be repaired or rebuilt with reasonable diligence by 6 months before the end of the Term.
(b)    The Tenant, by written notice to the Landlord given within 60 days of the occurrence of the damage, may terminate this Lease if the Premises are damaged by any cause and the damage is such that the Premises or a substantial part of the Premises are rendered not reasonably capable of use by the Tenant for the conduct of its business and in the reasonable opinion of the Landlord cannot be repaired or rebuilt with reasonable diligence by 6 months before the end of the Term.
(c)    If this Lease is terminated under either (a) or (b) above, neither the Landlord nor the Tenant will be bound to repair as provided in paragraphs 8.1 and 8.2, and the Tenant will deliver up possession of the Premises to the Landlord with reasonable speed but in any event within 60 days after the giving of the notice of termination, and all Rent will be apportioned and paid to the date on which possession is delivered up, subject to any abatement to which the Tenant may be entitled under paragraph 8.3, but otherwise the Landlord or the Tenant or both, as the case may be (according to the nature of the damage and the respective obligations to repair under paragraphs 8.1 and 8.2) will repair 

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the damage with all reasonable diligence and, without limiting the foregoing, the Tenant will restore or reconstruct all Tenant’s Work.
8.5    Certificate of Architect
.  If the Premises or the Building are damaged and there is a dispute as to the length of time required to repair or rebuild the Building or the Premises, or as to the cost of repairing or rebuilding the Building, or as to whether the Premises or a substantial part of the Premises are rendered not reasonably capable of use by the Tenant for the conduct of its business or have once again become capable of such use, the parties shall submit the disputed matter to the Architect whose fee shall be borne equally by the Landlord and the Tenant and whose decision shall, except for manifest error and except as to determinations of interpretation of this Lease, be final and binding on the parties.
8.6    Diligence and Quality
.  All repairs to be done by either the Landlord or the Tenant will be commenced as soon as reasonably practicable and completed diligently and in a good and workmanlike manner.
8.7    Landlord’s Approval
.
(a)    Before commencing any repairs, replacements, maintenance, alteration, decoration or improvements set out above, or elsewhere referred to in this Lease, which are reasonably estimated by the Tenant to cost in excess of [redacted]the Tenant will obtain the Landlord’s written approval and will, if reasonably required by the Landlord to do so, submit plans and specifications therefor.  The Tenant will pay to the Landlord a charge for review of its plans and specifications as provided in paragraph 15.1(e).  
(b)    The Tenant will not in any event make any alterations to the structure of any portion of the Building or to exterior walls or the mechanized systems of the Building.
(c)    The Tenant will supply the Landlord with copies of all plans prepared for the Tenant for any work done to the Premises.
8.8    Landlord’s Right to do Tenant’s Repair
.  If the Tenant refuses or neglects to repair properly as required hereunder the Landlord may give written notice to the Tenant of such required repairs and if the Tenant has not, within 20 days after receiving such notice, made such required repairs (or, if the required repairs reasonably require a longer period to complete, if the Tenant has not commenced such required repairs within the 20 day period and thereafter does not diligently pursue the repairs to completion), then the Landlord may make such repairs without liability to the Tenant (except for the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of other parties for whom the Landlord is responsible in law) for any loss or damage that may accrue to the Tenant’s merchandise, fixtures, or other property or to the Tenant’s business by reason thereof, and upon completion thereof, the Tenant will pay the Landlord’s actual reasonable costs in the circumstances plus [redacted] of such costs, for making such repairs, immediately upon presentation of an invoice for such costs.
Part 9

UTILITIES AND ADDITIONAL SERVICES

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9.1    Utilities
.
(a)    The Landlord will furnish building standard ducts for bringing telephone service to the Premises and will provide tempered and cold water to washrooms for the Tenant’s use in common with others entitled to such use.
(b)    If directed by the Landlord, the Tenant will pay directly to the supplier when due all charges for any utilities separately metered and invoiced for the Premises.  The Landlord will not be required to arrange for or assist in obtaining separate metering for any utilities supplied to the Premises.
(c)    For all utilities not so separately metered and invoiced the Tenant will pay its share of all costs for them as allocated by the Landlord under this Lease or otherwise as part of Operating Costs.
9.2    Limitation of Liability
.  The Landlord will not be liable to the Tenant in damages or otherwise for an interruption or failure in the supply of utilities or services to the Premises (except for an interruption or failure arising from or out of the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of other parties for whom the Landlord is responsible in law) but the Landlord will use diligent efforts to secure the re-supply of that utility or service.
9.3    Tenant not to Overload Utility and Service Facilities
.  The Tenant will not install equipment that will exceed or overload the capacity of utility or service facilities and if, in the opinion of the Landlord, acting reasonably, equipment installed by the Tenant requires additional facilities, they will be installed at the Tenant’s expense in accordance with plans and specifications approved by the Landlord prior to installation.  The Landlord reserves the right to install such additional equipment at the Tenant’s expense, which will not exceed 15% of the cost of the additional equipment.
9.4    Additional Services
.  The Landlord at its election will have the exclusive right, by way of Additional Services, to provide or have its designated agents or contractors provide any janitor or cleaning service to the Premises required by the Tenant which are additional to those required to be provided by the Landlord under paragraph 20.4 including Additional Services which the Landlord agrees to provide by arrangement and to supervise the moving of furniture or equipment of the Tenant and the making of repairs or alterations conducted within the Premises, and to supervise or make deliveries to the Premises.  The cost of Additional Services (including an administration fee of 15% of such costs) will be paid to the Landlord by the Tenant from time to time promptly upon receipt of invoices therefor from the Landlord.  The cost of Additional Services charged directly to the Tenant and other tenants will be credited in computing Operating Costs to the extent that they would otherwise have been included.  
9.5    Extra Operating Costs
.  The Tenant will pay to the Landlord in the manner in which Operating Costs are paid from time to time hereunder any and all additional costs and expenses of the Landlord which may arise in respect of the use by the Tenant of the Premises for business hours that do not coincide with Normal Business Hours for the Building generally or that may arise in respect of extra heating, ventilating and air-conditioning supply, electrical supply and other services which are required to be provided to the Tenant as a result of its 

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activities over and above those normally provided to tenants of the Building or outside of Normal Business Hours.  The Landlord reserves the right to install at the Tenant’s expense meters to check the Tenant’s consumption of electricity, water or other utilities.
Part 10

SUBORDINATION, ATTORNMENT AND STATUS STATEMENT BY TENANT
10.1    Subordination and Attornment
.  This Lease is subordinate to every Mortgage existing as of the date of this Lease.  The Tenant will subordinate this Lease to every Mortgage that comes into being after the date of this Lease and execute promptly and in registrable form a document in confirmation of the subordination if requested by the Landlord, in which the Tenant also will agree with the Mortgagee that if the Mortgagee becomes a mortgagee in possession or takes action to realize the security of the Mortgage the Tenant will attorn to the Mortgagee as a tenant upon all the terms of this Lease, provided however that is shall be a condition of the Tenant’s agreement to subordinate this Lease and attorn to any future Mortgagee that the Mortgagee agrees in writing to accept the attornment and permit the Tenant, if not in default, to continue in occupation of the Premises without interruption or disturbance from the Mortgagee until this Lease is terminated by the passage of time or by action taken because of a default of the Tenant under this Lease.
10.2    Status Statement
.  At any time and from time to time within 10 days after a written request by the Landlord, the Tenant will execute, acknowledge and deliver to the Landlord or an assignee, Mortgagee, proposed buyer or other person as the Landlord designates, a certificate in a form and content reasonably requested by the Landlord to include, without limitation, statements that:
(a)    this Lease is unmodified and in force in accordance with its terms (or if there have been modifications, that this Lease is in force as modified, and identifying the modifications, or if this Lease is not in force, that it is not) and that the Tenant is in possession of the Premises;
(b)    the commencement date and expiry date of this Lease;
(c)    the date to which Rent has been paid with particulars of any prepayment of Rent;
(d)    whether or not there is an existing default by the Tenant in the payment of Rent or any other sum of money under this Lease, and whether or not there is any other existing default by any party under this Lease concerning which a notice of default has been given, and if there is any, specifying its nature and extent; and
(e)    whether or not there are any set-offs, defences or counterclaims against the enforcement of the obligations of the Tenant under this Lease.
Part 11

INSURANCE AND INDEMNITY

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11.1    Landlord’s Insurance
.  The Landlord will take out and keep in force:
(a)    all risks, property insurance on the Building and comprehensive boiler and machinery insurance on the equipment contained therein and owned by the Landlord (excluding any property required to be insured by the Tenant or other tenants), which insurance will be endorsed to cover the full replacement value of the Building, all in such reasonable amounts and with reasonable deductibles as determined by the Landlord, having regard to the size, age and location of the Building;
(b)    intentionally deleted; and
(c)    intentionally deleted.
The cost of insurance obtained under paragraph 11.1 will be included in Operating Costs.  In spite of any contribution by the Tenant to the cost of the Landlord’s insurance and the Landlord’s covenants under this Part 11, the Tenant is not relieved of any liability arising from or contributed to by its acts, fault, negligence or omissions and no insurable interest is conferred on the Tenant under any policies of insurance carried by the Landlord nor does the Tenant have a right to receive any proceeds thereunder.
11.2    Tenant’s Insurance
.  The Tenant, at its expense, will maintain, throughout the Term and any period when it is in possession of all or any portion of the Premises, the insurance (“Insurance”) described in this paragraph 11.2.  The Tenant will cause each insurance policy to be (i) primary, non-contributing with, and not excess of, any other insurance available to the Landlord or the Mortgagee, (ii) contain a prohibition against cancellation or material change that reduces or restricts the Insurance (except on [redacted]prior written notice to the Landlord), (iii) in those instances in which the Landlord and the Mortgagee are insureds, contain a waiver in respect of the interests of the Landlord and the Mortgagee of any provision in any such insurance policies concerning any breach or violation of any warranties, representations or conditions in such policies, and (iv) be in a form and with insurers satisfactory to the Landlord and the Mortgagee.  The Insurance is as follows:
(a)    all risks (including flood, sewer and drain back-up, earthquake and sprinkler leakage) property insurance on insurable property including, without limitation, merchandise, furniture, fixtures and Leasehold Improvements, to the full replacement value thereof, on a stated amount coinsurance basis, with a deductible as may be approved by the Landlord;
(b)    broad comprehensive boiler and machinery insurance on all objects owned or operated by the Tenant or others on behalf of the Tenant in the Premises;
(c)    business interruption insurance providing coverage for 12 months loss of insurable gross earnings or profits including coverage not in excess of 2 weeks while access to the Premises is prohibited by order of governmental authority as a direct result of damage to neighbouring premises by a peril insured against;
(d)    commercial general liability insurance concerning the Premises and the business conducted by the Tenant and any other persons in or from the Premises with inclusive limits of [redacted]per occurrence. This insurance will include, without limitation, owners’ protective, products, completed operations, intentional acts to protect persons or property, personal injury, contingent employers’ liability, and occurrence property damage.  

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It will name the Landlord and the Mortgagee as additional insureds and will contain cross liability and severability of interests provisions;
(e)    Tenant’s legal liability insurance in the amount of [redacted], including loss of use;
(f)    all licensed vehicles operated by or on behalf of the Tenant will be insured by the Insurance Corporation of British Columbia, each with inclusive limits of not less than [redacted]; and
(g)    any other form of insurance and with whatever higher limits that the Landlord or the Mortgagee reasonably requires from time to time.
11.3    Waiver of Subrogation, Cross-Liability, Co-Insurance
.  Any policy of insurance under paragraphs 11.2(a), (b) and (c) will:
(a)    name the Landlord as a loss payee and contain a waiver of subrogation against the Landlord and its employees and agents or the Mortgagee, except in the case where the loss or damage is caused by the wilful misconduct or negligence of the Landlord, its employees, agents or any other party for whom the Landlord is responsible in law;
(b)    except concerning the Tenant’s stock-in-trade, and furniture, incorporate the standard mortgage clause of the Mortgagee;
(c)    cover all property owned by the Tenant or for which the Tenant is legally liable, located within the Building, including, without limitation, the Tenant’s Work and the Leasehold Improvements, in an amount not less than the full replacement cost thereof, including by-laws extension, which will be reviewed at least annually by the Tenant and will be subject to the approval of the Landlord.
11.4    Proceeds of Tenant’s Insurance
.  Intentionally deleted.
11.5    No Alienation of Proceeds
.  Intentionally deleted.
11.6    Landlord’s Right to Insure for Tenant
.  If the Tenant fails to take out or keep in force any such Insurance, the Landlord will on not less than 48 hours written notice to the Tenant have the right, but not the obligation, to do so and to pay the premium therefor and in such event the Tenant will repay to the Landlord the amount so paid by the Landlord as Additional Rent, payable on the first day of the next month following the payment by the Landlord, but if the Tenant cures that failure the Landlord will secure cancellation of the insurance taken out by the Landlord at the Tenant’s cost.
11.7    Limitation of Liability
.  The Landlord will not be liable to the Tenant in respect of any loss, injury or damage to the Tenant or any other person for any loss, injury or damage arising from or out of any occurrence in, upon, at or relating to the Building or the Land or any part of either of them or any loss or damage to property (including loss of use thereof) of the Tenant or any other person located in the Building or on the Land, howsoever caused and whether or not any injury, loss, or damage results from any fault, default, act or 

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omission of the Landlord, or its agents, servants, employees or any other person for whom the Landlord is in law responsible, except to the extent that such loss, injury or damage to the Tenant or any other person arises from or out of the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of any other party for whom the Landlord is responsible in law.  Without limiting the generality of the foregoing, the Landlord is not liable for death, injury, loss or damage of or to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, rain or snow or leaks from any part of the Building or from the pipes, appliances or plumbing works or from the roof, street or sub-surface or from any other place or by dampness or by any other cause of any kind, except to the extent that such death, injury, loss or damage of or to persons or property arises from or out of the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of any other party for whom the Landlord is responsible in law.  The intent of this paragraph is that the Tenant and any persons having business with the Tenant is to look solely to the Tenant’s insurers to satisfy any claims which may arise on account of injury, loss or damage to the Tenant or any other person or to the property of the Tenant or of any other person, irrespective of the cause, except to the extent the same arises from or out of the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of any other party for whom the Landlord is responsible in law.
11.8    Indemnification of Landlord
.  The Tenant will indemnify the Landlord and save it harmless from and against all claims, actions, damages, liabilities, costs and expenses in connection with loss of life, personal injury or damage to property arising from any occurrence on the Premises, or the occupancy or use of the Premises, or occasioned wholly or in part by an act or omission of the Tenant, its officers, employees, agents, customers, contractors or other invitees, licensees or concessionaires or by anyone permitted by the Tenant to be on the Premises, except to the extent the same arises from or out of the Landlord’s wilful misconduct or negligence or the wilful misconduct or negligence of any other party for whom the Landlord is responsible in law.
11.9    Tenant’s Contractor’s Insurance
.  The Tenant will require any contractor performing work on the Premises on behalf of the Tenant to carry and maintain, at no expense to the Landlord, comprehensive general liability insurance and other insurance in amounts and on terms reasonably determined by the Landlord and provide the Landlord with satisfactory proof of that insurance from time to time.
11.10    Acts Conflict With or Increase Insurance
.
(a)    The Tenant will not do, or omit to do, anything, or keep, use, sell or offer for sale on or from the Premises anything that may contravene any of the Landlord’s policies of insurance relating to any part of the Building or the Land, or which will prevent the Landlord from procuring policies of insurance with companies acceptable to the Landlord.  The Tenant will pay all increases in premiums for any insurance carried by the Landlord insuring any part of the Building or the Land, resulting from anything done or omitted to be done on the Premises, whether or not the Landlord has consented to them.  In determining whether increased premiums result from any of those causes, a schedule issued by the organization making the insurance rate on the Premises showing the various components of the rate will be conclusive evidence of the several items and charges which make up the insurance rates relating to the Building and the Premises.
(b)    If the use or occupancy of the Premises causes an increase of premium for any of the policies insuring the Premises or any part of the Building above the rate applicable for the least hazardous type of use or occupancy legally permitted in the Premises, the Tenant 

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will pay the amount of the increase.  The Tenant will also pay in that event any additional premium for rental income insurance carried by the Landlord for its protection against rent loss through an insured risk.  Bills for the increases and additional payments may be rendered by the Landlord to the Tenant when the Landlord elects, and will be payable by the Tenant when rendered.
(c)    The Tenant will not do or permit to be done, or omit to do or permit another person to omit to be done, any act which may render void or voidable, or which may conflict with, the requirements of any policy or policies of insurance relative to the Premises or the Land or the Building or any of them, including any regulations of fire insurance underwriters applicable to such policy or policies.
11.11    Cancellation of Insurance
.  If any insurance policy on the Building or any part of it is cancelled, or threatened by the insurer to be cancelled, or the coverage is reduced or threatened to be reduced by the insurer, because of the use or occupation of the Premises, and if the Tenant fails to remedy the condition giving rise to cancellation, threatened cancellation, reduction or threatened reduction of coverage within 5 days after notice from the Landlord, the Landlord may either:
(a)    re-enter the Premises and Part 16 will apply;
(b)    enter the Premises and remedy that condition, and the Tenant will pay to the Landlord the cost of doing so on demand as Additional Rent, and the Landlord will not be liable for damage or injury caused to property of the Tenant or others located on the Premises as a result of the entry or remedy; or
(c)    terminate this Lease.
11.12    Tenant’s Property at its Risk
.  All property of the Tenant kept or stored in the Premises is at the risk of the Tenant.
11.13    Survival
.  The provisions of paragraph 11.8 will survive the expiration or sooner termination of the Term.
Part 12

ASSIGNMENT AND SUBLETTING
12.1    Landlord’s Consent
.  The Tenant will not assign, mortgage, charge or encumber this Lease, in whole or in part, nor sublease all or any part of the Premises or permit them to be used or occupied by any other person (collectively “Transfer”), without the prior written consent of the Landlord, which consent may not be unreasonably withheld or delayed.  Any Transfer made in violation of this Part 12 will be void.
12.2    Standards for Consent

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.  Without limiting the other instances in which it may be reasonable for the Landlord to withhold its consent to a Transfer, it will be fair and reasonable for the Landlord to withhold its consent or impose conditions to its consent in any of the following instances:
(a)    if the Landlord determines, acting reasonably, that the financial condition of the proposed assignee, subtenant or occupant (collectively “Transferee”) or any indemnifier of a Transferee is or may become insufficient to support all of the financial and other obligations of the Tenant under this Lease;
(b)    if the use to which the Premises will be put by the proposed Transferee is inconsistent with the terms of this Lease or conflicts with any exclusive rights or covenants not to compete in favour of any other tenant or proposed tenant of the Building, or otherwise will materially or adversely affect any legitimate interest of the Landlord;
(c)    if, at the time of the proposed Transfer,
(i)    the Tenant is in default (or would be in default with the giving of notice by the Landlord and the expiration of any applicable cure period) under this Lease, and
(ii)    the Landlord has not received assurances acceptable to the Landlord, in its sole discretion, that any past due amounts owing from the Tenant to the Landlord will be paid and any other defaults on the part of the Tenant will be cured prior to the effectiveness of the proposed Transfer;
(d)    intentionally deleted;
(e)    if the Transfer is not approved by any Mortgagee having the right to approve such Transfer; or
(f)    if the Tenant has not received a bona fide, written offer to take an assignment or a sublease or has not supplied a copy of such offer to the Landlord at the time of requesting consent to a Transfer.
12.3    Terms and Conditions of Transfer
.  The following terms and conditions apply in respect of any Transfer:
(a)    the Landlord’s consent to a Transfer, if granted, will not constitute a waiver of the requirement for the Tenant to obtain the Landlord’s prior written consent to any subsequent Transfer;
(b)    intentionally deleted;
(c)    intentionally deleted;
(d)    in spite of any Transfer, the Tenant will remain fully liable for and will not be released from the performance of each and every one of the obligations of the Tenant under this Lease for the balance of the Term and any renewal term, whether exercised by the Tenant or the Transferee. Without limitation, the foregoing applies whether or not the Transferee is in default of this Lease and whether or not this Lease is assigned by a trustee in bankruptcy of the Transferee. The Tenant is not relieved of liability for any breach of this Lease, whether occurring before or after the Transfer; and

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(e)    any Transfer will provide that the Transferee has the rights and is subject to the obligations, of the Tenant under this Lease, except as it may be amended by the terms of the consent.
12.4    Documentation for Transfer
.  The Tenant will promptly execute and the Tenant will cause the Transferee to promptly execute such agreements and documents as are necessary, in the opinion of the Landlord, to complete the Transfer.  No assignment will be made other than to a Transferee which undertakes to perform and observe the obligations of the Tenant under this Lease by entering into an assumption agreement directly with the Landlord.  The Tenant will pay to the Landlord its reasonable expenses arising out of the request for consent to a Transfer and for the change in possession of the Premises, including, but not limited to, legal and other professional fees and costs incurred in connection with the negotiation, review, processing and completion of the Transfer.
12.5    Excess Consideration on Transfer
.  If the Tenant completes a Transfer which requires the Transferee to pay rent or other consideration in respect of the Transfer, in any other form, to the Tenant in excess of the Rent payable by the Tenant under this Lease, the Tenant will, upon any such excess payments being received, pay to the Landlord [redacted] of those excess payments. In calculating the amount of excess payments by the Transferee to the Tenant, an appropriate adjustment will be made to account for any financial inducements and expenses paid by the Tenant to or for the benefit of the Transferee, at any time, with the intent that the Tenant’s true costs of installing the Transferee are deducted before assessing the Landlord’s 50% entitlement to any excess payments.  The Tenant will immediately upon demand make available its books and records so as to enable the Landlord to verify the receipt or the amount of such consideration.
12.6    Landlord’s Right to Terminate
.  Intentionally deleted.
12.7    Assignment by Operation of Law
.  The prohibition against Transfer without the consent required by this Part 12 will be construed to include a prohibition against any Transfer by operation of law.
12.8    Acceptance of Rent
.  If this Lease, or any part of it, is assigned, or if all or part of the Premises is sublet or occupied by any party other than the Tenant, in any case without the consent of the Landlord, the Landlord may collect Rent from the assignee, subtenant or occupant, and apply the net amount collected to the Rent reserved in this Lease, but the assignment, sublease, occupancy or collection will not be considered a waiver of this covenant, or the acceptance of the assignee, subtenant or occupant as Tenant. 
12.9    No Advertising

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.  The Tenant will not advertise the whole or any part of the Premises for lease nor permit any agent or broker to do so, unless the prior written approval of the Landlord, not to be unreasonably withheld or delayed, has been received.
12.10    Corporate Ownership
.
(a)    If after the date of execution of this Lease shares either of the Tenant or of an Affiliate of the Tenant which Controls the Tenant are transferred or disposed of by operation of law or otherwise, or issued or redeemed, so as to result in a change in the Control of the Tenant from the person or persons holding Control on the date of execution of this Lease or if other steps are taken to accomplish a change of Control, the Tenant will promptly notify the Landlord in writing of the change, which will be considered to be an assignment of this Lease to which this Part 12 applies; and whether or not the Tenant notifies the Landlord, the Landlord may terminate this Lease within 60 days after the Landlord becomes aware of the change unless the Landlord previously had consented to the change.  Any subsequent change of Control will similarly be subject to the prior written consent of the Landlord.  The Tenant will make available to the Landlord or its lawful representative all corporate books and records of the Tenant and of any Affiliate of the Tenant for inspection at all reasonable times, to ascertain to the extent possible whether there has been a change in Control.
(b)    Paragraph 12.10(a) will not apply to the Tenant if:
(i)    the Tenant is a public corporation whose shares are listed for sale on a recognized North American stock exchange, or
(ii)    the Tenant is a private corporation which is Controlled by a public corporation as defined in paragraph (i).
12.11    Time to Complete Transfer
.  If the Landlord consents to a Transfer, the Tenant will have a period of 60 days thereafter to complete the Transfer, and failing which, the Landlord’s consent, at the Landlord’s option, will be null and void.
12.12    Remedy of the Tenant
.  Intentionally deleted.
12.13    Assignment by Landlord
.  If the Landlord sells or otherwise transfers an interest in the Building, the Land or in this Lease, in whole or in part, to the extent that the buyer or other party is responsible for compliance with the obligations of the Landlord under this Lease, the Landlord without further written agreement will be released from all of its obligations in this Lease.
12.14    Permitted Transferee
.  Notwithstanding any other provision of this Lease to the contrary, the Tenant may assign this Lease or sublet the Premises without the consent of, but with prior written notice to, the Landlord, at any time and from time to time during the Term, to:

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(a)    a parent, subsidiary, affiliate or related corporation(s) of the Tenant (within the meaning of the Canada Business Corporations Act) or to a partnership composed of parent, subsidiary or affiliate corporations of the Tenant;
(b)    a corporation formed as a result of a merger or amalgamation (within the meaning of the Canada Business Corporations Act) of the Tenant with another corporation or corporations;
(c)    a public corporation or a subsidiary body corporate (within the meaning of the Canada Business Corporations Act) of a public corporation whose shares are listed on a recognized North American stock exchange; or 
(d)    the purchaser of a majority of the Tenant's business assets.
It being understood, however, that paragraphs 12.3, 12.4 and 12.5 shall apply to any assignment or subletting contemplated in this paragraph 12.14.
Part 13

WASTE, GOVERNMENTAL AND ENVIRONMENTAL REGULATIONS
13.1    Waste or Nuisance
.  The Tenant will not commit or permit to be committed waste upon the Premises, or nuisance or other thing that may disturb or interfere with the use or enjoyment by any other tenant in the Building of its premises and the Common Areas and Facilities or that may disturb any person within 500 feet of a boundary of the Land, whether or not the nuisance arises out of the use of the Premises by the Tenant for a purpose permitted by this Lease.
13.2    Governmental, Insurance Underwriters’ and Environmental Regulations
.
(a)    The Tenant, at the Tenant’s cost, will comply with and cause all those under its control to comply with the applicable requirements of all municipal, provincial, federal and other governmental authorities now in force or which may hereafter be in force with respect to the Premises, including without limitation, all laws and regulations pertaining to the use, possession, control, discharge, removal, disposal and abatement of Hazardous Substances and all other laws and regulations pertaining to the Tenant’s occupancy or use of the Premises and will observe in any occupancy and use of the Premises all municipal by-laws and provincial and federal statutes and regulations now in force or which may hereafter be in force, and will comply with all regulations or orders made by fire insurance underwriters or by authorities having jurisdiction.  The provisions of this paragraph 13.2(a) will survive the expiration or earlier termination of this Lease.
(b)    The Landlord may enter the Premises at all reasonable times on not less than 2 days prior written notice to the Tenant, with as little interference to the conduct of the Tenant’s business as is reasonably possible, to enable the Landlord to inspect the Premises and to comply with or cause the Tenant to comply with any municipal by-law or provincial statute now or in the future applicable to the Premises whether or not the application of the by-law or statute to the Premises results from an act or omission of the Landlord or any other person.

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(c)    If the Tenant has knowledge, or has reasonable cause to believe that any Hazardous Substance has come to be located on, under or about the Premises, the Tenant will, upon discovery of the presence or suspected presence of Hazardous Substance, give written notice of that condition to the Landlord.
(d)    If the Landlord, acting reasonably, believes that the Premises have become contaminated with any Hazardous Substance, the Landlord, in addition to its other rights under this Lease, may enter upon the Premises and obtain samples from the Premises and under the Premises, for the purpose of analysing the same to determine whether and to what extent the Premises have become so contaminated.  To the extent that contamination is found and that such contamination was caused by the Tenant, the Tenant will reimburse the Landlord for the costs of such inspection, sampling and analysis.
(e)    Without limiting the above, the Tenant will indemnify and save harmless the Landlord and its directors, officers and agents from and against any and all claims, losses, liabilities, damages, costs and expenses, including without limitation, legal fees and costs on a solicitor and own client basis, arising out of or in any way connected with the use, manufacture, transportation, storage, emission or disposal of Hazardous Substances by the Tenant, its agents or contractors, or any others under the control of the Tenant, on, under or about the Premises including, without limitation, the cost of any required or necessary repair, remediation or detoxification and the preparation of any closure or other required plans in connection herewith.  The indemnity obligations of the Tenant under this paragraph will survive any termination of this Lease.
Part 14

DELIVERY OF AND ACCEPTANCE OF PREMISES
14.1    Delivery of and Acceptance of Premises
.  The Landlord shall carry out and complete the Landlord’s Work in compliance with the terms of this Lease at the Landlord’s sole cost and expense and shall deliver possession of the Premises to the Tenant with all Delivery Conditions satisfied on or before April 1, 2022 (the “Required Delivery Date”).  The Landlord shall deliver the Delivery Notice to the Tenant not less than 3 months prior to the anticipated Possession Date.  If the Landlord fails to deliver the possession of the Premises to the Tenant with all Delivery Conditions satisfied by the Required Delivery Date and such failure is not the result of any Unavoidable Delay or Tenant Delays then in such case Basic Rent will abate, beginning on the day immediately following the last day of the Free Basic Rent Period (as defined in section 1 of Schedule 4), at a rate of 2 days abatement for each 1 day that the Landlord fails to deliver possession of the Premises to the Tenant with all Delivery Conditions satisfied beyond the Required Delivery Date.  In the event that the Possession Date has not occurred by August 1, 2022, and such delay is not the result of any Unavoidable Delay or Tenant Delays then the Tenant may, at its option, terminate this Lease at no cost by providing written notice of termination to the Landlord and upon delivery of such notice this Lease shall become null and void.  
The Tenant will notify the Landlord of any defects or deficiencies in the Premises, including environmental hazards (the “Deficiency List”), within 30 days after the Possession Date, and failing the giving such Deficiency List the Tenant will be considered for all purposes to have accepted the Premises in their then existing condition.  The Landlord will not have any further obligation to the Tenant for defects or faults other than:
(a)    latent defects in the Premises which cannot be discovered on a reasonable examination, and

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(b)    faults in structural elements relating to the Premises not caused by the Tenant’s act or negligence.
The Landlord shall, within 30 days after receipt of the Deficiency List, complete or correct all defects and deficiencies identified on the Deficiency List to the satisfaction of the Tenant, acting reasonably.
If a dispute occurs as to whether or not a defect or deficiency exists, the decision of an independent qualified architect or engineer selected by both the Landlord and the Tenant shall, except for manifest error and except as to determinations of interpretation of this Lease, be final and binding on the parties.  The fees of such architect or engineer shall be borne equally by the Landlord and the Tenant.
14.2    No Representation
.  The Tenant acknowledges that there is no promise, representation, warranty, or undertaking by, or binding upon, the Landlord concerning the condition or layout of, or the alterations, remodelling, decoration or installation of improvements, equipment or fixtures in the Premises or of the Building, except as expressly contained in this Lease and the taking of occupancy, subject always to the provisions of paragraph 14.1, is conclusive evidence as against the Tenant that any representations by the Landlord have been satisfied.
Part 15

LEASEHOLD IMPROVEMENTS AND TRADE FIXTURES
15.1    Installation and Changes by Tenant
.
(a)    The Tenant will have possession of the Premises throughout the Fixturing Period for the purpose of completing the Tenant’s Work which shall be completed in compliance with the provisions of Part B of Schedule 5.  During the Fixturing Period the Tenant shall not be liable for any payment of Rent to the Landlord but the Tenant shall comply with all other terms and conditions of this Lease during the Fixturing Period and shall pay the cost of any utilities consumed in the Premises during the Fixturing Period.  
(b)    All Leasehold Improvements including, without limitation, trade fixtures installed by, or on behalf of, the Tenant will be of first class quality.  The Tenant will not make or cause to be made any Leasehold Improvement, change, decoration, addition or improvement or cut or drill into, nail or otherwise attach, secure or install any trade fixture, exterior sign, floor covering, interior or exterior lighting, or mechanical or electrical system or fixture, or plumbing fixture, shade or awning to any part of the Premises or to the exterior of the Premises or hang from or affix anything to the ceiling, without first obtaining the Landlord’s written approval.  The Tenant will not create or cause to be created any mortgage, conditional sale agreement or other encumbrance in respect of the Leasehold Improvements (including trade fixtures), furniture or furnishings, or inventory of the Tenant except with the prior written consent of the Landlord.
(c)    The Tenant will present to the Landlord plans and specifications for the Tenant’s Work and all other work from time to time at the time approval is sought and the work will be done by contractors or other workers or tradesmen approved by the Landlord and in good and workmanlike manner with first class materials.
(d)    The Tenant will not make or permit to be made any changes, alterations, substitutions, replacements or improvements affecting the structure of the Premises or the exterior 

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appearance of the Premises or the operation of the mechanical systems including, without limitation, the heating, ventilation, air conditioning, humidity control, plumbing, electrical, or mechanical equipment in or connected with the Building and the Premises without obtaining the prior written consent of the Landlord.
(e)    The Tenant will pay, on demand, as Additional Rent, all the Landlord’s costs and expenses in connection with any installations and changes by the Tenant, including, without limitation, the costs of supervising and inspecting the work and the cost of examining the Tenant’s drawings and specifications, together with a sum of 15% of such costs, representing the Landlord’s overhead.
15.2    Removal of Installations and Restoration by Tenant
.
(a)    All Leasehold Improvements when installed become the property of the Landlord, without compensation to the Tenant, but the Landlord will have no responsibility for the repair, replacement, operation, maintenance or insurance of the Leasehold Improvements, which will remain the responsibility of the Tenant.
(b)    No Leasehold Improvements (including, without limitation, trade fixtures) will be removed from the Premises before the end of the Term without the prior consent in writing from the Landlord.  Upon termination of this Lease the Leasehold Improvements will remain the property of the Landlord except for any non-standard office improvements that the Landlord requires be removed by the Tenant in accordance with paragraph 15.2(c).
(c)    At the end of the Term the Tenant will not be required to remove and will not be responsible for any costs associated with the removal of the Leasehold Improvements or the Tenant’s Work, nor will the Tenant be required to restore and return or be responsible for any costs associated with the restoration and return of the Premises back to base building standard, provided however that the Tenant shall be required to remove, at its sole cost and expense, any non-standard office improvements that the Landlord advises the Tenant of in connection with its approval of the final space plan for the Premises. The Tenant shall return the Premises to the Landlord in a clean and tidy condition reasonable wear and tear excepted. 
(d)    If the Tenant does not remove any Leasehold Improvements that it is required to remove in accordance with paragraph 15.2(c), or its furnishings, furniture or equipment as required by the Landlord, the Landlord may, without liability on its part, and not as a bailee, without notice to the Tenant, enter the Premises and remove such items at the Tenant’s expense, plus an administration charge of 15% of such amount, which will be paid by the Tenant to the Landlord as Additional Rent, on demand, and such items may, without notice to the Tenant or to any other person and without obligation to account for them, be sold, destroyed, disposed of or used by the Landlord as it determines.
(e)    If the Tenant removes, or commences, attempts or threatens to remove any Leasehold Improvements, without the Landlord’s consent, the Tenant hereby consents (without limiting any other rights of the Landlord) to the Landlord obtaining an injunction in a court of competent jurisdiction to restrain the Tenant from removing any of the items referred to from the Premises, and the Tenant will pay to the Landlord all fees (including without limitation, all professional fees and all legal fees on a solicitor and own client basis) and expenses incurred by or on behalf of the Landlord concerning obtaining such an injunction.

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(f)    The Tenant’s obligations under this paragraph 15.2 will survive the expiration or earlier termination of this Lease.
15.3    Title on Abandonment
.  Intentionally deleted.
15.4    Not to Overload Floors
.  The Tenant will not bring on the Premises anything that by reason of its weight, size or use, in the reasonable opinion of the Architect, might damage the Premises and will not overload the floors of the Premises.  If overloading occurs the Tenant will immediately repair any damage or pay to the Landlord the cost of repairing the damage and will also pay for any consequential damages arising from the overloading.
15.5    Tenant to Discharge All Liens
.  The Tenant will promptly pay all its contractors, subcontractors and suppliers and do all things necessary to ensure that no lien is claimed against the Premises or the Land or any other part of the Building and should a claim of lien be filed by the Tenant’s contractors, subcontracts or suppliers, the Tenant will cause it to be discharged or vacated at the Tenant’s expense within 15 days after it is brought to the attention of the Tenant or provide adequate security for it to the extent approved by the Landlord, acting reasonably. The Landlord may, but it is not obligated to discharge the lien by paying the amount claimed to be due into court, or by any other means available to the Landlord, and the amount paid, plus all costs, including without limitation, professional and solicitors fees (on a solicitor and own client basis) incurred by or on behalf of the Landlord concerning the lien, plus any damages suffered by the Landlord as a result of the filing of the lien, will be immediately paid, on demand, by the Tenant as Additional Rent.  The Tenant acknowledges that the Landlord may file a notice of interest in the applicable land title office under the provisions of the Builders Lien Act or any legislation in amendment or substitution thereof evidencing that the Landlord is not responsible for any of the Tenant’s improvements.  The Tenant agrees to cooperate with the Landlord in respect of the same and, if necessary, to execute and deliver all other instruments and take any actions necessary to give effect to the same.
Part 16

DEFAULT OF TENANT
16.1    Tenant’s Default
.  If:
(a)    the Tenant fails to pay any Rent when due and has not remedied the same within [redacted] after the Landlord has given written notice to the Tenant requiring such payment;
(b)    the Tenant fails to observe or perform any of its other material obligations under this Lease and the Tenant has not, within [redacted]after notice from the Landlord specifying the default, cured the default or, if the cure reasonably requires a longer period, if the Tenant has not commenced to cure the default within the [redacted] period and thereafter does not diligently pursue the cure of such default;
(c)    the Tenant falsifies a report required to be furnished to the Landlord under this Lease; or
(d)    if re-entry is permitted under other terms of this Lease;

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the Landlord, in addition to any other right or remedy, may do any or all of the following:
(e)    re-enter and remove all persons and property from the Premises and the property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of the Tenant, all without service of notice or resort to legal process and without the Landlord being guilty of trespass or becoming liable for loss or damage occasioned by any of those actions; and
(f)    terminate this Lease and all of the Tenant’s rights under it.
16.2    Bankruptcy or Insolvency of Tenancy
.
(a)    If:
(i)    any material or significant goods and chattels of the Tenant on the Premises at any time during the Term are seized or taken in execution or attachment by a creditor of the Tenant or the Tenant receives a notice from one or more of its secured creditors that the creditor(s) intend to realize on security located at or upon the Premises, which, in each case, remains unsatisfied for a period of [redacted]after the Tenant is aware of such seizure or received such notice; 
(ii)    the Tenant makes an assignment for the benefit of creditors or any arrangement or compromise, or a bulk sale from the Premises other than a bulk sale to an assignee or sublessee under an assignment or sublease which under Part 12 was consented to or which does not require consent,
(iii)    a receiver-manager is appointed to control the conduct of the business of the Tenant on or from the Premises and such appointment is not dismissed within [redacted]after the date the Tenant receives notice of such appointment,
(iv)    the Tenant becomes bankrupt or insolvent or takes the benefit of an Act now or hereafter in force for bankrupt or insolvent debtors or files any proposal or a notice of intention to file a proposal, provided that if such event is involuntary, the Tenant has not been restored to its prior status within [redacted]after the date the Tenant receives notice of such involuntary bankruptcy or insolvency event,
(v)    proceedings are instituted by the Tenant or any other person for an order for the winding-up of the Tenant, or other termination of the corporate existence of the Tenant, and such proceedings are not dismissed within [redacted]after the date the Tenant receives notice of such proceedings,
(vi)    without the written consent of the Landlord, the Premises become and remain vacant for a period of [redacted] (except as necessitated for the completion of repairs, or due to force majeure, damage, destruction or condemnation) or are used by any persons other than those entitled to use them under the terms of this Lease,
(vii)    without the written consent of the Landlord, the Tenant abandons or attempts to abandon the Premises, or

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(viii)    this Lease or any of the Tenant’s assets on the Premises are taken under a writ of execution, charge, debenture or other security instrument, which remains unsatisfied for a period of [redacted]after the Tenant is aware of such taking;
then the Landlord may re-enter and take possession of the Premises as though the Tenant or any other occupant of the Premises was holding over after the expiration of the Term and this Lease may, at its option be immediately terminated by notice left upon the Premises.
(b)    The Tenant will immediately notify the Landlord if it receives from any of its secured creditors a notice under the Bankruptcy and Insolvency Act, or any legislation in amendment or substitution therefor, advising the Tenant that the secured creditor intends to realize upon its security located on the Premises.
(c)    Unless the Landlord expressly consents thereto, which the Landlord is not obliged to do, the Tenant will not exercise any right to repudiate this Lease under the terms of a proposal filed under the Bankruptcy and Insolvency Act, or any legislation in amendment or substitution therefor.
16.3    Landlord may Perform Tenant’s Obligations
.  If the Tenant fails to perform an obligation of the Tenant under this Lease the Landlord may give written notice to the Tenant of such failure to perform and if the Tenant has not, within [redacted]after receiving such notice, performed the obligation (or, if the performance of the obligation reasonably requires a longer period to complete, if the Tenant has not commenced to perform the obligation within the [redacted]period and thereafter does not diligently pursue such performance to completion), then the Landlord may perform the obligation and for that purpose may enter on the Premises without notice and do anything in respect of the Premises that the Landlord considers necessary to cure the default.  The Tenant will pay as Additional Rent all costs and expenses incurred by or on behalf of the Landlord plus [redacted] for overhead upon presentation of a bill.  The Landlord will not be liable to the Tenant for loss or damage resulting from such action by the Landlord, except for loss or damage resulting from the wilful misconduct or negligence of the Landlord or another person for whose wilful misconduct or negligence the Landlord is responsible in law.
16.4    Right to Relet
.
(a)    If the Landlord re-enters, as provided in this Lease, it may at its option, without terminating the Tenant’s rights under this Lease, make alterations and repairs considered by the Landlord necessary to facilitate a reletting, and relet the Premises or any part thereof as agent of the Tenant for such period of time and at such rent and upon such other terms and conditions as the Landlord in its discretion considers advisable.
(b)    Upon each reletting all rent and other monies received by the Landlord from the reletting will be applied, first to the payment of indebtedness other than Rent due hereunder from the Tenant to the Landlord, secondly to the payment of costs and expenses of the reletting including brokerage fees and legal fees and costs of the alterations and repairs, and third to the payment of Rent due and unpaid under this Lease.  The residue, if any, will be held by the Landlord and applied in payment of future rent as it becomes due and payable.
(c)    If the rent received from the reletting during a month is less than the Rent to be paid during that month by the Tenant, the Tenant will pay the deficiency to the Landlord.  The deficiency will be calculated and paid monthly.

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16.5    Reentry Without Termination
.  No re-entry by the Landlord will be construed as an election on its part to terminate this Lease unless a written notice of that intention is given to the Tenant.  Despite a reletting without termination, the Landlord may elect at any time to terminate this Lease for a previous breach.
16.6    Damages
.  If the Landlord terminates this Lease for any breach, then, in addition to other remedies, it may recover from the Tenant all damages it incurs by reason of the breach including, without limitation, the cost of recovering the Premises, professional and other legal fees (on a solicitor and own client basis), the unamortized portion of any allowance, concession or inducement paid by the Landlord under the terms of the tenancy (on the basis of an assumed rate of depreciation on a straight line basis to zero over the Term) and the worth at the time of termination of the excess, if any, of (i) the amount of rent and charges equivalent to Rent reserved in this Lease for the remainder of the Term over (ii) the then reasonable rental value of the Premises for the remainder of the Term, calculated on a present value basis, all of which amounts will be immediately due and payable by the Tenant to the Landlord.  In determining the Rent which would be payable by the Tenant after default, the Basic Rent component of the annual Rent for each year of the unexpired Term will be considered to be the average Basic Rent paid or payable by the Tenant from the beginning of the Term to the time of default, or during the preceding 3 full calendar years, whichever period is shorter.
16.7    Acceleration of Rent
.  If any of the events referred to in paragraph 16.1 or paragraph 16.2 occur then, in addition to all other rights available to the Landlord, including the rights referred to in this paragraph 16.7, the full amount of the current month’s Basic Rent and Additional Rent, and all other payments required to be made monthly by the Tenant, and the next ensuing 3 months’ Basic Rent and Additional Rent will immediately become due and payable as accelerated rent, and the Landlord may recover the accelerated rent in the same manner as Rent in arrears, including immediately distraining for it together with all other arrears then unpaid.
16.8    Expenses for Remedying Breach
.  If the Landlord brings any proceeding against the Tenant arising from an alleged breach of an obligation of the Tenant in this Lease and it is established that the Tenant is in breach of that obligation, the Tenant will pay to the Landlord all costs and expenses incurred by the Landlord in those proceedings including, without limitation, legal fees, on a solicitor and own client basis.
16.9    Interest on Overdue Monies
.  All overdue monies payable to the Landlord by the Tenant on any account whatever will bear interest at the Prime Rate plus [redacted] per annum from the due date until paid in full.
16.10    No Exemption from Distress
.  None of the property of the Tenant on the Premises (except data, computer hard drives and paper files) is exempt from levy by distress for Rent in arrears, and a claim being made for exemption by the Tenant or on distress being made by the Landlord, this paragraph 16.10 may be pleaded as an estoppel against the Tenant in any proceedings brought to test the right to levy upon property claimed to be exempt.
16.11    New Lease

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.  If this Lease is either terminated or repudiated in the process of insolvency or bankruptcy proceedings, with or without the consent of the Landlord, and whether or not a Transfer of Lease has occurred, the Landlord may, within 3 months after that event, require the Tenant, or its Trustee in Bankruptcy, receiver or other successor, to enter into a lease with the Landlord for the Premises for the remainder of the Term on the same terms and conditions as contained in this Lease.
Part 17

REMEDIES OF LANDLORD AND WAIVER
17.1    Remedies Cumulative
.  No exercise of a specific right or remedy by the Landlord or by the Tenant precludes it from, or prejudices it in, exercising another right or pursuing another remedy or maintaining an action to which it may otherwise be entitled either at law or in equity.
17.2    No Waiver
.  The waiver by the Landlord or the Tenant of a breach of an obligation in this Lease will not be considered to be a waiver of a subsequent breach of that obligation or another obligation.  The subsequent acceptance of Rent by the Landlord will not be a waiver of a preceding breach by the Tenant of an obligation in this Lease, regardless of the Landlord’s knowledge of the preceding breach at the time of acceptance of the Rent.  No obligation in this Lease will be considered to have been waived by the Landlord or by the Tenant unless the waiver is in writing signed by the Landlord or by the Tenant, as the case may be.
17.3    Injunctive Relief
.  If the Tenant breaches or threatens to breach any of the terms of this Lease, the Landlord will have the right to injunctive relief, as if no other remedies were provided for in this Lease.
Part 18

ACCESS BY LANDLORD
18.1    Right of Entry
.
(a)    The Landlord and its agents may enter the Premises at a day and time that is mutually agreeable to the Landlord and the Tenant, each acting reasonably, and in any event on not less than 2 days prior written notice to Tenant, with as little interference to the conduct of the Tenant’s business as is reasonably possible, to examine the Premises and to show the Premises to a prospective buyer, lessee or mortgagee.  
(b)    The Landlord may make alterations, additions and adjustments to and changes of location of the pipes, conduits, wiring, ducts and other installations of any kind in the Premises where necessary to serve another tenant of the Building but the Landlord will take commercially reasonable steps to minimize any disruption of the Tenant’s business (including, without limitation, performing such work outside of Normal Business Hours where reasonably possible).  The Landlord may take all material required on to the Premises without constituting an eviction of the Tenant in whole or in part. The Rent reserved will not abate while the alterations, additions or changes of location are being made by reason of loss or interruption of the business of the Tenant, or otherwise, and 

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the Landlord will not be liable for damage to property of the Tenant or of others located on the Premises as a result of any entry except for damage caused by the negligence of the Landlord or another person for whose negligence the Landlord is responsible in law.
(c)    During the 6 months prior to the expiration of the Term the Landlord may place upon the Premises a notice “For Rent” which the Tenant will permit to remain without interference.
(d)    If after the required notice has been provided to the Tenant (except in the case of an emergency when no prior notice is required) and on the mutually agreed day and time, the Tenant is not present to open and permit entry into the Premises when the Landlord requires entry, the Landlord or its agents may enter by a master key without rendering the Landlord or its agents liable for any damage or trespass and without affecting this Lease.  Nothing in this paragraph 18.1 imposes on the Landlord an obligation, responsibility or liability for the care, maintenance or repair of the Premises or any part thereof except as specifically provided in this Lease.  The Landlord may at a day and time that is mutually agreeable to the Landlord and the Tenant, each acting reasonably, and in any event on not less than 2 days prior written notice to Tenant, with as little interference to the conduct of the Tenant’s business as is reasonably possible, to enter on the Premises in order to install, construct, operate, maintain, repair and replace any utilities and services, but the Landlord in doing so will exercise such right in a manner which is commercially reasonable to minimize any disruption of the Tenant’s business (including, without limitation, performing such work outside of Normal Business Hours where reasonably possible).  
18.2    Roof and Walls
.  The Landlord will have the exclusive right to use all or any part of the roof of the Building for any purpose; to erect additional stories or other structures over all of any part of the Building; to erect in connection with the construction thereof temporary scaffolds and other aids to construction on the exterior of the Building, provided that access to the Premises will not be unreasonably denied; and to install, maintain, use, repair and replace within the Premises pipes, ducts, conduits, wires and all other mechanical equipment serving other parts of the Building, the same to be in locations within the Premises as will not unreasonably deny the Tenant’s use of them.  The Landlord may make any use it desires of the exterior portions of the walls of the Premises, provided that such use will not encroach on the interior of the Premises or impede access to or from the Premises.  The Tenant agrees to give the Landlord access to the Premises for those purposes at a day and time that is mutually agreeable to the Landlord and the Tenant, each acting reasonably, and in any event on not less than 3 days prior written notice to Tenant and with as little interference to the conduct of the Tenant’s business as is reasonably possible.  
18.3    Excavation
.  Intentionally deleted.
Part 19

RULES AND REGULATIONS
19.1    Landlord May Make
.  The Landlord from time to time may establish, modify and enforce reasonable rules and regulations regarding the use and occupancy of the Common Areas and Facilities of the Building and of the premises set aside by the Landlord for leasing to tenants of the Building.  All rules and regulations and modifications whether made under this paragraph 19.1 or paragraph 7.2 become a part of this Lease and the Tenant will comply with the rules and regulations and modifications, provided that such rules and 

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regulations and policies shall not (i) discriminate against the Tenant, (ii) materially or unreasonably interfere with or restrict the Tenant’s conduct of its business or the Tenant’s use or enjoyment of the Premises, or (iii) derogate from any of the Tenant’s rights under this Lease.  Notice of the rules and regulations and modifications will be given to the Tenant by the Landlord.  A set of the most recent rules and regulations are annexed to this Lease as Rules and Regulations Schedule 3.
Part 20

LANDLORD’S COVENANTS AND OBLIGATIONS
20.1    Taxes
.  The Landlord will pay all real property taxes (including local improvement rates) that may be assessed by a lawful authority against the Building and the Land.
20.2    Quiet Enjoyment
.  Subject to the observance and performance by the Tenant of all of its obligations under this Lease, the Tenant may use and possess the Premises, in accordance with the provisions of this Lease, for the Term, without interference by the Landlord, or any other party claiming by, through or under the Landlord, except as otherwise provided in this Lease.
20.3    Interior Climate Control
.  The Landlord will provide to the Premises during Normal Business Hours, by means of a system for heating and cooling, filtering and circulating air, processed air in such quantities, at such temperatures as will maintain in the Premises conditions of reasonable temperature and comfort in accordance with good standards of interior climate control generally pertaining at the date of this Lease applicable to normal occupancy of premises for office purposes, but the Landlord will have no responsibility for any inadequacy of performance of the system if the Premises depart from the design criteria for such system.
20.4    Janitor Service
.  The Landlord will cause when reasonably necessary from time to time the floors and windows of the Premises to be swept and cleaned and the desks, tables and other furniture of the Tenant to be dusted all in keeping with the standard of similar buildings in the City of Victoria having regard to the age and location of the Building.  Such work will be done at the Landlord’s direction without interference by the Tenant, its servants or employees.
20.5    Maintain Common Areas and Facilities
.  The Landlord will cause the elevators, common entrances, lobbies, stairways, corridors, washrooms and other parts of the Building including Common Areas and Facilities from time to time provided for common use and enjoyment to be maintained, cleaned or otherwise operated substantially in keeping with the standard of similar buildings in the City of Victoria having regard to the age and location of the Building.
Part 21

OVERHOLDING
21.1    No Tacit Renewal

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.  If the Tenant remains in possession of the Premises after the end of the Term and without the execution and delivery of a new lease or written renewal or extension of this Lease, there is no tacit or other renewal of this Lease, and the Tenant will be considered to be occupying the Premises as a Tenant from month to month at a monthly rental payable in advance on the first day of each month equal to the sum of [redacted] of the monthly instalment of Basic Rent payable for the last month of the Term, and otherwise upon the terms and conditions set out in this Lease, so far as applicable.
Part 22

OPTIONS TO EXTEND
22.1    Options to Extend
.  
(a)    Provided the Tenant is not in default under this Lease beyond applicable cure periods at the time the Tenant delivers the applicable Extension Notice (as defined below), the Tenant shall have [redacted] separate consecutive options to extend the Term, in each case for a further period of [redacted] (each, an “Extension Term”), each option exercisable by written notice to the Landlord (the “Extension Notice”) given no later than [redacted]and no earlier than [redacted]prior to the expiry of the Initial Term or the then current Extension Term, as the case may be (the “Extension Notice Expiration Date”).  Each such Extension Term shall be on the same terms and conditions as the Initial Term, save and except that Basic Rent shall be determined in accordance with paragraph 22.1(b) or 22.1(c), as applicable, the Tenant shall have no further right of extension beyond the second Extension Term, the Landlord will have no obligation to pay or provide to the Tenant any allowance, concession or inducement of any nature, or provide any free rent or discounted rent of any nature, or provide any fixturing period, or do or perform any work in the Premises.  
(b)    The Basic Rent for each Extension Term shall be agreed upon by the Landlord and the Tenant prior to the commencement of the applicable Extension Term and shall be the then current fair market basic rent for the Premises, being the basic rent which would be paid for the Premises in its current condition as of the commencement of the subject Extension Term, including all Leasehold Improvements installed or placed in the Premises.  In determining the then current fair market basic rent for the Premises, all relevant circumstances must be considered and applied, including without limitation the basic rent payable for comparable premises in a building of similar size, age and location as the Building, provided that under no circumstances will Basic Rent for any Extension Term be less than the Basic Rent applicable during the last year of the Initial Term in respect of the first Extension Term and during the last year of the first Extension Term in respect of the second Extension Term.    
(c)    Failing agreement by the parties as to the Basic Rent for any Extension Term by not later than 60 days prior to the commencement of the particular Extension Term, either party may submit the matter to a single arbitrator appointed under the Arbitration Act (British Columbia), whose decision will be final and binding upon the Tenant and the Landlord.  The cost of the arbitration will be borne by the Landlord and the Tenant equally.  In the event that the Basic Rent payable during any Extension Term has not been agreed upon or determined by the date of commencement of the particular Extension Term, the Tenant shall pay by way of provisional Basic Rent on the first day of the first month of that Extension Term, an amount equal to the monthly instalment of Basic Rent payable in the month immediately preceding the commencement of such Extension Term, and on the first day of each and every month thereafter the Tenant shall continue to pay such 

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monthly amount until the new Basic Rent is agreed upon or determined, and, upon the Basic Rent being so agreed upon or determined an appropriate adjustment of Basic Rent shall be made, if required, on the first day of the month next following the month in which the new Basic Rent is so agreed upon or determined, retroactive to the commencement of the applicable Extension Term.
Part 23

MISCELLANEOUS
23.1    Accord and Satisfaction
.  No payment by the Tenant or receipt by the Landlord of a lesser amount than the Rent stipulated in this Lease will be considered to be other than on account of the earliest stipulated Rent, nor will an endorsement or statement on a cheque or in a letter accompanying a cheque or payment as rent be considered to be an accord or satisfaction, and the Landlord may accept a cheque or payment without prejudice to the Landlord’s right to recover the balance of the Rent or pursue any other remedy.
23.2    No Partnership
.  The Landlord does not in any way or for any purpose become a partner of, or joint venturer or a member of a joint enterprise with, the Tenant.  No provision of this Lease is intended to create a relationship between the parties other than that of Landlord and Tenant.
23.3    Unavoidable Delay
.
(a)    If the performance of any act required hereunder to be performed by a party hereto is affected by Unavoidable Delay then:
(i)    if the act is to be performed on or at a specified day or time then the day or time for performance will be extended to a day or time after the Unavoidable Delay ceases which is reasonable having regard to the nature of both the act and the Unavoidable Delay; or
(ii)    if the act is to be performed within a specified period of time that period will be extended from the time the Unavoidable Delay ceases to affect the performance for a period equal to the amount of that specified period which occurred during the period of Unavoidable Delay.
(b)    The party obligated to do or perform such act or thing will not be considered to have committed a default until the expiration of such time as so extended.
(c)    Each party will when so delayed promptly notify the other of the occurrence of the Unavoidable Delay with an estimate of its expected duration.
23.4    Partial Invalidity
.  If a term, covenant or condition of this Lease or the application thereof to any person or circumstances is held to any extent invalid or unenforceable, the remainder of this Lease or the application of the term, 

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covenant or condition to persons or circumstances other than those as to which it is held invalid or unenforceable will not be affected.
23.5    Joint and Several Liability
.  If two or more individuals, corporations, partnerships or other business associations compose the Tenant, the liability of each individual, corporation, partnership or other business association to pay Rent and perform all other obligations of the Tenant under this Lease is joint and several.  If the Tenant is a partnership or other business association the members of which are by virtue of statute or general law subject to personal liability, the liability of each member is joint and several.
23.6    Registration
.  The Tenant may, at is discretion, register a short form of this Lease (including, without limitation, the Tenant’s Right of First Refusal) at the applicable Land Title Office provided that such short form does not disclose any financial information contained in this Lease and is approved by the Landlord, acting reasonably. The Landlord shall forthwith execute and deliver all such documentation reasonably required by the Tenant to effect such registration.  The Tenant shall be responsible for the preparation of any and all plans required in connection with the foregoing at its sole cost and expense. 
23.7    Notice
.
(a)    Any notice or other communication required or permitted to be given under this Lease will be in writing unless otherwise specified and will be considered to have been given if delivered by hand or mailed by prepaid registered post in Canada, to the address of the party set out below: 
(i)    if to the Landlord:
2621 Douglas Street, Victoria, BC V8T 4M2
Attention:    David Fullbrook
(ii)    if to the Tenant:
#1203 – 4464 Markham Street, Victoria, BC  V8Z 7X8
Attention:    Michael Martin, Chief Operating Officer
or to such other address as a party may specify by notice given as set out above.
(b)    Notice or other communication will be considered to have been received:
(i)    if delivered by hand during business hours, upon receipt by a responsible representative of the receiver, and if not delivered during business hours, upon the commencement of business on the next business day; and
(ii)    if mailed by prepaid registered post in Canada, upon the fifth business day following posting, except that, in the case of a disruption or an impending or threatened disruption in the postal service, every notice or communication will be delivered by hand.
(c)    In this Lease, whenever a notice provision refers to “days”, it will be considered to refer to “business days” and “business day” or “business days” will mean a day or days which are 

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not a Saturday or defined as a “holiday” under the Interpretation Act  (British Columbia) as amended or substituted from time to time.
23.8    No Modification
.  No representations, understandings or agreements have been made or relied upon in the making of this Lease other than those specifically set out in this Lease.  This Lease may only be modified in writing signed by the party against whom the modification is enforceable.
23.9    Successors and Assigns
.  This Lease binds and benefits the parties and their respective heirs, executors, administrators, successors and assigns.  No rights, however, benefit an assignee of the Tenant unless under Part 12 the assignment was consented to by the Landlord.
23.10    Number and Gender
.  The necessary grammatical changes required to make the provisions of this Lease apply in the plural sense where the Tenant comprises more than one entity and to corporations, associations, partnerships, or individuals, males or females, in all cases will be assumed as though in each case fully expressed.
23.11    Headings and Captions
.  The table of contents, part numbers, part headings, paragraph numbers and paragraph headings are inserted for convenience of reference only and are not to be considered when interpreting this Lease.
23.12    Confidentiality
.  Each of the Landlord and Tenant will keep the existence and terms of this Lease in strict confidence both before and after the Term, except in the course of conveying necessary information to legal, accounting and tax and financial advisors, lenders, investors or as may be required by applicable laws or otherwise mutually agreed upon by the Landlord and Tenant.
23.13    Obligations as Covenants
.  Each obligation of the Landlord or the Tenant in this Lease, even though not expressed as a covenant, is considered to be a covenant for all purposes.
23.14    Entire Agreement
.  This Lease contains all the representations, warranties, covenants, agreements, conditions and understandings between the Landlord and the Tenant concerning the Premises or the subject matter of this Lease.
23.15    Time is of the Essence
.  Time will be of the essence.
23.16    Governing Law
.  This Lease will be interpreted under and is governed by the laws of the Province of British Columbia.
[EXECUTION PAGE FOLLOWS]

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TO EVIDENCE THEIR AGREEMENT each of the parties has executed this Agreement on the date appearing below.
TC EVOLUTION LIMITED PARTNERSHIP,
by its general partner TC Evolution General Partner Inc.

By:    /s/ David Fullblook    
        Name: David Fullbook
    Title:    CEO / Director

I have the authority to bind the company, which has the authority to bind the limited partnership.

Dated:     August 12, 2020        

AURINIA PHARMACEUTICALS INC.

By:    /s/ Max Donley    
        Name: Max Donley
    Title:    EVP

I/We have the authority to bind the company.

Dated:      August 7, 2020        

Schedule 1 

PLAN OF PREMISES

3rd floor of the Building Schedule 2 

LEGAL DESCRIPTION OF THE LAND
PID: 003-149-021, Lot 2 Section 4 Victoria District Plan 23740

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Schedule 3 

RULES AND REGULATIONS
1.    Refuse.
(a)    If the Tenant’s garbage is of a deteriorating nature, creating offensive odours, the Tenant will utilize and maintain at its cost and expense refrigerated facilities as required by the Landlord.
2.    Overloading, Suspension.
(a)    The Tenant will not overload any floor of the Premises in excess of 100 pounds per square foot.
(b)    The Tenant will not hang or suspend from any wall or ceiling or roof, or any other part of the Building, any equipment, fixtures, signs or displays which are not first authorized by the Landlord.
3.    Electrical Equipment.
(a)    If the Tenant requires any electrical equipment which might overload the electrical facilities in the Premises, the Tenant will submit to the Landlord plans and specifications for works required to install and supply additional electrical facilities or equipment to prevent such overloading and will obtain the Landlord’s prior written approval to perform the works, which will meet all applicable regulations and codes, including without limitation, the requirements of the Landlord’s insurers, and will be installed at the Tenant’s sole expense.  The Landlord reserves the right to install such additional equipment at the Tenant’s expense, which will not exceed 15% of the cost of the additional equipment.
4.    Plumbing.
(a)    No plumbing facilities will be used for any purpose other than that for which they were designed, and no foreign substance of any kind will be thrown therein, and the expense of any breakage, stoppage or damage resulting from a violation of this provision by the Tenant or by any person for whom the Tenant is responsible will be borne by the Tenant.
5.    HVAC Operation/Window Covering.
(a)    The Tenant will not directly or indirectly appropriate heating or cooling from other portions of the Building unless it is unavoidable, due to the nature of the HVAC design of the Building.
(b)    The Tenant will not leave open any doors or windows to the exterior of the Building which would adversely affect the performance of any HVAC equipment in the Building.
(c)    The Tenant will not interfere with any window coverings installed upon the exterior windows and will close the window coverings during such hours from dusk to dawn as the Landlord may require and will not install or operate any drapes so as to interfere with the exterior appearance of the Building.

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6.    Pests.
(a)    Should the Premises become infested with rodents, vermin or other pests, the Tenant will immediately remedy the same and will use such pest extermination contractor as the Landlord may direct.
7.    Notice of Accident, Defects.
(a)    The Tenant will give immediate notice to the landlord in case of fire or accident in the Premises or of defects therein or to any fixtures or equipment therein.
8.    Emergency Contacts.
(a)    The Tenant will provide the Landlord with the names, addresses and telephone numbers of 2 authorized employees of the Tenant who may be contacted by the Landlord if an emergency relative to the Premises arises.
9.    Normal Business Hours.
(a)    The Normal Business Hours are the hours from 7 a.m. to 6 p.m., Monday to Friday, inclusive, of each week, holidays excepted, or such other hours and days as may be specified by the Landlord, acting reasonably, from time to time, provided that in doing so the Landlord may not reduce the total number of hours on weekdays (holidays excepted) which constitute Normal Business Hours.  
10.    Entry after Hours/Locks.
(a)    The Tenant and its employees, servants, agents, contractors, and invitees may enter the Premises or the Building when the Building is closed to the public but only by way of such entrances as the Landlord may designate from time to time and subject to the control and security procedures designated by the Landlord from time to time.
(b)    The Tenant will not place any locks or other security devises upon the doors of the Premises without the prior written approval of the Landlord and subject to any conditions imposed by the Landlord for the maintenance of necessary access and security.
11.    Permits, Licences.
(a)    The Tenant alone will be responsible for obtaining from the appropriate governmental authorities or other regulatory body having jurisdiction whatever permits, licences or approvals may be necessary for the operation of the Tenant’s business.
12.    Further Rules and Regulations.
(a)    For the general benefit and welfare of the Building and the tenants therein, the Landlord may amend these rules and regulations, by alteration or addition, and such amended rules and regulations will be binding on the Tenant. provided that such amended rules and regulations and policies shall not (i) discriminate against the Tenant, (ii) materially or unreasonably interfere with or restrict the Tenant’s conduct of its business or the Tenant’s use or enjoyment of the Premises, or (iii) derogate from any of the Tenant’s rights under this Lease.

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Schedule 4 

ADDITIONAL PROVISIONS
1.    Free Basic Rent.  Notwithstanding any terms to the contrary in this Lease, the Tenant shall not be required to pay Basic Rent for the first 2 months of the Initial Term (the “Free Basic Rent Period”). 
2.    Tax Exemption.  The Tenant acknowledges that the Landlord has applied to the City of Victoria for an exemption in respect of Taxes for up to [redacted]pursuant to the City’s Tax Incentive Program for heritage designated commercial buildings (the “Tax Exemption”).  The Tenant acknowledges and agrees that notwithstanding the application of the Tax Exemption to Taxes in respect of Building and the Land, during any period that the Tax Exemption applies the Tenant will pay, pursuant to paragraph 4.4(a)(ii) of this Lease, the Tenant’s Proportionate Share of Taxes based on what the Taxes would have been if the Tax Exemption was not applicable.  For example, for illustration purposes only, if during the first full Lease Year of the Initial Term the Tax Exemption applies and the Tenant’s Proportionate Share of Taxes would have been equal to [redacted]per square foot of the Rentable Area of the Premises if the Tax Exemption had not been applicable, the Tenant will pay [redacted]per square foot of the Rentable Area of the Premises to satisfy its payment obligations under paragraph 4.4(a)(ii) of this Lease.
3.    Exterior Signage.  At the Tenant’s sole cost and expense, the Landlord will permit the Tenant to install exterior signage on the Building on Douglas Street, subject to compliance with the Landlord’s reasonable signage guidelines and applicable City of Victoria bylaws and subject to the Landlord’s approval, acting reasonably, as to size, design and location of the signage.  Crown signage can be made available by proposal and occupancy of an entire floor.     
4.    Tenant Improvement Allowance.  The Landlord shall pay to the Tenant, the Tenant Improvement Allowance to be spent on the construction and installation of the Tenant’s Work.   The Tenant Improvement Allowance will be paid by the Landlord to the Tenant during the Fixturing Period as the Tenant’s Work progresses upon receipt of a Tenant draw request, provided the Tenant is not then in default under this Lease beyond applicable notice and cure periods and further provided that the total number of draw requests made by the Tenant shall not exceed 3 in number.  Any costs and expenses in respect of the Tenant’s Work over and above the Tenant Improvement Allowance shall be to the account of and responsibility of the Tenant.  The draws will be paid to the Tenant within 30 days of a written request therefor by the Tenant, provided the following conditions are satisfied:
a.    this Lease has been executed by the parties and the Tenant is not then in default of any of the Tenant’s covenants hereunder beyond applicable notice and cure periods, 
b.    such payments shall be no greater than the cost of work in place in respect of the Tenant’s Work in the Premises as of the date of such request, as reasonably determined by the Architect;
c.    the Tenant provides to the Landlord a sworn declaration from the general contractor stating that, provided specified funds are paid, there are no liens or encumbrances affecting the Premises, the Building or the Land in respect of work, services, materials and equipment relating to the Tenant’s Work and that the Tenant’s designers, contractors, subcontractors, workers and suppliers of materials and equipment, if any, have been paid in full for all work and services performed and materials and equipment supplied by them to the Premises to the date of such request; and

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d.    the Tenant provides to the Landlord copies of all costs actually expended by the Tenant (by way of invoices or accounts pertaining to the Tenant’s Work), certified by an officer of the Tenant, for completion of such portion of the Tenant’s Work.
The final [redacted] of the Tenant Improvement Allowance shall be paid upon the expiry of any lien holdback period provided for by any applicable builders lien legislation and the delivery to the Landlord of “as built” drawings for all of the Tenant’s Work.  [redacted] of any amount of the Tenant Improvement Allowance that is unused by the Tenant for the construction and installation of the Tenant’s Work shall be a credit to the Tenant and applied to the earliest Rent payable under this Lease.
5.    Preliminary Space Planning.  The Landlord shall, promptly upon the Tenant’s request, reimburse the Tenant for its costs to prepare a preliminary space plan for the Tenant in respect of the Premises, provided that such reimbursement shall not exceed fifteen cents ($0.15) per square foot of the Rentable Area of the Premises.
6.    Parking.  The Landlord grants to the Tenant a license to use and the Tenant accepts such license to use during the Term 19 designated parking stalls located on the Land.  As of the date of this Lease the Landlord has designated the Tenant’s parking stalls as those shown hatched on Schedule 6 attached hereto.  The monthly rental for the parking stalls will be at the prevailing monthly rate established by the Landlord from time to time but, in any event, commensurate with prevailing market rates from time to time for comparable parking stalls in the area of the Land.  As of the date of this Lease the current market rate is [redacted]per reserved stall per month, plus applicable taxes.  The monthly rental for the parking stalls contemplated in this paragraph shall be payable in advance as Additional Rent on the first day of each month of the Term. Any or all of the aforementioned 19 parking stalls may be relocated by the Landlord on no less than [redacted]notice to the Tenant, provided that the number of parking stalls is not reduced below 19.  
7.    Right of First Refusal to Lease.  
a.    In consideration of the Tenant’s covenants under this Lease and provided the Tenant is not in default of this Lease beyond any applicable notice and cure periods at the time the Landlord gives the Offer (as defined below) to the Tenant, the Landlord grants to the Tenant a right of first refusal to lease (the “Tenant’s Right of First Refusal”) on the terms and conditions of this paragraph.
b.    During the Term, the Landlord will not lease, in whole or in part, any space on the 3rd floor of the Building that is not part of the Premises (the “Additional 3rd Floor Space”), unless:
i.    the Landlord gives to the Tenant a written offer to lease (the “Offer”) setting forth the space which is available, the date it is available and the Rent, inducements and other terms and conditions upon which a bona fide third party dealing with the Landlord at arm’s length (the “Third Party”) has made an offer to lease to the Landlord, and which the Landlord is willing to accept; and
ii.    the Tenant does not accept the Offer by notice in writing to the Landlord given within 5 business days after receipt of the Offer.
c.    The Landlord and the Tenant agree that except for the use clause, which will be deemed to read “ general office purposes and any other purposes directly related thereto as permitted by applicable zoning”, the Landlord will not make any amendments to the terms of the offer to lease received from the Third Party when preparing the Offer to the Tenant.  

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The Landlord shall, together with the Offer, provide the Tenant with a copy of the offer to lease that the Landlord received from the Third Party. 
d.    If the Tenant does not accept the Offer, the Landlord may lease the space referred to in the Offer, at arm’s length, to the Third Party on equal terms or terms more favourable to the Landlord than those set out in the Offer, during a period of 90 days following the expiration of the period in which the Tenant was entitled to accept the Offer.  Thereafter, the Landlord will not lease the Additional 3rd Floor Space, in whole or in part, without again making an offer to the Tenant on the terms and conditions of paragraphs b. and c. above.
e.    If the Tenant accepts the Offer, the Offer, as accepted, will constitute a binding agreement of lease and the Tenant will execute, at its cost, a lease amending agreement prepared by the Landlord and acceptable to the Tenant, reflecting the amendments to the Lease required as a result of the addition of the Additional 3rd Floor Space, or any part thereof, that is acquired by the Tenant following acceptance of the Offer.
f.    Time will be of the essence of the right of first refusal to lease contemplated in this section 7 of Schedule 4.
g.    This right of first refusal may not be assigned by the Tenant except to a person to whom the Tenant assigns this Lease in compliance with the applicable terms of this Lease.
8.    Estimate of Additional Rent.  
The Landlord estimates that for the 2020 Lease Year the Additional Rent will be [redacted]per square foot of the Rentable Area of the Premises.  

Schedule 5 

LANDLORD’S WORK AND TENANT’S WORK
PART A - Landlord’s Work
The “Landlord’s Work” shall include the following work, all of which shall be completed by the Landlord, at its sole cost and expense, in a good and workmanlike manner to first class standards and using only new materials (provided that some repurposing of existing materials shall be permitted where deemed appropriate by the Landlord, acting reasonably, so long as the same is done to first class standards), and in strict compliance with all applicable laws, bylaws, codes, rules and regulations, including without limitation the British Columbia Building Code, the British Columbia Fire Code and all bylaws of the City of Victoria: 

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PART B - Tenant’s Work
1.    “Tenant’s Work” means all work other than the Landlord’s Work required to be done to complete the Premises for occupancy by the Tenant to meet all building code requirements.  
2.    The Tenant’s Work shall not be undertaken or commenced by the Tenant until: 
a.    the Tenant has delivered to the Landlord a certificate of insurance for the Premises confirming that the Tenant has obtained the insurance coverage required under this Lease; and
b.    the Tenant has obtained the necessary permits to complete the Tenant’s Work and delivered copies of the same to the Landlord. 
3.    All improvements to the Premises shall conform to the quality standards of the Building.  The Tenant shall use an architect and other necessary consultants such as mechanical engineer, electrical and data engineer, code consultant and such other certified registered professionals who may be required from time to time to design and prepare working drawings and specifications of the Tenant’s Work and shall submit same for the Landlord’s prior written approval, not to be unreasonably withheld.
4.    All work including changes to the structural elements or mechanical systems of the Building necessitated by the Tenant’s Work shall be first approved by the Landlord.
5.    No Tenant’s Work shall be commenced by the Tenant until all plans, drawings and specifications of the proposed Tenant’s Work have been submitted to and approved in writing by the Landlord and until the Tenant has secured all requisite approvals and permits from all applicable authorities having jurisdiction and submitted proof of same to the Landlord.  The Tenant shall apply to the appropriate governmental and all other applicable authorities for all necessary permits and approvals necessary for the construction and installation of the Tenant’s Work to be constructed by Tenant within the Premises.  All such applications shall be made in a 

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timely manner so that the necessary permits and approvals may be obtained prior to the Possession Date.  The Tenant will be responsible for compliance with final plans and specifications and the building code applicable to the Building in connection with its construction responsibilities. Notwithstanding anything to the contrary set forth in this Part B of Schedule 5, the Tenant will not be obligated to pay any fees or charges related to the Landlord’s approval, supervision, coordination, security or overhead with respect to the Tenant’s Work, except that the Landlord shall be entitled to recover any reasonable, out-of-pocket costs incurred in its review and approval of the plans, drawings and specifications of the Tenant’s Work by any arms-length, third party consultants retained by the Landlord for such purpose.
6.    The preparation of all design and working drawings and specifications relating to completion of the Premises for occupation by the Tenant and the calling of tenders and letting of contracts relating to the Tenant’s Work and the supervision and completion of the Tenant’s Work and payment therefore shall be the responsibility of the Tenant. 
7.    Approvals must be obtained by the Tenant for its work from the municipal building department and all authorities having jurisdiction and the Tenant must submit evidence of these approvals to the Landlord before commencing work and post such approvals on the job site prior to the commencement of the work.  The Tenant shall be responsible for payment of all fees and charges incurred in obtaining such approvals before commencing work and for obtaining an occupancy permit prior to opening.
8.    All the Tenant’s Work required by the Tenant to complete the Premises for occupancy shall be carried out with good workmanship and shall not be in contravention of the codes or regulations of the municipality or any other authority having jurisdiction.
9.    Before commencing any work, the Tenant shall furnish the Landlord with written proof of all contractors’ commercial general liability insurance for limits not less than those to be maintained by the Tenant under the Lease.  The Landlord and its agent shall be named as additional insureds in such contractors’ insurance policies.
10.    Before commencing any work, the Tenant shall furnish the Landlord with written proof of all contractors’ WorkSafe BC clearance as well as a list of all trades, which must be approved by the Landlord.  All contractors shall abide by all WorkSafe BC rules and regulations on site.
11.    The Tenant shall at all times keep the Premises and all other areas clear of waste materials and refuse caused by itself, its suppliers, contractors or by their work.
12.    The Landlord may require the Tenant to clean up on a daily basis and be entitled to clean up at the Tenant’s expense if the Tenant shall not comply with the Landlord’s reasonable requirements.
13.    All Tenant’s Work including the delivery, storage and removal of materials shall be subject to the reasonable supervision of the Landlord and shall be performed in accordance with any reasonable conditions or regulations imposed by the Landlord and adherence to all building rules and regulations.
14.    The Landlord may require that the Landlord’s contractors and sub-contractors be engaged for any mechanical or electrical work, work conducted on the roof or the fire and sprinkler systems, or other work which may be under warranty.
15.    The Landlord shall not in any way be responsible for or liable with regard to any work carried out or any materials left or installed in the Premises.

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16.    Any damages caused by the Tenant, the contractors or subtrades employed on the work to any of the structural elements or mechanical systems of the Building or to any property of the Landlord or of other tenants, shall be repaired by the Landlord’s contractor to the satisfaction of the Landlord and the Landlord may recover the costs incurred from the Tenant plus an additional fee equal to 15% of such costs.
17.    If the Tenant’s contractor neglects to carry out the work properly or fails to perform any work required by or in accordance with the approved plans and specifications, the Landlord may give written notice to the Tenant and the Tenant’s contractor of such failure and if the Tenant has not, within 30 days after receiving such notice, remedied such failure (or, if remedying such failure requires a longer period to complete, if the Tenant has not commenced to remedy such failure within the 30 day period and thereafter does not diligently pursue remedying such failure to completion), then the Landlord may, without prejudice to any right or remedy, complete the work, remedy the default or make good any deficiencies and recover the costs incurred from the Tenant.
18.    The Tenant shall perform its work expeditiously and efficiently and shall complete the same prior to the Commencement Date or within the period stipulated in any other written agreement between the parties subject only to circumstances over which the Tenant has no control and which by the exercise of due diligence could not have been avoided.
19.    On completion of the Tenant’s Work, the Tenant shall forthwith furnish to the Landlord “as built” drawings for the Tenant’s Work and a statutory declaration in a form provided by the Landlord stating that there are no builders’ liens outstanding against the Premises or the Building on account of the Tenant’s Work and that all accounts for work, service and materials have been paid in full with respect to all of the Tenant’s Work, together with evidence in writing satisfactory to the Landlord that all assessments under the Workers Compensation Act (British Columbia) have been paid.  
20.    The Tenant shall complete all work in a good and workmanlike manner, and in strict accordance with the drawings and specifications approved by the Landlord and all applicable laws, bylaws, codes, rules and regulations.  The Tenant agrees to indemnify and save the Landlord harmless from any and all loss, damage or injury which may result from the Tenant’s activities in the Premises, the Building or the Land in completing the Premises as aforesaid.  The Tenant acknowledges and agrees that there may be inconvenience associated with completing either the Landlord’s Work or the Tenant’s Work.

SCHEDULE 6

DESIGNATED PARKING STALLS

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