Document:

bmrwateridgepointlp-leas

                  BioMed Realty form dated 5/12/21  LEASE  by and between  BRE-BMR WATERIDGE POINTE LP,  a Delaware limited partnership  and  CODEX DNA, INC.,  a Delaware corporation 

 

  i  Table of Contents  1.  Lease of Premises ................................................................................................................... 1  2.  Basic Lease Provisions ........................................................................................................... 2  3.  Term ........................................................................................................................................ 5  4.  Possession and Commencement Date. .................................................................................... 5  5.  Condition of Premises ........................................................................................................... 10  6.  Rentable Area........................................................................................................................ 12  7.  Rent ....................................................................................................................................... 12  8.  Rent Adjustments; Free Rent Period..................................................................................... 13  9.  Operating Expenses .............................................................................................................. 14  10.  Taxes on Tenant’s Property .................................................................................................. 19  11.  Security Deposit .................................................................................................................... 20  12.  Use ........................................................................................................................................ 22  13.  Rules and Regulations, CC&Rs, Parking Facilities and Common Area .............................. 26  14.  Project Control by Landlord ................................................................................................. 27  15.  Quiet Enjoyment ................................................................................................................... 29  16.  Utilities and Services ............................................................................................................ 29  17.  Alterations ............................................................................................................................. 33  18.  Repairs and Maintenance ...................................................................................................... 36  19.  Liens ...................................................................................................................................... 37  20.  Estoppel Certificate ............................................................................................................... 38  21.  Hazardous Materials ............................................................................................................. 38  22.  Odors and Exhaust ................................................................................................................ 41  23.  Insurance ............................................................................................................................... 43  24.  Damage or Destruction ......................................................................................................... 46  25.  Eminent Domain ................................................................................................................... 49  26.  Surrender ............................................................................................................................... 50  27.  Holding Over ........................................................................................................................ 50  28.  Indemnification and Exculpation .......................................................................................... 51  29.  Assignment or Subletting ...................................................................................................... 52  30.  Subordination and Attornment .............................................................................................. 56  31.  Defaults and Remedies ......................................................................................................... 57  32.  Bankruptcy ............................................................................................................................ 62  

 

  ii  33.  Brokers .................................................................................................................................. 63  34.  Definition of Landlord .......................................................................................................... 63  35.  Limitation of Landlord’s Liability ........................................................................................ 64  36.  Joint and Several Obligations ............................................................................................... 64  37.  Representations ..................................................................................................................... 65  38.  Confidentiality ...................................................................................................................... 65  39.  Notices .................................................................................................................................. 65  40.  Miscellaneous ....................................................................................................................... 66  41.  Waples Lease ........................................................................................................................ 69  42.  Option to Extend Term ......................................................................................................... 69  43.  Right of First Offer ............................................................................................................... 71    

 

LEASE  THIS LEASE (this “Lease”) is entered into as of this ____ day of _______, 2021  (the “Execution Date”), by and between BRE-BMR WATERIDGE POINTE LP, a Delaware  limited partnership (“Landlord”), and CODEX DNA, INC., a Delaware corporation (“Tenant”).  RECITALS  A. WHEREAS, Landlord owns certain real property (the “Property”) and the improvements on the Property located at 10421 and 10431 Wateridge Circle, San Diego,  California, including the buildings located thereon; and  B. WHEREAS, Landlord wishes to lease to Tenant, and Tenant desires to lease from Landlord, certain premises (the “Premises”) known as (i) Suites 150 and 200 (the “10431  Premises”) on the first (1st) and second (2nd) floors of the building located at 10431 Wateridge  Circle, San Diego, California (the “10431 Building”) and (ii) Suite 200 (the “10421 Premises”) on  the second (2nd) floor of the building located at 10421 Wateridge Circle, San Diego, California  (the “10421 Building”), pursuant to the terms and conditions of this Lease, as detailed below; and    C. The term “Premises” shall mean the 10431 Premises and/or the 10421 Premises, as the context may require.  The term “Building” shall mean the 10431 Building and/or the 10421  Building, as the context may require.  AGREEMENT  NOW, THEREFORE, Landlord and Tenant, in consideration of the mutual promises  contained herein and for other good and valuable consideration, the receipt and sufficiency of  which are hereby acknowledged, and intending to be legally bound, agree as follows:  1. Lease of Premises. 1.1. Effective on the 10431 Premises Commencement Date (as defined below) as to the 10431 Premises and on the 10421 Premises Commencement Date (as defined below) as to the  10421 Premises, Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the  applicable portion of the Premises, as shown on Exhibit A attached hereto, for use by Tenant in  accordance with the Permitted Use (as defined below) and no other uses.  The Property and all  landscaping, parking facilities, private drives and other improvements and appurtenances related  thereto, including the Buildings and any other buildings(s) located on the Property, are hereinafter  collectively referred to as the “Project.”  All portions of the Building that are for the non-exclusive  use of the tenants of the Building only, and not the tenants of the Project generally, such as service  corridors, stairways, elevators, public restrooms and public lobbies (all to the extent located in the  Building), are hereinafter referred to as “Building Common Area.” All portions of the Project that  are for the non-exclusive use of tenants of the Project generally, including driveways, sidewalks,  parking areas, landscaped areas and public lobbies (but excluding Building Common Area), are  hereinafter referred to as “Project Common Area.” The Building Common Area and Project  Common Area are collectively referred to herein as “Common Area.”   29th September 

 

2  2. Basic Lease Provisions.  For convenience of the parties, certain basic provisions of this Lease are set forth herein.  The provisions set forth herein are subject to the remaining terms and conditions of this Lease and are to be interpreted in light of such remaining terms and conditions. 2.1. This Lease shall take effect upon the Execution Date and, except as specifically  otherwise provided within this Lease, each of the provisions hereof shall be binding upon and inure  to the benefit of Landlord and Tenant from the date of execution and delivery hereof by all parties  hereto.  2.2. In the definitions below, Rentable Area (as defined below) is expressed in square  feet.  Rentable Area and “Tenant’s Pro Rata Shares” are all subject to adjustment as provided in  this Lease.   Definition or Provision  Means the Following   (As of the applicable Commencement  Date)  Approximate Rentable Area of 10431 Premises  49,077 square feet  Approximate Rentable Area of 10421 Premises 17,146 square feet  Approximate Rentable Area of entire Premises 66,223 square feet  Approximate Rentable Area of 10431 Building 64,254 square feet  Approximate Rentable Area of 10421 Building 62,850 square feet  Approximate Rentable Area of Project 127,104 square feet  Tenant’s Pro Rata Share of 10431 Building 76.38%  Tenant’s Pro Rata Share of 10421 Building 27.28%  Tenant’s Pro Rata Share of Project 52.10%  2.3. Initial monthly and annual installments of Base Rent for the Premises (“Base Rent”)  as of the later to occur of the 10431 Premises Commencement Date and the 10421 Premises  Commencement Date, subject to adjustment under this Lease, will be as follows:   Dates  Square Feet  of Rentable  Area  Base Rent per Square  Foot of Rentable Area*  Monthly  Base Rent*  Annual Base  Rent*  Months 1** - 12 66,223 $4.75 monthly $314,559.25 $3,774,711.00  * Note: Subject to (a) increase in the event that Tenant utilizes all or any portion of the  Additional TI Allowance (as defined in Section 4.7 below), (b) annual escalation as  

 

  3  set forth in Section 8.1 below, and (c) the Free Rent Period (as defined in  Section 8.2 below).    **Note: In the event the 10431 Premises Commencement Date occurs prior to the 10421  Premises Commencement Date, Tenant will pay Base Rent for the 10431 Premises  at a monthly Base Rent rate equal to $4.75 per square foot of Rentable Area of the  10431 Premises during the period from the 10431 Premises Commencement Date  until the 10421 Premises Commencement Date.  Similarly, in the event the 10421  Premises Commencement Date occurs prior to the 10431 Premises Commencement  Date, Tenant will pay Base Rent for the 10421 Premises at a monthly Base Rent  rate equal to $4.75 per square foot of Rentable Area of the 10421 Premises during  the period from the 10421 Premises Commencement Date until the 10431 Premises  Commencement Date.  For illustrative purposes, if Tenant utilizes all of the Additional TI Allowance (as defined  in Section 4.7 below), then initial monthly installments of Base Rent as of the later to occur of the  10431 Premises Commencement Date and the 10421 Premises Commencement Date, subject to  further adjustment under this Lease, will be as follows:   Dates*  Square Feet  of Rentable  Area  Base Rent per  Square Foot of  Rentable Area  Monthly Base  Rent  Annualized Base  Rent  Months 1 - 3 66,223 $4.75 monthly $314,559.25** $3,774,711.00**  Months 4 - 12 66,223 $4.87 monthly  $322,506.01*** $3,870,072.12***  * Note: For clarity, the Months in the chart above are measured from the later of the 10431  Premises Commencement Date and the 10421 Premises Commencement Date.   ** Note: Subject to the Free Rent Period (as defined in Section 8.2 below).  ***Note: Subject to annual escalations as set forth in Section 8.1 below.    2.4. Estimated 10431 Premises Commencement Date:  The date that is forty-four (44)  weeks after the date that the 10431 Approved Schematic Plans (as defined in the Work Letter (as  defined below)) are fully and finally approved by Tenant in accordance with Section 2.1 of the  Work Letter.  Estimated 10421 Premises Commencement Date: The date that is forty-six (46)  weeks after the date that the 10421 Approved Schematic Plans (as defined in the Work Letter) are  fully and finally approved by Tenant in accordance with Section 2.1 of the Work Letter.    2.5. Estimated Term Expiration Date:   August 31, 2032  2.6. Security Deposit: $433,421.11  2.7. Permitted Use:  Office and laboratory use in conformity with all federal, state,  municipal and local laws, codes, ordinances, rules and regulations of Governmental Authorities  

 

  4  (as defined below), or other regulatory agencies or governing bodies having jurisdiction over the  Premises, the Building, the Property, the Project, Landlord or Tenant, including both statutory and  common law and hazardous waste rules and regulations (“Applicable Laws”)  2.8. Address for Rent Payment:   BRE-BMR Wateridge Pointe LP  P.O. Box 31001-2829  Los Angeles, California  90051-7970  2.9. Address for Notices to Landlord:  BRE-BMR Wateridge Pointe LP  4570 Executive Drive, Suite 400  San Diego, California  92121  Attn:  Legal Department  Email:  legalreview@biomedrealty.com  2.10. Address for Notices to Tenant:  Before Commencement Date:                Codex DNA, Inc.        9535 Waples Street, Suite 100        San Diego, CA 92121        Attn: Legal          After Commencement Date:    Codex DNA, Inc.  10431 Wateridge Circle        San Diego, California 92121        Attn: Legal    2.11. Address for Invoices to Tenant:  Before Commencement Date:                Codex DNA, Inc.        9535 Waples Street, Suite 100        San Diego, CA 92121        Attn: Accounts Payable          After Commencement Date:  Codex DNA, Inc.  10431 Wateridge Circle        San Diego, California 92121  

 

  5  Attn: Accounts Payable  2.12. The following Exhibits are attached hereto and incorporated herein by reference:  Exhibit A Premises  Exhibit A-1 10431 Landlord Work  Exhibit A-2 10421 Landlord Work  Exhibit B Work Letter  Exhibit B-1 Tenant Work Insurance Schedule  Exhibit C Acknowledgement of Term Commencement Dates and Term  Expiration Date  Exhibit D Form of Additional TI Allowance Acceptance Letter  Exhibit E Form of Letter of Credit  Exhibit F Rules and Regulations  Exhibit G Waples Lease Amendment  Exhibit H Tenant’s Personal Property  Exhibit I Form of Estoppel Certificate  Exhibit J Available ROFO Premises    3. Term.  The actual term of this Lease (as the same may be extended pursuant to Article 42  hereof, and as the same may be earlier terminated in accordance with this Lease, the “Term”) shall  commence (i) as to the 10431 Premises, on the actual 10431 Premises Commencement Date (as  defined in Article 4) and (ii) as to 10421 Premises, on the actual 10421 Premises Commencement  Date (as defined in Article 4), and as to the entire Premises, shall end on the date (the “Term  Expiration Date”) that is one hundred twenty-three (123) months after the later of (a) the actual  10431 Premises Commencement Date or (b) the actual 10421 Premises Commencement Date,  subject to extension or earlier termination of this Lease as provided herein.  TENANT HEREBY  WAIVES THE REQUIREMENTS OF SECTION 1933 OF THE CALIFORNIA CIVIL CODE,  AS THE SAME MAY BE AMENDED FROM TIME TO TIME.  4. Possession and Commencement Date.  4.1. Delivery.    4.1.1 10431 Premises.  Landlord shall use commercially reasonable efforts to  tender possession of the 10431 Premises to Tenant on the Estimated 10431 Premises  Commencement Date in the condition required under Section 4.3.1 below.  Tenant agrees that in  the event that Landlord has not tendered possession of the 10431 Premises to Tenant in the  condition required under Section 4.3.1 below on or before the Estimated 10431 Premises  Commencement Date for any reason, then (a) this Lease shall not be void or voidable, and (b)  Landlord shall not be liable to Tenant for any loss or damage resulting therefrom (except as  otherwise set forth in Section 4.4.1 below).    4.1.2 10421 Premises.  Landlord shall use commercially reasonable efforts to  tender possession of the 10421 Premises to Tenant on the Estimated 10421 Premises  Commencement Date in the condition required under Section 4.3.2 below.  Tenant agrees that in  the event that Landlord has not tendered possession of the 10431 Premises to Tenant in the  

 

6  condition required under Section 4.3.2 below on or before the Estimated 10421 Premises  Commencement Date for any reason, then (a) this Lease shall not be void or voidable, and (b)  Landlord shall not be liable to Tenant for any loss or damage resulting therefrom (except as  otherwise set forth in Section 4.4.2 below).  4.2. Tenant Improvements.  The term “Tenant Improvements” means the work required  of Landlord described in the Work Letter attached hereto as Exhibit B (the “Work Letter”).  4.2.1 10431 Tenant Improvements.  The term “10431 Tenant Improvements”  means the portion of the Tenant Improvements to be constructed in the 10431 Premises.  With  respect to the 10431 Tenant Improvements, the term “Substantially Complete” or “Substantial  Completion” means that the 10431 Tenant Improvements are substantially complete in accordance  with the 10431 Approved Plans (as defined in the Work Letter), except for punch list items (which  shall be conclusively established by delivery of a Certificate of Substantial Completion in the form  of the American Institute of Architects document G704, executed by the project architect and the  general contractor).  4.2.2 10421 Tenant Improvements.  The term “10421 Tenant Improvements”  means the portion of the Tenant Improvements to be constructed in the 10421 Premises.  With  respect to the 10421 Tenant Improvements, the term “Substantially Complete” or “Substantial  Completion” means that the 10421 Tenant Improvements are substantially complete in accordance  with the 10421 Approved Plans (as defined in the Work Letter), except for punch list items (which  shall be conclusively established by delivery of a Certificate of Substantial Completion in the form  of the American Institute of Architects document G704, executed by the project architect and the  general contractor).  4.3. Commencement Date.  The 10431 Premises Commencement Date (as defined  below) and the 10421 Premises Commencement Date (as defined below) may each be referred to  herein as a “Commencement Date.”  4.3.1 10431 Premises.  The “10431 Premises Commencement Date” shall be the  date that Landlord tenders possession of the 10431 Premises to Tenant and the following  conditions have been satisfied: (a) The 10431 Tenant Improvements are Substantially Complete;  (b) The 10431 Landlord Work is Substantially Complete (as defined below); and (c) The 10431 Premises may be legally occupied pursuant to a temporary certificate of occupancy or its substantial equivalent (such as sign-off on the building permit by the Governmental Authority that issued such permit), to the extent required by Applicable Laws for legal occupancy of the 10431 Premises. 4.3.2 10421 Premises.  The “10421 Premises Commencement Date” shall be the  date that Landlord tenders possession of the 10421 Premises and the following conditions have  been satisfied: (a) The 10421 Tenant Improvements are Substantially Complete; (b) The 10421  Landlord Work is Substantially Complete (as defined below); and (c) The 10421 Premises may be  legally occupied pursuant to a temporary certificate of occupancy or its substantial equivalent  (such as sign-off on the building permit by the Governmental Authority that issued such permit),  to the extent required by Applicable Laws for legal occupancy of the 10421 Premises.   

 

7  4.4. Outside Date.  4.4.1 10431 Premises.  If the 10431 Premises Commencement Date has not occurred by the date  that is ninety (90) days after the Estimated 10431 Premises Commencement Date (the “10431  Outside Date”), then Tenant shall be entitled to receive one (1) day of Base Rent abatement (for  the 10431 Premises only) for each day thereafter that the 10431 Premises Commencement Date  has not occurred; provided, however, that the 10431 Outside Date shall be subject to extension on  a day-for-day basis as a result of (a) Force Majeure (as defined below) and (b) any Tenant Delay  (as defined below).  In the event that Tenant is entitled to Base Rent abatement under this Section,  such Base Rent abatement shall be applied to Tenant’s obligations to pay Base Rent for the 10431  Premises as such amounts become due.  4.4.2 10421 Premises.  If the 10421 Premises Commencement Date has not  occurred by the date that is ninety (90) days after the Estimated 10421 Premises Commencement  Date (the “10421 Outside Date”), then Tenant shall be entitled to receive one (1) day of Base Rent  abatement (for the 10421 Premises only) for each day thereafter that the 10421 Premises  Commencement Date has not occurred; provided, however, that the 10421 Outside Date shall be  subject to extension on a day-for-day basis as a result of (a) Force Majeure (as defined below) and  (b) any Tenant Delay (as defined below).  In the event that Tenant is entitled to Base Rent abatement under this Section, such Base Rent abatement shall be applied to Tenant’s obligations to pay Base Rent for the 10421 Premises as such amounts become due. 4.5. Acknowledgement.  Tenant shall execute and deliver to Landlord written  acknowledgment of the actual 10431 Premises Commencement Date, the 10421 Premises  Commencement Date and the Term Expiration Date within ten (10) days following Landlord’s  request therefor, in the form attached as Exhibit C hereto.  Failure to execute and deliver such  acknowledgment, however, shall not affect the 10431 Premises Commencement Date or the 10421  Premises Commencement Date or Landlord’s or Tenant’s liability hereunder.  Failure by Tenant  to obtain any governmental licensing or similar governmental approval required for the Permitted  Use by Tenant (other than any certificate of occupancy or its legal equivalent, which Landlord is  obligated to obtain pursuant to Section 4.3.1 and Section 4.3.2 above) shall not serve to extend the  10431 Premises Commencement Date or the 10421 Premises Commencement Date, as applicable.  4.6. Early Access.  Provided that Tenant and the Tenant Parties do not interfere with  Landlord’s construction of the Tenant Improvements or the Landlord Work (as defined below),  Landlord shall permit Tenant to enter upon (i) the 10431 Premises thirty (30) days prior to the  10431 Commencement Date and (ii) the 10421 Premises thirty (30) days prior to the 10421  Commencement Date, for the purpose of installing improvements or the placement of personal  property; provided that prior to such entry Tenant shall furnish to Landlord evidence satisfactory  to Landlord that insurance coverages required of Tenant under the provisions of Article 23 are in  effect, and such entry shall be subject to all the terms and conditions of this Lease other than the  payment of Base Rent or Tenant’s Adjusted Share of Operating Expenses (as defined below) or  utilities; and provided, further, that if the 10431 Premises Commencement Date or 10421 Premises  Commencement Date is delayed due to a Tenant Delay caused by such early access, then the 10431  Premises Commencement Date or 10421 Premises Commencement Date, as applicable, shall be  the date that the 10431 Premises Commencement Date or 10421 Premises Commencement Date,  as applicable, would have occurred but for such delay.  Tenant shall not be permitted to conduct  

 

  8  business operations (a) in the 10431 Premises prior to the 10431 Premises Commencement Date,  or (b) in the 10421 Premises prior to the 10421 Premises Commencement Date.   4.7. TI Allowance.  Landlord shall cause the Tenant Improvements to be constructed in  the Premises pursuant to the Work Letter at a cost to Landlord not to exceed (a) Twelve Million  Two Hundred Fifty-One Thousand Two Hundred Fifty-Five Dollars ($12,251,255) (based upon  One Hundred Eighty-Five Dollars ($185) per square foot of Rentable Area (as defined below))  (the “Base TI Allowance”), plus (b) if properly requested by Tenant pursuant to this Section, Six  Hundred Sixty-Two Thousand Two Hundred Thirty Dollars ($662,230) (based upon Ten Dollars  ($10) per square foot of Rentable Area) (the “Additional TI Allowance”), for a total of Twelve  Million Nine Hundred Thirteen Thousand Four Hundred Eighty-Five Dollars ($12,913,485)  (based upon One Hundred Ninety Five Dollars ($195) per square foot of Rentable Area).  The  Base TI Allowance, together with the Additional TI Allowance (if properly requested by Tenant  pursuant to this Article), shall be referred to herein as the “TI Allowance.”  The TI Allowance may  be applied to the costs of (m) construction, (n) project management by Landlord (which fee shall  equal three percent (3%) of the cost of the Tenant Improvements, including costs paid from the  Base TI Allowance and, if used by Tenant, the Additional TI Allowance), (o) commissioning of  mechanical, electrical and plumbing systems by a licensed, qualified commissioning agent hired  by Landlord, and review of such party’s commissioning report by a licensed, qualified  commissioning agent hired by Tenant, (p) space planning, architect, engineering and other related  services performed by third parties unaffiliated with Tenant, (q) building permits and other taxes,  fees, charges and levies by Governmental Authorities (as defined below) for permits or for  inspections of the Tenant Improvements, and (r) costs and expenses for labor, material, equipment  and fixtures (provided, however, that Tenant shall be entitled to allocate up to a maximum amount  of One Hundred Fifty Thousand Dollars ($150,000) of the TI Allowance toward furniture, fixtures  and equipment for the Premises).  In no event shall the TI Allowance be used for (w) payments to  Tenant or any affiliates of Tenant, (x) the purchase of any furniture, personal property or other  non-building system equipment (except as otherwise set forth in Section 4.7(r) above), (y) costs  arising from any default by Tenant of its obligations under this Lease or (z) costs that are recovered  by Tenant from a third party (e.g., insurers, warrantors, or tortfeasors).  In addition,  notwithstanding anything to the contrary herein, the TI Allowance will not be charged for, and  Tenant shall not be responsible for, (i) legal fees incurred by Landlord in connection with the  negotiation of any construction contracts for the Tenant Improvements or attorneys' fees, experts'  fees and other costs incurred by Landlord in connection with disputes with contractors retained by  Landlord to construct the Tenant Improvements, (ii) interest and other costs of financing the TI  Allowance, (iii) penalties and late fees due to Landlord’s failure to pay any contractors when due  for the Tenant Improvements (provided that Tenant has not failed to pay any amounts due from  Tenant on account of the Tenant Improvements), (iv) costs incurred to remove or remediate  Hazardous Materials (as defined below) existing in the Premises as of the Execution Date, and (v)  Common Area Legal Compliance Work Costs (as defined below) except to the extent such  Common Area Legal Compliance Work Costs are triggered by, or necessitated as a result of, the  unique nature of the Tenant Improvements (as opposed to Common Area Legal Compliance Work  Costs that would have been incurred as a condition to the issuance or sign off on any permit at the  Building).  Notwithstanding anything to the contrary in this Lease, Landlord and Tenant acknowledge  and agree that Tenant shall not be permitted to allocate more than (i) Nine Million Seventy-Nine  

 

  9  Thousand Two Hundred Forty Five Dollars ($9,079,245) of the Base TI Allowance toward the  10431 Tenant Improvements, or (ii) Three Million One Hundred Seventy-Two Thousand and Ten  Dollars ($3,172,010) of the Base TI Allowance toward the 10421 Tenant Improvements.    4.8. TI Deadline; Base Rent Increase.  Landlord shall not have any obligation to fund  any unused portion of the TI Allowance after the date that is twelve (12) months after the later of  the 10431 Premises Commencement Date and the 10421 Premises Commencement Date (the “TI  Deadline”), after which date Landlord’s obligation to fund any such costs shall expire.  Initial Base  Rent shall be increased to include the amount of the Additional TI Allowance disbursed by  Landlord in accordance with this Lease amortized over the portion of the initial Term after the  scheduled expiration of the Free Rent Period (as defined below) at a rate of eight percent (8%)  annually.  The amount by which Base Rent shall be increased shall be determined (and Base Rent  shall be increased accordingly) as of the date immediately following the scheduled expiration of  the Free Rent Period and, if such determination does not reflect use by Tenant of all of the  Additional TI Allowance, shall be determined again as of the TI Deadline, with Tenant paying (on  the next succeeding day that Base Rent is due under this Lease (the “TI True-Up Date”)) any  underpayment of the further adjusted Base Rent for the period beginning on the date immediately  following the scheduled expiration of the Free Rent Period and ending on the TI True-Up Date.   The initial Base Rent, as adjusted to reflect the disbursement of the Additional TI Allowance in  accordance with this Section, shall be subject to further annual adjustments as set forth in Section  8.1.  4.9. Additional TI Allowance Request.  Landlord shall not be obligated to expend any  portion of the Additional TI Allowance until Landlord shall have received from Tenant a letter in  the form attached as Exhibit D hereto executed by an authorized officer of Tenant.  In no event  shall any unused TI Allowance entitle Tenant to a credit against Rent payable under this Lease.    4.10. Landlord Work.  In addition to constructing the Tenant Improvements in  accordance with the Work Letter, Landlord is in the process of repositioning the Buildings located  on the Property and shall be responsible, at Landlord’s sole cost and expense, to construct the work  described in Section 4.10.1 and Section 4.10.2 below (collectively, the “Landlord Work”):  4.10.1 10431 Landlord Work.  Landlord shall Substantially Complete the  following work in the 10431 Building (collectively, the “10431 Landlord Work”) prior to the  10431 Premises Commencement Date:  (i) new base mechanical systems for standard lab and  office use stubbed to the 10431 Premises, (ii) installation of the 10431 Generator (as defined in  Section 16.9), and (iii) a new service elevator serving the 10431 Building, as such work is more  particularly described and depicted on Exhibit A-1 attached hereto (the “10431 Landlord Work  Plans”).  With respect to the 10431 Landlord Work, the term “Substantially Complete” or  “Substantial Completion” means that the 10431 Landlord Work is substantially complete in  accordance with the 10431 Landlord Work Plans, except for punch list items (which shall be  conclusively established by delivery of a Certificate of Substantial Completion in the form of the  American Institute of Architects document G704, executed by the project architect and the general  contractor).  4.10.2 10421 Landlord Work.  Landlord shall Substantially Complete the  following work in the 10421 Building (collectively, the “10421 Landlord Work”) prior to the  

 

10  10421 Premises Commencement Date:  (i) new base mechanical systems for standard lab and  office use stubbed to the 10421 Premises, and (ii) a new service elevator serving the 10421  Building, as such work is more particularly described and depicted on Exhibit A-2 attached hereto  (the “10421 Landlord Work Plans”). With respect to the 10421 Landlord Work, the term  “Substantially Complete” or “Substantial Completion” means that the 10421 Landlord Work is  substantially complete in accordance with the 10421 Landlord Work Plans, except for punch list  items (which shall be conclusively established by delivery of a Certificate of Substantial  Completion in the form of the American Institute of Architects document G704, executed by the  project architect and the general contractor).  4.11. Tenant Delay.  The term “Tenant Delay” means any delay in (a) Substantial  Completion of the 10431 Tenant Improvements or the 10421 Tenant Improvements, (b)  Substantial Completion of the 10431 Landlord Work or the 10421 Landlord Work, and/or (c) the  issuance of a temporary certificate of occupancy or its substantial equivalent for the 10431  Premises or the 10421 Premises (such as sign-off on the building permit by the Governmental  Authority that issued such permit), in each case to the extent arising from any act or omission of  Tenant, and subject to the notice and cure periods set forth in Section 4.11.1 below.    4.11.1 Tenant Delay Notice.  Except as expressly set forth in this Lease, if there is  an event which Landlord contends is a Tenant Delay, then Landlord shall give Tenant notice of  such Tenant Delay (which notice may be by email to Tenant’s Authorized Representative (as  defined in the Work Letter)) (“Tenant Delay Notice”).  If Tenant fails to remedy the Tenant Delay  within one (1) business day after Tenant’s receipt of a Tenant Delay Notice, then a Tenant Delay  shall be deemed to have occurred.  Notwithstanding anything to the contrary in this Lease, any  delay arising from (a) a failure by Tenant to provide any response or approval within the express  time periods set forth in the Work Letter, or (b) any Changes or Change Requests (as such terms  are defined in the Work Letter) requested by Tenant, shall not require a Tenant Delay Notice to be  deemed a Tenant Delay, but rather shall automatically be deemed a Tenant Delay.  4.11.2 Effect on Commencement Date.  In the event of a Tenant Delay, (a) the  10431 Premises Commencement Date shall be the date that the 10431 Premises Commencement  Date would have occurred but for such Tenant Delay, and (b) the 10421 Premises Commencement  Date shall be the date that the 10421 Premises Commencement Date would have been but for such  Tenant Delay.  5. Condition of Premises. 5.1. 10431 Premises.  Tenant acknowledges that, except as expressly set forth in this Lease, neither Landlord nor any agent of Landlord has made any representation or warranty with  respect to the condition of the 10431 Premises, the 10431 Building or the Project, or with respect  to the suitability of the 10431 Premises, the 10431 Building or the Project for the conduct of  Tenant’s business.  Tenant acknowledges that (a) it is fully familiar with the condition of the 10431  Premises and agrees to take the 10431 Premises in its condition “as is” as of the 10431 Premises  Commencement Date, and (b) Landlord shall have no obligation to alter, repair or otherwise  prepare the 10431 Premises for Tenant’s occupancy or to pay for or construct any improvements  to the 10431 Premises, except for performance of the 10431 Landlord Work, the 10431 Tenant  Improvements and Landlord’s ongoing repair and maintenance obligations hereunder.  Notwithstanding the foregoing, Landlord shall deliver the 10431 Premises to Tenant with the  

 

  11  heating, ventilating and air conditioning, electrical, lighting and plumbing systems serving the  10431 Premises in good working order, condition and repair (such obligation, “Landlord’s  Delivery Obligation”).  If Landlord fails to satisfy Landlord’s Delivery Obligation (a “Delivery  Shortfall”), then Tenant may, as its sole and exclusive remedy, deliver notice of such failure to  Landlord detailing the nature of such failure (a “Shortfall Notice”); provided, further, that any  Shortfall Notice must be received by Landlord no later than the date (the “Shortfall Notice  Deadline”) that is sixty (60) days after the 10431 Premises Commencement Date.  In the event that  Landlord receives a Shortfall Notice on or before the applicable Shortfall Notice Deadline,  Landlord shall, at Landlord’s sole expense (and not as an Operating Expense), promptly remedy  the Delivery Shortfall. Landlord shall not have any obligations or liabilities in connection with a  failure to satisfy Landlord’s Delivery Obligation except to the extent such failure is identified by  Tenant in a Shortfall Notice delivered to Landlord on or before the applicable Shortfall Notice  Deadline.  To the extent assignable, upon written request by Tenant, Landlord will assign to Tenant  the right to enforce all warranties obtained by Landlord in connection with the 10431 Tenant  Improvements; provided, however, that, notwithstanding any such assignment, Landlord shall also  retain the right to enforce such warranties against the applicable contractor, at Landlord’s sole  option.  5.2. 10421 Premises.  Tenant acknowledges that, except as expressly set forth in this  Lease, neither Landlord nor any agent of Landlord has made any representation or warranty with  respect to the condition of the 10421 Premises, the 10421 Building or the Project, or with respect  to the suitability of the 10421 Premises, the 10421 Building or the Project for the conduct of  Tenant’s business.  Tenant acknowledges that (a) it is fully familiar with the condition of the 10421  Premises and agrees to take the 10421 Premises in its condition “as is” as of the 10421 Premises  Commencement Date, and (b) Landlord shall have no obligation to alter, repair or otherwise  prepare the 10421 Premises for Tenant’s occupancy or to pay for or construct any improvements  to the 10421 Premises, except for performance of the 10421 Landlord Work, the 10421 Tenant  Improvements and Landlord’s ongoing repair and maintenance obligations hereunder.   Notwithstanding the foregoing, Landlord shall deliver the 10421 Premises to Tenant with the  heating, ventilating and air conditioning, electrical, lighting and plumbing systems serving the  10421 Premises in good working order, condition and repair (such obligation, “Landlord’s  Delivery Obligation”).  If Landlord fails to satisfy Landlord’s Delivery Obligation (a “Delivery  Shortfall”), then Tenant may, as its sole and exclusive remedy, deliver notice of such failure to  Landlord detailing the nature of such failure (a “Shortfall Notice”); provided, further, that any  Shortfall Notice must be received by Landlord no later than the date (the “Shortfall Notice  Deadline”) that is sixty (60) days after the 10421 Premises Commencement Date.  In the event that  Landlord receives a Shortfall Notice on or before the applicable Shortfall Notice Deadline,  Landlord shall, at Landlord’s sole expense (and not as an Operating Expense), promptly remedy  the Delivery Shortfall. Landlord shall not have any obligations or liabilities in connection with a  failure to satisfy Landlord’s Delivery Obligation except to the extent such failure is identified by  Tenant in a Shortfall Notice delivered to Landlord on or before the applicable Shortfall Notice  Deadline.  To the extent assignable, upon written request by Tenant, Landlord will assign to Tenant  the right to enforce all warranties obtained by Landlord in connection with the 10421 Tenant  Improvements; provided, however, that, notwithstanding any such assignment, Landlord shall also  retain the right to enforce such warranties against the applicable contractor, at Landlord’s sole  option.  

 

12  6. Rentable Area. 6.1. The term “Rentable Area” shall reflect such areas as reasonably calculated by Landlord’s architect, as the same may be reasonably adjusted from time to time by Landlord in  consultation with Landlord’s architect to reflect changes to the Premises, the Building or the  Project, as applicable.  Notwithstanding the foregoing or Section 6.5 below to the contrary, in no  event shall the Rentable Area of the Premises, the Building or the Project, as applicable, be deemed  to have increased unless due to a physical change in the same.  6.2. The Rentable Area of each Building is generally determined by making separate  calculations of Rentable Area applicable to each floor within each Building and totaling the  Rentable Area of all floors within the Building.  The Rentable Area of a floor is computed by  measuring to the outside finished surface of the permanent outer Building walls.  The full area  calculated as previously set forth is included as Rentable Area, without deduction for columns and  projections or vertical penetrations, including stairs, elevator shafts, flues, pipe shafts, vertical  ducts and the like, as well as such items’ enclosing walls.  6.3. The term “Rentable Area,” when applied to the Premises, is that area equal to the  usable area of the Premises, plus an equitable allocation of Rentable Area within the Building that  is not then utilized or expected to be utilized as usable area, including that portion of the Building  devoted to corridors, equipment rooms, restrooms, elevator lobby, atrium and mailroom.  6.4. The Rentable Area of the Project is the total Rentable Area of all buildings within  the Project.  6.5. Review of allocations of Rentable Areas as between tenants of each Building and  the Project shall be made as frequently as Landlord deems appropriate, including in order to  facilitate an equitable apportionment of Operating Expenses (as defined below).  If such review is  by a licensed architect and allocations are certified by such licensed architect as being correct, then  Tenant shall be bound by such certifications.  7. Rent. 7.1. Tenant shall pay to Landlord as Base Rent for (i) the 10431 Premises, commencing on the 10431 Premises Commencement Date and (ii) the 10421 Premises, commencing on the  10421 Premises Commencement Date, the sums set forth in Section 2.3, subject to the rental  adjustments provided in Article 8 hereof.  Base Rent shall be paid in equal monthly installments  as set forth in Section 2.3, subject to the rental adjustments provided in Article 8 hereof, each in  advance on the first day of each and every calendar month during the Term.  7.2. In addition to Base Rent, Tenant shall pay to Landlord as additional rent  (“Additional Rent”) at times hereinafter specified in this Lease (a) Tenant’s Adjusted Share (as  defined below) of Operating Expenses (as defined below), (b) the Property Management Fee (as  defined below), (c) [Intentionally omitted] and (d) any other amounts that Tenant assumes or  agrees to pay under the provisions of this Lease that are owed to Landlord, including any and all  other sums that may become due by reason of any default of Tenant or failure on Tenant’s part to  comply with the agreements, terms, covenants and conditions of this Lease to be performed by  Tenant, after notice and the lapse of any applicable cure periods.  

 

13  7.3. Base Rent and Additional Rent shall together be denominated “Rent.”  Rent shall  be paid to Landlord, without abatement, deduction or offset, in lawful money of the United States  of America to the address set forth in Section 2.8 or to such other person or at such other place as  Landlord may from time designate in writing.  In the event the Term commences or ends on a day  other than the first day of a calendar month, then the Rent for such fraction of a month shall be  prorated for such period on the basis of the number of days in the month and shall be paid at the  then-current rate for such fractional month.  7.4. Tenant’s obligation to pay Rent shall not be discharged or otherwise affected by (a)  any Applicable Laws now or hereafter applicable to the Premises, (b) any other restriction on  Tenant’s use, (c) except as expressly provided herein, any casualty or taking or (d) any other  occurrence; and Tenant waives all rights now or hereafter existing to terminate or cancel this Lease  or quit or surrender the Premises or any part thereof, or to assert any defense in the nature of  constructive eviction to any action seeking to recover rent.  Tenant’s obligation to pay Rent with  respect to any period or obligations arising, existing or pertaining to the period prior to the date of  the expiration or earlier termination of the Term or this Lease shall survive any such expiration or  earlier termination; provided, however, that nothing in this sentence shall in any way affect  Tenant’s obligations with respect to any other period.  8. Rent Adjustments; Free Rent Period. 8.1. Base Rent (including any increase to Base Rent arising from any disbursement of the Additional TI Allowance by Landlord in accordance with this Lease) shall be subject to an  annual upward adjustment of three percent (3%) of the then-current Base Rent.  The first such  adjustment shall become effective commencing on the first (1st) annual anniversary of the later to  occur of the 10431 Premises Commencement Date and the 10421 Premises Commencement Date,  and subsequent adjustments shall become effective on every successive annual anniversary for so  long as this Lease continues in effect.  8.2. Notwithstanding anything to the contrary contained in this Lease, and so long as no  Default (as defined below) by Tenant has occurred, Tenant shall not be required to pay Base Rent  for the first (1st) three (3) months of the Term immediately succeeding the later of (i) the 10431  Premises Commencement Date and (ii) the 10421 Premises Commencement Date (such period,  the “Free Rent Period”); provided, however, that the total amount of Base Rent abated during the  Free Rent Period shall not exceed Nine Hundred Forty-Three Thousand Six Hundred Seventy- Seven and 75/100 Dollars ($943,677.75) (the “Free Rent Cap”).  The Free Rent Cap shall not be  increased as a result of any increase in Base Rent arising from Landlord’s disbursement of any  Additional TI Allowance.  During the Free Rent Period, Tenant shall continue to be responsible  for the payment of all of Tenant’s other Rent obligations under this Lease, including all Additional  Rent such as Operating Expenses, the Property Management Fee (which shall be calculated as if  the Free Rent Period was not in effect), and costs of utilities for the Premises.  Upon the occurrence  of any Default, the Free Rent Period shall immediately expire, and Tenant shall no longer be  entitled to any further abatement of Base Rent pursuant to this Section.  In the event of any Default  that results in termination of this Lease, then, as part of the recovery to which Landlord is entitled  pursuant to this Lease, and in addition to any other rights or remedies to which Landlord may be  entitled pursuant to this Lease (including Article 31), at law or in equity, Landlord shall be entitled  to the immediate recovery, as of the day immediately prior to such termination of the Lease, of the  

 

  14  unamortized amount of Base Rent that Tenant would have paid had the Free Rent Period not been  in effect.  9. Operating Expenses.  9.1 As used herein, the term “Operating Expenses” shall include:  (a) Government impositions, including property tax costs consisting of real and  personal property taxes (including amounts due under any improvement bond upon the 10421  Building, the 10431 Building or the Project (including the parcel or parcels of real property upon  which the 10421 Building, the 10431 Building, any other buildings in the Project and areas serving  the 10421 Building and/or the 10431 Building and the Project are located)) or assessments in lieu  thereof imposed by any federal, state, regional, local or municipal governmental authority, agency  or subdivision (each, a “Governmental Authority”); taxes on or measured by gross rentals received  from the rental of space in the Project; taxes based on the square footage of the Premises, the 10421  Building, the 10431 Building or the Project, as well as any parking charges, utilities surcharges or  any other costs levied, assessed or imposed by, or at the direction of, or arising from Applicable  Laws or interpretations thereof, promulgated by any Governmental Authority in connection with  the use or occupancy of the Project or the parking facilities serving the Project; taxes on this  transaction or any document to which Tenant is a party creating or transferring an interest in the  Premises; any fee for a business license to operate an office building; and any expenses, including  the reasonable cost of attorneys or experts, reasonably incurred by Landlord in seeking reduction  by the taxing authority of the applicable taxes, less tax refunds obtained as a result of an application  for review thereof; provided, however, Operating Expenses will not include and Tenant shall not  be required to pay any tax or assessment expense (i) in excess of the amount which would be  payable if such tax or assessment expense were paid in installments over the longest permitted  term; (ii) imposed on land and improvements other than the Project; (iii) attributable to Landlord’s  gift or transfer taxes (however, in the event of a reassessment of the Property for any reason  whatsoever, including a sale, refinancing, or any change in ownership, any increase in taxes arising  from such reassessment will be included in Operating Expenses); or (iv) taxes that are the personal  obligation of another tenant at the Project; and  (b) All other costs of any kind paid or incurred by Landlord in connection with  the operation or maintenance of the 10421 Building, the 10431 Building and the Project, which  shall include Project office rent at fair market rental for a commercially reasonable amount of  space for Project management personnel, to the extent an office used for Project operations is  maintained at the Project, plus customary expenses for such office, and costs of repairs and  replacements to improvements within the Project as appropriate to maintain the Project as required  hereunder; costs of utilities furnished to the Common Area; sewer fees; cable television; trash  collection; cleaning, including windows; heating, ventilation and air-conditioning (“HVAC”);  maintenance of landscaping and grounds; snow removal; maintenance of drives and parking areas;  maintenance of the roof; security services and devices; building supplies; maintenance or  replacement of equipment utilized for operation and maintenance of the Project; license, permit  and inspection fees; sales, use  and excise taxes on goods and services purchased by Landlord in  connection with the operation, maintenance or repair of Building or Project systems and  equipment; telephone, postage, stationery supplies and other expenses incurred in connection with  the operation, maintenance or repair of the Project; accounting, legal and other professional fees  

 

15  and expenses incurred in connection with the Project; costs of furniture, draperies, carpeting,  landscaping supplies, snow removal and other customary and ordinary items of personal property  provided by Landlord for use in Common Area or in the Project office; Project office rent or rental  value for a commercially reasonable amount of space, to the extent an office used for Project  operations is maintained at the Project, plus customary expenses for such office; capital  expenditures incurred (i) in replacing obsolete equipment, (ii) for the primary purpose of reducing  Operating Expenses or (iii) required by any Governmental Authority to comply with changes in  Applicable Laws that take effect after the earlier of the 10431 Premises Commencement Date or  the 10421 Premises Commencement Date, or to ensure continued compliance with Applicable  Laws in effect as of the earlier of the 10431 Premises Commencement Date or the 10421 Premises  Commencement Date, in each case amortized over the useful life thereof, as reasonably determined  by Landlord, in accordance with generally accepted accounting principles ((i) – (iii) collectively,  “Permitted Capital Expenditures”); costs of complying with Applicable Laws (except to the extent  such costs are incurred to remedy non-compliance existing as of the earlier of the 10431 Premises  Commencement Date or the 10421 Premises Commencement Date); costs to keep the Project in  compliance with, or costs or fees otherwise required under any CC&Rs (as defined below);  insurance premiums, including premiums for commercial general liability, property casualty,  earthquake, terrorism and environmental coverages; portions of insured losses paid by Landlord  as part of the deductible portion of a loss pursuant to the terms of insurance policies; service  contracts; costs of services of independent contractors retained to do work of a nature referenced  above; and costs of compensation (including employment taxes and fringe benefits) of all persons  who perform regular and recurring duties connected with the day-to-day operation and  maintenance of the Project, its equipment, the adjacent walks, landscaped areas, drives and parking  areas, including janitors, floor waxers, window washers, watchmen, gardeners, sweepers, plow  truck drivers, handymen, and engineering/maintenance/facilities personnel.  (c) Notwithstanding the foregoing, Operating Expenses shall not include any net income, franchise, capital stock, estate or inheritance taxes, or taxes that are the personal  obligation of Tenant or of another tenant of the Project; any leasing commissions; expenses that  relate to preparation of rental space for a tenant; expenses of initial development and construction,  including grading, paving, landscaping and decorating (as distinguished from maintenance, repair  and replacement of the foregoing); legal expenses relating to other tenants; costs of repairs to the  extent reimbursed by payment of insurance proceeds received by Landlord; principal or interest  upon loans to Landlord or secured by a loan agreement, mortgage, deed of trust, security  instrument or other loan document covering the Project or a portion thereof (collectively, “Loan  Documents”) (provided that interest upon a government assessment or improvement bond payable  in installments shall constitute an Operating Expense under Subsection 9.1(a)); salaries of  executive officers of Landlord; depreciation claimed by Landlord for tax purposes (provided that  this exclusion of depreciation is not intended to delete from Operating Expenses actual costs of  repairs and replacements that are provided for in Subsection 9.1(b)); taxes that are excluded from  Operating Expenses by the last sentence of Subsection 9.1(a); costs or expenses incurred in  connection with the financing or sale of the Project or any portion thereof (however, in the event  of a reassessment of the Property due to a sale or financing, any increase in taxes arising from such  reassessment will be included in Operating Expenses); costs expressly excluded from Operating  Expenses elsewhere in this Lease or that are charged to or paid by Tenant under other provisions  of this Lease; professional fees and disbursements and other costs and expenses related to the  ownership (as opposed to the use, occupancy, operation, maintenance or repair) of the Project;  

 

16  costs occasioned by the willful violation of any Applicable Laws or the terms and conditions of  any lease by Landlord; costs to correct any violation of Applicable Laws existing at the Project on  the earlier of the 10431 Premises Commencement Date or the 10421 Premises Commencement  Date; costs incurred in connection with negotiations or disputes with any other occupant of the  Project; reserves; capital expenditures other than Permitted Capital Expenditures; costs for services  not provided (or made available) to Tenant or that are paid directly by Tenant; costs incurred to  remove, study, test or remediate Hazardous Materials (as defined below) to the extent (i) such  Hazardous Materials existed on or about the Project in violation of Applicable Laws as of the  Execution Date and did not arise from and were not caused or exacerbated by Tenant or any Tenant  Party, (ii) such Hazardous Materials were brought onto the Project by Landlord or any Landlord  Party (as defined below) after the Execution Date, or (iii) such costs are recovered by Landlord  from any third-party (including any insurer or any other tenant at the Project); ground rental; any  amounts paid to the Landlord or to subsidiaries or affiliates of the Landlord for services in the  Project to the extent the same exceeds the costs of such services rendered by qualified, first-class  unaffiliated third parties on a competitive basis; any item that, if included in Operating Expenses,  would involve a double collection for such item by Landlord; and costs of capital expenditures for  replacements required due to damage caused by fire, windstorm or other casualty (provided,  however, that any amounts paid by Landlord toward insurance deductibles or self-insured  retentions in connection with such capital expenditures shall not be excluded from Operating  Expenses, but rather shall be expressly included in Operating Expenses and amortized in the same  manner as Permitted Capital Expenditures).  To the extent that Tenant uses more than Tenant’s  Pro Rata Share of any item of Operating Expenses, Tenant shall pay Landlord for such excess in  addition to Tenant’s obligation to pay Tenant’s Pro Rata Share of Operating Expenses (such  excess, together with Tenant’s Pro Rata Share, “Tenant’s Adjusted Share”).  9.2 Tenant shall pay to Landlord on the first day of each calendar month of the Term,  as Additional Rent, (a) the Property Management Fee (as defined below), (b) [Intentionally  omitted] and (c) Landlord’s estimate of Tenant’s Adjusted Share of Operating Expenses with  respect to the 10421 Building, the 10431 Building and the Project, as applicable, for such month.  (w) The “Property Management Fee” shall equal three percent (3%) of Base Rent due from Tenant.  Tenant shall pay the Property Management Fee in accordance with Section  9.2 with respect to the entire Term, including any Free Rent Period, any extensions of the Term,  or any holdover periods, regardless of whether Tenant is obligated to pay Base Rent, Operating  Expenses or any other Rent with respect to any such period or portion thereof.  During any Free  Rent Period, the Property Management Fee shall be calculated as if Tenant were paying Base Rent  in the full amount required pursuant to this Lease had the Free Rent Period not been in effect.  (x) [Intentionally omitted]. (y) Within ninety (90) days after the conclusion of each calendar year (or such longer period as may be reasonably required by Landlord), Landlord shall furnish to Tenant a  statement showing in reasonable detail the actual Operating Expenses, Tenant’s Adjusted Share of  Operating Expenses, and the cost of providing utilities to the Premises for the previous calendar  year (“Landlord’s Statement”).  Any additional sum due from Tenant to Landlord shall be due and  payable within thirty (30) days after receipt of an invoice therefor.  If the amounts paid by Tenant  pursuant to this Section exceed Tenant’s Adjusted Share of Operating Expenses for the previous  

 

17  calendar year, then Landlord shall credit the difference against the Rent next due and owing from  Tenant; provided that, if the Lease term has expired, Landlord shall accompany Landlord’s  Statement with payment for the amount of such difference.  (z) Any amount due under this Section for any period that is less than a full month shall be prorated for such fractional month on the basis of the number of days in the month.  9.3 Landlord or an affiliate(s) of Landlord may own other property(ies) adjacent to the  Project or its neighboring properties (collectively, “Neighboring Properties”).  In connection with  Landlord performing services for the Project pursuant to this Lease, similar services may be  performed by the same vendor(s) for Neighboring Properties.  In such a case, Landlord shall  reasonably allocate to the 10421 Building, the 10431 Building and the Project the costs for such  services based upon the ratio that the square footage of the 10421 Building, the 10431 Building or  the Project (as applicable) bears to the total square footage of all of the Neighboring Properties or  buildings within the Neighboring Properties for which the services are performed, unless the scope  of the services performed for any building or property (including the 10421 Building, the 10431  Building and the Project) is disproportionately more or less than for others, in which case Landlord  shall equitably allocate the costs based on the scope of the services being performed for each  building or property (including the 10421 Building, the 10431 Building and the Project).  Since  the Project consists of multiple buildings, certain Operating Expenses may pertain to a particular  building(s) and other Operating Expenses to the Project as a whole.  Landlord reserves the right in  its reasonable discretion to allocate any such costs applicable to any particular building within the  Project to such building, and other such costs applicable to the Project to each building in the  Project (including the 10421 Building, the 10431 Building), with the tenants in each building being  responsible for paying their respective proportionate shares of their buildings to the extent required  under their leases.  Landlord shall allocate such costs to the buildings (including the 10421  Building, the 10431 Building) in a reasonable, non-discriminatory manner, and such allocation  shall be binding on Tenant.  9.4 Landlord’s annual statement shall be final and binding upon Tenant unless Tenant,  within ninety (90) days after Tenant’s receipt thereof, shall contest any item therein by giving  written notice to Landlord, specifying each item contested and the reasons therefor; provided that  Tenant shall in all events pay the amount specified in Landlord’s annual statement, pending the  results of the Tenant Review and determination of the Accountant(s), as applicable and as each  such term is defined below.  If, during such ninety (90)-day period, Tenant reasonably and in good  faith questions or contests the correctness of Landlord’s statement of Tenant’s Adjusted Share of  Operating Expenses, Landlord shall provide Tenant with reasonable access to Landlord’s books  and records to the extent relevant to determination of Operating Expenses, and such information  as Landlord reasonably determines to be responsive to Tenant’s written inquiries.  In the event  that, after Tenant’s review of such information, Landlord and Tenant cannot agree upon the amount  of Tenant’s Adjusted Share of Operating Expenses, then Tenant shall have the right to have (a) an  independent public accounting firm hired by Tenant on an hourly basis and not on a contingent- fee basis (at Tenant’s sole cost and expense) and approved by Landlord (which approval Landlord  shall not unreasonably withhold or delay), or (b) Tenant’s employees, audit and review such of  Landlord’s books and records for the year in question as directly relate to the determination of  Operating Expenses for such year (the “Tenant Review”), but not books and records of entities  other than Landlord.  Landlord shall make such books and records available at the location where  

 

  18  Landlord maintains them in the ordinary course of its business.  Landlord need not provide copies  of any books or records.  Tenant shall commence the Tenant Review within thirty (30) days after  the date Landlord has given Tenant access to Landlord’s books and records for the Tenant Review.   Tenant shall complete the Tenant Review and notify Landlord in writing of Tenant’s specific  objections to Landlord’s calculation of Operating Expenses (including Tenant’s accounting firm’s  or Tenant’s written statement of the basis, nature and amount of each proposed adjustment) no  later than sixty (60) days after Landlord has first given Tenant access to Landlord’s books and  records for the Tenant Review.  Landlord shall review the results of any such Tenant Review.  The  parties shall endeavor to agree promptly and reasonably upon Operating Expenses taking into  account the results of such Tenant Review.  If, as of the date that is sixty (60) days after Tenant  has submitted the Tenant Review to Landlord, the parties have not agreed on the appropriate  adjustments to Operating Expenses, then the parties shall engage a mutually agreeable independent  third party accountant with at least ten (10) years’ experience in commercial real estate accounting  in the San Diego, California area (the “Accountant”).  If the parties cannot agree on the  Accountant, each shall within ten (10) days after such impasse appoint an Accountant (different  from the accountant and accounting firm that conducted the Tenant Review) and, within ten (10)  days after the appointment of both such Accountants, those two Accountants shall select a third  (which cannot be the accountant and accounting firm that conducted the Tenant Review).  If either  party fails to timely appoint an Accountant, then the Accountant the other party appoints shall be  the sole Accountant.  Within ten (10) days after appointment of the Accountant(s), Landlord and  Tenant shall each simultaneously give the Accountants (with a copy to the other party) its  determination of Operating Expenses, with such supporting data or information as each submitting  party determines appropriate.  Within ten (10) days after such submissions, the Accountants shall  by majority vote select either Landlord’s or Tenant’s determination of Operating Expenses.  The  Accountants may not select or designate any other determination of Operating Expenses.  The  determination of the Accountant(s) shall bind the parties.  If the parties agree or the Accountant(s)  determine that the Operating Expenses actually paid by Tenant for the calendar year in question  exceeded Tenant’s obligations for such calendar year, then Landlord shall, at Tenant’s option,  either (a) credit the excess to the next succeeding installments of estimated Additional Rent or (b)  pay the excess to Tenant within thirty (30) days after delivery of such results.  If the parties agree  or the Accountant(s) determine that Tenant’s payments of Operating Expenses for such calendar  year were less than Tenant’s obligation for the calendar year, then Tenant shall pay the deficiency  to Landlord within thirty (30) days after delivery of such results.  If the Landlord agrees that the  Tenant Review revealed, or if the Accountant(s) determine, that the Operating Expenses billed to  Tenant by Landlord and paid by Tenant to Landlord for the applicable calendar year in question  exceeded by more than five percent (5%) what Tenant should have been billed during such  calendar year, then Landlord shall pay (y) the reasonable out-of-pocket cost of the Tenant Review  (if any), and (b) the reasonable cost of the Accountant(s).  In all other cases Tenant shall pay the  cost of the Tenant Review and the Accountant(s).  9.5. Tenant shall not be responsible for Operating Expenses (i) as to the 10431 Premises,  with respect to any time period prior to the 10431 Premises Commencement Date and (ii) as to the  10421 Premises, with respect to any time period prior to the 10421 Premises Commencement Date;  provided, however, that Landlord may annualize certain Operating Expenses incurred prior to the  10431 Premises Commencement Date or the 10421 Premises Commencement Date, as applicable,  over the course of the budgeted year during which the 10431 Premises Commencement Date or  the 10421 Premises Commencement Date, as applicable, occurs, and Tenant shall be responsible  

 

  19  for the annualized portion of such Operating Expenses corresponding to the number of days during  such year, commencing with the 10431 Premises Commencement Date or the 10421 Premises  Commencement Date, as applicable, for which Tenant is otherwise liable for Operating Expenses  pursuant to this Lease.  Tenant’s responsibility for Tenant’s Adjusted Share of Operating Expenses  shall continue to the later of (a) the date of termination of the Lease and (b) the date Tenant has  fully vacated the Premises; provided, however, in the event this Lease is terminated in connection  with a Default by Tenant, the Rent that Landlord may recover pursuant to Article 31 or otherwise  on account of such Default may include Tenant’s obligations under this Lease with respect to  Operating Expenses.  9.6. Operating Expenses for the calendar year in which Tenant’s obligation to share  therein commences and for the calendar year in which such obligation ceases shall be prorated on  a basis reasonably determined by Landlord.  Expenses such as taxes, assessments and insurance  premiums that are incurred for an extended time period shall be prorated based upon the time  periods to which they apply so that the amounts attributed to the Premises relate in a reasonable  manner to the time period wherein Tenant has an obligation to share in Operating Expenses.  9.7. In the event that the 10421 Building, the 10431 Building or the Project is less than  fully occupied during a calendar year, Tenant acknowledges that Landlord may extrapolate  Operating Expenses that vary depending on the occupancy of the 10421 Building, the 10431  Building or the Project, as applicable, to equal Landlord’s reasonable estimate of what such  Operating Expenses would have been had the 10421 Building, the 10431 Building or the Project,  as applicable, been ninety-five percent (95%) occupied during such calendar year; provided,  however, that Landlord shall not recover more than one hundred percent (100%) of Operating  Expenses.  10. Taxes on Tenant’s Property.  10.1. Tenant shall be solely responsible for the payment of any and all taxes levied upon  (a) personal property and trade fixtures located at the Premises and (b) any gross or net receipts of  or sales by Tenant, and shall pay the same at least ten (10) days prior to delinquency.  10.2. If any such taxes on Tenant’s personal property or trade fixtures are levied against  Landlord or Landlord’s property or, if the assessed valuation of the Building, the Property or the  Project is increased by inclusion therein of a value attributable to Tenant’s personal property or  trade fixtures, and if Landlord, after written notice to Tenant, pays the taxes based upon any such  increase in the assessed value of the Building, the Property or the Project, then Tenant shall, upon  demand, repay to Landlord the taxes so paid by Landlord.  10.3. If any improvements in or alterations to the Premises installed by or for Tenant  (other than the Landlord Work and Tenant Improvements), whether owned by Landlord or Tenant  and whether or not affixed to the real property so as to become a part thereof, are assessed for real  property tax purposes at a valuation higher than the valuation at which improvements conforming  to Landlord’s building standards (the “Building Standard”) in other spaces in the Building are  assessed, then the real property taxes and assessments levied against Landlord or the Building, the  Property or the Project by reason of such excess assessed valuation shall be deemed to be taxes  levied against personal property of Tenant and shall be governed by the provisions of Section 10.2.   

 

20  Any such excess assessed valuation due to improvements in or alterations to space in the Project  leased by other tenants at the Project shall not be included in Operating Expenses.  If the records  of the applicable governmental assessor’s office are available and sufficiently detailed to serve as  a basis for determining whether such Tenant improvements or alterations are assessed at a higher  valuation than the Building Standard, then such records shall be binding on both Landlord and  Tenant.  11. Security Deposit. 11.1. Tenant shall deposit with Landlord on or before the Execution Date the sum set forth in Section 2.6 (the “Security Deposit”), which sum shall be held by Landlord as security for  the faithful performance by Tenant of all of the terms, covenants and conditions of this Lease to  be kept and performed by Tenant.  If Tenant Defaults (as defined below) with respect to any  provision of this Lease, including any provision relating to the payment of Rent, then Landlord  may (but shall not be required to) use, apply or retain all or any part of the Security Deposit for  the payment of any Rent or any other sum in default, or to compensate Landlord for any other loss  or damage that Landlord may suffer by reason of Tenant’s default.  If any portion of the Security  Deposit is so used or applied, then Tenant shall, within ten (10) days following demand therefor,  deposit cash with Landlord in an amount sufficient to restore the Security Deposit to its original  amount, and Tenant’s failure to do so shall be a material breach of this Lease.  The provisions of  this Article shall survive the expiration or earlier termination of this Lease. TENANT HEREBY  WAIVES THE REQUIREMENTS OF SECTION 1950.7 OF THE CALIFORNIA CIVIL CODE,  AS THE SAME MAY BE AMENDED FROM TIME TO TIME.  11.2. In the event of bankruptcy or other debtor-creditor proceedings against Tenant, the  Security Deposit shall be deemed to be applied first to the payment of Rent and other charges due  Landlord for all periods prior to the filing of such proceedings.  11.3. Landlord may deliver to any purchaser of Landlord’s interest in the Premises the  funds deposited hereunder by Tenant, and thereupon Landlord shall be discharged from any further  liability with respect to such deposit.  This provision shall also apply to any subsequent transfers.  11.4. Subject to Landlord’s right to draw on the Security Deposit under the terms,  conditions and provisions of this Article 11, the Security Deposit, or any balance thereof, shall be  returned to Tenant (or, at Landlord’s option, to the last assignee of Tenant’s interest hereunder)  within sixty (60) days after the expiration or earlier termination of this Lease.  11.5. If the Security Deposit shall be in cash, Landlord shall hold the Security Deposit in  an account at a banking organization selected by Landlord; provided, however, that Landlord shall  not be required to maintain a separate account for the Security Deposit, but may intermingle it with  other funds of Landlord.  Landlord shall be entitled to all interest and/or dividends, if any, accruing  on the Security Deposit.  Landlord shall not be required to credit Tenant with any interest for any  period during which Landlord does not receive interest on the Security Deposit.   11.6. The Security Deposit may be in the form of cash, a letter of credit or any other  security instrument acceptable to Landlord in its sole discretion.  Tenant may at any time, except  when Tenant is in Default (as defined below), deliver a letter of credit (the “L/C Security”) as the  entire Security Deposit, as follows:  

 

  21  (a) If Tenant elects to deliver L/C Security, then Tenant shall provide Landlord,  and maintain in full force and effect throughout the Term and until the date that is four (4) months  after the then-current Term Expiration Date, a letter of credit in the form of Exhibit E issued by an  issuer reasonably satisfactory to Landlord, in the amount of the Security Deposit, with an initial  term of at least one year.  Landlord hereby approves of Silicon Valley Bank as the issuing bank.   Landlord may require the L/C Security to be re-issued by a different issuer at any time during the  Term if Landlord reasonably believes that the issuing bank of the L/C Security is or may soon  become insolvent; provided, however, Landlord shall return the existing L/C Security to Tenant  immediately upon receipt of the substitute L/C Security.  If any issuer of the L/C Security shall  become insolvent or placed into FDIC receivership, then Tenant shall immediately deliver to  Landlord (without the requirement of notice from Landlord) cash or a substitute L/C Security  issued by an issuer reasonably satisfactory to Landlord, and otherwise conforming to the  requirements set forth in this Article 11.  As used herein with respect to the issuer of the L/C  Security, “insolvent” means the determination of insolvency as made by such issuer’s primary  bank regulator (i.e., the state bank supervisor for state chartered banks; the OCC or OTS,  respectively, for federally chartered banks or thrifts; or the Federal Reserve for its member banks).   Tenant shall reimburse Landlord’s reasonable out-of-pocket legal costs (as estimated by  Landlord’s counsel) in handling Landlord’s acceptance of L/C Security or its replacement or  extension (other than the initial L/C Security).  Tenant may at any time substitute cash for the L/C  Security, and upon deposit of the cash security deposit, Landlord will return the L/C Security to  Tenant.   If Landlord draws upon the L/C Security, Tenant shall at any time thereafter be entitled  to provide Landlord with a replacement L/C Security that satisfies the requirements hereunder, at  which time Landlord shall return the unapplied cash proceeds of the original L/C Security drawn  by Landlord.  (b) If Tenant delivers to Landlord satisfactory L/C Security in place of the  entire Security Deposit, Landlord shall remit to Tenant any cash Security Deposit Landlord  previously held.  (c) Landlord may draw upon the L/C Security, and hold and apply the proceeds  in the same manner and for the same purposes as the Security Deposit, if (i) an uncured Default  (as defined below) exists, (ii) as of the date that is thirty (30) days before any L/C Security expires  (even if such scheduled expiry date is after the Term Expiration Date) Tenant has not delivered to  Landlord an amendment or replacement for such L/C Security, reasonably satisfactory to  Landlord, extending the expiry date to the earlier of (1) four (4) months after the then-current Term  Expiration Date or (2) the date that is one year after the then-current expiry date of the L/C  Security, (iii) the L/C Security provides for automatic renewals, Landlord asks the issuer to  confirm the current L/C Security expiry date, and the issuer fails to do so within ten (10) business  days; provided, that, Landlord shall provide notice to Tenant concurrently with any such request,  (iv) Tenant fails to pay (when and as the issuer reasonably requires) any bank charges for  Landlord’s transfer of the L/C Security or (v) the issuer of the L/C Security ceases, or announces  that it will cease, to maintain an office in the city where Landlord may present drafts under the L/C  Security (and fails to permit drawing upon the L/C Security by overnight courier or facsimile).   This Section does not limit any other provisions of this Lease allowing Landlord to draw the L/C  Security under specified circumstances.  

 

  22  (d) Tenant shall not seek to enjoin, prevent, or otherwise interfere with  Landlord’s draw under L/C Security, even if it violates this Lease.  Tenant acknowledges that the  only effect of a wrongful draw would be to substitute a cash Security Deposit for L/C Security,  causing Tenant no legally recognizable damage.  Landlord shall hold the proceeds of any draw in  the same manner and for the same purposes as a cash Security Deposit.  In the event of a wrongful  draw, the parties shall cooperate to allow Tenant to post replacement L/C Security simultaneously  with the return to Tenant of the wrongfully drawn sums, and Landlord shall upon request confirm  in writing to the issuer of the L/C Security that Landlord’s draw was erroneous.  (e) If Landlord transfers its interest in the Premises, then Tenant shall at  Tenant’s expense, within five (5) business days after receiving a request from Landlord, deliver  (and, if the issuer requires, Landlord shall consent to) an amendment to the L/C Security naming  Landlord’s grantee as substitute beneficiary.  If the required Security Deposit changes while L/C  Security is in force, then Tenant shall deliver (and, if the issuer requires, Landlord shall consent  to) a corresponding amendment to the L/C Security.  12. Use.   12.1. Tenant shall use the Premises for the Permitted Use, and shall not use the Premises,  or permit or suffer the Premises to be used, for any other purpose without Landlord’s prior written  consent, which consent Landlord may withhold in its sole and absolute discretion.  Tenant shall be  prohibited from using the Premises or any portion of the Property for the sale, distribution or  production of marijuana.  12.2. Tenant shall not use or occupy the Premises in violation of Applicable Laws; zoning  ordinances; or the certificate of occupancy (or its legal equivalent) issued for the Building or the  Project, and shall, upon five (5) days’ written notice from Landlord, discontinue any use of the  Premises that is declared or claimed by any Governmental Authority having jurisdiction to be a  violation of any of the above, or that in Landlord’s reasonable opinion violates any of the above.   Tenant shall take such further actions and execute such further documents in connection with this  Lease as are necessary to comply with Applicable Laws relating to privacy, personal information  and data security, including the California Consumer Privacy Act.  Tenant acknowledges that  Landlord may collect certain personal information (e.g., names, email addresses and contact  information) of Tenant’s and its affiliates’ employees (and, if applicable, subcontractors and  consultants), and use such information in connection with performing Landlord’s duties and  obligations, and exercising its rights under this Lease.  Neither Landlord nor Tenant shall retain,  use or disclose any personal information received from the other party pursuant to this Lease for  any purpose other than to perform its duties and obligations, and exercise its rights under this Lease  or as required by Applicable Law.  In the event of a conflict between this Section and Article 38,  this Section shall govern. Tenant shall comply with any direction of any Governmental Authority  having jurisdiction that shall, by reason of the nature of Tenant’s use or occupancy of the Premises,  impose any duty upon Tenant or Landlord with respect to the Premises or with respect to the use  or occupation thereof, and shall indemnify, defend (at the option of and with counsel reasonably  acceptable to the indemnified party(ies)), save, reimburse and hold harmless (collectively,  “Indemnify,” “Indemnity” or “Indemnification,” as the case may require) Landlord and its  affiliates, employees, agents and contractors; and any lender, mortgagee, ground lessor or  beneficiary (each, a “Lender” and, collectively with Landlord and its affiliates, employees, agents  

 

  23  and contractors, the “Landlord Indemnitees”) harmless from and against any and all demands,  claims, liabilities, losses, costs, expenses, actions, causes of action, damages, suits or judgments,  and all reasonable expenses (including reasonable attorneys’ fees, charges and disbursements,  regardless of whether the applicable demand, claim, action, cause of action or suit is voluntarily  withdrawn or dismissed) incurred in investigating or resisting the same (collectively, “Claims”) of  any kind or nature that arise before, during or after the Term as a result of Tenant’s breach of this  Section.  In the event that any Governmental Authority requires legal compliance work to be  completed in the Common Area (any such work, “Common Area Legal Compliance Work”),  Landlord shall be responsible for performing such Common Area Legal Compliance Work and all  costs incurred by Landlord in connection with such Common Area Legal Compliance Work (any  such costs, “Common Area Legal Compliance Work Costs”) shall be included in Operating  Expenses to the extent permitted under Article 9; provided, however, that if any Common Area  Legal Compliance Work is triggered by, or necessitated as a result of, (a) the unique nature of the  Tenant Improvements (as opposed to Common Area Legal Compliance Work that would have  been required as a condition to the issuance or sign off on any permit at the Building), (b) any  Alterations (as defined below) performed by or on behalf of Tenant (other than the Tenant  Improvements), or (c) Tenant’s particular use of the Premises (as opposed to general office and  laboratory use), then Tenant shall be solely responsible, and shall reimburse Landlord within thirty  (30) days of receiving an invoice, for all Common Area Legal Compliance Work Costs incurred  by Landlord in connection with such Common Area Legal Compliance Work.  12.3. Tenant shall not do or permit to be done anything that will invalidate or increase  the cost of any fire, environmental, extended coverage or any other insurance policy covering the  Buildings or the Project, and shall comply with all rules, orders, regulations and requirements of  the insurers of the Buildings and the Project, and Tenant shall promptly, upon demand, reimburse  Landlord for any additional premium charged for such policy by reason of Tenant’s failure to  comply with the provisions of this Article.  12.4. Tenant shall keep all doors opening onto public corridors closed, except when in  use for ingress and egress.  12.5. No additional locks or bolts of any kind shall be placed upon any of the doors or  windows by Tenant, nor shall any changes be made to existing locks or the mechanisms thereof  without Landlord’s prior written consent.  Tenant shall, upon termination of this Lease, return to  Landlord all keys to offices and restrooms either furnished to or otherwise procured by Tenant.  In  the event any key so furnished to Tenant is lost, Tenant shall pay to Landlord the cost of replacing  the same or of changing the lock or locks opened by such lost key if Landlord shall deem it  necessary to make such change.  12.6. No awnings or other projections shall be attached to any outside wall of the 10421  Building or the 10431 Building.  No curtains, blinds, shades or screens shall be attached to or hung  in, or used in connection with, any window or door of the Premises other than Landlord’s standard  window coverings.  Neither the interior nor exterior of any windows shall be coated or otherwise  sunscreened without Landlord’s prior written consent, nor shall any bottles, parcels or other  articles be placed on the windowsills or items attached to windows that are visible from outside  the Premises.  No equipment, furniture or other items of personal property shall be placed on any  exterior balcony without Landlord’s prior written consent.  

 

  24  12.7. No sign, advertisement or notice (“Signage”) shall be exhibited, painted or affixed  by Tenant on any part of the Premises or the 10421 Building or the 10431 Building without  Landlord’s prior written consent.  Signage shall conform to Landlord’s design criteria established  from time to time.  For any Signage, Tenant shall, at Tenant’s own cost and expense, (a) acquire  all permits for such Signage in compliance with Applicable Laws and (b) design, fabricate, install  and maintain such Signage in a first-class condition.  Tenant shall be responsible for reimbursing  Landlord for costs incurred by Landlord in removing any of Tenant’s Signage upon the expiration  or earlier termination of the Lease.  Interior signs on entry doors to the Premises and the directory  tablet shall be inscribed, painted or affixed for Tenant by Landlord at Tenant’s sole cost and  expense, and shall be of a size, color and type and be located in a place acceptable to Landlord.   The directory tablet shall be provided exclusively for the display of the name and location of  tenants only.  Tenant shall not place anything on the exterior of the corridor walls or corridor doors  other than Landlord’s standard lettering.  At Landlord’s option, Landlord may install any Tenant  Signage, and Tenant shall pay all costs associated with such installation within thirty (30) days  after demand therefor.   12.7.1 Subject to the terms, conditions and provisions of this Subsection 12.7.1,  Tenant shall be entitled to install, at its sole cost and expense, one (1) building top sign in a location  reasonably designated by Landlord on the 10431 Building (the “Building Top Sign”).  The  graphics, materials, size, color, design, lettering, lighting (if any), specifications and exact location  of the Building Top Sign (collectively, the "Signage Specifications") shall be subject to the prior  written approval of Landlord, which approval shall not be unreasonably withheld, conditioned or  delayed.  In addition, the Building Top Sign and all Signage Specifications therefore shall be  subject to Tenant's receipt of all required governmental permits and approvals, and shall be subject  to all Applicable Laws affecting the Project.  In the event Tenant does not receive the necessary  permits and approvals for the Building Top Sign, Tenant's and Landlord's rights and obligations  under the remaining provisions of this Lease shall not be affected.  All costs associated with  Tenant’s Signage (including the Building Top Sign) including, without limitation, costs of  installation, design, construction, permits, maintenance and repair, shall be the sole responsibility  of Tenant.  At Landlord’s option, Landlord may install the Building Top Sign, and Tenant shall  pay all costs associated with such installation within thirty (30) days after demand therefor.  Should  Tenant’s Signage (including the Building Top Sign) require maintenance or repairs as determined  in Landlord’s reasonable judgment, Landlord shall have the right to provide written notice thereof  to Tenant and Tenant shall cause such repairs and/or maintenance to be performed within thirty  (30) days after receipt of such notice from Landlord at Tenant’s sole cost and expense.  Should  Tenant fail to perform such maintenance and repairs within the period described in the immediately  preceding sentence, Landlord shall have the right to cause such work to be performed and to charge  Tenant, as Additional Rent, for the cost of such work.  Upon the expiration or earlier termination  of this Lease, Tenant shall, at Tenant’s sole cost and expense, cause the Building Top Sign to be  removed from the 10431 Building and shall cause exterior façade of the 10431 Building to be  restored to the condition existing prior to the placement of the Building Top Sign.  If Tenant fails  to remove the Building Top Sign and to restore the exterior façade of the 10431 Building as  provided in the immediately preceding sentence within thirty (30) days following the expiration  or earlier termination of this Lease, then Landlord may perform such work, and all costs and  expenses incurred by Landlord in so performing such work shall be reimbursed by Tenant to  Landlord within thirty (30) days after Tenant’s receipt of invoice therefore.  The immediately  preceding sentence shall survive the expiration or earlier termination of this Lease. Should the  

 

25  name of the original Tenant change, then the Signage may be modified at Tenant’s sole cost and  expense to reflect the new name, but only if the new name does not (i) relate to an entity that is of  a character, reputation, or associated with a political orientation or a faction, that is inconsistent  with the quality of the Building or would otherwise reasonably offend an institutional landlord of  a project comparable to the Building, taking into consideration the level and visibility of such  signage or (ii) cause Landlord or its affiliate(s) to be in default under any lease or license with  another tenant of the Project.  12.8. Tenant may only place equipment within the Premises with floor loading consistent  with the Building’s structural design unless Tenant obtains Landlord’s prior written approval.  Tenant may place such equipment only in a location designed to carry the weight of such  equipment.  12.9. Tenant shall cause any equipment or machinery to be installed in the Premises so  as to reasonably prevent sounds or vibrations therefrom from extending into the Common Area or  other offices in the Project.  12.10. Tenant shall not (a) do or permit anything to be done in or about the Premises that  shall in any way obstruct or interfere with the rights of other tenants or occupants of the Project,  or injure or annoy them, (b) use or allow the Premises to be used for immoral or unlawful purposes  (measured based on uses which would be immoral to an institutional quality landlord of life  sciences projects comparable to the Project in the San Diego, California area), (c) cause, maintain  or permit any nuisance or waste in, on or about the Project or (d) take any other action that would  in Landlord’s reasonable determination in any manner adversely affect other tenants’ quiet use and  enjoyment of their space or adversely impact their ability to conduct business in a professional and  suitable work environment.  Notwithstanding any other provision herein to the contrary, but  subject to the last sentence of Section 12.2 above, Tenant shall be responsible for all liabilities,  costs and expenses arising from or in connection with the compliance of the Premises with the  Americans with Disabilities Act, 42 U.S.C. § 12101, et seq., and any state and local accessibility  laws, codes, ordinances and rules (collectively, and together with regulations promulgated  pursuant thereto, the “ADA”), and Tenant shall Indemnify the Landlord Indemnitees from and  against any Claims arising from any such failure of the Premises to comply with the ADA.  For  clarity, nothing in this Section 12.10 will require Tenant to perform legal compliance upgrades to  the Premises which are not required by any applicable Governmental Authorities (e.g., due to  “grandfathering” or similar provisions) unless failure to comply would result in a risk of personal  injury or property damage.  The Premises have not undergone inspection by a Certified Access  Specialist (“CASp,” as defined in California Civil Code Section 55.52).  Even if not required by  California law, the Premises may be inspected by a CASp to determine whether the Premises  comply with the ADA, and Landlord may not prohibit a CASp performing such an inspection.  If  Tenant requests that such an inspection take place, Landlord and Tenant shall agree on the time  and manner of the inspection, as well as which party will pay the cost of the inspection and the  cost to remedy any defects identified by the CASp.  A Certified Access Specialist can inspect the  Premises and determine whether the Premises comply with all of the applicable construction- related accessibility standards under State law. Although State law does not require a Certified  Access Specialist inspection of the Premises, Landlord may not prohibit Tenant from obtaining a  Certified Access Specialist inspection of the Premises for the occupancy or potential occupancy  of Tenant, if requested by Tenant. Landlord and Tenant shall agree on the arrangements for the  

 

  26  time and manner of the Certified Access Specialist inspection, the payment of the fee for the  Certified Access Specialist inspection, and the cost of making any repairs necessary to correct  violations of construction-related accessibility standards within the Premises.  For the avoidance  of doubt, “Lenders” shall also include historic tax credit investors and new market tax credit  investors.  The provisions of this Section shall survive the expiration or earlier termination of this  Lease.  13. Rules and Regulations, CC&Rs, Parking Facilities and Common Area.   13.1. Tenant shall have the non-exclusive right, in common with others, to use the  Common Area in conjunction with Tenant’s use of the Premises for the Permitted Use, and such  use of the Common Area and Tenant’s use of the Premises shall be subject to the rules and  regulations adopted by Landlord and attached hereto as Exhibit F, together with such other  reasonable and nondiscriminatory rules and regulations as are hereafter promulgated by Landlord  in its sole and absolute discretion (the “Rules and Regulations”).  Tenant shall and shall ensure  that its contractors, subcontractors, employees, subtenants and invitees faithfully observe and  comply with the Rules and Regulations.  Landlord shall not be responsible to Tenant for the  violation or non-performance by any other tenant or any agent, employee or invitee thereof of any  of the Rules and Regulations.  13.2. This Lease is subject to any recorded covenants, conditions or restrictions on the  Project or Property as of the date hereof, or added after the date hereof provided Tenant is notified  thereof, as the same may be amended, amended and restated, supplemented or otherwise modified  from time to time (the “CC&Rs”); provided that Landlord agrees not to voluntarily execute any  further amendments, restatements, supplements or modifications of the CC&Rs that would  materially and adversely affect Tenant’s material rights under this Lease.  Tenant shall, at its sole  cost and expense, comply with the CC&Rs.   13.3. Notwithstanding anything in this Lease to the contrary, Tenant may not install any  security systems (including cameras) outside the Premises or that record sounds or images outside  the Premises without Landlord’s prior written consent, which Landlord may withhold in its sole  and absolute discretion.  13.4. Tenant shall have a non-exclusive, irrevocable license to use Tenant’s Pro Rata  Share of parking facilities serving the Project in common on an unreserved basis with other tenants  of the Project during the Term at no additional cost.  As of the Execution Date, Tenant’s Pro Rata  Share of parking facilities is equal to three (3) parking spaces per one thousand (1,000) square feet  of Rentable Area of the Premises.  Landlord shall, at Landlord’s sole cost and expense, install eight  (8) EV charging stations in the parking facilities serving the Project for non-exclusive use of  tenants at the Project.  13.5. Tenant agrees not to unreasonably overburden the parking facilities and agrees to  cooperate with Landlord and other tenants in the use of the parking facilities.  Landlord reserves  the right to determine that parking facilities are becoming overcrowded and to limit Tenant’s use  thereof (but not to fewer parking spaces than the ratio allocated to Tenant pursuant to Section 13.4  above).  Upon such determination, Landlord may reasonably allocate parking spaces among  Tenant and other tenants of a Building or the Project (consistent with Section 13.4 above).  Nothing  

 

  27  in this Section, however, is intended to create an affirmative duty on Landlord’s part to monitor  parking.  13.6. Subject to the terms of this Lease including the Rules and Regulations and the rights  of other tenants of the 10431 Building, Tenant shall have (i) the exclusive right to access the freight  loading dock serving the 10431 Premises, at no additional cost and (ii) the non-exclusive right to  access the freight loading dock serving the 10421 Building, at no additional cost.  13.7. Notwithstanding the foregoing, Tenant may, at Tenant’s sole cost and expense as  an Alteration (as defined below), install its own security system in the Premises (the “Tenant  Security System”); provided, however, that (a) Tenant’s installation of the Tenant Security System  shall be subject to all of the terms, conditions and provisions of this Lease governing Alterations  (including, without limitation, Article 17), and (b) Tenant shall coordinate the installation and  operation of the Tenant Security System with Landlord to assure that the Tenant Security System  does not interfere with (y) any Landlord security system in place as of the as of the 10431 Premises  Commencement Date or the 10421 Premises Commencement Date, as applicable (for which  security system Landlord makes no warranties of any kind whatsoever), and (z) the 10421  Building‘s or the 10431 Building’s, as applicable, systems and equipment.  Tenant shall be solely  responsible, at Tenant’s sole cost and expense, for monitoring and operating the Tenant Security  System.  Landlord may require Tenant, at Tenant’s sole cost, to remove the Tenant Security System  and restore each Building to its condition prior to the installation of the Tenant Security System  upon the expiration or earlier termination of this Lease.  14. Project Control by Landlord.   14.1. Landlord reserves full control over the 10421 Building, the 10431 Building and the  Project to the extent not inconsistent with Tenant’s enjoyment of the Premises as provided by this  Lease.  This reservation includes Landlord’s right to subdivide the Project; convert the 10421  Building, the 10431 Building and other buildings within the Project to condominium units; change  the size of the Project by selling all or a portion of the Project or adding real property and any  improvements thereon to the Project; grant easements and licenses to third parties; maintain or  establish ownership of the Building separate from fee title to the Property; make additions to or  reconstruct portions of the Building and the Project; install, use, maintain, repair, replace and  relocate for service to the Premises and other parts of the Building or the Project pipes, ducts,  conduits, wires and appurtenant fixtures, wherever located in the Premises, the Building or  elsewhere at the Project; and alter or relocate any other Common Area or facility, including private  drives, lobbies, entrances and landscaping; provided, however, that such rights shall be exercised  in a way that does not materially adversely affect Tenant’s rights or obligations under this Lease  including, without limitation, Tenant’s beneficial use and occupancy of the Premises, including  the Permitted Use and Tenant’s access to the Premises.  Tenant acknowledges that Landlord  specifically reserves the right to allow the exclusive use of corridors and restroom facilities located  on specific floors to one or more tenants occupying such floors; provided, however, that Tenant  shall not be deprived of the use of the corridors reasonably required to serve the Premises or of  restroom facilities serving the floor upon which the Premises are located.  14.2. Possession of areas of the Premises necessary for utilities, services, safety and  operation of the 10421 Building and/or the 10431 Building is reserved to Landlord.  In exercising  

 

  28  its rights pursuant to this Section 14.2, Landlord will use commercially reasonable efforts to  minimize interference with Tenant’s use and occupancy of the Premises.  14.3. Tenant shall, at Landlord’s request, promptly execute such further documents as  may be reasonably appropriate to assist Landlord in the performance of its obligations hereunder;  provided that Tenant need not execute any document that materially and adversely affects Tenant’s  rights or obligations under this Lease, creates additional liability for Tenant or that deprives Tenant  of the quiet enjoyment and use of the Premises or materially decreases Tenant’s parking allocation  as provided for in this Lease.  14.4. Landlord may, at any and all reasonable times during business hours (or during  non-business hours, if (a) with respect to Subsections 14.4(u) through 14.4(y), Tenant so requests,  and (b) with respect to Subsection 14.4(z), if Landlord so requests), and upon twenty-four (24)  hours’ prior notice (which may be by email to the Tenant-designated individual at the Premises  (as of the Execution Date, the Tenant designated email for purposes of this provision shall be  finance@codexdna.com); but provided that no time restrictions shall apply or advance notice be  required if an emergency necessitates immediate entry), enter the Premises to (u) inspect the same  and to determine whether Tenant is in compliance with its obligations hereunder, (v) supply any  service Landlord is required to provide hereunder, (w) alter, improve or repair any portion of the  10421 Building or the 10431 Building other than the Premises for which access to the Premises is  reasonably necessary, (x) post notices of nonresponsibility, (y) access the telephone equipment,  electrical substation and fire risers and (z) show the Premises to prospective tenants, or permit a  future tenant of the Premises to inspect and measure the Premises in anticipation of such tenant’s  future occupancy of the Premises during the final nine (9) months of the Term and show the  Premises to current and prospective purchasers and lenders at any time.  In connection with any  such alteration, improvement or repair as described in Subsection 14.4(w), Landlord may erect in  the Premises or elsewhere in the Project scaffolding and other structures reasonably required for  the alteration, improvement or repair work to be performed.  In no event shall Tenant’s Rent abate  as a result of Landlord’s activities pursuant to this Section; provided, however, that all such  activities shall be conducted in such a manner so as to cause as little interference to Tenant as is  reasonably possible.  Landlord shall at all times retain a key with which to unlock all of the doors  in the Premises.  If an emergency necessitates immediate access to the Premises, Landlord may  use whatever force is necessary to enter the Premises, and any such entry to the Premises shall not  constitute a forcible or unlawful entry to the Premises, a detainer of the Premises, or an eviction  of Tenant from the Premises or any portion thereof.  Except in case of an emergency or in  connection with the provision of services performed by Landlord under this Lease, Tenant shall  have a reasonable opportunity to have a representative of Tenant accompany Landlord during any  entry into the Premises pursuant to this Section; provided, however, if Tenant’s representative is  not available or does not elect to accompany Landlord at the times that Landlord has requested  access, then such unavailability shall not prohibit or otherwise restrict Landlord’s access, and  Landlord may access the Premises with or without Tenant’s representative present.  14.5. During the Term, Tenant shall, subject to Force Majeure, casualty and all of the  other terms, conditions and provisions of this Lease, have access to the Premises twenty-four (24)  hours per day, seven (7) days per week.  

 

  29  14.6. Landlord and Tenant acknowledge that it is Landlord's current intention to cause  the ownership of the 10431 Building and 10421 Building to be held by the same entity.  If,  however, at any time during the Term of this Lease or any Option Term, Landlord determines to  separate ownership of the 10431 Building and 10421 Building or to separately finance the 10431  Building and 10421 Building (where the lender requires separate documentation), Tenant agrees  to promptly after request from Landlord, execute commercially reasonable documents in order to  separate Tenant's lease of the Premises in the 10431 Building from the Premises in the 10421  Building.  Any such documentation shall be on the exact same terms as specified in this Lease but  as applicable to the relevant portion of the Premises and Landlord shall reimburse Tenant for all  actual, reasonable, out-of-pocket costs incurred by Tenant in connection therewith.  15. Quiet Enjoyment.  Landlord covenants that Tenant, upon paying the Rent and performing  its obligations contained in this Lease, may peacefully and quietly have, hold and enjoy the  Premises, free from any claim by Landlord or persons claiming under Landlord, but subject to all  of the terms and provisions hereof, provisions of Applicable Laws and rights of record to which  this Lease is or may become subordinate.  This covenant is in lieu of any other quiet enjoyment  covenant, either express or implied.  16. Utilities and Services.   16.1 Tenant shall pay for all water (including the cost to service, repair and replace  reverse osmosis, de-ionized and other treated water), gas, heat, light, power, telephone, internet  service, cable television, other telecommunications and other utilities supplied to the Premises,  together with any fees, surcharges and taxes thereon.  If any such utility is not separately metered  to Tenant, Tenant shall pay Tenant’s Adjusted Share of all charges of such utility jointly metered  with other premises as Additional Rent or, in the alternative, Landlord may, at its option, monitor  the usage of such utilities by Tenant and (if the decision to meter or submeter is due to Tenant’s  overstandard use of such utilities) charge Tenant with the cost of purchasing, installing and  monitoring such metering equipment, which cost shall be paid by Tenant as Additional Rent.   Tenant shall maintain temperature and humidity in the Premises in accordance with ASHRAE  standards at all times.  Landlord shall cause electricity to be separately metered as of (i) the 10431  Premises Commencement Date for the 10431 Premises and (iii) the 10421 Premises  Commencement Date for the 10421 Premises.  If Tenant desires to install equipment to separately  meter water to the 10431 Premises and/or the 10421 Premises, Landlord will not unreasonably  withhold its consent to such installation, provided that such installation shall be completed as an  Alteration in accordance with the terms, conditions and provisions of Article 17 below.   16.2 Landlord may base its bills for utilities on reasonable estimates; provided that  Landlord adjusts such billings promptly thereafter or as part of the next Landlord’s Statement to  reflect the actual cost of providing utilities to the Premises.  To the extent that Tenant uses more  than Tenant’s Pro Rata Share of any utilities, then Tenant shall pay Landlord for Tenant’s Adjusted  Share of such utilities to reflect such excess.  In the event that the 10421 Building, the 10431  Building or the Project is less than fully occupied during a calendar year, Tenant acknowledges  that Landlord may extrapolate utility usage that varies depending on the occupancy of the 10421  Building, the 10431Building or the Project (as applicable) to equal Landlord’s reasonable estimate  of what such utility usage would have been had the 10421 Building, the 10431Building or the  Project, as applicable, been ninety-five percent (95%) occupied during such calendar year;  

 

  30  provided, however, that Landlord shall not recover more than one hundred percent (100%) of the  cost of such utilities.  Tenant shall not be liable for the cost of utilities supplied to the Premises  attributable to the time period prior to the 10431 Premises Commencement Date or the 10421  Premises Commencement Date, as applicable; provided, however, that, if Landlord shall permit  Tenant to have possession of the 10431 Premises prior to the 10431 Premises Commencement  Date or the 10421 Premises prior to the 10421 Premises Commencement Date, as applicable, and  Tenant uses the applicable portion of the Premises for any purpose other than placement of  personal property as set forth in Section 4.6, then Tenant shall be responsible for the cost of utilities  supplied to the 10431 Premises or 10421 Premises, as applicable, from such earlier date of  possession.  16.3 Landlord shall not be liable for, nor shall any eviction of Tenant result from, the  failure to furnish any utility or service, whether or not such failure is caused by Force Majeure (as  defined below).  In the event of such failure, Tenant shall not be entitled to termination of this  Lease or any abatement or reduction of Rent, nor shall Tenant be relieved from the operation of  any covenant or agreement of this Lease.  Notwithstanding anything to the contrary in this Lease,  if, for more than five (5) consecutive business days following written notice to Landlord and as a  direct result of Landlord’s gross negligence or willful misconduct (and except to the extent that  such failure arises from any other factor, including any action or inaction of a Tenant Party (as  defined below)), the provision of HVAC or other utilities to all or a material portion of the Premises  that Landlord must provide pursuant to this Lease is interrupted (a “Material Services Failure”),  then Base Rent (or, to the extent that less than all of the Premises are affected, a proportionate  amount (based on the Rentable Area of the Premises that is rendered unusable) of Base Rent) shall  thereafter be abated until the Premises are again usable by Tenant for the Permitted Use; provided,  however, that, if Landlord is diligently pursuing the restoration of such HVAC and other utilities  and Landlord provides substitute HVAC and other utilities reasonably suitable for Tenant’s  continued use and occupancy of the Premises for the Permitted Use (e.g., supplying potable water  or portable air conditioning equipment), then Base Rent shall not be abated.  During any Material  Services Failure, Tenant will cooperate with Landlord to arrange for the provision of any  interrupted utility services on an interim basis via temporary measures until final corrective  measures can be accomplished, and Tenant will permit Landlord the necessary access to the  Premises to remedy such Material Service Failure.  In the event of any interruption of HVAC or  other utilities that Landlord must provide pursuant to this Lease, regardless of the cause, Landlord  shall diligently pursue the restoration of such HVAC and other utilities.  Notwithstanding anything  in this Lease to the contrary, but subject to Article 24 (which shall govern in the event of a  casualty), the provisions of this Section shall be Tenant’s sole recourse and remedy in the event of  an interruption of HVAC or other utilities to the Premises, including related to Section 16.8.  16.4 Tenant shall pay for, prior to delinquency of payment therefor, any utilities and  services that may be furnished to the Premises during or, if Tenant occupies the Premises after the  expiration or earlier termination of the Term, after the Term, beyond those utilities provided by  Landlord, including telephone, internet service, cable television and other telecommunications,  together with any fees, surcharges and taxes thereon.  Upon Landlord’s demand, utilities and  services provided to the Premises that are separately metered shall be paid by Tenant directly to  the supplier of such utilities or services.  

 

  31  16.5 Tenant shall not, without Landlord’s prior written consent, use any device in the  Premises (including data processing machines) that will in any way (a) increase the amount of  ventilation, air exchange, gas, steam, electricity or water required or consumed in the Premises  based upon Tenant’s Pro Rata Share of the Building or Project (as applicable) beyond the existing  capacity of the Building or the Project usually furnished or supplied for the Permitted Use or (b)  exceed Tenant’s Pro Rata Share of the Building’s or Project’s (as applicable) capacity to provide  such utilities or services.  16.6. If Tenant shall require utilities or services in excess of those usually furnished or  supplied for tenants in similar spaces in the Building or the Project by reason of Tenant’s  equipment or extended hours of business operations, then Tenant shall first procure Landlord’s  consent for the use thereof, which consent Landlord may condition upon the availability of such  excess utilities or services, and Tenant shall pay as Additional Rent an amount equal to the cost of  providing such excess utilities and services.  16.7. Landlord shall provide water in the Common Area for lavatory and landscaping  purposes only, which water shall be from the local municipal or similar source; provided, however,  that if Landlord determines that Tenant requires, uses or consumes water provided to the Common  Area for any purpose other than ordinary lavatory purposes, Landlord may install a water meter  (“Tenant Water Meter”) and thereby measure Tenant’s water consumption for all purposes.   Tenant shall pay Landlord for the costs of any Tenant Water Meter and the installation and  maintenance thereof during the Term.  If Landlord installs a Tenant Water Meter, Tenant shall pay  for water consumed, as shown on such meter, as and when bills are rendered.  If Tenant fails to  timely make such payments, Landlord may pay such charges and collect the same from Tenant.   Any such costs or expenses incurred or payments made by Landlord for any of the reasons or  purposes stated in this Section shall be deemed to be Additional Rent payable by Tenant and  collectible by Landlord as such.  For the avoidance of doubt, this Section 16.7 shall not apply to  Tenant’s use of water in the Premises.  16.8. Landlord reserves the right to stop service of the elevator, plumbing, ventilation,  air conditioning and utility systems (“Service Stoppage”), when Landlord deems necessary or  desirable, due to accident, emergency or the need to make repairs, alterations or improvements,  until such repairs, alterations or improvements shall have been completed, and, except as provided  in Section 16.3, Landlord shall further have no responsibility or liability for failure to supply  elevator facilities, plumbing, ventilation, air conditioning or utility service when prevented from  doing so by Force Majeure (as defined below).  Without limiting the foregoing, it is expressly  understood and agreed that any covenants on Landlord’s part to furnish any service pursuant to  any of the terms, covenants, conditions, provisions or agreements of this Lease, or to perform any  act or thing for the benefit of Tenant, shall not be deemed breached if Landlord is unable to furnish  or perform the same by virtue of Force Majeure.  Except in case of emergencies (in which event  no notice shall be required), Landlord shall provide Tenant with three (3) business days’ written  notice prior to any Service Stoppage (which notice may be by email to the Tenant-designated  individual at the Premises (as of the Execution Date, the Tenant designated email for purposes of  this provision shall be finance@codexdna.com).  16.9. Generators.  

 

  32  16.9.1 10431 Premises Generator.  As part of the 10431 Landlord Work, Landlord will install a back-up  generator for the 10431 Building and connect the Generator to the 10431 Premises’ emergency  electrical panel (the “10431 Generator”).  Tenant shall be entitled to use up to its proportionate  share (after deducting any power from the 10431 Generator required for the Common Area) of  power from the 10431 Generator on a non-exclusive basis with other tenants in the 10431 Building.   The cost of maintaining, repairing and replacing the 10431 Generator shall constitute Operating  Expenses.  Landlord expressly disclaims any warranties with regard to the 10431 Generator or the  installation thereof, including any warranty of merchantability or fitness for a particular purpose.   Landlord shall maintain the 10431 Generator and any equipment connecting the 10431 Generator  to Tenant’s automatic transfer switch in good working condition, provided, however, that Tenant  shall be solely responsible, at Tenant’s sole cost and expense, (and Landlord shall not be liable)  for maintaining and operating Tenant’s automatic transfer switch and the distribution of power  from Tenant’s automatic transfer switch throughout the 10431 Premises, and provided further that  Landlord shall not be liable for any failure to make any repairs or to perform any maintenance of  the 10431 Generator that is an obligation of Landlord unless and except to the extent that Landlord  willfully fails to make such repairs or perform such maintenance and such failure persists for an  unreasonable time after Tenant provides Landlord with written notice of the need for such repairs  or maintenance.  Upon receipt of such written notice, Landlord shall promptly commence to cure  such failure and shall diligently prosecute the same to completion in accordance with Section  31.13.  The provisions of Section 16.3 shall apply to the 10431 Generator.  16.9.2 10421 Premises Generator.  Landlord has installed a back-up generator  serving the 10421 Building (the “10421 Generator”).  Tenant shall be entitled to use up to its  proportionate share (after deducting any power from the 10421 Generator required for the  Common Area) of power from the 10421 Generator on a non-exclusive basis with other tenants in  the 10421 Building.  The cost of maintaining, repairing and replacing the 10421 Generator shall  constitute Operating Expenses.  Landlord expressly disclaims any warranties with regard to the  10421 Generator or the installation thereof, including any warranty of merchantability or fitness  for a particular purpose.  Landlord shall maintain the 10421 Generator and any equipment  connecting the 10421 Generator to Tenant’s automatic transfer switch in good working condition,  provided, however, that Tenant shall be solely responsible, at Tenant’s sole cost and expense, (and  Landlord shall not be liable) for maintaining and operating Tenant’s automatic transfer switch and  the distribution of power from Tenant’s automatic transfer switch throughout the 10421 Premises,  and provided further that Landlord shall not be liable for any failure to make any repairs or to  perform any maintenance of the 10421 Generator that is an obligation of Landlord unless and  except to the extent that Landlord willfully fails to make such repairs or perform such maintenance  and such failure persists for an unreasonable time after Tenant provides Landlord with written  notice of the need for such repairs or maintenance.  Upon receipt of such written notice, Landlord  shall promptly commence to cure such failure and shall diligently prosecute the same to  completion in accordance with Section 31.13.  The provisions of Section 16.3 shall apply to the  10421 Generator  16.10. For the Premises, Landlord shall (a) maintain and operate the HVAC systems used  for the Permitted Use only (“Base HVAC”), and (b) subject to Subsection 16.10(a), furnish HVAC  as reasonably required (except as this Lease otherwise provides) for reasonably comfortable  occupancy of the Premises twenty-four (24) hours a day, every day during the Term, subject to  casualty, eminent domain or as otherwise specified in this Article.  Notwithstanding anything to  

 

  33  the contrary in this Section, Landlord shall have no liability, and Tenant shall have no right or  remedy, on account of any interruption or impairment in HVAC services.  16.11. For any utilities serving the Premises for which Tenant is billed directly by such  utility provider, Tenant agrees to furnish to Landlord (a) any invoices or statements for such  utilities within thirty (30) days after Landlord’s request, (b) within thirty (30) days after Landlord’s  request, any other utility usage information reasonably requested by Landlord, and (c) within thirty  (30) days after Landlord’s request, authorization in a commercially reasonable form to allow  Landlord to access Tenant’s usage information necessary for Landlord to complete an ENERGY  STAR® Statement of Performance (or similar comprehensive utility usage report (e.g., related to  Labs 21), if requested by Landlord) and any other information reasonably requested by Landlord  for the immediately preceding year; and Tenant shall comply with any other energy usage or  consumption requirements required by Applicable Laws.  Tenant shall retain records of utility  usage at the Premises, including invoices and statements from the utility provider, for at least sixty  (60) months, or such other period of time as may be requested by Landlord.  Tenant acknowledges  that any utility information for the Premises, the Buildings and the Project may be shared with  third parties, including Landlord’s consultants and Governmental Authorities.  In the event that  Tenant fails to comply with this Section after written notice from Landlord, Tenant hereby  authorizes Landlord to collect utility usage information directly from the applicable utility  providers.  In addition to the foregoing, Tenant shall comply with all Applicable Laws related to  the disclosure and tracking of energy consumption at the Premises.  The provisions of this Section  shall survive the expiration or earlier termination of this Lease.  17. Alterations.   17.1. Tenant shall make no alterations, additions or improvements in or to the Premises  or engage in any construction, demolition, reconstruction, renovation or other work (whether major  or minor) of any kind in, at or serving the Premises (“Alterations”) without Landlord’s prior written  approval, which approval Landlord shall not otherwise unreasonably withhold; provided, however,  that, in the event any proposed Alteration affects (a) any structural portions of a Building, including  exterior walls, the roof, the foundation or slab, foundation or slab systems (including barriers and  subslab systems) or the core of a Building, (b) the exterior of a Building or (c) any Building  systems, including elevator, plumbing, HVAC, electrical, security, life safety and power in an  adverse manner (as reasonably determined by Landlord), then Landlord may withhold its approval  in its sole and absolute discretion.  Tenant shall, in making any Alterations, use only those  architects, contractors, suppliers and mechanics of which Landlord has given prior written  approval, which approval shall not be unreasonably withheld, conditioned or delayed.  In seeking  Landlord’s approval, Tenant shall provide Landlord, at least thirty (30) days in advance of the  desired commencement date of any proposed construction, with plans, specifications, bid  proposals, certified stamped engineering drawings (if applicable, as reasonably determined by  Landlord) and calculations by Tenant’s engineer of record or architect of record (including  connections to a Building’s structural system, modifications to the Building’s envelope, non- structural penetrations in slabs or walls, and modifications or tie-ins to life safety systems), work  contracts, requests for laydown areas and such other information concerning the nature and cost  of the Alterations as Landlord may reasonably request, provided that Tenant shall not commence  any such Alterations that require Landlord’s consent unless and until Tenant has received the  written approval of Landlord.  In no event shall Tenant use or Landlord be required to approve any  

 

  34  architects, consultants, contractors, subcontractors or material suppliers that may not have  sufficient experience, in Landlord’s reasonable opinion, to perform work in an occupied Class “A”  laboratory research building and in tenant-occupied lab areas.  Notwithstanding the foregoing,  Tenant may make cosmetic changes to the Premises that do not require any demolition, permits or  more than three (3) total contractors and subcontractors (“Cosmetic Alterations”) without  Landlord’s consent; provided that (y) the cost of any Cosmetic Alterations does not exceed One  Hundred Thousand Dollars ($100,000) in any one instance or Two Hundred Fifty Thousand  Dollars ($250,000) annually, (z) such Cosmetic Alterations are not reasonably expected to have  any material adverse effect on the Project and do not (i) require any structural modifications to the  Premises, (ii) require any material changes to or adversely affect any Building systems, (iii) affect  any portion of a Building or the Project that is exterior to the Premises or (iv) trigger any  requirement under Applicable Laws that would require Landlord to make any alteration or  improvement to the Premises, a Building or the Project.  17.2. Tenant shall not construct or permit to be constructed partitions or other  obstructions that might interfere with free access to mechanical installation or service facilities of  a Building or with other tenants’ components located within a Building, or interfere with the  moving of Landlord’s equipment to or from the enclosures containing such installations or  facilities.  17.3. Tenant shall accomplish any work performed on the Premises or a Building in such  a manner as to permit any life safety systems to remain fully operable at all times.  17.4. Any work performed on the Premises, a Building or the Project by Tenant or  Tenant’s contractors shall be done at such times and in such manner as Landlord may from time  to time designate.  Tenant covenants and agrees that all work done by Tenant or Tenant’s  contractors shall be performed in full compliance with Applicable Laws.  Within thirty (30) days  after completion of any Alterations, Tenant shall provide Landlord with complete “as built”  drawing print sets and electronic CADD files on disc (or files in such other current format in  common use as Landlord reasonably approves or requires) showing any changes in the Premises,  as well as a commissioning report prepared by a licensed, qualified commissioning agent hired by  Tenant and approved by Landlord for all new or affected mechanical, electrical and plumbing  systems (if reasonably requested by Landlord, given the scope of the Alterations).  Any such “as  built” plans shall show the applicable Alterations as an overlay on the Building as-built plans;  provided that Landlord provides the Building “as built” plans to Tenant.  17.5. Before commencing any Alterations, Tenant shall (a) give Landlord at least thirty  (30) days’ prior written notice of the proposed commencement of such work and the names and  addresses of the persons supply labor or materials therefor so that Landlord may enter the Premises  to post and keep posted thereon and therein notices or to take any further action that Landlord may  reasonably deem proper for the protection of Landlord’s interest in the Project and (b) shall, if  required by Landlord, secure, at Tenant’s own cost and expense, a completion and lien indemnity  bond satisfactory to Landlord for such work (provided that no bond will be required for alterations  costing less than Two Hundred Fifty Thousand Dollars ($250,000)).  17.6. Tenant shall repair any damage to the Premises arising from Tenant’s removal of  any property from the Premises.  During any such restoration period, Tenant shall pay Rent to  

 

  35  Landlord as provided herein as if such space were otherwise occupied by Tenant.  The provisions  of this Section shall survive the expiration or earlier termination of this Lease.  17.7. The Premises plus any Alterations; Signage; Tenant Improvements; attached  equipment, attached fixtures and attached trade fixtures; movable laboratory casework and related  appliances; and other additions and improvements attached to or built into the Premises made by  either of the parties (including all floor and wall coverings; paneling; sinks and related plumbing  fixtures; attached laboratory benches; exterior venting fume hoods; walk-in freezers and  refrigerators; ductwork; conduits; electrical panels and circuits; attached machinery and  equipment; and built-in furniture and cabinets, in each case, together with all additions and  accessories thereto, but expressly excluding Tenant’s Property (as defined below)), shall (unless,  prior to such construction or installation, Landlord elects otherwise in writing) at all times remain  the property of Landlord, shall remain in the Premises and shall (unless, prior to construction or  installation thereof, Landlord elects otherwise in writing) be surrendered to Landlord upon the  expiration or earlier termination of this Lease.  However, all unattached trade fixtures, moveable  laboratory benches, moveable furniture, moveable equipment, and other unattached personal  property placed in the Premises by Tenant shall remain the Property of Tenant, and may be  removed by Tenant.  For the avoidance of doubt, the items listed on Exhibit H attached hereto  (which Exhibit H may be updated by Tenant during the Term, subject to Landlord’s reasonable  written consent) constitute Tenant’s property (the “Tenant’s Property”) and shall be removed by  Tenant upon the expiration or earlier termination of the Lease.  Tenant may remove the Tenant's  Property from the Premises at any time, provided that Tenant repairs all damage caused by such  removal.    17.8. Notwithstanding any other provision of this Article to the contrary, in no event shall  Tenant remove any improvement from the Premises as to which Landlord contributed payment,  including the Tenant Improvements, without Landlord’s prior written consent, which consent  Landlord may withhold in its sole and absolute discretion.  17.9. If Tenant shall fail to remove any of its property from the Premises prior to the  expiration or earlier termination of this Lease, then Landlord may, at its option, remove the same  in any manner that Landlord shall choose and store such effects without liability to Tenant for loss  thereof or damage thereto, and Tenant shall pay Landlord, upon demand, any costs and expenses  incurred due to such removal and storage or Landlord may, at its sole option and without notice to  Tenant, sell such property or any portion thereof at private sale and without legal process for such  price as Landlord may obtain and apply the proceeds of such sale against any (a) amounts due by  Tenant to Landlord under this Lease and (b) any expenses incident to the removal, storage and sale  of such personal property.  17.10. Tenant shall pay to Landlord an amount equal to three percent (3%) of the cost to  Tenant of all Alterations to cover Landlord’s overhead and expenses for plan review, engineering  review, coordination, scheduling and supervision thereof or obtaining any required Lender consent  (provided, however, that the total amount of such fee payable by Tenant to Landlord with respect  to any particular Alteration project shall not exceed the greater of (a) an amount equal to Ten  Thousand Dollars ($10,000), or (b) an amount equal to Landlord’s actual out-of-pocket costs  incurred in connection with the plan review, engineering review, coordination, scheduling and  supervision of such Alteration project).  For purposes of payment of such sum, Tenant shall submit  

 

  36  to Landlord copies of all bills, invoices and statements covering the costs of such charges,  accompanied by payment to Landlord of the fee set forth in this Section.  Tenant shall reimburse  Landlord for any extra expenses incurred by Landlord by reason of faulty work done by Tenant or  its contractors, or by reason of delays arising from such faulty work, or by reason of inadequate  clean-up.  17.11. If requested by Landlord, within sixty (60) days after final completion of any  Alterations performed by Tenant with respect to the Premises, Tenant shall submit to Landlord  documentation showing the amounts expended by Tenant with respect to such Alterations, together  with supporting documentation reasonably acceptable to Landlord.  17.12. Tenant shall take, and shall cause its contractors to take, commercially reasonable  steps to protect the Premises during the performance of any Alterations, including covering or  temporarily removing any window coverings so as to guard against dust, debris or damage.  17.13. Tenant shall require its contractors and subcontractors performing work on the  Premises to name Landlord, BioMed Realty, L.P., and their respective officers, employees,  directors, representatives, agents, general partners, members, subsidiaries, affiliates and Lenders  (collectively with Landlord, the “Landlord Parties”) as additional insureds on their respective  insurance policies.  18. Repairs and Maintenance.   18.1. Landlord shall repair and maintain the structural and exterior portions and Common  Area of the Buildings and the Project, including roofing and covering materials; foundations  (excluding any architectural slabs, but including any structural slabs); exterior walls; base Building  plumbing systems serving the Common Area and/or more than one tenant of the Building (for  purposes of clarity, any portion of the Building plumbing systems exclusively serving the Premises  shall not be part of the base Building plumbing systems and shall be Tenant’s obligation to  maintain and repair pursuant to Section 18.2 below); base Building fire sprinkler systems serving  the Common Area and/or more than one tenant of the Building (if any) (for purposes of clarity,  any portion of the Building fire sprinkler systems exclusively serving the Premises shall not be  part of the base Building plumbing systems and shall be Tenant’s obligation to maintain and repair  pursuant to Section 18.2 below); base Building HVAC systems up to the first damper or isolation  valve that serves the Premises (for purposes of clarity, the portion of the HVAC system that  includes such first damper or isolation valve and extends into and through the Premises, and any  supplemental HVAC serving the Premises shall not be part of the base Building HVAC and shall  be Tenant’s obligation to maintain and repair pursuant to Section 18.2 below); elevators; and base  Building electrical systems installed or furnished by Landlord.  18.2. Except for services of Landlord, if any, required by Section 18.1, Tenant shall at  Tenant’s sole cost and expense maintain and keep the Premises (including but not limited to (i) the   portion of the HVAC system that includes the first damper or isolation valve and extends into and  through the Premises and any supplemental HVAC serving the Premises, (ii) the portion of the  Building plumbing system exclusively serving the Premises (e.g., pipes serving only the Premises  (including those pipes that lead to shared pipes maintained by Landlord), sinks located within the  Premises, and garbage disposals located within the Premises), (iii) the portion of the Building fire  sprinkler system exclusively serving the Premises (e.g., sprinkler heads, horizontal pipe runs), and  

 

37  (iv) and any other systems or equipment exclusively serving the Premises) and every part thereof in good condition and repair, ordinary wear and tear excepted, and shall, within ten (10) days after receipt of written notice from Landlord, provide to Landlord any maintenance records that Landlord reasonably requests.  Notwithstanding the foregoing, in no event shall Tenant have any obligation to repair, maintain, or replace any portion of any base Building system serving the Premises that is located underground. Tenant shall, upon the expiration or sooner termination of the Term, surrender the Premises to Landlord in as good a condition as when received, ordinary wear and tear and repairs which are not Tenant’s responsibility hereunder excepted; and shall, at Landlord’s request and Tenant’s sole cost and expense, remove all telephone and data systems, wiring and equipment from the Premises, and repair any damage to the Premises caused thereby. Landlord shall have no obligation to alter, remodel, improve, repair, decorate or paint the Premises or any part thereof, other than pursuant to the terms and provisions of this Lease and the Work Letter. 18.3. Landlord shall not be liable for any failure to make any repairs or to perform any  maintenance that is Landlord’s obligation pursuant to this Lease unless such failure shall persist  for an unreasonable time after Tenant provides Landlord with written notice of the need of such  repairs or maintenance.  Tenant waives its rights under Applicable Laws now or hereafter in effect  to make repairs at Landlord’s expense.  18.4. If any excavation shall be made upon land adjacent to or under a Building, or shall  be authorized to be made, Tenant shall afford to the person causing or authorized to cause such  excavation, license to enter the Premises for the purpose of performing such work as such person  shall deem necessary or desirable to preserve and protect the Building from injury or damage and  to support the same by proper foundations, without any claim for damages or liability against  Landlord and without reducing or otherwise affecting Tenant’s obligations under this Lease;  provided that during any non-emergency entry by such third persons, such persons will use  commercially reasonable efforts to perform such work in a manner which minimizes disruption to  Tenant’s operations in the Premises and comply with Section 14.4 above.  18.5. This Article relates to repairs and maintenance arising in the ordinary course of  operation of the Buildings and the Project.  In the event of a casualty described in Article 24,  Article 24 shall apply in lieu of this Article.  In the event of eminent domain, Article 25 shall apply  in lieu of this Article.  18.6. Costs incurred by Landlord pursuant to this Article shall constitute Operating  Expenses to the extent permitted by the terms of Article 9.   19. Liens. 19.1. Subject to the immediately succeeding sentence, Tenant shall keep the Premises, the Buildings and the Project free from any liens arising from work or services performed,  materials furnished to or obligations incurred by Tenant.  Tenant further covenants and agrees that  any mechanic’s or materialman’s lien filed against the Premises, a Building or the Project for work  or services claimed to have been done for, or materials claimed to have been furnished to, or  obligations incurred by Tenant shall be discharged or bonded by Tenant within ten (10) days after  Tenant’s receipt of notice of the filing thereof, at Tenant’s sole cost and expense.  

 

  38  19.2. Should Tenant fail to discharge or bond against any lien of the nature described in  Section 19.1, Landlord may, at Landlord’s election, pay such claim or post a statutory lien bond  or otherwise provide security to eliminate the lien as a claim against title, and Tenant shall  immediately reimburse Landlord for the costs thereof as Additional Rent.  Tenant shall Indemnify  the Landlord Indemnitees from and against any Claims arising from any such liens, including any  administrative, court or other legal proceedings related to such liens.  19.3. In the event that Tenant leases or finances the acquisition of office equipment,  furnishings or other personal property of a removable nature utilized by Tenant in the operation of  Tenant’s business, Tenant warrants that any Uniform Commercial Code financing statement shall,  upon its face or by exhibit thereto, indicate that such financing statement is applicable only to  removable personal property of Tenant located within the Premises.  In no event shall the address  of the Premises, any Building or the Project be furnished on a financing statement without  qualifying language as to applicability of the lien only to removable personal property located in  an identified suite leased by Tenant.  Should any holder of a financing statement record or place  of record a financing statement that appears to constitute a lien against any interest of Landlord or  against equipment that may be located other than within an identified suite leased by Tenant,  Tenant shall, within ten (10) days after Tenant receives notice of the filing of such financing  statement, cause (a) a copy of the lender security agreement or other documents to which the  financing statement pertains to be furnished to Landlord to facilitate Landlord’s ability to  demonstrate that the lien of such financing statement is not applicable to Landlord’s interest and  (b) Tenant’s lender to amend such financing statement and any other documents of record to clarify  that any liens imposed thereby are not applicable to any interest of Landlord in the Premises, any  Building or the Project.  20. Estoppel Certificate.  Tenant shall, within ten (10) business days after receipt of written  notice from Landlord, execute, acknowledge and deliver a statement in writing substantially in the  form attached to this Lease as Exhibit I, or on any other form reasonably requested by a current or  proposed Lender or encumbrancer or proposed purchaser, (a) certifying that this Lease is  unmodified and in full force and effect (or, if modified, stating the nature of such modification and  certifying that this Lease as so modified is in full force and effect) and the dates to which rental  and other charges are paid in advance, if any, (b) acknowledging that there are not, to Tenant’s  knowledge, any uncured defaults on the part of Landlord hereunder, or specifying such defaults if  any are claimed, and (c) setting forth such further information with respect to this Lease or the  Premises as may be requested thereon.  Any such statements may be relied upon by any prospective  purchaser or encumbrancer of all or any portion of the Property.  Tenant’s failure to deliver any  such statement within the prescribed time shall, at Landlord’s option, constitute a Default (as  defined below) under this Lease after the expiration of any applicable notice and cure period, and,  in any event, shall be binding upon Tenant that the Lease is in full force and effect and without  modification except as may be represented by Landlord in any certificate prepared by Landlord  and delivered to Tenant for execution.  21. Hazardous Materials.   21.1. Tenant shall not cause or permit any Hazardous Materials (as defined below) to be  brought upon, kept or used in or about the Premises, any Building or the Project in violation of  Applicable Laws by Tenant or any of its employees, agents, contractors or invitees (collectively  

 

  39  with Tenant, each a “Tenant Party” and collectively, the “Tenant Parties”).  If (a) Tenant breaches  such obligation, (b) the presence of Hazardous Materials as a result of such a breach results in  contamination of the Project, any portion thereof, or any adjacent property, (c) contamination of  the Premises otherwise occurs during the Term or any extension or renewal hereof or holding over  hereunder (other than (i) if such contamination results from migration of Hazardous Materials from  outside the Premises (including Hazardous Materials originating from Landlord, another tenant at  the Project or any other third-party that is not a Tenant Party), and not arising from the acts or  omissions of a Tenant Party or coming from property owned or leased by a Tenant Party or (ii) to  the extent such contamination arises directly from Landlord’s negligence or willful misconduct)  or (d) contamination of the Project occurs as a result of Hazardous Materials that are placed on or  under or are released into the Project by a Tenant Party, then Tenant shall Indemnify the Landlord  Indemnitees from and against any and all Claims of any kind or nature arising therefrom, including  (w) diminution in value of the Project or any portion thereof, (x) damages for the loss or restriction  on use of rentable or usable space or of any amenity of the Project, (y) damages arising from any  adverse impact on marketing of space in the Project or any portion thereof and (z) sums paid in  settlement of Claims that arise before, during or after the Term as a result of such breach or  contamination.  This Indemnification by Tenant includes costs incurred in connection with any  investigation of site conditions or any clean-up, remedial, removal or restoration work required by  any Governmental Authority because of Hazardous Materials present in the air, soil or  groundwater above, on, under or about the Project for which Tenant is responsible hereunder.   Without limiting the foregoing, if the presence of any Hazardous Materials in, on, under or about  the Project, any portion thereof or any adjacent property caused or permitted by any Tenant Party  results in any contamination of the Project, any portion thereof or any adjacent property, then  Tenant shall promptly take all actions at its sole cost and expense as are necessary to return the  Project, any portion thereof or any adjacent property to its respective condition existing prior to  the time of such contamination; provided that Landlord’s written approval of such action shall first  be obtained, which approval Landlord shall not unreasonably withhold; and provided, further, that  it shall be reasonable for Landlord to withhold its consent if such actions could have a material  adverse long-term or short-term effect on the Project, any portion thereof or any adjacent property.   Tenant’s obligations under this Section shall not be affected, reduced or limited by any limitation  on the amount or type of damages, compensation or benefits payable by or for Tenant under  workers’ compensation acts, disability benefit acts, employee benefit acts or similar legislation.   Notwithstanding the foregoing, Landlord shall Indemnify the Tenant Parties from and against any  and all Claims arising from the presence of Hazardous Materials at the Project in violation of  Applicable Laws as of the Execution Date, unless placed at the Project by a Tenant Party.  21.2. Landlord acknowledges that it is not the intent of this Article to prohibit Tenant  from operating its business for the Permitted Use.  Tenant may operate its business according to  the custom of Tenant’s industry so long as the use or presence of Hazardous Materials is strictly  and properly monitored in accordance with Applicable Laws.  As a material inducement to  Landlord to allow Tenant to use Hazardous Materials in connection with its business, Tenant  agrees to deliver to Landlord (a) a list identifying each type of Hazardous Material to be present  at the Premises that is subject to regulation under any environmental Applicable Laws in the form  of a Tier II form pursuant to Section 312 of the Emergency Planning and Community Right-to- Know Act of 1986 (or any successor statute) or any other form reasonably approved by Landlord,  (b) a list of any and all approvals or permits from Governmental Authorities required in connection  with the presence of such Hazardous Material at the Premises and (c) correct and complete copies  

 

  40  of (i) notices of violations of Applicable Laws related to Hazardous Materials and (ii) plans relating  to the installation of any storage tanks to be installed in, on, under or about the Project (provided  that installation of storage tanks shall only be permitted after Landlord has given Tenant its written  consent to do so, which consent Landlord may withhold in its sole and absolute discretion) and  closure plans or any other documents required by any and all Governmental Authorities for any  storage tanks installed in, on, under or about the Project for the closure of any such storage tanks  (collectively, “Hazardous Materials Documents”).  Tenant shall deliver to Landlord updated  Hazardous Materials Documents, within fourteen (14) days after receipt of a written request  therefor from Landlord, not more often than once per year, unless (m) there are any changes to the  Hazardous Materials Documents or (n) Tenant initiates any Alterations or changes its business, in  either case in a way that involves any material increase in the types or amounts of Hazardous  Materials, in which case Tenant shall deliver updated Hazardous Materials documents (without  Landlord having to request them) before or, if not practicable to do so before, as soon as reasonably  practicable after the occurrence of the events in Subsection 21.2(m) or (n).  For each type of  Hazardous Material listed, the Hazardous Materials Documents shall include (t) the chemical  name, (u) the material state (e.g., solid, liquid, gas or cryogen), (v) the concentration, (w) the  storage amount and storage condition (e.g., in cabinets or not in cabinets), (x) the use amount and  use condition (e.g., open use or closed use), (y) the location (e.g., room number or other  identification) and (z) if known, the chemical abstract service number.  Notwithstanding anything  in this Section to the contrary, Tenant shall not be required to provide Landlord with any  documents containing information of a proprietary nature, unless such documents contain a  reference to Hazardous Materials or activities related to Hazardous Materials and such disclosure  is permitted by Applicable Law.  If Tenant provides Landlord with Hazardous Materials  Documents containing information of a proprietary nature (and Tenant notifies Landlord that such  Hazardous Materials Documents contain information of a proprietary nature), Landlord shall keep  the same confidential and shall not disclose them to any third-party except to Landlord’s  consultants and attorneys or as may be required by Applicable Laws.  Landlord may, at Landlord’s  expense, cause the Hazardous Materials Documents to be reviewed by a person or firm qualified  to analyze Hazardous Materials to confirm compliance with the provisions of this Lease and with  Applicable Laws.  In the event that a review of the Hazardous Materials Documents indicates non- compliance with this Lease or Applicable Laws, Tenant shall, at its expense, diligently take steps  to bring its storage and use of Hazardous Materials into compliance.  Notwithstanding anything in  this Lease to the contrary or Landlord’s review into Tenant’s Hazardous Materials Documents or  use or disposal of hazardous materials, however, Landlord shall not have and expressly disclaims  any liability related to Tenant’s or other tenants’ use or disposal of Hazardous Materials, it being  acknowledged by Tenant that Tenant is best suited to evaluate the safety and efficacy of its  Hazardous Materials usage and procedures.  21.3. Tenant represents and warrants to Landlord that it is not nor has it been, in  connection with the use, disposal or storage of Hazardous Materials, (a) subject to a material  enforcement order issued by any Governmental Authority or (b) required to take any remedial  action by any Governmental Authority.  21.4. At any time, and from time to time,  prior to the expiration of the Term, Landlord  shall have the right to conduct appropriate tests of the Project or any portion thereof to demonstrate  that Hazardous Materials are present or that contamination has occurred due to the acts or  

 

  41  omissions of a Tenant Party.  Tenant shall pay all reasonable costs of such tests if such tests reveal  that Hazardous Materials exist at the Project in violation of Tenant’s obligations under this Lease.  21.5. If underground or other storage tanks storing Hazardous Materials installed or  utilized by Tenant are located on the Premises, or are hereafter placed on the Premises by Tenant  (or by any other party, if such storage tanks are utilized by Tenant), then Tenant shall monitor the  storage tanks, maintain appropriate records, implement reporting procedures, properly close any  underground storage tanks, and take or cause to be taken all other steps necessary or required under  the Applicable Laws.  Tenant shall have no responsibility or liability for underground or other  storage tanks installed by anyone other than Tenant unless Tenant utilizes such tanks, in which  case Tenant’s responsibility for such tanks shall be as set forth in this Section.  21.6. Tenant shall promptly report to Landlord any actual or suspected presence of mold  or water intrusion at the Premises.  21.7. Tenant’s obligations under this Article shall survive the expiration or earlier  termination of the Lease.  During any period of time needed by Tenant or Landlord after the  termination of this Lease to complete the removal from the Premises of any Hazardous Materials  which Tenant is responsible for hereunder, Tenant shall be deemed a holdover tenant and subject  to the provisions of Article 27.  21.8. As used herein, the term “Hazardous Material” means any toxic, explosive,  corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous  substance, material or waste that is or becomes regulated by Applicable Laws or any Governmental  Authority.  21.9. Notwithstanding anything to the contrary in this Lease, Landlord shall have sole  control over the equitable allocation of fire control areas (as defined in the Uniform Building Code  as adopted by the city or municipality(ies) in which the Project is located (the “UBC”)) within the  Project for the storage of Hazardous Materials.  Notwithstanding anything to the contrary in this  Lease, the quantity of Hazardous Materials allowed by this Section is specific to Tenant and shall  not run with the Lease in the event of a Transfer (as defined in Article 29).  In the event of a  Transfer, if the use of  Hazardous Materials by such new tenant (“New Tenant”) is such that New  Tenant utilizes fire control areas in the Project in excess of New Tenant’s Pro Rata Share of the  Building or the Project, as applicable, then New Tenant shall, at its sole cost and expense and upon  Landlord’s written request, establish and maintain a separate area of the Premises classified by the  UBC as an “H” occupancy area for the use and storage of Hazardous Materials, or take such other  action as is necessary to ensure that its share of the fire control areas of the Building and the Project  is not greater than New Tenant’s Pro Rata Share of the Building or the Project, as applicable.   Notwithstanding anything in this Lease to the contrary, Landlord shall not have and expressly  disclaims any liability related to Tenant’s or other tenants’ use or disposal of fire control areas, it  being acknowledged by Tenant that Tenant and other tenants are best suited to evaluate the safety  and efficacy of its Hazardous Materials usage and procedures.  22. Odors and Exhaust.  Tenant acknowledges that Landlord would not enter into this Lease  with Tenant unless Tenant assured Landlord that under no circumstances will any other occupants  of any Building or the Project (including persons legally present in any outdoor areas of the  

 

  42  Project) be subjected to odors or fumes (whether or not noxious), and that neither Building nor the  Project will not be damaged by any exhaust, in each case from Tenant’s operations.  Landlord and  Tenant therefore agree as follows:  22.1. Tenant shall not cause or permit (or conduct any activities that would cause) any  release of any odors or fumes of any kind from the Premises.  22.2. If a Building has a ventilation system that, in Landlord’s judgment, is adequate,  suitable, and appropriate to vent the Premises in a manner that does not release odors affecting any  indoor or outdoor part of the Project, Tenant shall vent the Premises through such system.  If  Landlord at any time determines that any existing ventilation system is inadequate, or if no  ventilation system exists, Tenant shall in compliance with Applicable Laws vent all fumes and  odors from the Premises (and remove odors from Tenant’s exhaust stream) as Landlord requires.   The placement and configuration of all ventilation exhaust pipes, louvers and other equipment  shall be subject to Landlord’s approval.  Tenant acknowledges Landlord’s legitimate desire to  maintain the Project (indoor and outdoor areas) in an odor-free manner, and Landlord may require  Tenant to abate and remove all odors in a manner that goes beyond the requirements of Applicable  Laws.  22.3. Tenant shall, at Tenant’s sole cost and expense, provide odor eliminators and other  devices (such as filters, air cleaners, scrubbers and whatever other equipment may in Landlord’s  judgment be necessary or appropriate from time to time) to completely remove, eliminate and  abate any odors, fumes or other substances in Tenant’s exhaust stream that, in Landlord’s  judgment, emanate from Tenant’s Premises.  Any work Tenant performs under this Section shall  constitute Alterations.  22.4. Tenant’s responsibility to remove, eliminate and abate odors, fumes and exhaust  shall continue throughout the Term.  Landlord’s construction of the Tenant Improvements shall  not preclude Landlord from requiring additional measures to eliminate odors, fumes and other  adverse impacts of Tenant’s exhaust stream (as Landlord may designate in Landlord’s discretion).   Tenant shall install additional equipment as Landlord requires from time to time under the  preceding sentence.  Such installations shall constitute Alterations.  22.5. If Tenant fails to install satisfactory odor control equipment within ten (10) business  days after Landlord’s demand made at any time, then Landlord may, without limiting Landlord’s  other rights and remedies, require Tenant to cease and suspend any operations in the Premises that,  in Landlord’s determination, cause odors, fumes or exhaust.  For example, if Landlord determines  that Tenant’s production of a certain type of product causes odors, fumes or exhaust, and Tenant  does not install satisfactory odor control equipment within ten (10) business days after Landlord’s  request, then Landlord may require Tenant to stop producing such type of product in the Premises  unless and until Tenant has installed odor control equipment satisfactory to Landlord.  22.6. Without limiting the terms and conditions of this Article 22, Landlord  acknowledges that the use of fume hoods for the Permitted Use and in accordance with all  Applicable Laws will not, in and of itself, result in a violation of this Article 22.  The foregoing  does not relieve Tenant of its obligation to control odors or fumes which emanate from any fume  hoods used in the Premises in accordance with this Article.  

 

  43  23. Insurance.    23.1. Landlord shall maintain all risk property insurance (subject to standard policy  terms, conditions, limitations and exclusions) on a full replacement cost basis with limits, sub- limits and deductibles as are customary for similar properties in the region, which Landlord shall  determine in its reasonable discretion.  Landlord, subject to availability thereof, shall further  insure, if Landlord deems it appropriate, coverage against flood, environmental hazard,  earthquake, loss or failure of building equipment, and rental loss during the period of repairs or  rebuilding, in each case with limits, sub-limits and deductibles as are customary for similar  properties in the region, which Landlord shall determine in its sole and absolute discretion.  Notwithstanding the foregoing, Landlord will insure permanently affixed improvements installed  by Tenant in the Premises which are of a type typically found in general office and laboratory  buildings (i.e., excluding specialized improvements which are unique to Tenant’s use as opposed  to typical lab and office improvements); provided that the replacement cost value is provided to  Landlord in writing promptly upon completion of the installation of such permanently affixed  improvements.  For clarity, if Tenant fails to provide Landlord with the replacement cost value of  any permanently affixed improvements installed by Tenant, Tenant will be deemed to have elected  to insure such items as specialized improvements.  23.2. In addition, Landlord shall carry Commercial General Liability insurance with  limits of not less than One Million Dollars ($1,000,000) per occurrence/general aggregate for  bodily injury (including death), or property damage with respect to the Project.  23.3. Tenant shall, at its own cost and expense, procure and maintain during the Term  the following insurance for the benefit of Tenant and Landlord (as their interests may appear) with  insurers financially acceptable and lawfully authorized to do business in the state where the  Premises are located:  (a) Commercial General Liability insurance on a broad-based occurrence  coverage form, with coverages including but not limited to bodily injury (including death),  property damage (including loss of use resulting therefrom), premises/operations, personal &  advertising injury, and contractual liability with limits of liability of not less than $2,000,000 for  bodily injury and property damage per occurrence, $2,000,000 general aggregate, which limits  may be met by use of excess and/or umbrella liability insurance; provided that such coverage is at  least as broad as the primary coverages required herein.  (b) Commercial Automobile Liability insurance covering liability arising from  the use or operation of any auto on behalf of Tenant or invited by Tenant (including those owned,  hired, rented, leased, borrowed, scheduled or non-owned).  Coverage shall be on a broad-based  occurrence form in an amount not less than $1,000,000 combined single limit per accident for  bodily injury and property damage.  Such coverage shall apply to all vehicles and persons, whether  accessing the property with active or passive consent.  (c) Commercial Property insurance covering property damage to the full  replacement cost value and business interruption.  Covered property shall include all tenant  improvements in the Premises to the extent not insured by Landlord pursuant to Section 23.1 (i.e.,  non-affixed improvements and any affixed improvements which are unique to Tenant’s use, not  typical lab or office improvements, or installed by Tenant and not reported to Landlord as required  

 

  44  herein) and Tenant’s Property including personal property, furniture, fixtures, machinery,  equipment, stock, and inventory, which may be owned by Tenant or Landlord and required to be  insured hereunder, or which may be leased, rented, borrowed or in the care custody or control of  Tenant, or Tenant’s agents, employees or subcontractors.  Such insurance, with respect only to any  affixed Tenant Improvements, Alterations or other work performed on the Premises by Tenant  which is not insured by Landlord pursuant to Section 23.1 above (collectively, “Tenant Work”),  shall name Landlord and Landlord’s current and future mortgagees as loss payees as their interests  may appear.  Such insurance shall be written on an “all risk” of physical loss or damage basis  including the perils of fire, extended coverage, windstorm, vandalism, malicious mischief,  sprinkler leakage, flood, earthquake, and such other risks Landlord may from time to time  designate, for the full replacement cost value of the covered items with an agreed amount  endorsement with no co-insurance.  Business interruption coverage shall have limits sufficient to  cover Tenant’s lost profits and necessary continuing expenses, including rents due Landlord under  the Lease.  The minimum period of indemnity for business interruption coverage shall be twelve  (12) months plus twelve (12) months’ extended period of indemnity.  (d) Workers’ Compensation in compliance with all Applicable Laws or as may  be available on a voluntary basis.  Employer’s Liability must be at least in the amount of $500,000  for bodily injury by accident for each employee, $1,000,000 for bodily injury by disease for each  employee, and $500,000 bodily injury by disease for policy limit.  (e) Medical malpractice insurance at limits of not less than $1,000,000 each  claim during such periods, if any, that Tenant engages in the practice of medicine or clinical trials  involving human beings at the Premises.  (f) Pollution Legal Liability insurance is required if Tenant stores, handles,  generates or treats Hazardous Materials, as determined solely by Landlord, on or about the  Premises.  Such coverage shall include bodily injury, sickness, disease, death or mental anguish  or shock sustained by any person; property damage including physical injury to or destruction of  tangible property including the resulting loss of use thereof, clean-up costs, and the loss of use of  tangible property that has not been physically injured or destroyed; and defense costs, charges and  expenses incurred in the investigation, adjustment or defense of claims for such compensatory  damages.  Coverage shall apply to both sudden and non-sudden pollution conditions including the  discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic  chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or  upon land, the atmosphere or any watercourse or body of water.  Claims-made coverage is  permitted, provided the policy retroactive date is continuously maintained prior to the  commencement date of this agreement, and coverage is continuously maintained during all periods  in which Tenant occupies the Premises.  Coverage shall be maintained with limits of not less than  $1,000,000 per incident with a $2,000,000 policy aggregate and for a period of three (3) years  thereafter.  (g) During all construction by Tenant at the Premises, with respect to tenant  improvements being constructed (including any Alterations, insurance required in Exhibit B-1  must be in place.  

 

  45  23.4. The insurance required of Tenant by this Article shall be with companies at all times  having a current rating of not less than A- and financial category rating of at least Class VII in  “A.M. Best’s Insurance Guide” current edition.  Tenant shall obtain for Landlord from the  insurance companies/broker or cause the insurance companies/broker to furnish certificates of  insurance evidencing all coverages required herein to Landlord.  Landlord reserves the right to  require complete, certified copies of all required insurance policies including any endorsements.   Tenant shall not cause such policy to be cancelable except after twenty (20) days’ prior written  notice to Landlord from Tenant or its insurers (except in the event of non-payment of premium, in  which case five (5) days’ written notice shall be given).  All such policies shall be written as  primary policies, not contributing with and not in excess of the coverage that Landlord may carry.   Tenant’s required policies shall contain severability of interests clauses stating that, except with  respect to limits of insurance, coverage shall apply separately to each insured or additional insured.   Tenant shall, on the date of expiration of such policies, furnish Landlord with renewal certificates  of insurance or binders.  Tenant agrees that if Tenant does not take out and maintain such  insurance, Landlord may (but shall not be required to) procure such insurance on Tenant’s behalf  and at its cost to be paid by Tenant as Additional Rent.  Commercial General Liability, Commercial  Automobile Liability, Umbrella Liability and Pollution Legal Liability insurance as required above  shall name the Landlord Parties as additional insureds as respects liability arising from work or  operations performed by or on behalf of Tenant, Tenant’s use or occupancy of Premises, and  ownership, maintenance or use of vehicles by or on behalf of Tenant. Tenant must disclose any  self-insurance, including self-insurance retentions, to Landlord in writing in advance, which shall  be subject to Landlord’s prior written approval in its sole discretion. If Tenant self-insures with  Landlord’s prior written approval, Tenant is itself acting as though it were providing the insurance  required under the provisions of this Lease, and Tenant shall pay those amounts due in lieu of  insurance proceeds that would have been covered and payable if the insurance policies had been  carried for such self-insured coverages, which amounts shall be treated as insurance proceeds for  all purposes under this Lease.  23.5. In each instance where insurance is to name the Landlord Parties as additional  insureds, Tenant shall, upon Landlord’s written request, also designate and furnish certificates  evidencing the Landlord Parties as additional insureds to (a) any Lender of Landlord holding a  security interest in any Building or the Project, (b) the landlord under any lease whereunder  Landlord is a tenant of the real property upon which the Building is located if the interest of  Landlord is or shall become that of a tenant under a ground lease rather than that of a fee owner  and (c) any management company retained by Landlord to manage the Project.  23.6. Tenant assumes the risk of damage to any of Tenant’s fixtures, goods, inventory,  merchandise, and equipment, and Landlord shall not be liable for injury to Tenant’s business or  any loss of income therefrom, relative to such damage, all as more particularly set forth within this  Lease.  Tenant shall, at Tenant’s sole cost and expense, carry such insurance as Tenant desires for  Tenant’s protection with respect to personal property of Tenant or business interruption.  23.7. Tenant, on behalf of itself and its insurers, hereby waives any and all rights of  recovery against the Landlord Parties with respect to any loss, damage, claims, suits or demands,  howsoever caused, that are covered, or required to be covered, by valid and collectible workers’  compensation, employer’s liability insurance and other liability insurance required to be obtained  and carried by Tenant pursuant to this Article, including any deductibles or self-insurance  

 

46  maintained thereunder.  Tenant agrees that the required workers’ compensation, employer’s  liability and other liability insurance policies shall permit waivers of subrogation as required  hereunder and hold harmless and indemnify the Landlord Parties for any loss or expense incurred  as a result of a failure to obtain policies that permit waivers of subrogation. Tenant, upon obtaining  the policies of workers’ compensation, employer’s liability and other liability insurance required  or permitted under this Lease, shall give notice to its insurance carriers that the foregoing waiver  of subrogation is contained in this Lease.  If such policies shall not be obtainable with such waiver  or shall be so obtainable only at a premium over that chargeable without such waiver, then Tenant  shall notify Landlord of such conditions.  In addition, notwithstanding anything to the contrary  herein, each of Landlord and Tenant, on behalf of itself and its insurers, hereby waives and releases  all rights of subrogation and recovery against the other party or such other party’s insurers with  respect to any Claims covered by property insurance policies required to be obtained and  maintained by the non-waiving party pursuant to this Lease, or that would have been covered had  the non-waiving party obtained and maintained such policies, except to the extent of the non- waiving party’s gross negligence or willful misconduct.    23.8. Landlord may require insurance policy limits required under this Lease to be raised  to conform with requirements of Landlord’s Lender or to bring coverage limits to levels then being  required of new tenants within the Project, if such limits are then customarily being required of  tenants of comparable premises in the vicinity of the Project.  23.9. In addition to other insurance required by this Lease to be carried by Tenant, if  Tenant sells or merchandises alcoholic beverages in, upon or from any part of the Premises, then  Tenant shall, at Tenant’s sole cost and expense, purchase and maintain in full force and effect  during the Term liquor liability insurance in form and substance satisfactory to Landlord, with  total limits of liability for bodily injury, loss of means of support and property damage for each  occurrence in an amount and with a carrier reasonably acceptable to Landlord, and otherwise in  compliance with the general provisions of this Article governing the provision of insurance by  Tenant.  Such policy shall name the Landlord Parties as additional insureds against any liability  by virtue of Applicable Laws concerning the use, sale or giving away of alcoholic beverages.  If  at any time such insurance is for any reason not in force, then during all and any such times no  selling or merchandising of alcoholic beverages shall be conducted by Tenant in, upon or from  any part of the Premises.  23.10. Any costs incurred by Landlord pursuant to this Article shall constitute a portion of  Operating Expenses, subject to Article 9.  23.11. The provisions of this Article shall survive the expiration or earlier termination of  this Lease.  24. Damage or Destruction. 24.1. In the event of a partial destruction of (a) the Premises, (b) a Building, (c) the Common Area or (d) the Project ((a)-(d) collectively, the “Affected Areas”) by fire or other perils  covered by extended coverage insurance not exceeding twenty-five percent (25%) of the full  insurable value thereof, and provided that (w) the damage thereto is such that the Affected Areas  may be repaired, reconstructed or restored within a period of nine (9) months from the date of the  happening of such casualty, (x) Landlord shall receive insurance proceeds sufficient to cover the  

 

47  cost of such repairs, reconstruction and restoration (except for any deductible amount provided by  Landlord’s policy, which deductible amount, if paid by Landlord, shall constitute an Operating  Expense to the extent permitted by the terms of Article 9), and (y) such casualty was not  intentionally caused by a Tenant Party, then Landlord shall commence and proceed diligently with  the work of repair, reconstruction and restoration of the Affected Areas and this Lease shall  continue in full force and effect.  24.2. In the event of any damage to or destruction of a Building or the Project other than  as described in Section 24.1, Landlord may elect to repair, reconstruct and restore the Building or  the Project, as applicable, in which case this Lease shall continue in full force and effect.  If  Landlord elects not to repair, reconstruct and restore the Building or the Project, as applicable,  then this Lease shall terminate as of the date of such damage or destruction.  In the event of any  damage or destruction (regardless of whether such damage is governed by Section 24.1 or this  Section), if (a) in Landlord’s determination as set forth in the Damage Repair Estimate (as defined  below), the Affected Areas cannot be repaired, reconstructed or restored within twelve (12) months  after the date of the Damage Repair Estimate, (b) subject to Section 24.6, the Affected Areas are  not actually repaired, reconstructed and restored within sixteen (16) months after the date of the  Damage Repair Estimate, or (c) the damage and destruction occurs within the last twelve (12)  months of the then-current Term and will take over one month to repair, then Tenant shall have  the right to terminate this Lease, effective as of the date of such damage or destruction, by  delivering to Landlord its written notice of termination (a “Termination Notice”) (y) with respect  to Subsections 24.2(a) and (c), no later than fifteen (15) days after Landlord delivers to Tenant  Landlord’s Damage Repair Estimate and (z) with respect to Subsection 24.2(b), no later than  fifteen (15) days after such sixteen (16) month period (as the same may be extended pursuant to  Section 24.6) expires.  If Tenant provides Landlord with a Termination Notice pursuant to  Subsection 24.2(z), Landlord shall have an additional thirty (30) days after receipt of such  Termination Notice to complete the repair, reconstruction and restoration.  If Landlord does not  complete such repair, reconstruction and restoration within such thirty (30) day period, then Tenant  may terminate this Lease by giving Landlord written notice within five (5) business days after the  expiration of such thirty (30) day period.  If Landlord does complete such repair, reconstruction  and restoration within such thirty (30) day period, then this Lease shall continue in full force and  effect.  In the event that (i) damage or destruction of a Building provides Landlord and/or Tenant  the right to terminate this Lease pursuant to Section 24.2 above, and (ii) such damage or destruction  was limited to only one (1) Building (and not any other Building), then both Landlord’s and  Tenant’s rights to terminate this Lease pursuant to Section 24.2 above shall only apply to the  portion of the Premises located in the Building that was damaged or destroyed (i.e., if either party  exercises its option to terminate pursuant to Section 24.2 above, then this Lease shall be terminated  in accordance therewith only with respect to the portion of the Premises located in the Building  that was damaged or destroyed, and this Lease shall not be terminated with respect to the portion  of the Premises located in any other Building).  24.3. As soon as reasonably practicable, but in any event within sixty (60) days following  the date of damage or destruction, Landlord shall notify Tenant of Landlord’s good faith estimate  of the period of time in which the repairs, reconstruction and restoration will be completed (the  “Damage Repair Estimate”), which estimate shall be based upon the opinion of a contractor  

 

48  reasonably selected by Landlord and experienced in comparable repair, reconstruction and  restoration of similar buildings.  Additionally, Landlord shall give written notice to Tenant within  sixty (60) days following the date of damage or destruction of its election not to repair, reconstruct  or restore the Building or the Project, as applicable.  24.4. Upon any termination of this Lease under any of the provisions of this Article, the  parties shall be released thereby without further obligation to the other from the date possession of  the Premises is surrendered to Landlord, except with regard to (a) items occurring prior to the  damage or destruction and (b) provisions of this Lease that, by their express terms, survive the  expiration or earlier termination hereof.  24.5. In the event of repair, reconstruction and restoration as provided in this Article, all  Rent to be paid by Tenant under this Lease shall be abated proportionately based on the extent to  which Tenant’s use of the Premises is impaired during the period of such repair, reconstruction or  restoration; provided, however, that the amount of such abatement shall be reduced by the amount  of Rent that is received by Tenant as part of the business interruption or loss of rental income with  respect to the Premises from the proceeds of business interruption or loss of rental income  insurance.  24.6. Notwithstanding anything to the contrary contained in this Article, should Landlord  be delayed or prevented from completing the repair, reconstruction or restoration of the damage  or destruction to the Premises after the occurrence of such damage or destruction by Force Majeure  (as defined below) or delays caused by a Lender or Tenant Party, then the time for Landlord to  commence or complete repairs, reconstruction and restoration shall be extended on a day-for-day  basis.  24.7. If Landlord is obligated to or elects to repair, reconstruct or restore as herein  provided, then Landlord shall be obligated to make such repairs, reconstruction or restoration only  with regard to (a) those portions of the Premises that were originally provided at Landlord’s  expense or that Landlord is required to insure pursuant to this Lease and (b) the Common Area  portion of the Affected Areas.  The repairs, reconstruction or restoration of improvements in the  Premises (or outside the Premises and exclusively serving the Premises) not originally provided  by Landlord or at Landlord’s expense or required to be insured by Landlord pursuant to this Lease  shall be the obligation of Tenant.  In the event Tenant has elected to install specialized  improvements which are unique to Tenant’s use as opposed to typical lab and office improvements,  Landlord shall, upon the need for replacement due to an insured loss, provide only the Building  Standard, unless Tenant again elects to install such specialized improvements and pay any  incremental costs related thereto, except to the extent that excess insurance proceeds, if received,  are adequate to provide such specialized improvements, in addition to providing for basic repairs,  reconstruction and restoration of the Premises, the Building and the Project.  24.8. Notwithstanding anything to the contrary contained in this Article, Landlord shall  not have any obligation whatsoever to repair, reconstruct or restore the Premises if the damage  resulting from any casualty covered under this Article occurs during the last twelve (12) months  of the Term or any extension thereof (and the Damage Repair Estimate indicates that more than  sixty (60) days will be required for such repair, reconstruction or restoration).  

 

  49  24.9. Landlord’s obligation, should it elect or be obligated to repair, reconstruct or  restore, shall be limited to the Affected Areas, and shall be conditioned upon Landlord receiving  any permits or authorizations required by Applicable Laws.  Tenant shall, at its expense, replace  or fully repair any Alterations installed by Tenant which Tenant is required to insure and which  are existing at the time of such damage or destruction and all of Tenant’s personal property.  If  Affected Areas are to be repaired, reconstructed or restored in accordance with the foregoing,  Landlord shall make available to Tenant any portion of insurance proceeds it receives that are  allocable to the Alterations constructed by Tenant pursuant to this Lease which are not being  restored by Landlord; provided Tenant is not then in Default under this Lease, and subject to the  requirements of any Lender of Landlord.  24.10. This Article sets forth the terms and conditions upon which this Lease may  terminate in the event of any damage or destruction.  Accordingly, the parties hereby waive the  provisions of California Civil Code Sections 1932(2) and 1933(4) (and any successor statutes)  permitting the parties to terminate this Lease as a result of any damage or destruction.    25. Eminent Domain.   25.1. In the event (a) the whole of all Affected Areas or (b) such part thereof as shall  substantially interfere with Tenant’s use and occupancy of the Premises for the Permitted Use shall  be taken for any public or quasi-public purpose by any lawful power or authority by exercise of  the right of appropriation, condemnation or eminent domain, or sold to prevent such taking, Tenant  or Landlord may terminate this Lease effective as of the date possession is required to be  surrendered to such authority, except with regard to (y) items occurring prior to the taking and (z)  provisions of this Lease that, by their express terms, survive the expiration or earlier termination  hereof.  25.2. In the event of a partial taking of (a) the Building or the Project or (b) drives,  walkways or parking areas serving the Building or the Project for any public or quasi-public  purpose by any lawful power or authority by exercise of right of appropriation, condemnation, or  eminent domain, or sold to prevent such taking, then, without regard to whether any portion of the  Premises occupied by Tenant was so taken, Landlord may elect to terminate this Lease (except  with regard to (a) items occurring prior to the taking and (b) provisions of this Lease that, by their  express terms, survive the expiration or earlier termination hereof) as of such taking if such taking  is, in Landlord’s reasonable opinion, of a material nature such as to make it uneconomical to  continue use of the unappropriated portion for purposes of renting office or laboratory space.  25.3. Tenant shall be entitled to any award that is specifically awarded as compensation  for (a) the taking of Tenant’s personal property that was installed at Tenant’s expense and (b) the  costs of Tenant moving to a new location.  Except as set forth in the previous sentence, any award  for such taking shall be the property of Landlord.  25.4. If, upon any taking of the nature described in this Article, this Lease continues in  effect, then Landlord shall promptly proceed to restore the Affected Areas to substantially their  same condition prior to such partial taking.  To the extent such restoration is infeasible, as  determined by Landlord in its sole and absolute discretion, the Rent shall be decreased  proportionately to reflect the loss of any portion of the Premises no longer available to Tenant.   

 

50  25.5. This Article sets forth the terms and conditions upon which this Lease may  terminate in the event of any taking.  Accordingly, the parties hereby waive the provisions of  California Code of Civil Procedure Section 1265.130 (and any successor statutes) permitting the  parties to terminate this Lease as a result of any taking.  26. Surrender. 26.1. At least fifteen (15) days prior to Tenant’s surrender of possession of any part of the Premises, Tenant shall provide Landlord with a facility decommissioning and Hazardous  Materials closure plan for the Premises (“Exit Survey”) prepared by an independent third party  state-certified professional with appropriate expertise, which Exit Survey must be reasonably  acceptable to Landlord.  The Exit Survey shall comply with the American National Standards  Institute’s Laboratory Decommissioning guidelines (ANSI/AIHA Z9.11-2008) or any successor  standards published by ANSI or any successor organization (or, if ANSI and its successors no  longer exist, a similar entity publishing similar standards).  In addition, at least ten (10) days prior  to Tenant’s surrender of possession of any part of the Premises, Tenant shall (a) provide Landlord  with written evidence of all appropriate governmental releases obtained by Tenant in accordance  with Applicable Laws, including laws pertaining to the surrender of the Premises, (b) place  Laboratory Equipment Decontamination Forms on all decommissioned equipment to assure safe  occupancy by future users and (c) conduct a site inspection with Landlord.  In addition, Tenant  agrees to remain responsible after the surrender of the Premises for the remediation of any  recognized environmental conditions set forth in the Exit Survey and comply with any  recommendations set forth in the Exit Survey, in each case to the extent the same are Tenant’s  responsibility under this Lease.  Tenant’s obligations under this Section shall survive the expiration  or earlier termination of the Lease.  26.2. No surrender of possession of any part of the Premises shall release Tenant from  any of its obligations hereunder, unless such surrender is accepted in writing by Landlord.  26.3. The voluntary or other surrender of this Lease by Tenant shall not effect a merger  with Landlord’s fee title or leasehold interest in the Premises, the Building, the Property or the  Project, unless Landlord consents in writing, and shall, at Landlord’s option, operate as an  assignment to Landlord of any or all subleases.  26.4. The voluntary or other surrender of any ground or other underlying lease that now  exists or may hereafter be executed affecting the Building or the Project, or a mutual cancellation  thereof or of Landlord’s interest therein by Landlord and its lessor shall not effect a merger with  Landlord’s fee title or leasehold interest in the Premises, the Building or the Property and shall, at  the option of the successor to Landlord’s interest in the Building or the Project, as applicable,  operate as an assignment of this Lease.  27. Holding Over. 27.1. If, with Landlord’s prior written consent, Tenant holds possession of all or any part of the Premises after the Term, Tenant shall become a tenant from month to month after the  expiration or earlier termination of the Term, and in such case Tenant shall continue to pay (a)  Base Rent in accordance with Article 7, as adjusted in accordance with Article 8, and (b) any  amounts for which Tenant would otherwise be liable under this Lease if the Lease were still in  

 

51  effect, including payments for Tenant’s Adjusted Share of Operating Expenses, and all other  Additional Rent.  Any such month-to-month tenancy shall be subject to every other term, covenant  and agreement contained herein.  27.2. Notwithstanding the foregoing, if Tenant remains in possession of the Premises  after the expiration or earlier termination of the Term without Landlord’s prior written consent, (a)  Tenant shall become a tenant at sufferance subject to the terms and conditions of this Lease, except  that the monthly rent shall be equal to one hundred fifty percent (150%) of the Base Rent in effect  during the last thirty (30) days of the Term, plus any amounts for which Tenant would otherwise  be liable under this Lease if the Lease were still in effect (i.e., Additional Rent), and (b) Tenant  shall be liable to Landlord for any and all damages suffered by Landlord as a result of such  holdover, including any lost rent or consequential, special and indirect damages (in each case,  regardless of whether such damages are foreseeable).  27.3. Acceptance by Landlord of Rent after the expiration or earlier termination of the  Term shall not result in an extension, renewal or reinstatement of this Lease.  27.4. The foregoing provisions of this Article are in addition to and do not affect  Landlord’s right of reentry or any other rights of Landlord hereunder or as otherwise provided by  Applicable Laws.  27.5. The provisions of this Article shall survive the expiration or earlier termination of  this Lease.  28. Indemnification and Exculpation. 28.1. Tenant agrees to Indemnify the Landlord Indemnitees from and against any and all  Claims of any kind or nature, real or alleged, arising from (a) injury to or death of any person or  damage to any property occurring within or about the Premises, any Building, the Property or the  Project, arising directly or indirectly out of (i) the presence at or use or occupancy of the Premises  or Project by a Tenant Party or (ii) an act or omission on the part of any Tenant Party, (b) a breach  or default by Tenant in the performance of any of its obligations hereunder or (c) injury to or death  of persons or damage to or loss of any property, real or alleged, arising from the serving of  alcoholic beverages at the Premises or Project, including liability under any dram shop law, host  liquor law or similar Applicable Law, except to the extent arising directly from Landlord’s or the  Landlord Parties’ negligence or willful misconduct.  Tenant’s obligations under this Section shall  not be affected, reduced or limited by any limitation on the amount or type of damages,  compensation or benefits payable by or for Tenant under workers’ compensation acts, disability  benefit acts, employee benefit acts or similar legislation.  Tenant’s obligations under this Section  shall survive the expiration or earlier termination of this Lease.  Subject to Sections 28.2 and 31.13,  Landlord agrees to Indemnify the Tenant Parties from and against any and all Claims arising from  injury to or death of any person or damage to or loss of any physical property occurring within or  about the Premises, the Buildings, the Property or the Project to the extent arising directly from  Landlord’s or Landlord’s Parties’ gross negligence or willful misconduct.  28.2. Notwithstanding anything in this Lease to the contrary, Landlord shall not be liable  to Tenant for and Tenant assumes all risk of (a) damage or losses arising from fire, electrical  malfunction, gas explosion or water damage of any type (including broken water lines,  

 

52  malfunctioning fire sprinkler systems, roof leaks or stoppages of lines), unless any such loss is due  to Landlord’s willful disregard of written notice by Tenant of need for a repair that Landlord is  responsible to make for an unreasonable period of time, and (b) damage to personal property;  products manufactured, produced of stored by Tenant; or scientific research, including loss of  records kept by Tenant within the Premises (in each case, regardless of whether such damages are  foreseeable).  Tenant further waives any claim for injury to Tenant’s business or loss of income  relating to any such damage or destruction of personal property; products manufactured, produced  of stored by Tenant; or scientific research as described in this Section.  Notwithstanding anything  in the foregoing or this Lease to the contrary, except (x) as otherwise provided herein (including  Section 27.2), (y) as may be provided by Applicable Laws or (z) in the event of Tenant’s breach  of Article 21 or Section 26.1, in no event shall Landlord or Tenant be liable to the other for any  consequential, special or indirect damages arising from this Lease, including lost profits (provided  that this Subsection 28.2(z) shall not limit Tenant’s liability for Base Rent or Additional Rent  pursuant to this Lease).  28.3. Landlord shall not be liable for any damages arising from any act, omission or  neglect of any other tenant in any Building or the Project, or of any other third party.  28.4. Tenant acknowledges that security devices and services, if any, while intended to  deter crime, may not in given instances prevent theft or other criminal acts.  Landlord shall not be  liable for injuries or losses arising from criminal acts of third parties, and Tenant assumes the risk  that any security device or service may malfunction or otherwise be circumvented by a criminal,  or that Landlord may decide (in its sole and absolute discretion) not to monitor any installed  security devices.  If Tenant desires protection against such criminal acts, then Tenant shall, at  Tenant’s sole cost and expense, obtain appropriate insurance coverage.  Tenant’s security  programs and equipment for the Premises shall be coordinated with Landlord and subject to  Landlord’s reasonable approval.  28.5. The provisions of this Article shall survive the expiration or earlier termination of  this Lease.  29. Assignment or Subletting. 29.1. Except as hereinafter expressly permitted, none of the following (each, a “Transfer”), either voluntarily or by operation of Applicable Laws, shall be directly or indirectly  performed without Landlord’s prior written consent, which shall not be unreasonably withheld,  conditioned or delayed:  (a) Tenant selling, hypothecating, assigning, pledging, encumbering or  otherwise transferring its interest in this Lease or subletting all or a portion of the Premises, (b) a  controlling interest in Tenant being sold, assigned or otherwise transferred (other than as a result  of shares in Tenant being sold on a public stock exchange) or (c) the sale of all or substantially of  Tenant’s assets (both (b) and (c), a “Change of Control”).  For purposes of the preceding sentence,  “control” means (f) owning (directly or indirectly) more than fifty percent (50%) of the stock or  other equity interests of another person or (g) possessing, directly or indirectly, the power to direct  or cause the direction of the management and policies of such person.  Notwithstanding the  foregoing, Tenant shall have the right to, without Landlord’s prior written consent, and without  being subject to Landlord’s profit sharing or recapture rights below, (A) undergo a Change of  Control, or (B) Transfer Tenant’s interest in this Lease or the Premises or any part thereof to any  person that (i) acquires all or substantially all of the assets or stock of Tenant, (ii) is a successor to  

 

  53  Tenant by merger, consolidation or reorganization, or (iii) as of the date of determination and at  all times thereafter directly, or indirectly through one or more intermediaries, controls, is  controlled by or is under common control with Tenant (any person described in (i), (ii), or (iii), a  “Tenant’s Affiliate”); provided that Tenant shall notify Landlord in writing at least thirty (30) days  prior to the effectiveness of such Transfer (an “Exempt Transfer”) and otherwise comply with the  requirements of this Lease regarding such Transfer; and provided, further, that the person that will  be the tenant under this Lease after the Exempt Transfer has a net worth (as of both the day  immediately prior to and the day immediately after the Exempt Transfer) that is equal to or greater  than the net worth (as of both the Execution Date and the date of the Exempt Transfer) of the  transferring Tenant.  For purposes of the immediately preceding sentence, “control” requires both  (m) owning (directly or indirectly) more than fifty percent (50%) of the stock or other equity  interests of another person and (n) possessing, directly or indirectly, the power to direct or cause  the direction of the management and policies of such person.      29.2. In the event Tenant desires to effect a Transfer, then, at least thirty (30) but not  more than one hundred eighty (180) days prior  to the date when Tenant desires the Transfer to be  effective (the “Transfer Date”), Tenant shall provide written notice to Landlord (the “Transfer  Notice”) containing information (including references) concerning the character of the proposed  transferee, assignee or sublessee; the Transfer Date; the most recent unconsolidated financial  statements of Tenant (if Tenant is no longer publicly traded) and of the proposed transferee,  assignee or sublessee satisfying the requirements of Section 40.2 (“Required Financials”); any  ownership or commercial relationship between Tenant and the proposed transferee, assignee or  sublessee; copies of Hazardous Materials Documents for the proposed transferee, assignee or  sublessee; and the consideration and all other material terms and conditions of the proposed  Transfer, all in such detail as Landlord shall reasonably require.  29.3. Landlord, in determining whether consent should be given to a proposed Transfer,  may give consideration to such factors as Landlord reasonably deems material, including (a) the  financial strength of Tenant and of such transferee, assignee or sublessee (notwithstanding Tenant  remaining liable for Tenant’s performance), (b) any change in use that such transferee, assignee or  sublessee proposes to make in the use of the Premises and (c) Landlord’s desire to exercise its  rights under Section 29.7 to recapture the Premises.  In no event shall Landlord be deemed to be  unreasonable for declining to consent to a Transfer if the Transfer is to a transferee, assignee or  sublessee of poor reputation, lacking financial qualifications or seeking a change in the Permitted  Use, or jeopardizing directly or indirectly the status of Landlord or any of Landlord’s affiliates as  a Real Estate Investment Trust under the Internal Revenue Code of 1986 (as the same may be  amended from time to time, the “Revenue Code”).  Notwithstanding anything contained in this  Lease to the contrary, (w) no Transfer shall be consummated on any basis such that the rental or  other amounts to be paid by the occupant, assignee, manager or other transferee thereunder would  be based, in whole or in part, on the income or profits derived by the business activities of such  occupant, assignee, manager or other transferee; (x) Tenant shall not furnish or render any services  to an occupant, assignee, manager or other transferee with respect to whom transfer consideration  is required to be paid, or manage or operate the Premises or any capital additions so transferred,  with respect to which transfer consideration is being paid; (y) Tenant shall not consummate a  Transfer with any person in which Landlord owns an interest, directly or indirectly (by applying  constructive ownership rules set forth in Section 856(d)(5) of the Revenue Code); and (z) Tenant  shall not consummate a Transfer with any person or in any manner that could cause any portion of  

 

54  the amounts received by Landlord pursuant to this Lease or any sublease, license or other  arrangement for the right to use, occupy or possess any portion of the Premises to fail to qualify  as “rents from real property” within the meaning of Section 856(d) of the Revenue Code, or any  similar or successor provision thereto or which could cause any other income of Landlord to fail  to qualify as income described in Section 856(c)(2) of the Revenue Code.  Notwithstanding  anything in this Lease to the contrary, if (a) Tenant or any proposed transferee, assignee or  sublessee of Tenant has been required by any prior landlord, Lender or Governmental Authority  to take material remedial action in connection with Hazardous Materials contaminating a property  if the contamination resulted from such party’s action or omission or use of the property in question  or (b) Tenant or any proposed transferee, assignee or sublessee is subject to a material enforcement  order issued by any Governmental Authority in connection with the use, disposal or storage of  Hazardous Materials, then Landlord shall have the right to terminate this Lease in Landlord’s sole  and absolute discretion (with respect to any such matter involving Tenant), and it shall not be  unreasonable for Landlord to withhold its consent to any proposed transfer, assignment or  subletting (with respect to any such matter involving a proposed transferee, assignee or sublessee).  29.4. The following are conditions precedent to a Transfer or to Landlord considering a  request by Tenant to a Transfer:  (a) Tenant shall remain fully liable under this Lease.  Tenant agrees that it shall not be (and shall not be deemed to be) a guarantor or surety of this Lease, however, and waives its  right to claim that is it is a guarantor or surety or to raise in any legal proceeding any guarantor or  surety defenses permitted by this Lease or by Applicable Laws;  (b) If Tenant or the proposed transferee, assignee or sublessee does not or cannot deliver the Required Financials, then Landlord may elect, as a condition to its consent  (which condition is hereby agreed by the parties to be reasonable), to have either Tenant’s ultimate  parent company or the proposed transferee’s, assignee’s or sublessee’s ultimate parent company  provide a guaranty of the applicable entity’s obligations under this Lease, in a form acceptable to  Landlord, which guaranty shall be executed and delivered to Landlord by the applicable guarantor  prior to the Transfer Date;  (c) In the case of an Exempt Transfer, Tenant shall provide Landlord with evidence reasonably satisfactory to Landlord that the Transfer qualifies as an Exempt Transfer;  (d) Tenant shall deliver evidence respecting the relevant business experience and financial responsibility and status of the proposed transferee, assignee or sublessee;  (e) Tenant shall reimburse Landlord for Landlord’s actual and reasonable costs and expenses, including reasonable attorneys’ fees, charges and disbursements incurred in  connection with the review, processing and documentation of such request (not to exceed $5,000  in the aggregate for any particular Transfer);  (f) Except with respect to an Exempt Transfer, if Tenant’s transfer of rights or sharing of the Premises provides for the receipt by, on behalf of or on account of Tenant of any  consideration of any kind whatsoever (including a premium rental for a sublease or lump sum  payment for an assignment, but excluding Tenant’s reasonable costs in marketing and subleasing  

 

  55  the Premises, and to the extent the same do not exceed fair market value, amounts payable for the  use or conveyance of personal property or equipment to such transferee) in excess of the rental  and other charges due to Landlord under this Lease, Tenant shall (unless Landlord directs in  writing otherwise) pay fifty percent (50%) of all of such excess actually received by Tenant to  Landlord, after making deductions for any reasonable marketing expenses, tenant improvement  funds expended by Tenant, alterations, cash concessions, brokerage commissions, attorneys’ fees  and free rent actually paid by Tenant.  If such consideration consists of cash paid to Tenant,  payment to Landlord shall be made upon receipt by Tenant of such cash payment;  (g) The proposed transferee, assignee or sublessee shall agree that, in the event  Landlord gives such proposed transferee, assignee or sublessee notice that Tenant is in default  under this Lease, such proposed transferee, assignee or sublessee shall thereafter make all  payments otherwise due Tenant directly to Landlord, which payments shall be received by  Landlord without any liability being incurred by Landlord, except to credit such payment against  those due by Tenant under this Lease, and any such proposed transferee, assignee or sublessee  shall agree to attorn to Landlord or its successors and assigns should this Lease be terminated for  any reason; provided, however, that in no event shall Landlord or its Lenders, successors or assigns  be obligated to accept such attornment;  (h) Landlord’s consent to any such Transfer shall be effected on Landlord’s  commercially reasonable forms;  (i) Tenant shall not then be in default hereunder in any respect;  (j) Such proposed transferee, assignee or sublessee’s use of the Premises shall  be the same as the Permitted Use;  (k) Landlord shall not be bound by any provision of any agreement pertaining  to the Transfer, except for Landlord’s written consent to the same;  (l) Tenant shall pay all transfer and other taxes (including interest and  penalties) assessed or payable for any Transfer;  (m) Landlord’s consent (or waiver of its rights) for any Transfer shall not waive  Landlord’s right to consent or refuse consent to any later Transfer;  (n) Tenant shall deliver to Landlord one executed copy of any and all written  instruments evidencing or relating to the Transfer; and  (o) Tenant shall deliver to Landlord a list of Hazardous Materials (as defined  below), certified by the proposed transferee, assignee or sublessee to be true and correct, that the  proposed transferee, assignee or sublessee intends to use or store in the Premises.  Additionally,  Tenant shall deliver to Landlord, on or before the date any proposed transferee, assignee or  sublessee takes occupancy of the Premises, all of the items relating to Hazardous Materials of such  proposed transferee, assignee or sublessee as described in Section 21.2.  29.5. Any Transfer that is not in compliance with the provisions of this Article or with  respect to which Tenant does not fulfill its obligations pursuant to this Article shall (a) constitute  

 

56  a Default, (b) be voidable by Landlord and (c), at Landlord’s option, terminate this Lease, except  for those provisions that, by their express terms, survive the expiration or earlier termination  hereof.  29.6. Notwithstanding any Transfer, Tenant shall remain fully and primarily liable for  the payment of all Rent and other sums due or to become due hereunder, and for the full  performance of all other terms, conditions and covenants to be kept and performed by Tenant.  The  acceptance of Rent or any other sum due hereunder, or the acceptance of performance of any other  term, covenant or condition thereof, from any person or entity other than Tenant shall not be  deemed a waiver of any of the provisions of this Lease or a consent to any Transfer.  29.7. If Tenant delivers to Landlord a Transfer Notice indicating a desire to assign this  Lease (or sublease more than seventy-five percent (75%) of the Rentable Area of the Premises) to  a proposed transferee, assignee or sublessee (other than pursuant to an Exempt Transfer), then  Landlord shall have the option, exercisable by giving notice to Tenant at any time within thirty  (30) days after Landlord’s receipt of such Transfer Notice, to terminate this Lease as of the date specified in the Transfer Notice as the Transfer Date, except for those provisions that, by their express terms, survive the expiration or earlier termination hereof.  If Landlord exercises such option, then Tenant shall have the right to withdraw such Transfer Notice by delivering to Landlord written notice of such election within five (5) days after Landlord’s delivery of notice electing to exercise Landlord’s option to terminate this Lease.  In the event Tenant withdraws the Transfer Notice as provided in this Section, this Lease shall continue in full force and effect.  No failure of Landlord to exercise its option to terminate this Lease shall be deemed to be Landlord’s consent to a proposed Transfer. 29.8. If Tenant sublets the Premises or any portion thereof, Tenant hereby immediately  and irrevocably assigns to Landlord, as security for Tenant’s obligations under this Lease, all rent  from any such subletting, and appoints Landlord as assignee and attorney-in-fact for Tenant, and  Landlord (or a receiver for Tenant appointed on Landlord’s application) may collect such rent and  apply it toward Tenant’s obligations under this Lease; provided that, until the occurrence of a  Default (as defined below) by Tenant, Tenant shall have the right to collect such rent.  29.9. In the event that Tenant enters into a sublease for the entire Premises in accordance  with this Article that expires within two (2) days of the Term Expiration Date, the term expiration  date of such sublease shall, notwithstanding anything in this Lease, the sublease or any consent to  the sublease to the contrary, be deemed to be the date that is two (2) days prior to the Term  Expiration Date.  30. Subordination and Attornment. 30.1. This Lease shall be subject and subordinate to the lien of any mortgage, deed of trust, or lease in which Landlord is tenant now or hereafter in force against any Building or the  Project and to all advances made or hereafter to be made upon the security thereof without the  necessity of the execution and delivery of any further instruments on the part of Tenant to  effectuate such subordination; provided, however, that the automatic subordination to any future  mortgage, deed of trust or lease provided for in this Section is expressly conditioned upon the  holder of such mortgage, deed of trust or lease executing a subordination, non-disturbance and  attornment agreement on such party’s standard form.    

 

57  30.2. Notwithstanding the foregoing, Tenant shall execute and deliver upon demand such  further instrument or instruments evidencing such subordination of this Lease to the lien of any  such mortgage or mortgages or deeds of trust or lease in which Landlord is tenant as may be  reasonably required by Landlord.  If any Lender so elects, however, this Lease shall be deemed  prior in lien to any such lease, mortgage, or deed of trust upon or including the Premises regardless  of date and Tenant shall execute a statement in writing to such effect at Landlord’s request.  If  Tenant fails to execute any document required from Tenant under this Section within ten (10) days  after written request therefor, Tenant hereby constitutes and appoints Landlord or its special  attorney-in-fact to execute and deliver any such document or documents in the name of Tenant.  Such power is coupled with an interest and is irrevocable.  For the avoidance of doubt, “Lenders”  shall also include historic tax credit investors and new market tax credit investors.  Landlord shall  request a subordination and non-disturbance agreement from the current lender on the Project;  provided, however, that (a) Landlord shall have no obligation to obtain such subordination and  non-disturbance agreement (and Tenant shall have no right or remedy in the event that such lender  refuses to provide such subordination and non-disturbance agreement), and (b) Tenant shall pay  all fees and expenses of any kind (including, without limitation, attorneys’ fees) imposed or  required by such lender in connection with such subordination and non-disturbance agreement.  30.3. Upon written request of Landlord and opportunity for Tenant to review, Tenant  agrees to execute any reasonable Lease amendments not materially altering the terms of this Lease  or materially increasing Tenant’s liability or materially and adversely decreasing Tenant’s rights  under this Lease, if required by a Lender incident to the financing of the real property of which the  Premises constitute a part.  30.4. In the event any proceedings are brought for foreclosure, or in the event of the  exercise of the power of sale under any mortgage or deed of trust made by Landlord covering the  Premises, Tenant shall at the election of the purchaser at such foreclosure or sale attorn to the  purchaser upon any such foreclosure or sale and recognize such purchaser as Landlord under this  Lease.  31. Defaults and Remedies. 31.1. Late payment by Tenant to Landlord of Rent and other sums due shall cause Landlord to incur costs not contemplated by this Lease, the exact amount of which shall be  extremely difficult and impracticable to ascertain.  Such costs include processing and accounting  charges and late charges that may be imposed on Landlord by the terms of any mortgage or trust  deed covering the Premises.  Therefore, if any installment of Rent due from Tenant is not received  by Landlord within three (3) business days after the date such payment is due, Tenant shall pay to  Landlord (a) an additional sum of five percent (5%) of the overdue Rent as a late charge plus (b)  interest at an annual rate (the “Default Rate”) equal to the lesser of (a) twelve percent (12%) and  (b) the highest rate permitted by Applicable Laws.  The parties agree that this late charge represents a fair and reasonable estimate of the costs that Landlord shall incur by reason of late payment by Tenant and shall be payable as Additional Rent to Landlord due with the next installment of Rent or within five (5) business days after Landlord’s demand, whichever is earlier.  Landlord’s acceptance of any Additional Rent (including a late charge or any other amount hereunder) shall not be deemed an extension of the date that Rent is due or prevent Landlord from pursuing any other rights or remedies under this Lease, at law or in equity.  Notwithstanding anything to the 

 

  58  contrary in this Section, Tenant shall not be obligated to pay a late charge or interest pursuant to  this Section for the first (1st) late payment of Rent during any twelve (12) month period during the  Term, unless Tenant fails to make such payment within five (5) days after Tenant’s receipt of  notice from Landlord regarding such late payment (in which case Tenant will be responsible for  late fees and interest).  31.2. No payment by Tenant or receipt by Landlord of a lesser amount than the Rent  payment herein stipulated shall be deemed to be other than on account of the Rent, nor shall any  endorsement or statement on any check or any letter accompanying any check or payment as Rent  be deemed an accord and satisfaction, and Landlord may accept such check or payment without  prejudice to Landlord’s right to recover the balance of such Rent or pursue any other remedy  provided in this Lease or in equity or at law.  If a dispute shall arise as to any amount or sum of  money to be paid by Tenant to Landlord hereunder, Tenant shall have the right to make payment  “under protest,” such payment shall not be regarded as a voluntary payment, and there shall survive  the right on the part of Tenant to institute suit for recovery of the payment paid under protest.  31.3. If Tenant fails to pay any sum of money required to be paid by it hereunder or  perform any other act on its part to be performed hereunder, in each case within the applicable  cure period (if any) described in Section 31.4, then Landlord may (but shall not be obligated to),  without waiving or releasing Tenant from any obligations of Tenant, make such payment or  perform such act; provided that such failure by Tenant unreasonably interfered with the use of the  Building or the Project by any other tenant or with the efficient operation of the Building or the  Project, or resulted or could have resulted in a violation of Applicable Laws or the cancellation of  an insurance policy maintained by Landlord.  Notwithstanding the foregoing, in the event of an  emergency, Landlord shall have the right to enter the Premises and act in accordance with its rights  as provided elsewhere in this Lease.  In addition to the late charge described in Section 31.1, Tenant  shall pay to Landlord as Additional Rent all sums so paid or incurred by Landlord, together with  interest at the Default Rate, computed from the date such sums were paid or incurred.  31.4. The occurrence of any one or more of the following events shall constitute a  “Default” hereunder by Tenant:  (a) Tenant vacates the Premises and makes a statement in writing (which shall  include e-mail) or issues a public statement that Tenant will not continue to satisfy all other terms  and conditions of this Lease or Tenant abandons the Premises;  (b) Tenant fails to make any payment of Rent, as and when due, or to satisfy its  obligations under Article 19, where such failure shall continue for a period of three (3) business  days after written notice thereof from Landlord to Tenant;  (c) Tenant fails to observe or perform any obligation or covenant contained  herein (other than described in Sections 31.4(a) and 31.4(b)) to be performed by Tenant, where  such failure continues for a period of thirty (30) days after written notice thereof from Landlord to  Tenant; provided that, if the nature of Tenant’s default is such that it reasonably requires more than  thirty (30) days to cure, Tenant shall not be deemed to be in Default if Tenant commences such  cure within such thirty (30) day period and thereafter diligently prosecutes the same to completion;  

 

59  and provided, further, that such cure is completed no later than sixty (60) days after Tenant’s  receipt of written notice from Landlord;  (d) Tenant makes an assignment for the benefit of creditors; (e) A receiver, trustee or custodian is appointed to or does take title, possession or control of all or substantially all of Tenant’s assets;  (f) Tenant files a voluntary petition under the United States Bankruptcy Code or any successor statute (as the same may be amended from time to time, the “Bankruptcy Code”)  or an order for relief is entered against Tenant pursuant to a voluntary or involuntary proceeding  commenced under any chapter of the Bankruptcy Code;  (g) Any involuntary petition is filed against Tenant under any chapter of the Bankruptcy Code and is not dismissed within one hundred twenty (120) days;  (h) Tenant fails to deliver an estoppel certificate in accordance with Article 20 and such failure continues for three (3) business days after written notice from Landlord to Tenant;  or  (i) Tenant’s interest in this Lease is attached, executed upon or otherwise judicially seized and such action is not released within one hundred twenty (120) days of the action.  Notices given under this Section shall specify the alleged default and shall demand that Tenant  perform the provisions of this Lease or pay the Rent that is in arrears, as the case may be, within  the applicable period of time, or quit the Premises.  No such notice shall be deemed a forfeiture or  a termination of this Lease unless Landlord elects otherwise in such notice.    31.5. Intentionally Omitted.  31.6. In the event of a Default by Tenant, and at any time thereafter, with or without  notice or demand and without limiting Landlord in the exercise of any right or remedy that  Landlord may have, Landlord has the right to do any or all of the following:  (a) Halt any Tenant Improvements and Alterations and order Tenant’s contractors, subcontractors, consultants, designers and material suppliers to stop work;  (b) Terminate Tenant’s right to possession of the Premises by written notice to Tenant or by any lawful means, in which case Tenant shall immediately surrender possession of  the Premises to Landlord.  In such event, Landlord shall have the immediate right to re-enter and  remove all persons and property, and such property may be removed and stored in a public  warehouse or elsewhere at the cost and for the account of Tenant, all without service of notice or  resort to legal process and without being deemed guilty of trespass or becoming liable for any loss  or damage that may be occasioned thereby; and  (c) Terminate this Lease, in which event Tenant shall immediately surrender possession of the Premises to Landlord.  In such event, Landlord shall have the immediate right to  re-enter and remove all persons and property, and such property may be removed and stored in a  

 

60  public warehouse or elsewhere at the cost and for the account of Tenant, all without service of  notice or resort to legal process and without being deemed guilty of trespass or becoming liable  for any loss or damage that may be occasioned thereby.  In the event that Landlord shall elect to  so terminate this Lease, then Landlord shall be entitled to recover from Tenant all damages  incurred by Landlord by reason of Tenant’s default, including:  (i) The sum of: A. The worth at the time of award of any unpaid Rent that had accrued at the time of such termination; plus  B. The worth at the time of award of the amount by which the unpaid Rent that would have accrued during the period commencing with termination of the Lease  and ending at the time of award exceeds that portion of the loss of Landlord’s rental income from  the Premises that Tenant proves to Landlord’s reasonable satisfaction could have been reasonably  avoided; plus  C. The worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds that portion of the loss of  Landlord’s rental income from the Premises that Tenant proves to Landlord’s reasonable  satisfaction could have been reasonably avoided; plus  D. Any other amount necessary to compensate Landlord for all the detriment arising from Tenant’s failure to perform its obligations under this Lease or that in  the ordinary course of things would be likely to result therefrom, including the cost of restoring  the Premises to the condition required under the terms of this Lease; plus  E. At Landlord’s election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by Applicable Laws; or  (ii) Intentionally omitted. As used in Sections 31.6(c)(i)(A) and (B), “worth at the time of award” shall be computed by  allowing interest at the Default Rate.  As used in Section 31.6(c)(i)(C), the “worth at the time of  the award” shall be computed by taking the present value of such amount, using the discount rate  of the Federal Reserve Bank of San Francisco at the time of the award plus one (1) percentage  point.  31.7. In addition to any other remedies available to Landlord at law or in equity and under  this Lease, Landlord shall have the remedy described in California Civil Code Section 1951.4 and  may continue this Lease in effect after Tenant’s Default or abandonment and recover Rent as it  becomes due, provided Tenant has the right to sublet or assign, subject only to reasonable  limitations.  In addition, Landlord shall not be liable in any way whatsoever for its failure or refusal  to relet the Premises.  For purposes of this Section, the following acts by Landlord will not  constitute the termination of Tenant’s right to possession of the Premises:  

 

  61  (a) Acts of maintenance or preservation or efforts to relet the Premises,  including alterations, remodeling, redecorating, repairs, replacements or painting as Landlord shall  consider advisable for the purpose of reletting the Premises or any part thereof; or  (b) The appointment of a receiver upon the initiative of Landlord to protect  Landlord’s interest under this Lease or in the Premises.  Notwithstanding the foregoing, in the event of a Default by Tenant, Landlord may elect at any  time to terminate this Lease and to recover damages to which Landlord is entitled.  31.8. If Landlord does not elect to terminate this Lease as provided in Section 31.6, then  Landlord may, from time to time, recover all Rent as it becomes due under this Lease.  At any time  thereafter, Landlord may elect to terminate this Lease and to recover damages to which Landlord  is entitled.  31.9. In the event Landlord elects to terminate this Lease and relet the Premises, Landlord  may execute any new lease in its own name.  Tenant shall have no right or authority whatsoever  to collect any Rent from such tenant.  The proceeds of any such reletting shall be applied as  follows:  (a) First, to the payment of any indebtedness other than Rent due hereunder  from Tenant to Landlord, including storage charges or brokerage commissions owing from Tenant  to Landlord as the result of such reletting;  (b) Second, to the payment of the costs and expenses of reletting the Premises,  including (i) alterations and repairs that Landlord deems reasonably necessary and advisable and  (ii) reasonable attorneys’ fees, charges and disbursements incurred by Landlord in connection with  the retaking of the Premises and such reletting;  (c) Third, to the payment of Rent and other charges due and unpaid hereunder;  and  (d) Fourth, to the payment of future Rent and other damages payable by Tenant  under this Lease.  31.10. All of Landlord’s rights, options and remedies hereunder shall be construed and  held to be nonexclusive and cumulative.  Landlord shall have the right to pursue any one or all of  such remedies, or any other remedy or relief that may be provided by Applicable Laws, whether  or not stated in this Lease.  No waiver of any default of Tenant hereunder shall be implied from  any acceptance by Landlord of any Rent or other payments due hereunder or any omission by  Landlord to take any action on account of such default if such default persists or is repeated, and  no express waiver shall affect defaults other than as specified in such waiver.  Notwithstanding  any provision of this Lease to the contrary, in no event shall Landlord be required to mitigate its  damages with respect to any default by Tenant, except as required by Applicable Laws.  Any such  obligation imposed by Applicable Laws upon Landlord to relet the Premises after any termination  of this Lease shall be subject to the reasonable requirements of Landlord to (a) lease to high quality  tenants on such terms as Landlord may from time to time deem appropriate in its discretion and  (b) develop the Project in a harmonious manner with a mix of uses, tenants, floor areas, terms of  

 

62  tenancies, etc., as determined by Landlord.  Landlord shall not be obligated to relet the Premises  to (y) any Tenant’s Affiliate or (z) any party (i) unacceptable to a Lender, (ii) that requires Landlord  to make improvements to or re-demise the Premises, (iii) that desires to change the Permitted Use,  (iv) that desires to lease the Premises for more or less than the remaining Term or (v) to whom Landlord or an affiliate of Landlord may desire to lease other available space in the Project or at another property owned by Landlord or an affiliate of Landlord. 31.11. Landlord’s termination of (a) this Lease or (b) Tenant’s right to possession of the  Premises shall not relieve Tenant of any liability to Landlord that has previously accrued or that  shall arise based upon events that occurred prior to the later to occur of (y) the date of Lease  termination and (z) the date Tenant surrenders possession of the Premises.  31.12. To the extent permitted by Applicable Laws, Tenant waives any and all rights of  redemption granted by or under any present or future Applicable Laws if Tenant is evicted or  dispossessed for any cause, or if Landlord obtains possession of the Premises due to Tenant’s  default hereunder or otherwise.    31.13. Landlord shall not be in default or liable for damages under this Lease unless  Landlord fails to perform obligations required of Landlord within a reasonable time, but in no  event shall such failure continue for more than thirty (30) days after written notice from Tenant  specifying the nature of Landlord’s failure; provided, however, that if the nature of Landlord’s  obligation is such that more than thirty (30) days are required for its performance, then Landlord  shall not be in default if Landlord commences performance within such thirty (30) day period and  thereafter diligently prosecutes the same to completion.  In no event shall Tenant have the right to  terminate or cancel this Lease or to withhold or abate rent or to set off any Claims against Rent as  a result of any default or breach by Landlord of any of its covenants, obligations, representations,  warranties or promises hereunder, except as may otherwise be expressly set forth in this Lease.  31.14. In the event of any default by Landlord, Tenant shall give notice by registered or  certified mail to any (a) beneficiary of a deed of trust or (b) mortgagee under a mortgage covering  the Premises, the Building or the Project and to any landlord of any lease of land upon or within  which the Premises, the Building or the Project is located (provided Tenant has been informed of  the existence and address of such mortgagee or landlord), and shall offer such beneficiary,  mortgagee or landlord a reasonable opportunity to cure the default, including time to obtain  possession of the Building or the Project by power of sale or a judicial action if such should prove  necessary to effect a cure; provided that Landlord shall furnish to Tenant in writing, upon written  request by Tenant, the names and addresses of all such persons who are to receive such notices.  32. Bankruptcy .  In the event a debtor, trustee or debtor in possession under the Bankruptcy Code, or another person with similar rights, duties and powers under any other Applicable Laws, proposes to cure any default under this Lease or to assume or assign this Lease and is obliged to provide adequate assurance to Landlord that (a) a default shall be cured, (b) Landlord shall be compensated for its damages arising from any breach of this Lease and (c) future performance of 

 

  63  Tenant’s obligations under this Lease shall occur, then such adequate assurances shall include any  or all of the following, as designated by Landlord in its sole and absolute discretion:  32.1. Those acts specified in the Bankruptcy Code or other Applicable Laws as included  within the meaning of “adequate assurance,” even if this Lease does not concern a shopping center  or other facility described in such Applicable Laws;  32.2. A prompt cash payment to compensate Landlord for any monetary defaults or  actual damages arising directly from a breach of this Lease;  32.3. A cash deposit in an amount at least equal to the then-current amount of the Security  Deposit; or  32.4. The assumption or assignment of all of Tenant’s interest and obligations under this  Lease.  33. Brokers.   33.1 Tenant represents and warrants that it has had no dealings with any real estate  broker or agent in connection with the negotiation of this Lease other than Kidder Mathews  (“Broker”), and that it knows of no other real estate broker or agent that is or might be entitled to  a commission in connection with this Lease.  Landlord shall compensate Broker in relation to this  Lease pursuant to a separate agreement between Landlord and Broker.  33.2 Tenant represents and warrants that no broker or agent has made any representation  or warranty relied upon by Tenant in Tenant’s decision to enter into this Lease, other than as  contained in this Lease.  33.3 Tenant acknowledges and agrees that the employment of brokers by Landlord is for  the purpose of solicitation of offers of leases from prospective tenants and that no authority is  granted to any broker to furnish any representation (written or oral) or warranty from Landlord  unless expressly contained within this Lease.  Landlord is executing this Lease in reliance upon  Tenant’s representations, warranties and agreements contained within Sections 33.1 and 33.2.  33.4 Tenant agrees to Indemnify the Landlord Indemnitees from any and all cost or  liability for compensation claimed by any broker or agent, other than Broker, employed or engaged  by Tenant or claiming to have been employed or engaged by Tenant.  Landlord agrees to Indemnify  the Tenant Parties from any and all cost or liability for compensation claimed by any broker or  agent, other than Broker, employed or engaged by Landlord or claiming to have been employed  or engaged by Landlord.  34. Definition of Landlord.  With regard to obligations imposed upon Landlord pursuant to  this Lease, the term “Landlord,” as used in this Lease, shall refer only to Landlord or Landlord’s  then-current successor-in-interest.  In the event of any transfer, assignment or conveyance of  Landlord’s interest in this Lease or in Landlord’s fee title to or leasehold interest in the Property,  as applicable, Landlord herein named (and in case of any subsequent transfers or conveyances, the  subsequent Landlord) shall be automatically freed and relieved, from and after the date of such  transfer, assignment or conveyance, from all liability for the performance of any covenants or  

 

64  obligations contained in this Lease thereafter to be performed by Landlord and, without further  agreement, the transferee, assignee or conveyee of Landlord’s in this Lease or in Landlord’s fee  title to or leasehold interest in the Property, as applicable, shall be deemed to have assumed and  agreed to observe and perform any and all covenants and obligations of Landlord hereunder during  the tenure of its interest in the Lease or the Property.  Landlord or any subsequent Landlord may  transfer its interest in the Premises or this Lease without Tenant’s consent.  35. Limitation of Landlord’s Liability. 35.1 If Landlord is in default under this Lease and, as a consequence, Tenant recovers a monetary judgment against Landlord, the judgment shall be satisfied only out of (a) the proceeds  of sale received on execution of the judgment and levy against the right, title and interest of  Landlord in the Building and the Project, (b) rent or other income from such real property  receivable by Landlord or (c) the consideration received by Landlord from the sale, financing,  refinancing or other disposition of all or any part of Landlord’s right, title or interest in the Building  or the Project.  35.2 Neither Landlord nor any of its affiliates, nor any of their respective partners,  shareholders, directors, officers, employees, members or agents shall be personally liable for  Landlord’s obligations or any deficiency under this Lease, and service of process shall not be made  against any shareholder, director, officer, employee or agent of Landlord or any of Landlord’s  affiliates.  No partner, shareholder, director, officer, employee, member or agent of Landlord or  any of its affiliates shall be sued or named as a party in any suit or action, and service of process  shall not be made against any partner or member of Landlord except as may be necessary to secure  jurisdiction of the partnership, joint venture or limited liability company, as applicable.  No  partner, shareholder, director, officer, employee, member or agent of Landlord or any of its  affiliates shall be required to answer or otherwise plead to any service of process, and no judgment  shall be taken or writ of execution levied against any partner, shareholder, director, officer,  employee, member or agent of Landlord or any of its affiliates.  35.3 Each of the covenants and agreements of this Article shall be applicable to any  covenant or agreement either expressly contained in this Lease or imposed by Applicable Laws  and shall survive the expiration or earlier termination of this Lease.  36. Joint and Several Obligations.  If more than one person or entity executes this Lease as Tenant, then: 36.1. Each of them is jointly and severally liable for the keeping, observing and  performing of all of the terms, covenants, conditions, provisions and agreements of this Lease to  be kept, observed or performed by Tenant, and such terms, covenants, conditions, provisions and  agreements shall be binding with the same force and effect upon each and all of the persons  executing this Agreement as Tenant; and  36.2. The term “Tenant,” as used in this Lease, means and includes each of them, jointly  and severally.  The act of, notice from, notice to, refund to, or signature of any one or more of  them with respect to the tenancy under this Lease, including any renewal, extension, expiration,  termination or modification of this Lease, shall be binding upon each and all of the persons  

 

  65  executing this Lease as Tenant with the same force and effect as if each and all of them had so  acted, so given or received such notice or refund, or so signed.  37. Representations.  Tenant guarantees, warrants and represents that (a) Tenant is duly  incorporated or otherwise established or formed and validly existing under the laws of its state of  incorporation, establishment or formation, (b) Tenant has and is duly qualified to do business in  the state in which the Property is located, (c) Tenant has full corporate, partnership, trust,  association or other appropriate power and authority to enter into this Lease and to perform all  Tenant’s obligations hereunder, (d) each person (and all of the persons if more than one signs)  signing this Lease on behalf of Tenant is duly and validly authorized to do so and (e) neither (i)  the execution, delivery or performance of this Lease nor (ii) the consummation of the transactions  contemplated hereby will violate or conflict with any provision of documents or instruments under  which Tenant is constituted or to which Tenant is a party.  In addition, Tenant guarantees, warrants  and represents that none of (x) it, (y) its affiliates or partners nor (z) to its knowledge, its members,  or any of their respective employees, officers, directors, representatives or agents is a person or  entity with whom U.S. persons or entities are restricted from doing business under regulations of  the Office of Foreign Asset Control (“OFAC”) of the Department of the Treasury (including those  named on OFAC’s Specially Designated and Blocked Persons List) or under any statute, executive  order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting  Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism) or other  similar governmental action.  38. Confidentiality.  Tenant shall keep the terms and conditions of this Lease and any  information provided to Tenant or its employees, agents or contractors pursuant to Article 9  confidential and shall not (a) disclose to any third party any terms or conditions of this Lease or  any other Lease-related document (including subleases, assignments, work letters, construction  contracts, letters of credit, subordination agreements, non-disturbance agreements, brokerage  agreements or estoppels) or the contents of any documents, reports, surveys or evaluations related  to the Project or any portion thereof or (b) provide to any third party an original or copy of this  Lease (or any Lease-related document or other document referenced in Subsection 38(a)).   Landlord shall not release to any third party any non-public information that Tenant gives Landlord  and is clearly marked or designated by Tenant as “Confidential.”  Notwithstanding the foregoing,  confidential information under this Section may be released by Landlord or Tenant under the  following circumstances:  (w) if required by Applicable Laws or in any judicial proceeding;  provided that the releasing party has given the other party reasonable notice of such requirement,  if feasible, (x) to a party’s attorneys, accountants, brokers, lenders, potential lenders, investors,  potential investors, purchasers, potential purchasers and other bona fide consultants or advisers  (with respect to this Lease and any Lease-related document only); provided such third parties agree  to be bound by this Section, (y) to a party’s lenders for purposes of financial reporting or (z) to  bona fide prospective assignees or subtenants of this Lease; provided they agree in writing to be  bound by this Section.  39. Notices.  Except as otherwise stated in this Lease, any notice, consent, demand, invoice,  statement or other communication required or permitted to be given hereunder shall be in writing  and shall be given by (a) personal delivery, (b) overnight delivery with a reputable international  overnight delivery service, such as FedEx, or (c) email transmission to an email address designated  by Tenant (as of the Execution Date, the Tenant designated email for purposes of this provision  

 

  66  shall be finance@codexdna.com), so long as such transmission is followed within one (1) business  day by delivery utilizing one of the methods described in Subsection 39(a) or (b), provided that,  for purposes of this Subsection 39(c), if delivery utilizing one of the other methods described in  Subsection 39(a) or (b) is not reasonably practicable due to an event of Force Majeure (as defined  below), then such requirement shall be waived for deliveries by email transmission so long as  either the receiving party responds to the sending party confirming receipt of the applicable email  transmission, or the sending party receives other electronic confirmation that the email  transmission was received and read by the receiving party, such as a “read receipt” notice.  Any  such notice, consent, demand, invoice, statement or other communication shall be deemed  delivered (x) upon receipt, if given in accordance with Subsection 39(a); (y) one (1) business day  after deposit with a reputable international overnight delivery service, if given in accordance with  Subsection 39(b); or (z) upon transmission, if given in accordance with Subsection 39(c).  Except  as otherwise stated in this Lease, any notice, consent, demand, invoice, statement or other  communication required or permitted to be given pursuant to this Lease shall be addressed to  Tenant at the Premises, or to Landlord or Tenant at the addresses shown in Sections 2.9 and 2.10  or 2.11, respectively.  Either party may, by notice to the other given pursuant to this Section,  specify additional or different addresses for notice purposes.  40. Miscellaneous.   40.1. Landlord reserves the right to change the name of a Building or the Project in its  sole discretion.  40.2. To induce Landlord to enter into this Lease, Tenant agrees that it shall furnish to  Landlord, from time to time, within ten (10) business days after receipt of Landlord’s written  request, the most recent year-end unconsolidated financial statements reflecting Tenant’s current  financial condition audited by a nationally recognized accounting firm (and if unconsolidated  financial statements are not prepared by Tenant, then Tenant may provide consolidated financial  statements together with a certified statement from Tenant’s Chief Financial Officer or another  financial officer of Tenant identifying which portions of the consolidated financial statements  reflect Tenant’s financial condition in sufficient detail that Landlord can determine Tenant’s  financial condition).  Tenant shall, from time to time upon request from Landlord, furnish Landlord  with a certified copy of Tenant’s year-end unconsolidated financial statements for the previous  year audited by a nationally recognized accounting firm (and if unconsolidated financial  statements are not prepared by Tenant, then Tenant may provide consolidated financial statements  together with a certified statement from Tenant’s Chief Financial Officer or another financial  officer of Tenant identifying which portions of the consolidated financial statements reflect  Tenant’s financial condition in sufficient detail that Landlord can determine Tenant’s financial  condition).  Tenant represents and warrants that all financial statements, records and information  furnished by Tenant to Landlord in connection with this Lease are true, correct and complete in all  respects as of the date provided.  Notwithstanding the foregoing, if audited financials are not  otherwise prepared, unaudited financials complying with generally accepted accounting principles  and certified by the chief financial officer or chief executive officer of Tenant as true, correct and  complete in all respects shall suffice for purposes of this Section.  The provisions of this Section  shall not apply at any time while Tenant is a corporation whose shares are traded on any nationally  recognized stock exchange.  

 

67  40.3. Submission of this instrument for examination or signature by Tenant does not  constitute a reservation of or option for a lease, and shall not be effective as a lease or otherwise  until execution by and delivery to both Landlord and Tenant.  40.4. The terms of this Lease are intended by the parties as a final, complete and exclusive  expression of their agreement with respect to the terms that are included herein, and may not be  contradicted or supplemented by evidence of any other prior or contemporaneous agreement.  40.5. Landlord may, but shall not be obligated to, record a short form or memorandum  hereof without Tenant’s consent.  Within ten (10) days after receipt of written request from  Landlord, Tenant shall execute a termination of any short form or memorandum of lease recorded  with respect hereto.  Landlord shall be responsible for the cost of recording any short form or  memorandum of this Lease requested by Landlord, including any transfer or other taxes incurred  in connection with such recordation.  Neither party shall record this Lease.  40.6. Where applicable in this Lease, the singular includes the plural and the masculine  or neuter includes the masculine, feminine and neuter.  The words “include,” “includes,”  “included” and “including” mean “‘include,’ etc., without limitation.” The word “shall” is  mandatory and the word “may” is permissive.  The word “business day” means a calendar day  other than any national or local holiday on which federal government agencies in the County of  San Diego are closed for business, or any weekend.  The section headings of this Lease are not a  part of this Lease and shall have no effect upon the construction or interpretation of any part of  this Lease.  Landlord and Tenant have each participated in the drafting and negotiation of this  Lease, and the language in all parts of this Lease shall be in all cases construed as a whole  according to its fair meaning and not strictly for or against either Landlord or Tenant.  40.7. Except as otherwise expressly set forth in this Lease, each party shall pay its own  costs and expenses incurred in connection with this Lease and such party’s performance under this  Lease; provided that, if either party commences an action, proceeding, demand, claim, action,  cause of action or suit against the other party arising from or in connection with this Lease, then  the substantially prevailing party shall be reimbursed by the other party for all reasonable costs  and expenses, including reasonable attorneys’ fees and expenses, incurred by the substantially  prevailing party in such action, proceeding, demand, claim, action, cause of action or suit, and in  any appeal in connection therewith (regardless of whether the applicable action, proceeding,  demand, claim, action, cause of action, suit or appeal is voluntarily withdrawn or dismissed).  In  addition, Landlord shall, upon demand, be entitled to all reasonable attorneys’ fees and all other  reasonable costs incurred in the preparation and service of any notice of default or demand for  performance hereunder, regardless of whether a legal action is subsequently commenced, or  incurred in connection with any contested matter or other proceeding in bankruptcy court  concerning this Lease.  40.8. Time is of the essence with respect to the performance of every provision of this  Lease.  40.9. Each provision of this Lease performable by Tenant shall be deemed both a  covenant and a condition.  

 

68  40.10. Notwithstanding anything to the contrary contained in this Lease, Tenant’s  obligations under this Lease are independent and shall not be conditioned upon performance by  Landlord.  40.11. Any provision of this Lease that shall prove to be invalid, void or illegal shall in no  way affect, impair or invalidate any other provision hereof, and all other provisions of this Lease  shall remain in full force and effect and shall be interpreted as if the invalid, void or illegal  provision did not exist.  40.12. Each of the covenants, conditions and agreements herein contained shall inure to  the benefit of and shall apply to and be binding upon the parties hereto and their respective heirs;  legatees; devisees; executors; administrators; and permitted successors and assigns.  This Lease is  for the sole benefit of the parties and their respective heirs, legatees, devisees, executors,  administrators and permitted successors and assigns, and nothing in this Lease shall give or be  construed to give any other person or entity any legal or equitable rights.  Nothing in this Section  shall in any way alter the provisions of this Lease restricting assignment or subletting.  40.13. This Lease shall be governed by, construed and enforced in accordance with the  laws of the state in which the Premises are located, without regard to such state’s conflict of law  principles.  40.14. Tenant guarantees, warrants and represents that the individual or individuals  signing this Lease on its behalf have the power, authority and legal capacity to sign this Lease on  behalf of and to bind all entities, corporations, partnerships, limited liability companies, joint  venturers or other organizations and entities on whose behalf such individual or individuals have  signed.  40.15. This Lease may be executed in one or more counterparts, each of which, when taken  together, shall constitute one and the same document.  40.16. No provision of this Lease may be modified, amended or supplemented except by  an agreement in writing signed by Landlord and Tenant.  40.17. No waiver of any term, covenant or condition of this Lease shall be binding upon  Landlord unless executed in writing by Landlord.  The waiver by Landlord of any breach or default  of any term, covenant or condition contained in this Lease shall not be deemed to be a waiver of  any preceding or subsequent breach or default of such term, covenant or condition or any other  term, covenant or condition of this Lease.  40.18. To the extent permitted by Applicable Laws, the parties waive trial by jury in any  action, proceeding or counterclaim brought by the other party hereto related to matters arising from  or in any way connected with this Lease; the relationship between Landlord and Tenant; Tenant’s  use or occupancy of the Premises; or any claim of injury or damage related to this Lease or the  Premises.  40.19. A facsimile, electronic or portable document format (PDF) signature on this Lease  or any other document required or permitted by this Lease to be delivered by Landlord or Tenant  shall be equivalent to, and have the same force and effect as, an original signature.  

 

69  40.20. For purposes of this Lease, “Force Majeure” means accidents; breakage; casualties  (to the extent not caused by the party claiming Force Majeure); Severe Weather Conditions (as  defined below); physical natural disasters (but excluding weather conditions that are not Severe  Weather Conditions); strikes, lockouts or other labor disturbances or labor disputes (other than  labor disturbances and labor disputes resulting solely from the acts or omissions of the party  claiming Force Majeure); acts of terrorism; riots or civil disturbances; wars or insurrections;  shortages of materials (which shortages are not unique to the party claiming Force Majeure);  regulations, moratoria or other actions, inactions or delays by Governmental Authorities; failures  by third parties to deliver gas, oil or another suitable fuel supply, or inability of the party claiming  Force Majeure, by exercise of reasonable diligence, to obtain gas, oil or another suitable fuel; or  other causes beyond the reasonable control of the party claiming that Force Majeure has occurred.  “Severe Weather Conditions” means weather conditions that are materially worse than those that  would be reasonably anticipated for the Property at the applicable time based on historic  meteorological records.    40.21. Whenever consent or approval of either party is required, that party shall not  unreasonably withhold, condition or delay such consent or approval, except as may be expressly  set forth to the contrary.  41. Waples Lease.  Landlord’s affiliate, BMR Waples LP (“BMR-Waples”), and Tenant are parties to that certain Lease dated as of April 2, 2019 (as amended, the “Waples Lease”).  On or about the Execution Date,  BMR-Waples and Tenant shall enter into an amendment to the Waples Lease in the form attached hereto as Exhibit G. 42. Option to Extend Term.  Tenant shall have the option (“Option”) to extend the Term by five (5) years as to the entire Premises (and no less than the entire Premises) upon the following terms and conditions.  Any extension of the Term pursuant to the Option shall be on all the same terms and conditions as this Lease, except as follows: 42.1. Base Rent during the Option term shall equal the then-current fair market value for  comparable office and laboratory space in the Sorrento Mesa submarket of comparable age,  quality, level of finish and proximity to amenities and public transit, and containing the systems  and improvements present in the Premises as of the date that Tenant gives Landlord written notice  of Tenant’s election to exercise the Option (“FMV”).  For purposes of clarity, FMV will include a  starting Base Rent for the Option term and annual increases in Base Rent throughout the Option  term (both of which shall be determined as part of FMV in accordance with the provisions of  Article 42).   Tenant may, no more than nine (9) months prior to the date the Term is then scheduled  to expire, request Landlord’s estimate of the FMV for the Option term.  Landlord shall, within  fifteen (15) days after receipt of such request, give Tenant a written proposal of such FMV.  If  Tenant gives written notice to exercise the Option, such notice shall specify whether Tenant  accepts Landlord’s proposed estimate of FMV.  If Tenant does not accept the FMV, then the parties  shall endeavor to agree upon the FMV, taking into account all relevant factors, including (a) the  size of the Premises, (b) the length of the Option term, (c) rent in comparable buildings in the  relevant submarket, including concessions offered to new tenants (as compared to those offered to  Tenant), such as free rent, tenant improvement allowances and moving allowances, (d) Tenant’s  creditworthiness and (e) the quality and location of the Building and the Project.  In the event that  the parties are unable to agree upon the FMV within thirty (30) days after Tenant notifies Landlord  

 

70  that Tenant is exercising the Option, then either party may request that the same be determined as  follows:  a senior officer of a nationally recognized leasing brokerage firm with local knowledge  of the Sorrento Mesa laboratory/research and development leasing submarket (the “Baseball  Arbitrator”) shall be selected and paid for jointly by Landlord and Tenant.  If Landlord and Tenant  are unable to agree upon the Baseball Arbitrator, then the same shall be designated by the local  chapter of the Judicial Arbitration and Mediation Services or any successor organization thereto  (the “JAMS”).  The Baseball Arbitrator selected by the parties or designated by JAMS shall (y)  have at least ten (10) years’ experience in the leasing of laboratory/research and development space  in the Sorrento Mesa submarket and (z) not have been employed or retained by either Landlord or  Tenant or any affiliate of either for a period of at least ten (10) years prior to appointment pursuant  hereto.  Each of Landlord and Tenant shall submit to the Baseball Arbitrator and to the other party  its determination of the FMV.  The Baseball Arbitrator shall grant to Landlord and Tenant a  hearing and the right to submit evidence.  The Baseball Arbitrator shall determine which of the  two (2) FMV determinations more closely represents the actual FMV.  The arbitrator may not  select any other FMV for the Premises other than one submitted by Landlord or Tenant.  The FMV  selected by the Baseball Arbitrator shall be binding upon Landlord and Tenant and shall serve as  the basis for determination of Base Rent payable for the Option term.  If, as of the commencement  date of the Option term, the amount of Base Rent payable during the Option term shall not have  been determined, then, pending such determination, Tenant shall pay Base Rent equal to the Base  Rent payable with respect to the last year of the then-current Term.  After the final determination  of Base Rent payable for the Option term, the parties shall promptly execute a written amendment  to this Lease specifying the amount of Base Rent to be paid during the Option term.  Any failure  of the parties to execute such amendment shall not affect the validity of the FMV determined  pursuant to this Section.  42.2. The Option is not assignable separate and apart from this Lease.  42.3. The Option is conditional upon Tenant giving Landlord written notice of its election  to exercise the Option at six (6) months prior to the end of the expiration of the then-current Term.  Time shall be of the essence as to Tenant’s exercise of the Option.  Tenant assumes full  responsibility for maintaining a record of the deadlines to exercise the Option.  Tenant  acknowledges that it would be inequitable to require Landlord to accept any exercise of  the Option  after the date provided for in this Section.  42.4. Notwithstanding anything contained in this Article to the contrary, Tenant shall not  have the right to exercise the Option:  (a) During the time commencing from the date Landlord delivers to Tenant a written notice that Tenant is in default under any provisions of this Lease and continuing until  Tenant has cured the specified default to Landlord’s reasonable satisfaction; or  (b) At any time after any Default as described in Article 31 of the Lease and continuing until Tenant cures any such Default, if such Default is susceptible to being cured; or  (c) In the event that Tenant has Defaulted in the performance of its monetary or material non-monetary obligations under this Lease three (3) or more times during the twelve  

 

71  (12)-month period immediately prior to the date that Tenant intends to exercise the Option,  whether or not Tenant has cured such Defaults.  42.5. The period of time within which Tenant may exercise the Option shall not be  extended or enlarged by reason of Tenant’s inability to exercise such Option because of the  provisions of Section 42.4.  42.6. All of Tenant’s rights under the provisions of the Option shall terminate and be of  no further force or effect even after Tenant’s due and timely exercise of the Option if, after such  exercise, but prior to the commencement date of the new term, (a) Tenant fails to pay to Landlord  a monetary obligation of Tenant for a period of twenty (20) days after written notice from Landlord  to Tenant, (b) Tenant fails to commence to cure a default (other than a monetary default) within  thirty (30) days after the date Landlord gives notice to Tenant of such default or (c) Tenant has  Defaulted under this Lease three (3) or more times and a service or late charge under Section 31.1  has become payable for any such Default, whether or not Tenant has cured such Defaults.  43. Right of First Offer.  For so long as Tenant leases and personally occupies the entire Premises, and subject to any other parties’ pre-existing rights with respect to Available ROFO Premises (as defined below), Tenant shall have a right of first offer (“ROFO”) as to any rentable premises in the 10431 Building depicted and described on Exhibit J attached hereto, in each case for which Landlord is seeking a tenant (“Available ROFO Premises”); provided, however, that in no event shall Landlord be required to lease any Available ROFO Premises to Tenant for any period past the date on which this Lease expires or is terminated pursuant to its terms.  To the extent that Landlord renews or extends a then-existing lease with any then-existing tenant or subtenant of any space, or enters into a new lease with such then-existing tenant or subtenant for the same premises, the affected space shall not be deemed to be Available ROFO Premises.  In the event Landlord intends to market Available ROFO Premises, Landlord shall provide written notice thereof to Tenant (the “Notice of Marketing”), which shall include the following information:  (a) the suite number of the Available ROFO Premises, (b) the Rentable Area of the Available ROFO Premises, (c) the estimated date that Landlord anticipates receiving possession of the Available ROFO Premises, and (d) Landlord’s proposed economics for a lease of the Available ROFO Premises (including base rent, tenant improvement allowance and term), which shall be based upon Landlord’s determination of market rent for the Available ROFO Premises. 43.1. Within five (5) business days following its receipt of a Notice of Marketing, Tenant  shall either (i) advise Landlord in writing that Tenant elects to lease all (not just a portion) of the  Available ROFO Premises on the terms and conditions set forth in the Notice of Marketing, (ii)  submit a “Tenant’s Offer” as set forth in Section 43.2 below with regard to all (not just a portion)  of the Available ROFO Premises or (iii) elect not to lease the Available ROFO Premises.  If Tenant  fails to notify Landlord of Tenant’s election within such five (5) business day period, then Tenant  shall be deemed to have elected not to lease the Available ROFO Premises.  If Tenant notifies  Landlord that it elects to lease all of the Available ROFO Premises on the terms and conditions set  forth in the Notice of Marketing, Landlord shall prepare an amendment adding such Available  ROFO Premises to the Premises on the terms and conditions in the Notice of Marketing and  otherwise on the non-economic terms and conditions of this Lease.  Tenant will execute such  amendment within five (5) business days of Tenant’s receipt of such amendment; provided that  

 

72  execution of such amendment will not be a condition to the effectiveness of Tenant’s lease of the  Available ROFO Premises.  43.2. If Tenant timely notifies Landlord that Tenant desires to lease all of the Available  ROFO Premises, but specifies terms and conditions other than as set forth in the Notice of  Marketing (“Tenant’s Offer”) (provided that Tenant shall be required to lease the Available ROFO  Premises for at least the remainder of the then-current Term), then Landlord shall have five (5)  business days after receipt of Tenant’s Offer to respond to Tenant in writing whether Landlord  elects to lease the Available ROFO Premises to Tenant on the terms and conditions set forth in  Tenant’s Offer.  If Tenant timely delivers Tenant’s Offer and Landlord elects to lease the Available  ROFO Premises to Tenant on the terms and conditions set forth in Tenant’s Offer, then Landlord  shall lease the Available ROFO Premises to Tenant upon the terms and conditions set forth in  Tenant’s Offer.  43.3. If (a) Tenant notifies Landlord that Tenant elects not to lease the Available ROFO  Premises, (b) Tenant fails to notify Landlord of Tenant’s election within the five (5) business day  period described above or (c) Landlord declines to lease the Available ROFO Premises to Tenant  on the terms and conditions set forth in Tenant’s Offer, then Tenant’s ROFO with respect to such  Available ROFO Premises shall be extinguished, void and of no further force or effect, and  Landlord shall have the right to consummate a lease of such Available ROFO Premises with any  other third party on any terms that Landlord desires.  43.4. Notwithstanding anything in this Article to the contrary, Tenant shall not exercise  the ROFO during such period of time that Tenant is in default under any provision of this Lease.  Any attempted exercise of the ROFO during a period of time in which Tenant is so in default shall  be void and of no effect.  In addition, Tenant shall not be entitled to exercise the ROFO if Landlord  has given Tenant three (3) or more notices of default under this Lease, whether or not the defaults  are cured, during the twelve (12) month period prior to the date on which Tenant seeks to exercise  the ROFO.  43.5. Notwithstanding anything in this Lease to the contrary, Tenant shall not assign or  transfer the ROFO (other than in connection with an assignment of the entire interest of the original  Tenant named herein pursuant to an Exempt Transfer), either separately or in conjunction with an  assignment or transfer of Tenant’s interest in the Lease, without Landlord’s prior written consent,  which consent Landlord may withhold in its sole and absolute discretion.  43.6. If Tenant exercises the ROFO, Landlord does not guarantee that the Available  ROFO Premises will be available on the anticipated commencement date for the Lease as to such  Premises due to a holdover by the then-existing occupants of the Available ROFO Premises or for  any other reason beyond Landlord’s reasonable control.  43.7. Notwithstanding anything in this Lease to the contrary, the ROFO shall expire on  the date that is one hundred seventeen (117) months following the date which is the later of the  10431 Premises Commencement Date or the 10421 Premises Commencement Date.  [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 

 

Senior Vice President, Legal and Assistant Secretary Marie Lewis 

 

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A-1-5 EXHIBIT A-2  10421 LANDLORD WORK  10421 Building:  

 

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B-1 EXHIBIT B  WORK LETTER  This Work Letter (this “Work Letter”) is made and entered into as of the ____ day of  _______, 2021, by and between BRE-BMR WATERIDGE POINTE LP, a Delaware limited  partnership (“Landlord”), and CODEX DNA, INC., a Delaware corporation (“Tenant”), and is  attached to and made a part of that certain Lease dated as of even date herewith (as the same may  be amended, amended and restated, supplemented or otherwise modified from time to time, the  “Lease”), by and between Landlord and Tenant for the Premises located at 10421 and 10431  Wateridge Circle, San Diego, California.  All capitalized terms used but not otherwise defined  herein shall have the meanings given them in the Lease.  Landlord and Tenant hereby acknowledge that the Tenant Improvements may be  constructed in phases, with one phase being the 10431 Tenant Improvements and the other phase  being the 10421 Tenant Improvements.  The two phases of the Tenant Improvements may be  Substantially Completed at different times.  Notwithstanding the phasing of the Tenant  Improvements, the terms and conditions of this Work Letter will apply to all of the Tenant  Improvements in the entire Premises.  1. General Requirements. 1.1. Authorized Representatives. (a) Landlord designates, as Landlord’s authorized representative (“Landlord’s Authorized Representative”), (i) Chris Burrus as the person authorized to initial plans, drawings,  approvals and to sign change orders pursuant to this Work Letter and (ii) an officer of Landlord as  the person authorized to sign any amendments to this Work Letter or the Lease.  Tenant shall not  be obligated to respond to or act upon any such item until such item has been initialed or signed  (as applicable) by the appropriate Landlord’s Authorized Representative.  Landlord may change  either Landlord’s Authorized Representative upon one (1) business day’s prior written notice to  Tenant.  (b) Tenant designates Tom Braden (“Tenant’s Authorized Representative”) as the person authorized to initial and sign all plans, drawings, change orders and approvals pursuant  to this Work Letter.  Landlord shall not be obligated to respond to or act upon any such item until  such item has been initialed or signed (as applicable) by Tenant’s Authorized Representative.  Tenant may change Tenant’s Authorized Representative upon one (1) business day’s prior written  notice to Landlord.  1.2. Schedule.  The schedule for design and development of the Tenant Improvements,  including the time periods for preparation and review of construction documents, approvals and  performance, shall be in accordance with a schedule to be prepared by Landlord (the “Schedule”).  The Schedule shall be subject to adjustment as mutually agreed upon in writing by the parties, or  as otherwise provided in this Work Letter.   29th September 

 

  B-2  1.3. Landlord’s Architects, Contractors and Consultants.  The architect, engineering  consultants, design team, general contractor and subcontractors responsible for the construction of  the Tenant Improvements shall be selected by Landlord.  2. Tenant Improvements.  All Tenant Improvements shall be performed by Landlord’s  contractor, at Tenant’s sole cost and expense (subject to Landlord’s obligations with respect to any  portion of the Base TI Allowance and, if properly requested by Tenant pursuant to the terms of the  Lease, the Additional TI Allowance used by Landlord in completing the Tenant Improvements,  but subject to the last sentence of Section 4.7 of the Lease) and in substantial accordance with the  Approved Plans (as defined below), the Lease and this Work Letter.  To the extent that the total  projected cost of the Tenant Improvements (as projected by Landlord) exceeds the TI Allowance  (such excess, the “Excess TI Costs”), Tenant shall pay the costs of the Tenant Improvements on a  pari passu basis with Landlord as such costs become due, in the proportion of Excess TI Costs  payable by Tenant to the Base TI Allowance (and, if properly requested by Tenant pursuant to the  Lease, the Additional TI Allowance) payable by Landlord.  If the cost of the Tenant Improvements  (as projected by Landlord) increases over Landlord’s initial projection, then Landlord’s and  Tenant’s respective pari passu shares shall be adjusted accordingly.  If Tenant fails to pay, or is  late in paying, any sum due to Landlord under this Work Letter, then Landlord shall have all of  the rights and remedies set forth in the Lease for nonpayment of Rent (including the right to interest  and the right to assess a late charge), and for purposes of any litigation instituted with regard to  such amounts the same shall be considered Rent.  All material and equipment furnished by  Landlord or its contractors as the Tenant Improvements shall be new or “like new,” and the Tenant  Improvements shall be performed in a first-class, workmanlike manner and in compliance with  Applicable Laws to the extent required by applicable Governmental Authorities as a condition to  the issuance of a certificate of occupancy or its substantial equivalent (i.e., a final sign off on  permits for the Tenant Improvements).  2.1. Work Plans.  Landlord shall prepare and submit to Tenant for approval schematics  covering the Tenant Improvements prepared in conformity with the applicable provisions of this  Work Letter (the “Draft Schematic Plans”).  The Draft Schematic Plans shall contain sufficient  information and detail to accurately describe the proposed design to Tenant.  Tenant shall notify  Landlord in writing within five (5) business days after receipt of the Draft Schematic Plans whether  Tenant approves or objects to the Draft Schematic Plans and of the manner, if any, in which the  Draft Schematic Plans are unacceptable.  Tenant’s failure to respond within such five (5) business  day period shall be deemed approval by Tenant.  If Tenant reasonably objects to the Draft  Schematic Plans, then Landlord shall revise the Draft Schematic Plans and cause Tenant’s  objections to be remedied in the revised Draft Schematic Plans.  Landlord shall then resubmit the  revised Draft Schematic Plans to Tenant for approval, such approval not to be unreasonably  withheld, conditioned or delayed.  Tenant’s approval of or objection to revised Draft Schematic  Plans and Landlord’s correction of the same shall be in accordance with this Section until Tenant  has approved the Draft Schematic Plans in writing or been deemed to have approved them.  The  iteration of the Draft Schematic Plans that is approved or deemed approved by Tenant without  objection shall be referred to herein as the “Approved Schematic Plans.”  All references in the  Lease to the “Approved Schematic Plans” shall mean (x) with respect to the 10431 Tenant  Improvements, the portions of the Approved Schematic Plans related solely to the 10431 Tenant  Improvements (also referred to in the Lease as, the “10431 Approved Schematic Plans”), and (z)  with respect to the 10421 Tenant Improvements, the portions of the Approved Schematic Plans  

 

  B-3  related solely to the 10421 Tenant Improvements (also referred to in the Lease as, the “10421  Approved Schematic Plans”).  2.2. Construction Plans.  Landlord shall prepare final plans and specifications for the  Tenant Improvements that (a) are consistent with and are logical evolutions of the Approved  Schematic Plans and (b) incorporate any other Tenant-requested (and Landlord-approved)  Changes (as defined below).  As soon as such final plans and specifications (“Construction Plans”)  are completed, Landlord shall deliver the same to Tenant for Tenant’s approval, which approval  shall not be unreasonably withheld, conditioned or delayed.  Such Construction Plans shall be  approved or disapproved by Tenant within five (5) business days after delivery to Tenant.  Tenant’s  failure to respond within such five (5) business day period shall be deemed approval by Tenant.   If the Construction Plans are disapproved by Tenant, then Tenant shall notify Landlord in writing  of its reasonable objections to such Construction Plans, and the parties shall confer and negotiate  in good faith to reach agreement on the Construction Plans.  Promptly after the Construction Plans  are approved by Landlord and Tenant, two (2) copies of such Construction Plans shall be initialed  and dated by Landlord and Tenant, and Landlord shall promptly submit such Construction Plans  to all appropriate Governmental Authorities for approval.  The Construction Plans so approved,  and all change orders specifically permitted by this Work Letter, are referred to herein as the  “Approved Plans.”  All references in the Lease to the “Approved Plans” shall mean (x) with respect  to the 10431 Tenant Improvements, the portions of the Approved Plans related solely to the 10431  Tenant Improvements (also referred to in the Lease as, the “10431 Approved Plans”), and (z) with  respect to the 10421 Tenant Improvements, the portions of the Approved Plans related solely to  the 10421 Tenant Improvements (also referred to in the Lease as, the “10421 Approved Plans”).  2.3. Changes to the Tenant Improvements.  Any changes to the Approved Plans (each,  a “Change”) shall be requested and instituted in accordance with the provisions of this Article 2  and shall be subject to the written approval of the non-requesting party in accordance with this  Work Letter.  (a) Change Request.  Either Landlord or Tenant may request Changes after  Tenant approves the Approved Plans by notifying the other party thereof in writing in substantially  the same form as the AIA standard change order form (a “Change Request”), which Change  Request shall detail the nature and extent of any requested Changes, including (a) the Change, (b)  the party required to perform the Change and (c) any modification of the Approved Plans and the  Schedule, as applicable, necessitated by the Change.  If the nature of a Change requires revisions  to the Approved Plans, then the requesting party shall be solely responsible for the cost and  expense of such revisions and any increases in the cost of the Tenant Improvements as a result of  such Change (subject to application of any available TI Allowance).  Change Requests shall be  signed by the requesting party’s Authorized Representative.  (b) Approval of Changes.  All Change Requests shall be subject to the other  party’s prior written approval, which approval shall not be unreasonably withheld, conditioned or  delayed.  The non-requesting party shall have five (5) business days after receipt of a Change  Request to notify the requesting party in writing of the non-requesting party’s decision either to  approve or object to the Change Request.  The non-requesting party’s failure to respond within  such five (5) business day period shall be deemed approval by the non-requesting party.  

 

  B-4  3. Requests for Consent.  Except as otherwise provided in this Work Letter, Tenant shall  respond to all requests for consents, approvals or directions made by Landlord pursuant to this  Work Letter within five (5) business days following Tenant’s receipt of such request.  Tenant’s  failure to respond within such five (5) business day period shall be deemed approval by Tenant.  4. TI Allowance.  4.1. Application of TI Allowance.  Landlord shall contribute the Base TI Allowance  and, if properly requested by Tenant pursuant to the terms of the Lease, the Additional TI  Allowance and any Excess TI Costs advanced by Tenant to Landlord toward the costs and  expenses incurred in connection with the performance of the Tenant Improvements, in accordance  with Article 4 of the Lease.  If the entire TI Allowance is not applied toward or reserved for the  costs of the Tenant Improvements, then Tenant shall not be entitled to a credit of such unused  portion of the TI Allowance.  If the entire Excess TI Costs advanced by Tenant to Landlord are  not applied toward the costs of the Tenant Improvements, then Landlord shall promptly return  such excess to Tenant following completion of the Tenant Improvements.  Tenant may apply the  Base TI Allowance and, if properly requested by Tenant pursuant to the terms of the Lease, the  Additional TI Allowance for the payment of construction and other costs in accordance with the  terms and provisions of the Lease.  4.2. Approval of Budget for the Tenant Improvements.  Notwithstanding anything to  the contrary set forth elsewhere in this Work Letter or the Lease, Landlord shall not have any  obligation to expend any portion of the TI Allowance until Landlord and Tenant shall have  approved in writing the budget for the Tenant Improvements (the “Approved Budget”).  Prior to  Landlord’s approval of the Approved Budget, Tenant shall pay all of the costs and expenses  incurred in connection with the Tenant Improvements as they become due.  Tenant shall  promptly  reimburse Landlord for costs or expenses relating to the Tenant Improvements that exceed the  amount of the TI Allowance, subject to the terms of the Lease and this Work Letter.  5. Miscellaneous.  5.1. Incorporation of Lease Provisions.  Sections 40.6 through 40.19 of the Lease are  incorporated into this Work Letter by reference, and shall apply to this Work Letter in the same  way that they apply to the Lease.  5.2. General.  Except as otherwise set forth in the Lease or this Work Letter, this Work  Letter shall not apply to improvements performed in any additional premises added to the Premises  at any time or from time to time, whether by any options under the Lease or otherwise; or to any  portion of the Premises or any additions to the Premises in the event of a renewal or extension of  the original Term, whether by any options under the Lease or otherwise, unless the Lease or any  amendment or supplement to the Lease expressly provides that such additional premises are to be  delivered to Tenant in the same condition as the initial Premises.  5.3. Progress Meetings.  Upon Tenant’s written request, Landlord’s Authorized  Representative shall conduct regular construction meetings with Tenant’s Authorized  Representative to keep Tenant updated on progress with respect to construction, timing and budget.  [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]  

 

Senior Vice President, Legal and Assistant Secretary Marie Lewis 

 

  B-1-1  EXHIBIT B-1  TENANT WORK INSURANCE SCHEDULE  1. Types of Coverage.  Tenant shall maintain or cause Tenant’s contractors performing  construction or renovation work to maintain such insurance as shall protect it from the claims set  forth below that may arise out of or result from any Tenant Work, whether such Tenant Work is  completed by Tenant or by any Tenant contractors or by any person directly or indirectly employed  by Tenant or any Tenant contractors, or by any person for whose acts Tenant or any Tenant  contractors may be liable:  a. Commercial General Liability.  Commercial general liability insurance written on  the ISO form CG 00 01 or equivalent, including products and completed operations, on an  occurrence basis.  Such coverage shall apply to all Tenant Work done by Tenant’s contractors and  subcontractors of all tiers and provide insurance against personal injury, wrongful death, and  property damage (other than to the Tenant Work itself).  The policy shall include contractual  liability coverage sufficient to address the obligations of the Lease and the Tenant Work.  This  insurance policy shall include Landlord Parties as additional insureds with endorsements  equivalent to ISO CG 20 10 04/13 for ongoing operations, and to ISO CG 20 37 04/13 for  completed operations.  This policy shall be primary and noncontributory with respect to any other  insurance available to an additional insured.  The policy shall include endorsement ISO CG 24 04  or its equivalent, a waiver of subrogation in favor of the Landlord Parties.  Tenant contractors’  Commercial General Liability Insurance shall include premises/operations (including explosion,  collapse and underground coverage if such Tenant Work involves any underground work),  elevators, independent contractors, products and completed operations, and blanket contractual  liability on all written contracts, all including broad form property damage coverage.  Coverage  for completed operations must be maintained through the applicable statue of repose period  following completion of the Tenant Work.  b. Business Automobile Liability Insurance.  Business Automobile Liability  Insurance on an “occurrence” form covering any or all autos (including owned, hired, leased and  non-owned vehicles) used by or on behalf of the insured, and providing insurance for bodily injury  and property damage.  The policy shall include coverage for loading and unloading activities.  This  policy shall include the Landlord Parties as additional insureds, with endorsements.  c. Workers’ Compensation and Employer’s Liability Insurance.  For all operations,  Workers’ Compensation insurance in compliance with statutory limits for the Workers’  Compensation Laws of the state in which the Premises are located, and an Employer’s Liability  limit of not less than $1,000,000 each accident.  d. Contractors’ Pollution Liability.  Contractors and subcontractors handling,  removing or treating Hazardous Materials shall maintain pollution liability insurance.  Such  coverage shall include bodily injury, sickness, disease, death or mental anguish or shock sustained  by any person; property damage or environmental damage, including physical injury to or  destruction of tangible property (including the resulting loss of use thereof), contractual liability  coverage to cover liability arising out of cleanup, removal, storage or handling of hazardous or  toxic chemicals, materials or substances, or any other pollutants (including mold, asbestos or  

 

  B-1-2  asbestos-containing materials); and defense costs, charges and expenses incurred in the  investigation, adjustment or defense of claims for such damages.  Claims-made coverage is  permitted, provided that the policy retroactive date is continuously maintained prior to the  commencement of the Tenant Work.  This policy shall include the Landlord Parties as additional  insureds, with endorsements.  e. Professional Liability (Errors and Omissions).  Contractors and subcontractors of  any tier performing Tenant Work that includes any professional services, including design,  architecture, engineering, testing, surveying or design/build services shall provide and maintain  professional liability insurance.  Coverage shall be maintained following completion of the Tenant  Work through the applicable statute of repose of the state in which the Premises are located.  2. Minimum Limits of Insurance. All coverage types as defined above to be procured by  Tenant’s general contractor and designer for any Tenant Work shall be written for limits of  insurance not less than:  Coverage Cost of Work Minimum Limits of Insurance  a. Commercial  General Liability  *  Limits may be met  by use of excess  and/or umbrella  liability insurance,  provided that such  coverage is at least  as broad as the  primary coverages  required herein  <$200 million  $100 million per occurrence, general aggregate,  and products and completed operations  aggregate  <$100 million  $50 million per occurrence, general aggregate,  and products and completed operations  aggregate  <$50 million  $25 million per occurrence, general aggregate,  and products and completed operations  aggregate  <$25 million  $10 million per occurrence, general aggregate,  and products and completed operations  aggregate  <$10 million  $5 million per occurrence, general aggregate,  and products and completed operations  aggregate  <$5 million  $2 million per occurrence, general aggregate,  and products and completed operations  aggregate  b. Commercial  Automobile  Liability  ≥$25 million $25 million combined single limit  <$25 million $10 million combined single limit  <$10 million $5 million combined single limit  

 

  B-1-3  Coverage Cost of Work Minimum Limits of Insurance  *  Limits may be met  by use of excess  and/or umbrella  liability insurance,  provided that such  coverage is at least  as broad as the  primary coverages  required herein  <$5 million $2 million combined single limit  c. Workers’  Compensation  At all times As required by Applicable Laws  d. Contractor’s  Pollution Liability  At all times $2 million per location and $4 million aggregate  e. Professional  Liability (Errors  and Omissions)  <$200 million $10 million per project and in the aggregate  <$75 million $5 million per project and in the aggregate  <$25 million $2 million per project and $4 million aggregate  <$10 million $1 million per project and $2 million aggregate  3. Notice of Cancelation.  The foregoing policies shall contain a provision that coverages  afforded under the policies shall not be canceled or not renewed until at least thirty (30) days’ prior  written notice has been given to the Landlord.  4. Evidence of Insurance.  Certificates of insurance, including required endorsements  showing such coverages to be in force, shall be provided to Landlord prior to the commencement  of any Tenant Work and prior to each renewal.  5. Insurer Ratings.  The minimum A.M. Best’s rating of each insurer shall be A-VII.  6. Additional Insureds.  The policies shall name Landlord Parties as additional insureds to the  extent required by the Lease, the Work Letter or this Exhibit.  7. Waiver of Subrogation.  Tenant, contractors and subcontractors, and each of their  respective insurers shall provide waivers of subrogation in favor of the Landlord Parties with  respect to all insurance required by the Lease, the Work Letter or this Exhibit.  8. Tenant’s Contractors.  Tenant shall require all other persons, firms and corporations  engaged or employed by Tenant in connection with the performance of Tenant Work to carry and  maintain coverages with limits not less than those required by this Exhibit.  Tenant’s contractors’  and subcontractors’ insurance compliance, including any coverage exceptions, shall be Tenant’s  responsibility.  Tenant shall incorporate these insurance requirements by reference within any  contract executed by Tenant and its contractors.  Tenant shall obtain and verify the accuracy of  certificates of insurance evidencing required coverage prior to permitting its contractors,  

 

  B-1-4  subcontractors (of any tier), suppliers and agents from performing any Tenant Work or services at  the Premises.  Tenant shall furnish original certificates of insurance with additional insured  endorsements from Tenant’s contractors, subcontractors (of any tier), suppliers and agents as  evidence thereof, as Landlord may reasonably request.  9. No Limit of Liability.  It is expressly acknowledged and agreed that the insurance policies  and limits required hereunder shall not limit the liability of Tenant or its contractors or  subcontractors, and that Landlord makes no representation that these types or amounts of insurance  are sufficient or adequate to protect Tenant or its contractors’ or subcontractors’ interests or  liabilities, but are merely minimums.   Any insurance carried by Landlord shall be secondary and  non-contributory to that carried by Tenant and/or its contractors or subcontractors.    

 

  C-1  EXHIBIT C  ACKNOWLEDGEMENT OF TERM COMMENCEMENT DATE  AND TERM EXPIRATION DATE  [Note to Preparer: In the notice relating to the first to occur of the commencement dates,  delete references to the Term Expiration Date, as that date will not be determined until the  second to occur of the commencement dates]  10431 Premises:  THIS ACKNOWLEDGEMENT OF TERM COMMENCEMENT DATE [AND TERM  EXPIRATION DATE] is entered into as of [_______], 20[__], with reference to that certain Lease  (the “Lease”) dated as of [_______], 20[__], by CODEX DNA, INC., a Delaware corporation  (“Tenant”), in favor of BRE-BMR WATERIDGE POINTE LP, a Delaware limited partnership  (“Landlord”).  All capitalized terms used herein without definition shall have the meanings  ascribed to them in the Lease.  Tenant hereby confirms the following:  1. Tenant accepted possession of the 10431 Premises for use in accordance with the Permitted  Use on [_______], 20[__].  Tenant first occupied the 10431 Premises for the Permitted Use on  [_______], 20[__].    2. To Tenant’s current actual knowledge, all conditions of the Lease to be performed by  Landlord as a condition to the full effectiveness of the Lease have been satisfied, and Landlord has  fulfilled all of its duties in the nature of inducements offered to Tenant to lease the 10431 Premises.  3. In accordance with the provisions of Article 4 of the Lease, the 10431 Premises  Commencement Date is [_______], 20[__][, and, unless the Lease is terminated prior to the Term  Expiration Date pursuant to its terms, the Term Expiration Date shall be [_______], 20[__].]  4. The Lease is in full force and effect, and the same represents the entire agreement between  Landlord and Tenant concerning the Premises[, except [_______]].  5. To Tenant’s current actual knowledge, Tenant has no existing defenses against the  enforcement of the Lease by Landlord, and there exist no offsets or credits against Rent owed or  to be owed by Tenant.  6. The obligation to pay Rent is presently in effect and all Rent obligations on the part of  Tenant under the Lease commenced to accrue on [_______], 20[__], with Base Rent payable on  the dates and amounts set forth in the chart below:  

 

  C-2  Dates  Approximate  Square Feet of  Rentable Area  Base Rent per Square  Foot of Rentable Area  Monthly  Base Rent  Annual  Base Rent  [__]/[__]/[__]- [__]/[__]/[__]  [  ] $[_______]  [monthly][OR][annually]  [  ] [  ]  7. The undersigned Tenant has not made any prior assignment, transfer, hypothecation or  pledge of the Lease or of the rents thereunder or sublease of the Premises or any portion thereof.  [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 

 

  C-1  IN WITNESS WHEREOF, Tenant has executed this Acknowledgment of Term  Commencement Date and Term Expiration Date as of the date first written above.  TENANT:  CODEX DNA, INC.,  a Delaware corporation  By:       Name:       Title:          

 

  C-2  10421 Premises:  THIS ACKNOWLEDGEMENT OF TERM COMMENCEMENT DATE [AND TERM  EXPIRATION DATE] is entered into as of [_______], 20[__], with reference to that certain Lease  (the “Lease”) dated as of [_______], 20[__], by CODEX DNA, INC., a Delaware corporation  (“Tenant”), in favor of BRE-BMR WATERIDGE POINTE LP, a Delaware limited partnership  (“Landlord”).  All capitalized terms used herein without definition shall have the meanings  ascribed to them in the Lease.  Tenant hereby confirms the following:  1. Tenant accepted possession of the 10421 Premises for use in accordance with the Permitted  Use on [_______], 20[__].  Tenant first occupied the 10421 Premises for the Permitted Use on  [_______], 20[__].    2. To Tenant’s current actual knowledge, all conditions of the Lease to be performed by  Landlord as a condition to the full effectiveness of the Lease have been satisfied, and Landlord has  fulfilled all of its duties in the nature of inducements offered to Tenant to lease the Premises.  3. In accordance with the provisions of Article 4 of the Lease, the 10421 Premises  Commencement Date is [_______], 20[__][, and, unless the Lease is terminated prior to the Term  Expiration Date pursuant to its terms, the Term Expiration Date shall be [_______], 20[__].]  4. The Lease is in full force and effect, and the same represents the entire agreement between  Landlord and Tenant concerning the Premises[, except [_______]].  5. To Tenant’s current actual knowledge, Tenant has no existing defenses against the  enforcement of the Lease by Landlord, and there exist no offsets or credits against Rent owed or  to be owed by Tenant.  6. The obligation to pay Rent is presently in effect and all Rent obligations on the part of  Tenant under the Lease commenced to accrue on [_______], 20[__], with Base Rent payable on  the dates and amounts set forth in the chart below:  Dates  Approximate  Square Feet of  Rentable Area  Base Rent per Square  Foot of Rentable Area  Monthly  Base Rent  Annual  Base Rent  [__]/[__]/[__]- [__]/[__]/[__]  [  ] $[_______]  [monthly][OR][annually]  [  ] [  ]  7. The undersigned Tenant has not made any prior assignment, transfer, hypothecation or  pledge of the Lease or of the rents thereunder or sublease of the Premises or any portion thereof.  [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 

 

  C-3  IN WITNESS WHEREOF, Tenant has executed this Acknowledgment of Term  Commencement Date and Term Expiration Date as of the date first written above.  TENANT:  CODEX DNA, INC.,  a Delaware corporation  By:       Name:       Title:      

 

  D-1  EXHIBIT D  FORM OF ADDITIONAL TI ALLOWANCE[S] ACCEPTANCE LETTER  [TENANT LETTERHEAD]  BRE-BMR Wateridge Pointe LP  4570 Executive Drive, Suite 400  San Diego, California  92121  Attn:  Legal Department  [Date]  Re: [Additional TI Allowance[s]]  To Whom It May Concern:  This letter concerns that certain Lease dated as of [_______], 20[__] (the “Lease”), between  [Landlord] (“Landlord”) and [Tenant] (“Tenant”).  Capitalized terms not otherwise defined herein  shall have the meanings given them in the Lease.  Tenant hereby notifies Landlord that it wishes to exercise its right to utilize the [Additional  TI Allowance[s]] pursuant to Article 4 of the Lease.  If you have any questions, please do not hesitate to call [_______] at ([___]) [___]-[____].  Sincerely,  [Name]  [Title of Authorized Signatory]  cc: Karen Sztraicher  Jon Bergschneider  John Lu  Kevin Simonsen  

 

  E-2-1  EXHIBIT E  FORM OF LETTER OF CREDIT  [On letterhead or L/C letterhead of Issuer]  IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER _____________  ISSUE DATE: ______________  ISSUING BANK:  SILICON VALLEY BANK  3003 TASMAN DRIVE  2ND FLOOR, MAIL SORT HF210  SANTA CLARA, CALIFORNIA 95054  BENEFICIARY:  BRE-BMR WATERIDGE POINTE LP  4570 EXECUTIVE DRIVE, SUITE 400  SAN DIEGO, CALIFORNIA  92121  ATTN:  LEGAL DEPARTMENT  APPLICANT:  CODEX DNA, INC.  9535 WAPLES ST., SUITE 100  SAN DIEGO, 92121  AMOUNT:  US$_________ (____________ AND XX/100 U.S. DOLLARS)  EXPIRATION DATE: ONE YEAR FROM ISSUE DATE  PLACE OF EXPIRATION: ISSUING BANK’S COUNTERS AT ITS ABOVE ADDRESS    DEAR SIR/MADAM:  WE HEREBY ESTABLISH OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO.  SVBSF______ IN YOUR FAVOR AVAILABLE BY PAYMENT AGAINST YOUR  PRESENTATION TO US OF THE FOLLOWING DOCUMENT:  1.BENEFICIARY’S SIGNED AND DATED STATEMENT STATING AS FOLLOWS    (AND NO OTHER EVIDENCE OF AUTHORITY, CERTIFICATE OR DOCUMENTATION  IS REQUIRED):  “AN EVENT OF DEFAULT (AS DEFINED IN THE LEASE) HAS OCCURRED UNDER  THAT CERTAIN LEASE AGREEMENT BETWEEN CODEX DNA, INC, AS TENANT, AND  BRE-BMR WATERIDGE POINTE LP AS LANDLORD, AS AMENDED, SUPPLEMENTED  OR OTHERWISE MODIFIED TO DATE.  THE UNDERSIGNED HEREBY CERTIFIES  

 

    THAT: (I) THE UNDERSIGNED IS AN AUTHORIZED REPRESENTATIVE OF LANDLORD  AND (II) LANDLORD IS THE BENEFICIARY OF LETTER OF CREDIT NO. SVBSF  _______________ ISSUED BY SILICON VALLEY BANK.  THE AMOUNT HEREBY  DRAWN UNDER THE LETTER OF CREDIT IS US$______________, WITH PAYMENT TO  BE MADE TO THE FOLLOWING ACCOUNT: [INSERT WIRE INSTRUCTIONS (TO  INCLUDE NAME AND ACCOUNT NUMBER OF THE BENEFICIARY)].”  PARTIAL DRAWS AND MULTIPLE PRESENTATIONS ARE ALLOWED. THIS LETTER  OF CREDIT SHALL SURVIVE ANY PARTIAL DRAWINGS.  THIS LETTER OF CREDIT SHALL BE AUTOMATICALLY EXTENDED FOR  ADDITIONAL PERIODS OF ONE YEAR, WITHOUT AMENDMENT, FROM THE PRESENT  OR EACH FUTURE EXPIRATION DATE UNLESS AT LEAST 90 DAYS PRIOR TO THE  THEN CURRENT EXPIRATION DATE WE SEND TO YOU A NOTICE BY REGISTERED  OR CERTIFIED MAIL OR OVERNIGHT COURIER SERVICE AT THE ABOVE ADDRESS  THAT THIS LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE THEN  CURRENT EXPIRATION DATE.  IN NO EVENT SHALL THIS LETTER OF CREDIT BE  AUTOMATICALLY EXTENDED BEYOND _______________.  IN THE EVENT WE SEND  SUCH NOTICE OF NON-EXTENSION, YOU MAY DRAW HEREUNDER BY YOUR  PRESENTATION TO US OF YOUR SIGNED AND DATED STATEMENT STATING THAT  YOU HAVE RECEIVED A NON-EXTENSION NOTICE FROM SILICON VALLEY BANK  IN RESPECT OF LETTER OF CREDIT NO. SVBSF _____________, YOU ARE DRAWING  ON SUCH LETTER OF CREDIT FOR US$_____________, AND YOU HAVE NOT  RECEIVED A REPLACEMENT LETTER OF CREDIT ACCEPTABLE TO YOU.  ALL DEMANDS FOR PAYMENT SHALL BE MADE BY PRESENTATION (WHICH MAY  BE BY OVERNIGHT COURIER SERVICE) OF  THE REQUIRED DOCUMENTS  ON A  BUSINESS DAY AT OUR OFFICE (THE “BANK’S OFFICE”) AT:  SILICON VALLEY BANK,  3003 TASMAN DRIVE, MAIL SORT HF 210, SANTA CLARA, CA 95054, ATTENTION:  GLOBAL TRADE FINANCE. AS USED IN THIS LETTER OF CREDIT, "BUSINESS DAY"  SHALL MEAN ANY DAY OTHER THAN A SATURDAY, SUNDAY OR A DAY ON WHICH  BANKING INSTITUTIONS IN THE STATE OF CALIFORNIA ARE AUTHORIZED OR  REQUIRED BY LAW TO CLOSE.   FACSIMILE PRESENTATIONS ARE ALSO PERMITTED.  SHOULD BENEFICIARY WISH  TO MAKE A PRESENTATION UNDER THIS LETTER OF CREDIT ENTIRELY BY  FACSIMILE TRANSMISSION IT NEED NOT TRANSMIT THE ORIGINAL OF THIS LETTER  OF CREDIT AND AMENDMENTS, IF ANY.  EACH FACSIMILE TRANSMISSION SHALL  BE MADE AT:  (408) 496-2418 OR (408) 969-6510; AND UNDER CONTEMPORANEOUS  TELEPHONE ADVICE TO: (408) 450-5001 OR (408) 654-7176, ATTENTION: GLOBAL  TRADE FINANCE.  ABSENCE OF THE AFORESAID TELEPHONE ADVICE SHALL NOT  AFFECT OUR OBLIGATION TO HONOR ANY DRAW REQUEST.   THIS LETTER OF CREDIT IS TRANSFERABLE IN WHOLE BUT NOT IN PART ONE OR  MORE TIMES, BUT IN EACH INSTANCE ONLY TO A SINGLE BENEFICIARY AS  TRANSFEREE AND FOR THE THEN AVAILABLE AMOUNT, ASSUMING SUCH  TRANSFER TO SUCH TRANSFEREE WOULD BE IN COMPLIANCE WITH THEN  

 

    APPLICABLE LAW AND REGULATION, INCLUDING BUT NOT LIMITED TO THE  REGULATIONS OF THE U.S. DEPARTMENT OF TREASURY AND U.S. DEPARTMENT  OF COMMERCE.  AT THE TIME OF TRANSFER, THE ORIGINAL LETTER OF CREDIT  AND ORIGINALS OR COPIES OF ALL AMENDMENTS, IF ANY, TO THIS LETTER OF  CREDIT MUST BE SURRENDERED TO US AT OUR ADDRESS INDICATED IN THIS  LETTER OF CREDIT TOGETHER WITH OUR TRANSFER FORM ATTACHED HERETO  AS EXHIBIT A DULY EXECUTED.  THE CORRECTNESS OF THE SIGNATURE AND  TITLE OF THE PERSON SIGNING THE TRANSFER FORM MUST BE VERIFIED BY  BENEFICIARY’S BANK.   APPLICANT SHALL PAY OUR TRANSFER FEE OF 1⁄4 OF 1%  OF THE TRANSFER AMOUNT (MINIMUM US$250.00) UNDER THIS LETTER OF  CREDIT.  EACH TRANSFER SHALL BE EVIDENCED BY EITHER (1) OUR  ENDORSEMENT ON THE REVERSE OF THE LETTER OF CREDIT AND WE SHALL  FORWARD THE ORIGINAL OF THE LETTER OF CREDIT SO ENDORSED TO THE  TRANSFEREE OR (2) OUR ISSUING A REPLACEMENT LETTER OF CREDIT TO THE  TRANSFEREE ON SUBSTANTIALLY THE SAME TERMS AND CONDITIONS AS THE  TRANSFERRED LETTER OF CREDIT (IN WHICH EVENT THE TRANSFERRED LETTER  OF CREDIT SHALL HAVE NO FURTHER EFFECT).   NO AMENDMENT THAT ADVERSELY AFFECTS BENEFICIARY SHALL BE EFFECTIVE  WITHOUT BENEFICIARY’S PRIOR WRITTEN CONSENT.  IF ANY INSTRUCTIONS ACCOMPANYING A DRAWING UNDER THIS LETTER OF  CREDIT REQUEST THAT PAYMENT IS TO BE MADE BY TRANSFER TO YOUR  ACCOUNT WITH ANOTHER BANK, WE WILL ONLY EFFECT SUCH PAYMENT BY FED  WIRE TO A U.S. REGULATED BANK, AND WE AND/OR SUCH OTHER BANK MAY  RELY ON AN ACCOUNT NUMBER SPECIFIED IN SUCH INSTRUCTIONS EVEN IF THE  NUMBER IDENTIFIES A PERSON OR ENTITY DIFFERENT FROM THE INTENDED  PAYEE.  THIS LETTER OF CREDIT IS SUBJECT TO THE INTERNATIONAL STANDBY  PRACTICES (ISP98), INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO.  590.  SILICON VALLEY BANK    __________________________  AUTHORIZED SIGNATURE    

 

    IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER __________________    EXHIBIT “A”    FORM OF TRANSFER     DATE: ____________________    TO: SILICON VALLEY BANK         3003 TASMAN DRIVE    RE: IRREVOCABLE STANDBY LETTER OF CREDIT          SANTA CLARA, CA 95054                                           NO. _____________ ISSUED BY         ATTN: GLOBAL TRADE FINANCE                           SILICON VALLEY BANK, SANTA CLARA          STANDBY LETTERS OF CREDIT                      L/C AMOUNT: ___________________     GENTLEMEN:    FOR VALUE RECEIVED, THE UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:  _________________________________________________________________________________________  (NAME OF TRANSFEREE)  _________________________________________________________________________________________  (ADDRESS)  ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF CREDIT UP TO ITS  AVAILABLE AMOUNT AS SHOWN ABOVE AS OF THE DATE OF THIS TRANSFER.  BY THIS TRANSFER, ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF CREDIT ARE  TRANSFERRED TO THE TRANSFEREE.  TRANSFEREE SHALL HAVE THE SOLE RIGHTS AS BENEFICIARY  THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS, WHETHER INCREASES OR  EXTENSIONS OR OTHER AMENDMENTS, AND WHETHER NOW EXISTING OR HEREAFTER MADE.  ALL  AMENDMENTS ARE TO BE ADVISED DIRECTLY TO THE TRANSFEREE WITHOUT NECESSITY OF ANY CONSENT  OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.    THE ORIGINAL OF SUCH LETTER OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO EITHER (1)  ENDORSE THE TRANSFER ON THE REVERSE THEREOF, AND FORWARD IT DIRECTLY TO THE TRANSFEREE  WITH YOUR CUSTOMARY NOTICE OF TRANSFER, OR (2) ISSUE A REPLACEMENT LETTER OF CREDIT TO THE  

 

    TRANSFEREE ON SUBSTANTIALLY THE SAME TERMS AND CONDITIONS AS THE TRANSFERRED LETTER OF  CREDIT (IN WHICH EVENT THE TRANSFERRED LETTER OF CREDIT SHALL HAVE NO FURTHER EFFECT).    SINCERELY,    _____________________________       (BENEFICIARY’S NAME)     _____________________________  (SIGNATURE OF BENEFICIARY)     _____________________________          (NAME AND TITLE)  

 

  F-1  EXHIBIT F  RULES AND REGULATIONS  NOTHING IN THESE RULES AND REGULATIONS (“RULES AND  REGULATIONS”) SHALL SUPPLANT ANY PROVISION OF THE LEASE.  IN THE EVENT  OF A CONFLICT OR INCONSISTENCY BETWEEN THESE RULES AND REGULATIONS  AND THE LEASE, THE LEASE SHALL PREVAIL.  1. No Tenant Party shall encumber or obstruct the common entrances, lobbies, elevators,  sidewalks and stairways of the Building(s) or the Project or use them for any purposes other than  ingress or egress to and from the Building(s) or the Project.  2. Except as specifically provided in the Lease, no sign, placard, picture, advertisement, name  or notice shall be installed or displayed on any part of the outside of the Premises or the Building(s)  without Landlord’s prior written consent.  Landlord shall have the right to remove, at Tenant’s  sole cost and expense and without notice, any sign installed or displayed in violation of this rule.  3. If Landlord objects in writing to any curtains, blinds, shades, screens, hanging plants or  other similar objects attached to or used in connection with any window or door of the Premises  or placed on any windowsill, and (a) such window, door or windowsill is visible from the exterior  of the Premises and (b) such curtain, blind, shade, screen, hanging plant or other object is not  included in plans approved by Landlord, then Tenant shall promptly remove such curtains, blinds,  shades, screens, hanging plants or other similar objects at its sole cost and expense.  4. No deliveries shall be made that impede or interfere with other tenants in or the operation  of the Project.  Movement of furniture, office equipment or any other large or bulky material(s)  through the Common Area shall be restricted to such hours as Landlord may designate and shall  be subject to reasonable restrictions that Landlord may impose.   5. Tenant shall not place a load upon any floor of the Premises that exceeds the load per  square foot that (a) such floor was designed to carry or (b) is allowed by Applicable Laws.  Fixtures  and equipment that cause noises or vibrations that may be transmitted to the structure of the  Building(s) to such a degree as to be objectionable to other tenants shall be placed and maintained  by Tenant, at Tenant’s sole cost and expense, on vibration eliminators or other devices sufficient  to eliminate such noises and vibrations to levels reasonably acceptable to Landlord and the affected  tenants of the Project.   6. Tenant shall not use any method of HVAC other than that shown in the Tenant  Improvement plans or present at the Project and serving the Premises as of the 10431 Premises  Commencement Date or the 10421 Premises Commencement Date, as applicable.  7. Tenant shall not install any radio, television or other antennae; cell or other  communications equipment; or other devices on the roof or exterior walls of the Premises except  in accordance with the Lease.  Tenant shall not interfere with radio, television or other digital or  electronic communications at the Project or elsewhere.  

 

  F-2  8. Canvassing, peddling, soliciting and distributing handbills or any other written material  within, on or around the Project (other than within the Premises) are prohibited.  Tenant shall  cooperate with Landlord to prevent such activities by any Tenant Party.   9. Tenant shall store all of its trash, garbage and Hazardous Materials in receptacles within  its Premises or in receptacles designated by Landlord outside of the Premises.  Tenant shall not  place in any such receptacle any material that cannot be disposed of in the ordinary and customary  manner of trash, garbage and Hazardous Materials disposal.  Any Hazardous Materials transported  through Common Area shall be held in secondary containment devices.  Tenant shall be  responsible, at its sole cost and expense, for Tenant’s removal of its trash, garbage and Hazardous  Materials.  Tenant is encouraged to participate in the waste removal and recycling program in place  at the Project.  10. The Premises shall not be used for lodging or for any improper, immoral or objectionable  purpose.  No cooking shall be done or permitted in the Premises; provided, however, that Tenant  may use (a) equipment approved in accordance with the requirements of insurance policies that  Landlord or Tenant is required to purchase and maintain pursuant to the Lease for brewing coffee,  tea, hot chocolate and similar beverages, (b) microwave ovens for employees’ use and (c)  equipment shown on Tenant Improvement plans approved by Landlord; provided, further, that any  such equipment and microwave ovens are used in accordance with Applicable Laws.   11. Tenant shall not, without Landlord’s prior written consent, use the name of the Project, if  any, in connection with or in promoting or advertising Tenant’s business except as Tenant’s  address.  12. Tenant shall comply with all safety, fire protection and evacuation procedures and  regulations established by Landlord or any Governmental Authority.   13. Tenant assumes any and all responsibility for protecting the Premises from theft, robbery  and pilferage, which responsibility includes keeping doors locked and other means of entry to the  Premises closed.   14. Tenant shall not modify any locks to the Premises without Landlord’s prior written consent,  which consent Landlord shall not unreasonably withhold, condition or delay.  Tenant shall furnish  Landlord with copies of keys, pass cards or similar devices for locks to the Premises.  15. Tenant shall cooperate and participate in all reasonable security programs affecting the  Premises.  16. Tenant shall not permit any animals in the Project, other than for service animals or for use  in laboratory experiments.  17. Bicycles shall not be taken into the Building(s) (including the elevators and stairways of  the Building) except into areas designated by Landlord.  18. The water and wash closets and other plumbing fixtures shall not be used for any purposes  other than those for which they were constructed, and no sweepings, rubbish, rags or other  substances shall be deposited therein.  

 

  F-3  19. Discharge of industrial sewage shall only be permitted if Tenant, at its sole expense, first  obtains all necessary permits and licenses therefor from all applicable Governmental Authorities.  20. Smoking and the use of smokeless tobacco products, electronic smoking devices (e.g., e- cigarettes) and nicotine products is prohibited at the Project.    21. The Project’s hours of operation are currently 24 hours a day seven days a week.  22. Tenant shall comply with all orders, requirements and conditions now or hereafter imposed  by Applicable Laws or Landlord (“Waste Regulations”) regarding the collection, sorting,  separation and recycling of waste products, garbage, refuse and trash generated by Tenant  (collectively, “Waste Products”), including (without limitation) the separation of Waste Products  into receptacles reasonably approved by Landlord and the removal of such receptacles in  accordance with any collection schedules prescribed by Waste Regulations.  23. Tenant, at Tenant’s sole cost and expense, shall cause the Premises to be exterminated on  a monthly basis to Landlord’s reasonable satisfaction and shall cause all portions of the Premises  used for the storage, preparation, service or consumption of food or beverages to be cleaned daily  in a manner reasonably satisfactory to Landlord, and to be treated against infestation by insects,  rodents and other vermin and pests whenever there is evidence of any infestation.  Tenant shall not  permit any person to enter the Premises or the Project for the purpose of providing such  extermination services, unless such persons have been approved by Landlord.  If requested by  Landlord, Tenant shall, at Tenant’s sole cost and expense, store any refuse generated in the  Premises by the consumption of food or beverages in a cold box or similar facility.  24. Electric vehicles may be charged using only electric vehicle charging stations installed for  that purpose, and no other electrical outlets or connections at the Project may be used for charging  vehicles of any kind.  25. If Tenant desires to use any portion of the Common Area for a Tenant-related event, Tenant  must notify Landlord in writing at least thirty (30) days prior to such event on the form attached  as Attachment 1 to this Exhibit, which use shall be subject to Landlord’s prior written consent, not  to be unreasonably withheld, conditioned or delayed.  Notwithstanding anything in this Lease or  the completed and executed Attachment to the contrary, Tenant shall be solely responsible for  setting up and taking down any equipment or other materials required for the event, and shall  promptly pick up any litter and report any property damage to Landlord related to the event.  Any  use of the Common Area pursuant to this Section shall be subject to the provisions of Article 28  of the Lease.  26. Firearms and any other items intended for use as weapons are not permitted in the  Building(s) or at the Project.  27. Parking lots/parking garages may not be used for overnight parking or storage of vehicles  or other miscellaneous items without Landlord’s prior written approval.  Vehicles and other  miscellaneous items left unattended by a Tenant Party in Landlord’s parking lots/parking garages  for 24 hours or longer may be towed/removed at Tenant’s expense.  

 

  F-4  28. Common shower facilities are intended for use by tenants of the Building(s) or Project after  exercising or commuting.  Common shower facilities are not to be used to treat exposure to  potential hazards or contaminants.  Tenants are required to provide separate shower facilities for  employee use within individual premises when required for the health and safety of their  employees.  COVID-19 RULES AND REGULATIONS  To help minimize the spread of the COVID-19 virus and maintain a safe and healthy work  environment, Landlord is temporarily amending the Rules and Regulations as outlined below.  We  thank you in advance for your cooperation in enforcing the new set of rules and regulations with  your employees, visitors and vendors.  IN THE EVENT OF A CONFLICT BETWEEN THESE  RULES AND REGULATIONS AND THE LEASE, THE TERMS OF THE LEASE SHALL  PREVAIL.  1. Tenant must not permit its employees, vendors, contractors or invitees to enter the  Building/Property/Project if they are sick or experiencing flu-like symptoms.  2. Tenant shall cause its employees, vendors, contractors and invitees who have been ill or  have displayed flu-like symptoms to follow all recommendations of the Centers for Disease  Control (“CDC”) for symptomatic individuals prior to returning to the  Building/Property/Project.  3. Tenant shall cause its employees, vendors, contractors and invitees who have been exposed  to a known COVID-19-infected individual not to return to the Building/Property/Project  until 10 days after their most recent exposure to that infected individual, or as otherwise  directed by the CDC or federal, state or local Governmental Authorities.  4. In Common Areas, including elevators and parking garages, Tenant shall cause its  unvaccinated employees, vendors, contractors and invitees to continue to wear face  coverings or masks, practice social distancing, and maintain six feet of separation from  others while in public.  5. Tenant shall cause its employees, vendors, contractors and invitees to clean up after  themselves, wash hands frequently, and not leave trash or other personal items in Common  Areas.  6. Tenant must develop a COVID-19 remediation response plan for their Premises and share  that plan with Landlord.  Additionally, Tenant must share its re-emergence plan with  Landlord and continue to provide Landlord with updates as its plan evolves.  7. Tenant must monitor evolving CDC, state and local Governmental Authorities’ guidelines,  and educate its employees about new guidance and information, as needed.  8. Tenant must promptly report known COVID-19 cases that have occurred at the  Building/Property/Project to Landlord, but shall not be obligated to identify the name of  the infected individual due to privacy concerns or Applicable Laws.  Landlord may waive any one or more of these Rules and Regulations for the benefit of  Tenant or any other tenant, but no such waiver by Landlord shall be construed as a waiver of such  Rules and Regulations in favor of Tenant or any other tenant, nor prevent Landlord from thereafter  

 

  F-5  enforcing any such Rules and Regulations against any or all of the tenants of the Project, including  Tenant.  These Rules and Regulations are in addition to, and shall not be construed to in any way  modify or amend, in whole or in part, the terms covenants, agreements and conditions of the Lease.   Landlord reserves the right to make such other and reasonable additional rules and regulations as,  in its judgment, may from time to time be needed for safety and security, the care and cleanliness  of the Project, or the preservation of good order therein; provided, however, that Tenant shall not  be obligated to adhere to such additional rules or regulations until Landlord has provided Tenant  with written notice thereof.  Tenant agrees to abide by these Rules and Regulations and any such  additional rules and regulations issued or adopted by Landlord.  Tenant shall be responsible for  the observance of these Rules and Regulations by all Tenant Parties.  

 

  F-1-1  ATTACHMENT 1 TO EXHIBIT F  REQUEST FOR USE OF COMMON AREA  REQUEST FOR USE OF COMMON AREA  Date of Request:              Landlord/Owner:               Tenant/Requestor:              Property Location:               Event Description:                                           Proposed Plan for Security & Cleaning:______________________________________________  ______________________________________________________________________________  ______________________________________________________________________________  Date of Event:              Hours of Event: (to include set-up and take down):         Location at Property (see attached map): __      ______   Number of Attendees:             Open to the Public? [___] YES [___] NO  Food and/or Beverages? [___] YES [___] NO  If YES:   Will food be prepared on site?     [___] YES  [___] NO   Please describe:             Will alcohol be served? [___] YES [___] NO   Please describe:             Will attendees be charged for alcohol?  [___] YES [___] NO  

 

  F-1-2   Is alcohol license or permit required? [___] YES [___] NO   Does caterer have alcohol license or permit: [___] YES [___] NO [___] N/A      Other Amenities (tent, booths, band, food trucks, bounce house, etc.):                                      Other Event Details or Special Circumstances:                                                                       The undersigned Tenant certifies that the foregoing is true, accurate and complete and that the  individual executing on its behalf is duly authorized to sign and submit this request on behalf of  the Tenant/Requestor named above.  [INSERT NAME OF TENANT/REQUESTOR]  By:           Name:          Title:           Date:          

 

  BioMed Realty form dated 6/9/20  EXHIBIT G  WAPLES LEASE AMENDMENT    SECOND AMENDMENT TO LEASE  THIS SECOND AMENDMENT TO LEASE (this “Amendment”) is entered into as of this  ____ day of September, 2021, by and between BMR-WAPLES LP, a Delaware limited partnership  (“Landlord”) and CODEX DNA, INC., a Delaware corporation (“Tenant”).   RECITALS  A. WHEREAS, Landlord and Tenant (formerly known as SGI-DNA, Inc.) are parties  to that certain Lease dated as of April 4, 2019 (the “Original Lease”), as amended by that certain  First Amendment to Lease dated as of May 31, 2019 (the “First Amendment”) (collectively, and  as the same may have been further amended, amended and restated, supplemented or modified  from time to time, the “Existing Lease”), whereby Tenant leases certain premises (the “Premises”)  from Landlord in the building at 9535 Waples Street, San Diego, California (the “Building”);  B. WHEREAS, Landlord and Tenant wish to modify the Term Expiration Date of the  Existing Lease; and  C. WHEREAS, Landlord and Tenant desire to modify and amend the Existing Lease  only in the respects and on the conditions hereinafter stated.  AGREEMENT  NOW, THEREFORE, Landlord and Tenant, in consideration of the mutual promises  contained herein and for other good and valuable consideration, the receipt and sufficiency of  which are hereby acknowledged, and intending to be legally bound, agree as follows:  1. Definitions.  For purposes of this Amendment, capitalized terms shall have the  meanings ascribed to them in the Existing Lease unless otherwise defined herein.  The Existing  Lease, as amended by this Amendment, is referred to collectively herein as the “Lease.” From and  after the date hereof, the term “Lease,” as used in the Existing Lease, shall mean the Existing  Lease, as amended by this Amendment.  2. Term Expiration Date.  The Term Expiration Date is hereby amended to mean the  date (the “New Termination Date”) that is fifteen (15) days after the actual “10431 Premises  Commencement Date” (as such term is defined in that certain Lease dated as of September __,  2021 by and between BRE-BMR Wateridge Pointe LP, a Delaware limited partnership and Tenant  relating to certain premises located at 10421 and 10431 Wateridge Circle, San Diego, California).   

 

   4 3. Surrender.  On or before the New Termination Date, Tenant shall vacate, quit,  surrender and deliver exclusive possession of the Premises to Landlord in broom clean condition  and otherwise in the condition required under the Existing Lease, including (without limitation)  having delivered to Landlord the Exit Survey (as defined in Section 26.1 of the Original Lease).   Tenant will surrender the FF&E (as defined in Section 4.8 of the Original Lease) on the New  Termination Date in accordance with Section 4.8 of the Original Lease.  Tenant’s surrender  obligations under this Section shall survive the expiration or earlier termination of the Lease.  4. Option to Extend.  Article 42 of the Original Lease is hereby deleted in its entirety  and shall no longer be of any further force or effect.  5. Rent.  Tenant shall continue to remain fully responsible for the payment of all Rent  required under the Existing Lease for the periods prior to (and including) the New Termination  Date, including (without limitation) all Base Rent and Additional Rent.  6. Representations of Tenant.  Tenant represents and warrants to Landlord that  (a) Tenant is the sole tenant under the Existing Lease and no other person, firm or entity has any  right, title or interest in the Existing Lease, (b) Tenant has not Transferred any interest in the  Existing Lease or to the Premises, (c) Tenant has the full right, legal power and actual authority to  bind Tenant to the terms and conditions hereof and (d) to Tenant’s current actual knowledge, there  are no Claims against Tenant in any way arising from or in connection with the Existing Lease or  to the Premises, and that there is no Claim, agreement or other matter that Tenant is a party to that  would preclude or restrict the modification of the Existing Lease provided for hereunder or  otherwise adversely affect this Amendment or the enforceability thereof.  In addition, Tenant  hereby agrees to protect, defend, indemnify and hold Landlord and the Landlord Indemnitees  harmless from and against any and all Claims in any way arising from or in connection with or  related to any breach of Tenant's representations and warranties contained in this Article.   7. Broker. Tenant represents and warrants that it has not dealt with any broker or agent  in the negotiation for or the obtaining of this Amendment other than Kidder Matthews (who is not  being paid any commission by Landlord in connection with this Amendment) and agrees to  reimburse, indemnify, save, defend (at Landlord’s option and with counsel reasonably acceptable  to Landlord, at Tenant’s sole cost and expense) and hold harmless the Landlord Indemnitees for,  from and against any and all cost or liability for compensation claimed by any such broker or agent  (including, without limitation, Kidder Matthews) employed or engaged by it or claiming to have  been employed or engaged by it.    8. No Default.  Tenant represents, warrants and covenants that, to Tenant’s current  actual knowledge, Landlord and Tenant are not in default of any of their respective obligations  under the Existing Lease and no event has occurred that, with the passage of time or the giving of  notice (or both) would constitute a default by either Landlord or Tenant thereunder.  9. Effect of Amendment.  Except as modified by this Amendment, the Existing Lease  and all the covenants, agreements, terms, provisions and conditions thereof shall remain in full  

 

   5 force and effect and are hereby ratified and affirmed.  In the event of any conflict between the  terms contained in this Amendment and the Existing Lease, the terms herein contained shall  supersede and control the obligations and liabilities of the parties.  10. Successors and Assigns.  Each of the covenants, conditions and agreements  contained in this Amendment shall inure to the benefit of and shall apply to and be binding upon  the parties hereto and their respective heirs, legatees, devisees, executors, administrators and  permitted successors and assigns and sublessees.  Nothing in this section shall in any way alter the  provisions of the Lease restricting assignment or subletting.  11. Miscellaneous.  This Amendment becomes effective only upon execution and  delivery hereof by Landlord and Tenant. The captions of the paragraphs and subparagraphs in this  Amendment are inserted and included solely for convenience and shall not be considered or given  any effect in construing the provisions hereof.  All exhibits hereto are incorporated herein by  reference.  Submission of this instrument for examination or signature by Tenant does not  constitute a reservation of or option for a lease, and shall not be effective as a lease, lease  amendment or otherwise until execution by and delivery to both Landlord and Tenant.  12. Authority.  Tenant guarantees, warrants and represents that the individual or  individuals signing this Amendment have the power, authority and legal capacity to sign this  Amendment on behalf of and to bind all entities, corporations, partnerships, limited liability  companies, joint venturers or other organizations and entities on whose behalf such individual or  individuals have signed.  Landlord represents and warrants that it has obtained all consents and  approvals required to be obtained by Landlord in connection with this Amendment including,  without limitation, any required consent from any lender holding a loan secured by the Building.  13. Counterparts; Facsimile and PDF Signatures.  This Amendment may be executed  in one or more counterparts, each of which, when taken together, shall constitute one and the same  document.  A facsimile or portable document format (PDF) signature on this Amendment shall be  equivalent to, and have the same force and effect as, an original signature.  [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 

 

  G-1  IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment as of the  date and year first above written.  LANDLORD:  BMR-WAPLES LP,   a Delaware limited partnership     By:        Name:        Title:          TENANT:  CODEX DNA, INC.,   a Delaware corporation    By:        Name:        Title:            

 

  H-1  EXHIBIT H  TENANT’S PROPERTY      

 

  F-2  113228093v.2  

 

  F-3  113228093v.2  

 

  F-4  113228093v.2  

 

  F-5  113228093v.2  

 

  I-1  EXHIBIT I  FORM OF ESTOPPEL CERTIFICATE  To: BRE-BMR Wateridge Pointe LP  4570 Executive Drive, Suite 400  San Diego, California  92121  Attention: Legal Department  BioMed Realty, L.P.  4570 Executive Drive, Suite 400  San Diego, California  92121  Re: [PREMISES ADDRESS] (the “Premises”) at [STREET ADDRESS], [CITY AND  STATE] (the “Property”)  The undersigned tenant (“Tenant”) hereby certifies to you as follows:  1. Tenant is a tenant at the Property under a lease (the “Lease”) for the Premises dated as of  [_______], 20[__].  The Lease has not been cancelled, modified, assigned, extended or amended  [except as follows:  [_______]], and there are no other agreements, written or oral, affecting or  relating to Tenant’s lease of the Premises or any other space at the Property.  The lease term expires  on [_______], 20[__].  2. Tenant took possession of the Premises, currently consisting of [_______] square feet, on  [_______], 20[__], and commenced to pay rent on [_______], 20[__].  Tenant has full possession  of the Premises, has not assigned the Lease or sublet any part of the Premises, and does not hold  the Premises under an assignment or sublease[, except as follows:  [_______]].  3. All base rent, rent escalations and additional rent under the Lease have been paid through  [_______], 20[__].  There is no prepaid rent[, except $[_______]][, and the amount of security  deposit is $[_______] [in cash][OR][in the form of a letter of credit]].  Tenant currently has no  right to any future rent abatement under the Lease.  4. Base rent is currently payable in the amount of $[_______] per month.  5. Tenant is currently paying estimated payments of additional rent of $[_______] per month  on account of real estate taxes, insurance, management fees and Common Area maintenance  expenses.  6. To Tenant’s current actual knowledge, all work to be performed for Tenant under the Lease  has been performed as required under the Lease and has been accepted by Tenant[, except  [_______]], and all allowances to be paid to Tenant, including allowances for tenant  improvements, moving expenses or other items, have been paid.  7. To Tenant’s current actual knowledge, the Lease is in full force and effect, free from default  and free from any event that could become a default under the Lease, and Tenant has no claims  against the landlord or offsets or defenses against rent, and there are no disputes with the landlord.  

 

  I-2  The undersigned Tenant has not made any prior assignment, transfer, hypothecation or pledge of  the Lease or of the rents thereunder or sublease of the Premises or any portion thereof.  8. [Tenant has the following expansion rights or options for leasing additional space at the  Property:  [_______].][OR][Tenant has no rights or options to purchase the Property.]  9. To Tenant’s current actual knowledge, no hazardous wastes have been generated, treated,  stored or disposed of by or on behalf of Tenant in, on or around the Premises or the Project in  violation of any environmental laws.  10. The undersigned has executed this Estoppel Certificate with the knowledge and  understanding that [INSERT NAME OF LANDLORD, PURCHASER OR LENDER, AS  APPROPRIATE] or its assignee is [acquiring the Property/making a loan secured by the Property]  in reliance on this certificate and that the undersigned shall be bound by this certificate.  The  statements contained herein may be relied upon by [INSERT NAME OF PURCHASER OR  LENDER, AS APPROPRIATE], [LANDLORD], [BioMed Realty, L.P.][OR][BioMed Realty II  LP], [BRE Edison L.P.][OR][BRE Edison II LP], and any [other ]mortgagee of the Property and  their respective successors and assigns.  Any capitalized terms not defined herein shall have the respective meanings given in the Lease.  Dated this [____] day of [_______], 20[__].  [_______],  a [_______]  By:       Name:       Title:      

 

  J-1  EXHIBIT J  AVAILABLE ROFO PREMISES      

 

Codex DNA - Lease - Execution Version (CGS3 Draft 9-20-21) Final Audit Report 2021-09-30 Created: 2021-09-30 By: Serina Roth (serina.roth@biomedrealty.com) Status: Signed Transaction ID: CBJCHBCAABAAgDaNKthd1pBb-ZsWrCgLezbjhWAg2ChY "Codex DNA - Lease - Execution Version (CGS3 Draft 9-20-21)"  History Document created by Serina Roth (serina.roth@biomedrealty.com) 2021-09-30 - 7:08:04 PM GMT- IP address: 12.46.199.194 Document emailed to Marie Lewis (marie.lewis@biomedrealty.com) for signature 2021-09-30 - 7:10:58 PM GMT Email viewed by Marie Lewis (marie.lewis@biomedrealty.com) 2021-09-30 - 7:39:31 PM GMT- IP address: 119.13.202.201 Document e-signed by Marie Lewis (marie.lewis@biomedrealty.com) Signature Date: 2021-09-30 - 7:39:56 PM GMT - Time Source: server- IP address: 12.46.199.194 Agreement completed. 2021-09-30 - 7:39:56 PM GMTEX-10.1

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 Exhibit 10.1 

Form of 
 TRANSITION
SERVICES AGREEMENT 
 by and between 

VECTOR GROUP LTD. 
 and

 DOUGLAS ELLIMAN INC. 

Dated as of [•], 2021 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 TABLE OF CONTENTS 
  

							
	ARTICLE I	  			
	DEFINITIONS	  			
			
	 Section 1.1.
	 	General	  	 	1	 
	 Section 1.2.
	 	Reference; Interpretation	  	 	3	 
		
	ARTICLE II	  			
	SERVICES	  			
			
	 Section 2.1.
	 	Services	  	 	3	 
	 Section 2.2.
	 	Standard of Service	  	 	4	 
	 Section 2.3.
	 	Additional Services	  	 	4	 
		
	ARTICLE III	  			
	LICENSES AND PERMITS	  			
		
	ARTICLE IV	  			
	PAYMENT	  			
			
	 Section 4.1.
	 	General	  	 	4	 
	 Section 4.2.
	 	Additional Expenses	  	 	4	 
	 Section 4.3.
	 	Adjustments	  	 	5	 
	 Section 4.4.
	 	Invoices	  	 	5	 
	 Section 4.5.
	 	Failure to Pay	  	 	5	 
	 Section 4.6.
	 	Termination of Services	  	 	6	 
		
	ARTICLE V	  			
	INDEMNIFICATION	  			
			
	 Section 5.1.
	 	Indemnification of Party Receiving Services	  	 	6	 
	 Section 5.2.
	 	Indemnification of Party Providing Services	  	 	6	 
	 Section 5.3.
	 	Third Party Claims	  	 	6	 
	 Section 5.4.
	 	Indemnification Payments	  	 	8	 
	 Section 5.5.
	 	Survival	  	 	8	 
		
	ARTICLE VI	  			
	COOPERATION; CONFIDENTIALITY; TITLE	  			
			
	 Section 6.1.
	 	Services Cooperation	  	 	8	 
	 Section 6.2.
	 	Distribution Cooperation	  	 	8	 
	 Section 6.3.
	 	Confidentiality	  	 	9	 
	 Section 6.4.
	 	Internal Use; Title, Copies, Return	  	 	9	 
		
	ARTICLE VII	  			
	TERM	  			
			
	 Section 7.1.
	 	Duration	  	 	9	 
	 Section 7.2.
	 	Early Termination by Spinco	  	 	10	 
	 Section 7.3.
	 	Early Termination by Vector	  	 	10	 
	 Section 7.4.
	 	Suspension Due to Force Majeure	  	 	10	 
	 Section 7.5.
	 	Consequences of Termination	  	 	10	 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

							
	ARTICLE VIII	  			
	RECORDS; DATA SECURITY	  			
			
	 Section 8.1.
	 	Records Retention	  	 	10	 
	 Section 8.2.
	 	Data Security	  	 	10	 
		
	ARTICLE IX	  			
	DISPUTE RESOLUTION	  			
			
	 Section 9.1.
	 	Negotiation	  	 	11	 
	 Section 9.2.
	 	Mediation	  	 	11	 
	 Section 9.3.
	 	Arbitration	  	 	11	 
	 Section 9.4.
	 	Arbitration Period	  	 	12	 
	 Section 9.5.
	 	Treatment of Negotiations, Mediation and Arbitration	  	 	12	 
	 Section 9.6.
	 	Continuity of Service and Performance	  	 	12	 
	 Section 9.7.
	 	Consolidation	  	 	12	 
		
	ARTICLE X	  			
	NOTICES	  			
		
	ARTICLE XI	  			
	MISCELLANEOUS	  			
			
	 Section 11.1.
	 	Taxes	  	 	13	 
	 Section 11.2.
	 	Relationship of Parties	  	 	13	 
	 Section 11.3.
	 	Complete Agreement; Construction	  	 	13	 
	 Section 11.4.
	 	Other Agreements	  	 	13	 
	 Section 11.5.
	 	Counterparts	  	 	13	 
	 Section 11.6.
	 	Survival of Agreements	  	 	13	 
	 Section 11.7.
	 	Waivers and Consents	  	 	13	 
	 Section 11.8.
	 	Amendments	  	 	13	 
	 Section 11.9.
	 	Assignment	  	 	13	 
	 Section 11.10.
	 	Successors and Assigns	  	 	14	 
	 Section 11.11.
	 	No Circumvention	  	 	14	 
	 Section 11.12.
	 	Subsidiaries	  	 	14	 
	 Section 11.13.
	 	Third Party Beneficiaries	  	 	14	 
	 Section 11.14.
	 	Titles and Headings	  	 	14	 
	 Section 11.15.
	 	Exhibits and Schedules	  	 	14	 
	 Section 11.16.
	 	Governing Law	  	 	14	 
	 Section 11.17.
	 	Consent to Jurisdiction	  	 	14	 
	 Section 11.18.
	 	Specific Performance	  	 	14	 
	 Section 11.19.
	 	WAIVER OF JURY TRIAL	  	 	15	 
	 Section 11.20.
	 	Severability	  	 	15	 
	 Section 11.21.
	 	Interpretation	  	 	15	 
	 Section 11.22.
	 	No Duplication; No Double Recovery	  	 	15	 
	 Section 11.23.
	 	DISCLAIMER OF WARRANTIES	  	 	15	 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 TRANSITION SERVICES AGREEMENT 

This TRANSITION SERVICES AGREEMENT, dated as of [•], 2021 (this “Agreement”), between Vector Group Ltd., a Delaware
corporation (“Vector”), and Douglas Elliman Inc., a Delaware corporation (“Spinco”). Each of Vector and Spinco is referred to herein as a “Party” and, collectively, as the
“Parties”. 
 WITNESSETH: 

WHEREAS, Vector and Spinco have entered into a Distribution Agreement, dated as of the date hereof (the “Distribution
Agreement”), which sets forth the terms pursuant to which Vector will transfer certain assets to Spinco and Vector will distribute the common stock of Spinco to the holders of Vector common stock on a pro rata basis (including Vector common
stock underlying outstanding stock option awards and restricted stock awards) (the “Distribution”); and 
 WHEREAS, in
connection with the Distribution, and in order to ensure an orderly transition under the Distribution Agreement, it will be necessary for each of the Parties to provide to the other the Services described herein for a transitional period. 

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements, provisions and covenants contained in this Agreement, the Parties
hereby agree as follows: 
 ARTICLE I 

DEFINITIONS 
 Section 1.1.
General. As used in this Agreement, the following terms have the respective meanings set forth below: 
 “AAA” shall
have the meaning set forth in Section 9.2. 
 “Additional Services” shall have the meaning set forth in
Section 2.3. 
 “Affiliate” shall, subject to the next succeeding sentence, have the meaning assigned to that term in
the Distribution Agreement. For clarity, unless the context otherwise requires, a reference to a Person’s “Affiliates” shall be deemed to mean such Person’s Affiliates following the Distribution; provided that, for the
avoidance of doubt, for purposes of this Agreement Spinco and Vector shall not be considered Affiliates. 
 “Agreement”
shall have the meaning set forth in the preamble. 
 “Agreement Disputes” shall have the meaning set forth in
Section 9.1. 
 “Applicable Privacy Laws” shall have the meaning set forth in Section 8.2. 

“Applicable Rate” shall mean the Prime Rate plus three percent (3%) per annum. 

“Bankruptcy Event” with respect to a Party shall mean the filing of an involuntary petition in bankruptcy or similar
proceeding against such Party seeking its reorganization, liquidation or the appointment of a receiver, trustee or liquidator for it or for all or substantially all of its assets, whereupon such petition shall not be dismissed within sixty
(60) days after the filing thereof, or if such Party shall (i) apply for or consent in writing to the appointment of a receiver, trustee or liquidator of all or substantially all of its assets, (ii) file a voluntary petition or admit
in writing its inability to pay its debts as they become due, (iii) make a general assignment for the benefit of creditors, (iv) file a petition or an answer seeking reorganization or an arrangement with its creditors or take advantage of
any insolvency law with respect to itself as debtor, or (v) file an answer admitting the material allegations of a petition filed against it in any bankruptcy, reorganization, insolvency proceedings or any similar proceedings. 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 “Business Day” shall mean any day other than a Saturday, a Sunday or a day
on which banks in New York City, New York are authorized or obligated by law or executive order to close. 
 “Change of
Control” of a company shall mean an event or series of events by which any person or group (so long as such “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of Securities and Exchange Act of 1934,
as amended (the “Exchange Act”)) beneficially owns (within the meaning of Rule 13d-3 (as in effect on the effective date of this Agreement) promulgated under the Exchange Act), in the
aggregate, more than fifty percent (50%) of the shares of the capital stock of such company, having sufficient votes to elect (or otherwise designate) at such time a majority of the members of the board of directors of such company. 

“Commencement Date” shall have the meaning ascribed to that term in Section 7.1 of this Agreement. 

“Dispute Notice” shall have the meaning set forth in Section 9.1. 

“Distribution” shall have the meaning set forth in the preamble. 

“Distribution Agreement” shall have the meaning set forth in the preamble. 

“Existing Services” shall have the meaning set forth in Section 4.3. 

“Fees” shall have the meaning set forth in Section 4.3. 

“Indemnifying Party” shall have the meaning set forth in Section 5.3. 

“Indemnitee” shall have the meaning set forth in Section 5.3. 

“Information Security Incident” shall have the meaning set forth in Section 8.2. 

“Loss” shall mean shall mean any and all damages, losses, deficiencies, Liabilities, obligations, penalties, judgments,
settlements, claims, payments, fines, interest, costs and expenses (including the costs and expenses of any and all Actions and demands, assessments, judgments, settlements and compromises relating thereto and the reasonable costs and expenses of
attorneys’, accountants’, consultants’ and other professionals’ fees and expenses incurred in the investigation or defense thereof or the enforcement of rights hereunder), excluding special, consequential, indirect and/or
punitive damages (other than special, consequential, indirect and/or punitive damages awarded to any third party against an Indemnitee). 

“Mediation Period” shall have the meaning set forth in Section 9.2. 

“New York Courts” shall have the meaning set forth in Section 11.15. 

“Outside Notice Date” shall have the meaning set forth in Section 5.3. 

“Overlap Individuals” shall mean Persons who are directors of both Vector and Spinco or employees of both Vector and Spinco
if such employee is compensated by both companies. 
 “Party” shall have the meaning set forth in the preamble. 

“Person” shall mean any natural person, corporation, business trust, limited liability company, joint venture, association,
company, partnership or government, or any agency or political subdivision thereof. 
 “Personal Information” shall mean
any information that (i) identifies, relates to, describes, is reasonably capable of being associated with or could reasonably be linked, directly or indirectly, with, an individual, browser, device or household, or (ii) is considered
“personally identifiable information,” “personal data” or a similar term under applicable law. 

  
 -2- 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 “Prime Rate” shall mean the rate per annum publicly announced by Citibank,
N.A. (or successor thereto) from time to time as its prime rate in effect at its principal office in New York City. For purposes of this Agreement, any change in the Prime Rate shall be effective on the date such change in the Prime Rate is publicly
announced as effective. 
 “Rules” shall have the meaning set forth in Section 9.3. 

“Services” shall mean, collectively, the Spinco Services and the Vector Services. 

“Spinco” shall have the meaning set forth in the preamble. 

“Spinco Services” shall mean those transitional services, including any Additional Services, to be provided by Spinco to
Vector set forth on Schedule A hereto to assist Vector in operating Vector’s business following the Distribution. Services or actions of Overlap Individuals shall not be considered to be Spinco Services under this Agreement unless expressly
agreed in writing by both Parties. 
 “Third Party” shall mean any Person who is not a Party. 

“Third Party Claim” shall have the meaning set forth in Section 5.3. 

“Vector” shall have the meaning set forth in the preamble. 

“Vector Services” shall mean those transitional services, including any Additional Services, to be provided by Vector to
Spinco set forth on Schedule B hereto to assist Spinco in operating Spinco’s business following the Distribution. Services or actions of Overlap Individuals shall not be considered to be Vector Services under this Agreement unless expressly
agreed in writing by both Parties. 
 Section 1.2. Reference; Interpretation. References in this Agreement to any gender include
references to all genders, and references to the singular include references to the plural and vice versa. The words “include”, “includes” and “including” when used in this Agreement shall be deemed
to be followed by the phrase “without limitation.” Unless the context otherwise requires, references in this Agreement to Articles, Sections and Schedules shall be deemed references to Articles and Sections of, and Schedules to,
this Agreement. Unless the context otherwise requires, the words “hereof”, “hereby” and “herein” and words of similar meaning when used in this Agreement refer to this Agreement in its entirety and
not to any particular Article, Section or provision of this Agreement. Any capitalized terms used but not defined in this Agreement have the meanings given to them in the Distribution Agreement. 

ARTICLE II 
 SERVICES 

Section 2.1. Services. (a) Spinco shall provide to Vector each Spinco Service for the term set forth opposite the description of
such Spinco Service in Schedule A. Upon conclusion of the term set forth opposite the description of such Spinco Service, this Agreement shall be deemed terminated with respect to such Spinco Service. Additional Services may be provided by Spinco to
Vector as provided in Section 2.3. At its option, (i) Spinco may cause any Spinco Service it is required to provide hereunder to be provided by a Third Party that is providing, or may from time to time provide, the same or similar services
for Spinco and/or (ii) to the extent any Spinco Service is already provided by a Third Party, Spinco shall have the right to change the Third Party that is providing such Spinco Service to any Third Party that is providing, or may from time to
time provide, the same or similar services for Spinco, at any time upon reasonable notice to Vector. In the event of such a change as permitted in clauses (i) or (ii) above results in a change in cost of Spinco for the provision of such Spinco
Service, the applicable schedules to this agreement shall be updated to reflect the revised fees as allocated to Vector, provided that if such a change results in an increase over 10% of the costs then currently contemplated by Schedule A
such an amendment will require the consent (which consent shall not be unreasonably withheld, conditioned or delayed) of Vector. 

  
 -3- 

  

 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 (b) Vector shall provide to Spinco each Vector Service for the term set forth opposite the
description of such Vector Service in Schedule B. Upon conclusion of the term set forth opposite the description of such Vector Service, this Agreement shall be deemed terminated with respect to such Vector Service. Additional Services may be
provided to Spinco by Vector as provided in Section 2.3. At its option, (i) Vector may cause any Vector Service it is required to provide hereunder to be provided by a Third Party that is providing, or may from time to time provide, the
same or similar services for Vector and/or (ii) to the extent any Vector Service is already provided by a Third Party, Vector shall have the right to change the Third Party that is providing such Vector Service to any Third Party that is
providing, or may from time to time provide, the same or similar services for Vector, at any time upon reasonable notice to Spinco. In the event of such a change as permitted in clauses (i) or (ii) above results in a change in cost of Vector
for the provision of such Vector Service, the applicable schedules to this agreement shall be updated to reflect the revised fees as allocated to Spinco, provided that if such a change results in an increase over 10% of the costs then
currently contemplated by Schedule B such an amendment will require the consent (which consent shall not be unreasonably withheld, conditioned or delayed) of Spinco. 

Section 2.2. Standard of Service. Spinco and Vector shall maintain sufficient resources to perform their respective obligations
hereunder. In performing the Services, Spinco and Vector shall provide substantially the same level of service and use substantially the same degree of care as their respective personnel provided and used in providing such Services prior to
completion of the Distribution for itself (but in no event less than a reasonable degree of care), subject in each case to any provisions set forth on Schedule A or Schedule B with respect to each such Service. Each Party shall provide reasonable
assistance to the other Party in migrating the applicable Services to the recipient of such Services. 
 Section 2.3. Additional
Services. From time to time after the date hereof, the Parties may identify additional services that one Party will provide to the other Party in accordance with the terms of this Agreement (the “Additional Services”). The
Parties shall cooperate and act in good faith to agree on the terms pursuant to which any such Additional Service shall be provided and to amend Schedule A or Schedule B, as applicable, in accordance with such terms. 

ARTICLE III 
 LICENSES AND PERMITS

 Each Party warrants and covenants that all duties and obligations (including with respect to Spinco, all Spinco Services, and with
respect to Vector, all Vector Services) to be performed hereunder shall be performed in compliance with all material applicable federal, state and local laws, rules and regulations. Each Party shall obtain and maintain all material permits,
approvals and licenses necessary or appropriate to perform its duties and obligations (including with respect to Spinco, the Spinco Services, and with respect to Vector, the Vector Services) hereunder and shall at all times comply with the terms and
conditions of such permits, approvals and licenses. 
 ARTICLE IV 

PAYMENT 
 Section 4.1.
General. (a) In consideration for the provision of each of the Spinco Services, Vector shall pay to Spinco the fee set forth for such Spinco Service on Schedule A. 

(b) In consideration for the provision of each of the Vector Services, Spinco shall pay to Vector the fee as set forth for such Vector Service
on Schedule B. 
 Section 4.2. Additional Expenses. (a) In addition to the fees payable in accordance with Section 4.1(a),
Vector shall reimburse Spinco for all reasonable and necessary out-of-pocket costs and expenses incurred by Spinco with respect to Third Parties in connection with the
provision of Spinco Services to Vector pursuant to the terms of this Agreement or paid by Spinco on behalf of Vector that are not already contemplated by Schedule A; provided that if Spinco expects to incur in respect of a Third Party in any
month costs and expenses in excess of $25,000 and not already contemplated by Schedule A, Spinco shall use commercially reasonable efforts to provide to Vector prior to the first day of such month a written notice setting forth Spinco’s
reasonable estimate of the expenses it expects to incur. 

  
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PURSUANT TO CFR SECTION 200.83 ** 
  

 (b) In addition to the fees payable for expenses in accordance with Section 4.1(b),
Spinco shall reimburse Vector for all reasonable and necessary out-of-pocket costs and expenses incurred by Vector with respect to Third Parties in connection with the
provision of Vector Services to Spinco pursuant to the terms of this Agreement or paid by Vector on behalf of Spinco that are not already contemplated by Schedule B; provided that if Vector expects to incur in respect of a Third Party in any
month costs and expenses in excess of $25,000 and not already contemplated by Schedule B, Vector shall use commercially reasonable efforts to provide to Spinco prior to the first day of such a month written notice setting forth Vector’s
reasonable estimate of the expenses it expects to incur. 
 Section 4.3. Adjustments. Spinco and Vector shall review and
evaluate the fees payable in accordance with Section 4.1 (the “Fees”) for existing services contemplated on Schedule A or Schedule B (the “Existing Services”) for reasonableness annually and work in good faith
to equitably adjust such Fees for Existing Services as appropriate to reflect among other things changes in compensation due to promotions or replacement of personnel at a lower or higher compensation level, increases or decreases in the percentage
of labor-based allocation based on increased or decreased efforts of a particular individual, or adjustments to percentage of non-labor allocations tied to headcounts or other reasonable metrics. Spinco and
Vector shall work together in good faith to determine an appropriate date for such adjustments to take effect (which may be retroactive to the date of such changes). 

Section 4.4. Invoices. (a) Spinco will invoice Vector in U.S. dollars: (i) as of the last day of each calendar month for any
fees payable by Vector in accordance with Section 4.1(a) for Spinco Services listed on Schedule A provided pursuant to the terms of this Agreement during such month; (ii) as of the last day of each calendar month for any amounts payable by
Vector in accordance with Section 4.2(a) (and enclosing invoices from the relevant Third Parties); and (iii) as of the last day of each calendar month for any taxes (excluding income taxes) accrued with respect to the provision of Spinco
Services to Vector during such month. Spinco shall deliver or cause to be delivered to Vector each such invoice within thirty (30) days following the last day of the calendar month to which such invoice relates. Vector shall pay each such
invoice received by electronic funds transfer as follows: in the case of clauses (i) and (ii), within forty-five (45) Business Days of the date on which such invoice was received, and in the case of clause (iii), not later than one
(1) Business Day prior to the due date for such tax payments; provided that Spinco delivers such invoice not less than three (3) Business Days prior to the due date for such tax payments. 

(b) Vector will invoice Spinco in U.S. dollars: (i) as of the last day of each calendar month for any fees payable by Spinco in
accordance with Section 4.1(b) for Vector Services listed on Schedule B provided pursuant to the terms of this Agreement during such month; (ii) as of the last day of each calendar month for any amounts payable by Spinco in accordance with
Section 4.2(b) (and enclosing invoices from such Third Parties); and (iii) as of the last day of each calendar month for any taxes (excluding income taxes) accrued with respect to the provision of Vector Services to Spinco during such
month. Vector shall deliver or cause to be delivered to Spinco each such invoice within thirty (30) days following the last day of the calendar month to which such invoice relates. Spinco shall pay each such invoice received by electronic funds
transfer: in the case of clauses (i) and (ii), within forty-five (45) Business Days of the date on which such invoice was received, and in the case of clause (iii), not later than one (1) Business Day prior to the due date for such
tax payments; provided that Vector delivers such invoice not less than three (3) Business Days prior to the due date for such tax payments. 

Section 4.5. Failure to Pay. Any undisputed amount not paid when due shall be subject to a late payment fee computed daily at a
rate equal to the Applicable Rate from the due date of such amount to the date such amount is paid. Each Party agrees to pay the other Party’s reasonable attorneys’ fees and other costs incurred in collection of any amounts owed to such
other Party hereunder and not paid when due. Notwithstanding anything to the contrary contained herein, in the event either Party fails to make a payment of any undisputed amount when due hereunder, and such failure continues for a period of thirty
(30) days following delivery of notice to such non-paying Party of such failure, the other Party shall have the right to cease provision of such Services to such
non-paying Party until such overdue payment (and any applicable late payment fee accrued with respect thereto) is paid in full. Such right of the Party providing services shall not in any manner limit or
prejudice any of such Party’s other rights or remedies in the event of the non-paying Party’s failure to make payments when due hereunder, including without limitation any rights or remedies pursuant
to Sections 5, 7 and 9. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 Section 4.6. Termination of Services. In the event of a termination of Services
pursuant to Article VII, with respect to the calendar month in which such Services cease to be provided, the recipient of such Services shall be obligated to pay a fee for such Services calculated as set forth on Schedule A or Schedule B, as
applicable for the portion of the month prior to the termination. Where possible, the Parties agree to work together cooperatively to seek to have terminations occur as of month ends, but this Agreement shall not limit a Party’s right to effect
a termination in accordance with this Agreement other than as of a month end. 
 ARTICLE V 

INDEMNIFICATION 

Section 5.1. Indemnification of Party Receiving Services. (a) Spinco agrees to indemnify, defend and hold Vector harmless
from and against any Loss to which Vector may become subject arising out of, by reason of or otherwise in connection with the provision hereunder by Spinco of Spinco Services, other than Losses resulting from Vector’s gross negligence, willful
misconduct or breach of its obligations pursuant to this Agreement. Notwithstanding any provision in this Agreement to the contrary, Spinco shall not be liable under this Section 5.1 for any consequential, special or punitive damages (including
but not limited to lost profits), except to the extent that such consequential, special or punitive damages relate to a Loss resulting from a Third Party Claim (as defined below). 

(b) Vector agrees to indemnify, defend and hold Spinco harmless from and against any Loss to which Spinco may become subject arising out of,
by reason of or otherwise in connection with the provision hereunder by Vector of Vector Services, other than Losses resulting from Spinco’s gross negligence, willful misconduct or breach of its obligations pursuant to this Agreement.
Notwithstanding any provision in this Agreement to the contrary, Vector shall not be liable under this Section 5.1 for any consequential, special or punitive damages (including but not limited to lost profits), except to the extent that such
consequential, special or punitive damages relate to a Loss resulting from a Third Party Claim (as defined below). 
 Section 5.2.
Indemnification of Party Providing Services. (a) Vector agrees to indemnify, defend and hold Spinco harmless from and against any Loss to which Spinco may become subject arising out of, by reason of or otherwise in connection with, the
provision hereunder by Spinco of Spinco Services to Vector where such Losses resulted from Vector’s gross negligence, willful misconduct or breach of its obligations pursuant to this Agreement. Notwithstanding any provision in this Agreement to
the contrary, Vector shall not be liable under this Section 5.2 for any consequential, special or punitive damages (including but not limited to lost profits), except to the extent that such consequential, special or punitive damages relate to
a Loss resulting from a Third Party Claim (as defined below). 
 (b) Spinco agrees to indemnify, defend and hold Vector harmless from and
against any Loss to which Vector may become subject arising out of, by reason of or otherwise in connection with the provision hereunder by Vector of Vector Services to Spinco where such Losses resulted from Spinco’s gross negligence, willful
misconduct or breach of its obligations pursuant to this Agreement. Notwithstanding any provision in this Agreement to the contrary, Spinco shall not be liable under this Section 5.2 for any consequential, special or punitive damages (including
but not limited to lost profits), except to the extent that such consequential, special or punitive damages relate to a Loss resulting from a Third Party Claim (as defined below). 

Section 5.3. Third Party Claims. (a) If a claim or demand is made against Vector or Spinco (each, an
“Indemnitee”) by any Third Party (a “Third Party Claim”) as to which such Indemnitee is entitled to indemnification pursuant to this Agreement, such Indemnitee shall notify the Party which is or may be required
pursuant to Section 5.1 or Section 5.2 hereof to make such indemnification (the “Indemnifying Party”) in writing, and in reasonable detail, of the Third Party Claim promptly and in any event by the date (the
“Outside Notice Date”) that is the fifteenth (15th) Business Day after receipt by such Indemnitee of written notice of the Third Party Claim; provided, however, that failure to give such notification shall not affect
the indemnification provided hereunder except to the extent the Indemnifying Party shall have been actually prejudiced as a result of such failure (except that the Indemnifying Party shall not be liable for any expenses incurred during the period
beginning immediately after the Outside Notice Date and ending on the date that the Indemnitee gives the required notice). Thereafter, the Indemnitee shall deliver to the Indemnifying Party, promptly (and in any event within ten Business Days) after
the Indemnitee’s receipt thereof, copies of all notices and documents (including court papers) received by the 

  
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PURSUANT TO CFR SECTION 200.83 ** 
  

 
Indemnitee relating to the Third Party Claim. Notwithstanding anything to the contrary contained herein, neither Party shall be required to provide notice to the other Party for Third Party
Claims for which a Party is providing legal support as part of the Services to the extent that such Party has received notice in such capacity. 

(b) If a Third Party Claim is made against an Indemnitee, the Indemnifying Party shall be entitled to participate in the defense thereof and,
if it so chooses and acknowledges in writing its obligation to indemnify the Indemnitee therefor, to assume the defense thereof with counsel selected by the Indemnifying Party, provided, however, that such counsel is not reasonably
objected to by the Indemnitee. Should the Indemnifying Party so elect to assume the defense of a Third Party Claim, the Indemnifying Party shall, within thirty (30) days (or sooner if the nature of the Third Party Claim so requires), notify the
Indemnitee of its intent to do so, and the Indemnifying Party shall thereafter not be liable to the Indemnitee for legal or other expenses subsequently incurred by the Indemnitee in connection with the defense thereof; provided,
however, that such Indemnitee shall have the right to employ counsel to represent such Indemnitee if, in such Indemnitee’s reasonable judgment, a conflict of interest between such Indemnitee and such Indemnifying Party exists in respect
of such claim which would make representation of both such parties by one counsel inappropriate, and in such event the fees and expenses of such separate counsel shall be paid by such Indemnifying Party. If the Indemnifying Party assumes such
defense, the Indemnitee shall have the right to participate in the defense thereof and to employ counsel, subject to the proviso of the preceding sentence, at its own expense, separate from the counsel employed by the Indemnifying Party, it being
understood that the Indemnifying Party shall control such defense. The Indemnifying Party shall be liable for the fees and expenses of counsel employed by the Indemnitee for any period during which the Indemnifying Party has failed to assume the
defense thereof (other than during the period prior to the time the Indemnitee shall have given notice of the Third Party Claim as provided above). If the Indemnifying Party so elects to assume the defense of any Third Party Claim, all of the
Indemnitees shall cooperate with the Indemnifying Party in the defense or prosecution thereof, including by providing or causing to be provided agreements, documents, books, records, files and witnesses as soon as reasonably practicable after
receiving any request therefor from or on behalf of the Indemnifying Party, except to the extent that providing or causing the foregoing to be provided would constitute a waiver of any Indemnitee’s attorney-client privilege. 

(c) If the Indemnifying Party acknowledges in writing responsibility under this Article V for a Third Party Claim, then in no event will the
Indemnitee admit any liability with respect to, or settle, compromise or discharge, any Third Party Claim without the Indemnifying Party’s prior written consent; provided, however, that the Indemnitee shall have the right to
settle, compromise or discharge such Third Party Claim without the consent of the Indemnifying Party if the Indemnitee releases the Indemnifying Party from its indemnification obligation hereunder with respect to such Third Party Claim and such
settlement, compromise or discharge would not otherwise adversely affect the Indemnifying Party. If the Indemnifying Party acknowledges in writing liability for a Third Party Claim, the Indemnitee will agree to any settlement, compromise or
discharge of a Third Party Claim that the Indemnifying Party may recommend and that by its terms obligates the Indemnifying Party to pay the full amount of the liability in connection with such Third Party Claim and releases the Indemnitee
completely in connection with such Third Party Claim and that would not otherwise adversely affect the Indemnitee. If an Indemnifying Party elects not to assume the defense of a Third Party Claim, or fails to notify an Indemnitee of its election to
do so as provided herein, such Indemnitee may compromise, settle or defend such Third Party Claim. 
 (d) Notwithstanding the foregoing, the
Indemnifying Party shall not be entitled to assume the defense of any Third Party Claim (and shall be liable for the fees and expenses of counsel incurred by the Indemnitee in defending such Third Party Claim) if the Third Party Claim seeks an
order, injunction or other equitable relief or relief for other than money damages against the Indemnitee which the Indemnitee reasonably determines, after conferring with its counsel, cannot be separated from any related claim for money damages. If
such equitable relief or other relief portion of the Third Party Claim can be so separated from that for money damages, the Indemnifying Party shall be entitled to assume the defense of the portion relating to money damages. 

(e) In the event and to the extent of payment by an Indemnifying Party to any Indemnitee in connection with any Third Party Claim, such
Indemnifying Party shall be subrogated to and shall stand in the place of such Indemnitee as to any events or circumstances in respect of which such Indemnitee may have any right or claim relating to such Third Party Claim against any claimant or
plaintiff asserting such Third Party Claim. Such Indemnitee shall cooperate with such Indemnifying Party in a reasonable manner, and at the cost and expense of such Indemnifying Party, in prosecuting any subrogated right or claim. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 (f) Spinco and Vector shall cooperate as may reasonably be required in connection with the
investigation, defense and settlement of any Third Party Claim. In furtherance of this obligation, the Parties agree that if an Indemnifying Party chooses to defend or to compromise or settle any Third Party Claim, Vector or Spinco, as the case may
be, shall use its commercially reasonable efforts to make available to the other Party, upon written request, their former and then current directors, officers, employees and agents and those of their subsidiaries as witnesses and any records or
other documents within its control or which it otherwise has the ability to make available, to the extent that (i) any such Person, records or other documents may reasonably be required in connection with such defense, settlement or compromise
and (ii) making such Person, records or other documents so available would not constitute a waiver of the attorney-client privilege of Vector or Spinco, as the case may be. At the request of an Indemnifying Party, an Indemnitee shall enter into
a reasonably acceptable joint defense agreement. 
 (g) The remedies provided in this Article V shall be cumulative and shall not preclude
assertion by any Indemnitee of any other rights or the seeking of any and all other remedies against any Indemnifying Party. 

Section 5.4. Indemnification Payments. (a) Indemnification required by this Article V shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when bills are received or any Loss is incurred. If the Indemnifying Party fails to make an indemnification payment required by this Article V within thirty (30) days
after receipt of a bill therefor or notice that a Loss has been incurred, the Indemnifying Party shall also be required to pay interest on the amount of such indemnification payment, from the date of receipt of the bill or notice of the Loss to, but
not including the date of payment, at the Applicable Rate. 
 (b) The amount of any claim by an Indemnitee under this Agreement shall be
(i) reduced to reflect any actual tax savings or insurance proceeds received by any Indemnitee that result from the Losses that gave rise to such indemnity, and (ii) increased by an amount equal to any tax cost incurred by any Indemnitee
that results from receipt of payments under this Article V. 
 Section 5.5. Survival. The Parties’ obligations under this
Article V shall survive the termination of this Agreement. 
 ARTICLE VI 

COOPERATION; CONFIDENTIALITY; TITLE 

Section 6.1. Services Cooperation. Each Party shall use commercially reasonable efforts to cooperate with the other Party in all
matters relating to the provision and receipt of the Services. Such cooperation shall include, but not be limited to, exchanging information, providing electronic access to systems used in connection with the Services, performing true-ups and adjustments and obtaining all consents, licenses, sublicenses or approvals necessary to permit each Party to perform its obligations hereunder. Vector and Spinco shall maintain reasonable documentation
related to the Services and cooperate with each other in making such information available to the other Party as needed. 

Section 6.2. Distribution Cooperation. For a period of up to two (2) years after the Commencement Date, except as otherwise
set forth in the Distribution Agreement or a Commercial Arrangement, the Parties shall, and shall cause each of their respective Affiliates and employees to (i) provide reasonable cooperation and assistance to the other Party in connection with
the completion of the Plan of Reorganization, (ii) provide knowledge transfer regarding its applicable Business or Vector’s historical business and (iii) assist the other Party in the orderly and efficient transition in becoming an
independent company; in each case, except as may otherwise be agreed to by the Parties in writing, at no additional cost to the Party requesting such assistance other than for the actual out-of-pocket costs [(which shall not include the costs of salaries and benefits of employees of such Party or any pro rata portion of overhead or other costs of employing such employees which would
have been incurred by such employees’ employer regardless of the employees’ service with respect to the foregoing) incurred by any such Party, if applicable]. The cooperation and assistance provided for in this Section shall not be
required to the extent such cooperation and assistance would result in an undue burden on any Party or would unreasonably interfere with any of its employees normal functions and duties. [In furtherance of, and without limiting, the
foregoing, each Party shall make reasonably available those employees with particular knowledge of any function or service of which another Party was not allocated the employees, agents or consultants involved in such function or service in
connection with the Plan of Reorganization (including, employee benefits functions, risk management, etc.)]. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 Section 6.3. Confidentiality. Each Party shall keep confidential from Third Parties
the Schedules to this Agreement and all non-public information received from the other Party regarding the Services, including, without limitation, any information received with respect to products and
services of Vector or Spinco, and to use such information only for the purposes set forth in this Agreement unless (i) otherwise agreed to in writing by the Party from which such information was received or (ii) required by applicable law,
regulation or any securities exchange (in which case the Parties shall cooperate in seeking to obtain a protective order or other arrangement pursuant to which the confidentiality of such information is preserved). The covenants in this Article VI
shall survive any termination of this Agreement for a period of three (3) years from the date such termination becomes effective. 

Section 6.4. Internal Use; Title, Copies, Return. Except to the extent inconsistent with the express terms of the Distribution
Agreement and any Ancillary Agreement other than this Agreement, each Party agrees that: 
 (a) title to all systems used in performing any
Service provided hereunder shall remain with the Party providing such Service or its Third Party vendors; and 
 (b) to the extent the
provision of any Service involves intellectual property, including without limitation software programs or patented or copyrighted material, or material constituting trade secrets, the recipient of such Service shall not copy, modify, reverse
engineer, decompile or in any way alter any of such material, or otherwise use such material in a manner inconsistent with the terms and provisions of this Agreement, without the express written consent of the Party providing such Service; and upon
the termination of any Service, the recipient of such Service shall return to the Party providing such Service, as soon as practicable, any equipment or other property of the Party providing such Service relating to such Service which is owned or
leased by the Party providing such Service and is or was in its possession or control. 
 ARTICLE VII 

TERM 
 Section 7.1.
Duration. (a) Except as provided in Sections 4.6, 5.5, 6.2, 6.3, 7.2, 7.3, 7.4 and 7.5, the term of this Agreement shall commence on the date hereof (the “Commencement Date”) and shall continue in full force and effect until
the earlier of (i) the date that is the day prior to the third (3rd) anniversary of the Commencement Date, unless otherwise mutually agreed by the Parties and (ii) the earlier termination of all Services in accordance with Section 4.5
or 7.1(b). 
 (b) Each Party acknowledges that the purpose of this Agreement is for Spinco to provide the Spinco Services to Vector on an
interim basis until Vector can perform the Spinco Services for itself, and for Vector to provide the Vector Services to Spinco on an interim basis until Spinco can perform the Vector Services for itself. As Vector becomes self-sufficient or engages
other sources to provide any Spinco Service, Vector shall be entitled to release Spinco from providing any or all of the Spinco Services hereunder by delivering a written notice thereof to Spinco at least twenty (20) Business Days prior to the
effective date of release of such Spinco Service(s). At the end of such twenty (20) Business Day period (or such shorter period as may be agreed by the Parties), Spinco shall discontinue the provision of the Spinco Services specified in such
notice and any such Spinco Services shall be excluded from this Agreement, Schedule A shall be deemed to be amended accordingly, and this Agreement shall be deemed to be terminated with respect to such Spinco Service. Spinco shall also be entitled
to release Vector from providing any or all of the Vector Services hereunder by delivering a written notice thereof to Vector at least twenty (20) Business Days prior to the effective date of release of such Vector Service(s). At the end of
such twenty (20) Business Day period (or such shorter period as may be agreed by the Parties), Vector shall discontinue the provision of the Vector Services specified in such notice and any such Vector Services shall be excluded from this
Agreement, Schedule B shall be deemed to be amended accordingly, and this Agreement shall be deemed to be terminated with respect to such Vector Service. 

  
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PURSUANT TO CFR SECTION 200.83 ** 
  

 Section 7.2. Early Termination by Spinco. Spinco may terminate this Agreement by
giving written notice to Vector under the following circumstances: 
 (a) if Vector shall default in the performance of any of its material
obligations under this Agreement, and such default or breach shall continue and not be remedied for a period of thirty (30) days after Spinco has given written notice to Vector specifying such default and requiring it to be remedied; 

(b) if a Bankruptcy Event has occurred with respect to Vector; or 

(c) if a Change of Control of Vector has occurred. 

Section 7.3.Early Termination by Vector. Vector may terminate this Agreement by giving written notice to Spinco under the
following circumstances: 
 (a) if Spinco shall default in the performance of any of its material obligations under this Agreement and such
default shall continue and not be remedied for a period of thirty (30) days after Vector has given written notice to Spinco specifying such default and requiring it to be remedied; 

(b) if a Bankruptcy Event has occurred with respect to Spinco; or 

(c) if a Change of Control of Spinco has occurred. 

Section 7.4. Suspension Due to Force Majeure. In the event the performance by either Vector or Spinco of its duties or obligations
hereunder is interrupted or interfered with by reason of any Force Majeure, the Party affected by such Force Majeure shall not be deemed to be in default of this Agreement by reason of its non-performance due
to such Force Majeure, but shall give notice to the other Party of the Force Majeure and the fee provided for in Section 4.1 shall be equitably adjusted to reflect the reduced performance. In such event, the Party affected by such Force Majeure
shall resume the performance of its duties and obligations hereunder as soon as reasonably practicable after the end of the Force Majeure. 

Section 7.5. Consequences of Termination. In the event this Agreement expires or is terminated in accordance with this Article
VII, then (a) all Services to be provided will promptly cease, (b) each of Spinco and Vector shall, upon request of the other Party, promptly return or destroy all non-public confidential information
and Personal Information received from the other Party in connection with this Agreement (including the return of all information received with respect to the Services or products of Vector or Spinco, as the case may be), without retaining a copy
thereof (other than one copy for file purposes), and (c) each of Spinco and Vector shall honor all credits and make any accrued and unpaid payment to the other Party as required pursuant to the terms of this Agreement, and no rights already
accrued hereunder shall be affected. 
 ARTICLE VIII 

RECORDS; DATA SECURITY 

Section 8.1. Records Retention. Each of the Parties shall create and maintain full and accurate books in connection with the
provision of the Services, and all other records relevant to this Agreement, and upon reasonable notice from the other Party shall make available for inspection and copy by such other Party’s agents such records during reasonable business
hours. 
 Section 8.2. Data Security. In their respective provision of the Services, each Party shall comply with all
applicable federal, state, local and international laws, regulations and directives governing the collection, use, storage, processing, transmission, transfer, disclosure and protection of Personal Information (“Applicable Privacy
Laws”) and shall immediately inform the other Party if they believe that processing Personal Information as contemplated by this Agreement would violate Applicable Privacy Laws. Each Party shall process Personal Information only as
instructed by the other Party as required to provide the applicable Services or as otherwise required by applicable law, and will not sell the Personal Information or process it for any other purpose. The Parties shall ensure that all personnel
authorized to process Personal Information have agreed to maintain the confidentiality 

  
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PURSUANT TO CFR SECTION 200.83 ** 
  

 
of the Personal Information and that access to Personal Information is limited to only those who need to know the Personal Information in order perform the specific Vector Services or Spinco
Services under this Agreement. Each Party shall implement reasonable administrative, physical, technical and organizational measures designed to protect Personal Information from any unauthorized access to or acquisition, disclosure, disposal, loss
or use of such Personal Information (an “Information Security Incident”). Each Party shall notify the other Party within 72 hours following the discovery of any actual or suspected Information Security Incident and assist the other
Party in any efforts to contain, investigate or remediate such Information Security Incident. Each Party shall assist the other Party in fulfilling its obligations to respond to data subjects’ requests for exercising their rights under
Applicable Privacy Laws and shall make available all information necessary to demonstrate compliance with Applicable Privacy Laws. The Parties agree to enter into any further privacy or data security agreements as required to comply with Applicable
Privacy Laws. 
 ARTICLE IX 

DISPUTE RESOLUTION 

Section 9.1. Negotiation. In the event of a controversy, dispute or claim arising out of, in connection with, or in relation to
the interpretation, performance, nonperformance, validity or breach of this Agreement or otherwise arising out of, or in any way related to this Agreement or the transactions contemplated hereby, including any claim based on contract, tort, statute
or constitution (but excluding any controversy, dispute or claim arising out of any agreement relating to the use or lease of real property if any Third Party is a necessary party to such controversy, dispute or claim) (collectively,
“Agreement Disputes”), the Party claiming such Agreement Dispute shall give written notice to the other Party setting forth the Agreement Dispute and a brief description thereof (a “Dispute Notice”) pursuant to the
terms of the notice provisions of Article X hereof. Following delivery of a Dispute Notice, the general counsel of the other Party and/or such other executive officer designated by the other Party shall negotiate for a reasonable period of time to
settle such Agreement Dispute; provided, however, that such reasonable period shall not, unless otherwise agreed by the Parties in writing, exceed forty-five (45) calendar days from the time of receipt by a Party of a Dispute
Notice; provided, further, that in the event of any arbitration in accordance with Section 9.3 hereof, the Parties shall not assert the defenses of statute of limitations and laches arising during the period beginning after the
date of receipt of the Dispute Notice, and any contractual time period or deadline under this Agreement to which such Agreement Dispute relates occurring after the Dispute Notice is received shall not be deemed to have passed until such Agreement
Dispute has been resolved. 
 Section 9.2. Mediation. If, within forty-five (45) calendar days (or such longer period as
may be agreed in writing between the Parties) after receipt by a Party of a Dispute Notice, the Parties have not succeeded in negotiating a resolution of the Agreement Dispute, the Parties agree to submit the Agreement Dispute at the earliest
possible date to mediation conducted in accordance with the Commercial Mediation Rules of the American Arbitration Association (“AAA”), and to bear equally the costs of the mediation; provided, however, that each Party
shall bear its own costs in connection with such mediation. The Parties agree to participate in good faith in the mediation and negotiations related thereto for a period of thirty (30) days or such longer period as they may mutually agree
following the initial mediation session (the “Mediation Period”). 
 Section 9.3. Arbitration. If the Agreement
Dispute has not been resolved for any reason after the Mediation Period, such Agreement Dispute shall be determined, at the request of either Party, by arbitration conducted in New York City, New York, before and in accordance with the then-existing
Commercial Arbitration Rules of the AAA, except as modified herein (the “Rules”). There shall be three arbitrators. Each Party shall appoint one arbitrator within twenty (20) calendar days of receipt by respondent of a copy of
the demand for arbitration. The two party-appointed arbitrators shall have twenty (20) calendar days from the appointment of the second arbitrator to agree on a third arbitrator who shall chair the arbitral tribunal. Any arbitrator not timely
appointed by the Parties under this Section 9.3 shall be appointed by the AAA in accordance with the listing, ranking and striking method in the Rules, and in any such procedure, each Party shall be given a limited number of strikes, excluding
strikes for cause. Any controversy concerning whether an Agreement Dispute is an arbitrable Agreement Dispute, whether arbitration has been waived, whether an assignee of this Agreement is bound to arbitrate, or as to the interpretation of
enforceability of this Article IX shall be determined by the arbitrators. In resolving any Agreement Dispute, the Parties intend that the arbitrators shall apply the substantive laws of the State of New York, without regard to any choice of law
principles thereof that would mandate the application of the laws of another jurisdiction. The Parties 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 
intend that the provisions to arbitrate set forth herein be valid, enforceable and irrevocable, and any award rendered by the arbitrators shall be final and binding on the Parties. The Parties
agree to comply with any award made in any such arbitration proceedings and agree to enforcement of or entry of judgment upon such award in the United States District Court for the Southern District of New York. The arbitrators shall be entitled, if
appropriate, to award any remedy in such proceedings, including monetary damages, specific performance and all other forms of legal and equitable relief; provided, however, the arbitrators shall not be entitled to award punitive,
exemplary, treble or any other form of non-compensatory damages except in connection with indemnification for a Third Party Claim (and in such a case, only to the extent awarded in such Third Party Claim).

 Section 9.4. Arbitration Period. Any arbitration proceeding shall be concluded in a maximum of six (6) months from the
commencement of the arbitration. The Parties may agree in writing to extend the arbitration period if necessary to appropriately resolve the Agreement Dispute. 

Section 9.5. Treatment of Negotiations, Mediation and Arbitration. Without limiting the provisions of the Rules, unless otherwise
agreed in writing by the Parties or permitted by this Agreement, the Parties shall keep confidential all matters relating to and any negotiation, mediation, conference, arbitration, discussion or arbitration award pursuant to this Article IX
shall be treated as compromise and settlement negotiations for purposes of Rule 408 of the Federal Rules of Evidence and comparable state rules; provided, however, that such matters may be disclosed (i) to the extent reasonably
necessary in any proceeding brought to enforce the award or for entry of a judgment upon the award and (ii) to the extent otherwise required by Law or stock exchange rules. Nothing said or disclosed, nor any document produced, in the course of
any negotiations, conferences and discussions that is not otherwise independently discoverable shall be offered or received as evidence or used for impeachment or for any other purpose in any current or future arbitration. Nothing contained herein
is intended to or shall be construed to prevent any Party from applying to any court of competent jurisdiction for interim measures or other provisional relief in connection with the subject matter of any Agreement Disputes. Without prejudice to
such provisional remedies as may be available under the jurisdiction of a court, the arbitral tribunal shall have full authority to grant provisional remedies and to direct the parties to request that any court modify or vacate any temporary or
preliminary relief issued by such court, and to award damages for the failure of any Party to respect the arbitral tribunal’s orders to that effect. 

Section 9.6. Continuity of Service and Performance. Except as provided in Sections 4.5, 7.4 or 7.5 or otherwise agreed in writing,
the Parties will continue to provide Services and honor all other commitments under this Agreement and each Ancillary Agreement during the course of dispute resolution pursuant to the provisions of this Article IX with respect to all matters
not subject to such dispute resolution. 
 Section 9.7. Consolidation. The arbitrators may consolidate any Agreement Disputes
under this Agreement if the subject of the Agreement Disputes thereunder arise out of or relate essentially to the same set of facts or transactions. Such consolidated arbitration shall be determined by the arbitrator appointed for the arbitration
proceeding that was commenced first in time. 
 ARTICLE X 

NOTICES 
 All notices and other
communications hereunder shall be in writing, shall reference this Agreement and shall be emailed, hand delivered or mailed by registered or certified mail (return receipt requested) to the Parties at the following addresses (or at such other
address for a Party as shall be specified by like notice) and will be deemed given on the date on which such notice is received: 
 To Vector: 

Vector Group Ltd. 
 4400 Biscayne
Boulevard 
 Miami, Florida 33137 

Attention: General Counsel 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 To Spinco: 

Douglas Elliman Inc. 
 4400
Biscayne Boulevard 
 Miami, Florida 33137 

Attention: General Counsel 

ARTICLE XI 
 MISCELLANEOUS 

Section 11.1. Taxes. Except as may otherwise be specifically provided herein, each party shall bear all taxes, duties and other
similar charges (and any related interest and penalties) imposed as a result of its receipt of Services under this Agreement. 

Section 11.2. Relationship of Parties. Nothing in this Agreement shall be deemed or construed by the Parties or any Third Party as
creating the relationship of principal and agent, partnership or joint venture between the Parties, it being understood and agreed that no provision contained herein, and no act of the Parties, shall be deemed to create any relationship between the
Parties other than the relationship of independent contractor nor be deemed to vest any rights, interest or claims in any Third Parties. 

Section 11.3. Complete Agreement; Construction. This Agreement, including the Schedules hereto, shall constitute the entire
agreement between the Parties with respect to the subject matter hereof and shall supersede all previous negotiations, commitments and writings with respect to such subject matter. In the event of any inconsistency between this Agreement and any
Schedule hereto, the Schedule shall prevail. The rights and remedies of the Parties herein provided shall be cumulative and in addition to any other or further remedies provided by law or equity. 

Section 11.4. Other Agreements. This Agreement is not intended to address, and should not be interpreted to address, the matters
specifically and expressly covered by the Distribution Agreement or the other Ancillary Agreements. 
 Section 11.5.
Counterparts. This Agreement may be executed in more than one counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more such counterparts have been signed by each of the Parties and
delivered to the other Party. This Agreement may be executed and delivered by electronic means, including “.pdf” or “.tiff” files, and any electronic signature shall constitute an original for all purposes. 

Section 11.6. Survival of Agreements. Except as otherwise contemplated by this Agreement, the Distribution Agreement or any other
Ancillary Agreement, all covenants and agreements of the Parties contained in this Agreement, the Distribution Agreement and each Ancillary Agreement shall survive the Distribution and remain in full force and effect in accordance with their
applicable terms. 
 Section 11.7. Waivers and Consents. The failure of any Party to require strict performance by the other
Party of any provision in this Agreement will not waive or diminish that Party’s right to demand strict performance thereafter of that or any other provision hereof. Any consent required or permitted to be given by any Party to the other Party
under this Agreement shall be in writing and signed by the Party giving such consent. 
 Section 11.8. Amendments. This
Agreement may not be modified or amended except by an agreement in writing signed by a duly authorized representative of each of the Parties. 

Section 11.9. Assignment. This Agreement shall not be assignable, in whole or in part, directly or indirectly, by any Party
without the prior written consent of the other Party, and any attempt to assign any rights or obligations arising under this Agreement without such consent shall be void; provided, however, that a Party may assign this Agreement in
connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of its Assets; provided, however, that the surviving entity of such merger or the transferee of
such Assets shall agree in writing, reasonably satisfactory to the other Party, to be bound by the terms of this Agreement as if named as a “Party” hereto. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 Section 11.10. Successors and Assigns. The provisions of this Agreement and the
obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors and permitted transferees and assigns. 

Section 11.11. No Circumvention. The Parties agree not to directly or indirectly take any actions, act in concert with any Person
who takes an action (including the failure to take a reasonable action) such that the resulting effect is to materially undermine the effectiveness of any of the provisions of this Agreement or any Ancillary Agreement (including adversely affecting
the rights or ability of any Party to successfully pursue indemnification, contribution or payment pursuant to Article V). 

Section 11.12. Subsidiaries. Each of the Parties shall cause to be performed, and hereby guarantees the performance of, all
actions, agreements and obligations set forth herein to be performed by any Subsidiary of such Party or by any entity that becomes a Subsidiary of such Party on and after the effective Commencement Date. 

Section 11.13. Third Party Beneficiaries. This Agreement is solely for the benefit of the Parties and should not be deemed to
confer upon third parties any remedy, claim, liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement. 

Section 11.14. Titles and Headings. Titles and headings to sections herein are inserted for the convenience of reference only and
are not intended to be a part of or to affect the meaning or interpretation of this Agreement. 
 Section 11.15. Exhibits and
Schedules. The Exhibits and Schedules shall be construed with and as an integral part of this Agreement to the same extent as if the same had been set forth verbatim herein. 

Section 11.16. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New
York, without giving effect to any conflict-of-laws or other rule that would result in the application of the laws of a different jurisdiction. 

Section 11.17. Consent to Jurisdiction. Subject to the provisions of Article IX hereof, each of the Parties irrevocably submits to
the jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan (and if the courts of the State of New York shall be unavailable, any New York State court or federal court sitting in the City
and County of New York, Borough of Manhattan) (the “New York Courts”), for the purposes of any suit, Action or other proceeding to compel arbitration or for provisional relief in aid of arbitration in accordance with Article IX or
to prevent irreparable harm, and to the non-exclusive jurisdiction of the New York Courts for the enforcement of any award issued thereunder. Each of the Parties further agrees that service of any process,
summons, notice or document by U.S. registered mail to such Party’s respective address set forth above shall be effective service of process for any Action, suit or proceeding in the New York Courts with respect to any matters to which it has
submitted to jurisdiction in this Section. Each of the Parties irrevocably and unconditionally waives any objection to the laying of venue of any Action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in the
New York Courts, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action, suit or proceeding brought in any such court has been brought in an inconvenient forum. 

Section 11.18. Specific Performance. The Parties agree that irreparable damage would occur in the event that the provisions of
this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled to an injunction or injunctions to enforce specifically the terms and provisions hereof in any court of
the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 Section 11.19. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
EACH OF THE PARTIES HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 

Section 11.20. Severability. In the event any one or more of the provisions contained in this Agreement should be held invalid,
illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein shall not in any way be affected or impaired thereby. The Parties shall endeavor in good-faith negotiations
to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions. 

Section 11.21. Interpretation. The Parties have participated jointly in the negotiation and drafting of this Agreement. This
Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the Party drafting or causing any instrument to be drafted. 

Section 11.22. No Duplication; No Double Recovery. Nothing in this Agreement is intended to confer to or impose upon any Party a
duplicative right, entitlement, obligation or recovery with respect to any matter arising out of the same facts and circumstances (including with respect to the rights, entitlements, obligations and recoveries that may arise out of Section 5.1
or Section 5.2). 
 Section 11.23. DISCLAIMER OF WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE
SCHEDULES ATTACHED HERETO, THE PARTIES ACKNOWLEDGE AND AGREE THAT THE SERVICES ARE PROVIDED AS-IS, THAT EACH RECIPIENT ASSUMES ALL RISKS AND LIABILITIES ARISING FROM OR RELATING TO ITS USE OF AND RELIANCE UPON
THE SERVICES AND EACH PROVIDER, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, MAKES NO REPRESENTATION OR WARRANTY WITH RESPECT THERETO. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH
PROVIDER HEREBY EXPRESSLY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES REGARDING THE SERVICES, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, INCLUDING ANY REPRESENTATION OR WARRANTY IN REGARD TO QUALITY,
PERFORMANCE, NONINFRINGEMENT, COMMERCIAL UTILITY, MERCHANTABILITY OR FITNESS OF ANY SERVICE FOR A PARTICULAR PURPOSE. 

  
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 ** CONFIDENTIAL TREATMENT REQUESTED BY DOUGLAS ELLIMAN INC. 

PURSUANT TO CFR SECTION 200.83 ** 
  

 IN WITNESS WHEREOF, this Agreement has been duly executed and delivered on behalf of the
Parties as of the date first herein above written. 
  

			
	VECTOR GROUP LTD.
		
	By:	 	 
		 	Name:
		 	Title:
	
	DOUGLAS ELLIMAN INC.
		
	By:	 	 
		 	Name:
		 	Title:

  
 [Signature Page to
Transition Services Agreement]

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