Document:

kalv-ex1011_231.htm

Exhibit 10.11

 

April 15, 2016

Mr. John McKune

	
 
	
Re:
	
Amended and Restated Employment Agreement

Dear John:

This letter (the “Agreement”) contains the revised terms of your employment with Carbylan Therapeutics, Inc. (the “Company”), effective as of April 15, 2016 (the “Effective Date”). This Agreement amends and restates in its entirety that certain employment agreement between you and the Company dated as of July 27, 2015 (the “Prior Agreement”).

	
1.
	
Position.

	
 
	
a.
	
As of the Effective Date, you will fill the position of Vice President, Finance, with an assigned work location of the Company’s corporate headquarters. You will continue to report to the Company’s President and Chief Executive Officer until a Chief Financial Officer is hired at which time you will report to him or her. This continues to be a full-time position, and you agree to the best of your ability and experience that you will at all times loyally and conscientiously perform all of the duties and obligations required of and from you pursuant to the express and implicit terms hereof, and to the satisfaction of the Company. During the term of your employment, you further agree that you will devote your full business time and best professional efforts exclusively to the performance of your duties and responsibilities for the Company, and you will not directly or indirectly engage or participate in any business that is competitive in any manner with the business of the Company. The Company retains the discretion to modify your position, duties, reporting relationship, and work location from time to time.

	
2.
	
Compensation.

	
 
	
a.
	
Base Salary. You will continue to be paid a base salary at the annual rate of $213,726, subject to payroll withholdings and deductions. Your base salary will continue to be paid in two equal payments per month in accordance with the Company’s regular payroll practices. As an exempt salaried employee, you will be expected to work the Company’s standard business hours, and such additional hours as required by the nature of your work assignments and job responsibilities, and you will not be eligible for overtime compensation. The Company retains the discretion to modify your compensation terms (including the bonus program) from time to time.

	
 
	
b.
	
Bonus. You will continue to be eligible for consideration by the Company’s Board of Directors (the “Board”) for an annual bonus of up to twenty five percent 

 

 

	
 
		
(25%) of your annual base salary, with the bonus determination to be made by the Board within its sole discretion. Payment of the bonus will be based on the level of achievement of the applicable objectives and milestones, as such objectives and milestones are set by the Board in its sole discretion, and as such achievement is evaluated by the Board in its sole discretion, and the bonus is not guaranteed. As a condition precedent to earning and receiving any bonus, you must remain an active employee with the Company through the date the bonus otherwise is scheduled to be paid; and if your employment has been terminated for any reason, regardless of whether the termination is by you or the Company, you will not earn or be entitled to receive any bonus which has not been paid prior to the termination date.

	
3.
	
Benefits.

	
 
	
a.
	
Insurance Benefits. You will continue to be eligible to participate in the Company’s standard medical and dental insurance benefits, subject to the terms and conditions of these benefit plans, as in effect from time to time.

	
 
	
b.
	
Paid Time Off. You will continue to be eligible to accrue paid vacation, and be eligible for paid sick time and paid holidays, under the terms of the Company’s applicable policies, as in effect from time to time.

You will continue to be eligible to participate in any other benefits offered by the Company generally to its employees from time to time, subject to the terms and conditions of these benefit plans and the Company’s policies, as in effect from time to time. The Company reserves the right to add to, change, or terminate any or all of its benefit programs and related policies in its sole discretion.

	
4.
	
Compliance with Company Policies and Confidential Information and Invention Assignment Agreement.

As a condition of your continued employment with the Company, you will be required to continue to abide by the Company’s policies and procedures, including but not limited to the policies contained in the Company’s Employee Handbook, as may be in effect from time to time. In addition, you shall continue to abide by and be bound by the terms of that certain Employee Proprietary Information and Invention Agreement between you and the Company (the “Confidentiality Agreement”).

	
5.
	
Prior Confidentiality Obligations.

In your work for the Company, you will be expected not to use or disclose any confidential information, including trade secrets, of any former employer or other person to whom you have an obligation of confidentiality. Rather, you will be expected to use only that information which is generally known and used by persons with training and experience comparable to your own, which is common knowledge in the industry or otherwise legally in the public domain, or which 

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is otherwise provided or developed by the Company. You agree that you will not bring onto Company premises, any unpublished documents or property belonging to any former employer or other person to whom you have an obligation of confidentiality. You hereby represent that you have disclosed to the Company any contract you have signed that may restrict your activities on behalf of the Company.

	
6.
	
At-Will Employment.

Your employment with the Company will continue to be on an “at will” basis, meaning that either you or the Company may terminate your employment at any time, with or without cause, and with or without advance notice. In addition, the Company may also change any term or condition of your employment with or without cause. This “at will” relationship can only be changed by an agreement in writing signed by an expressly authorized officer of the Company.

	
7.
	
Severance Benefits for Qualifying Terminations.

	
 
	
a.
	
General Severance Benefits. You shall be entitled to receive the General Severance Benefits (as defined below), as your sole severance benefits, if your employment is terminated by the Company without Cause (as defined below) and if: (i) such termination of employment is not due to your death or disability; (ii) your termination constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)); and (iii) within the timing required by the Company, you sign, date and return to the Company a general release of all known and unknown claims (the “Release”) substantially in the form attached hereto as Exhibit A, and such Release becomes effective in accordance with its terms, including through the expiration of any applicable revocation period.

For purposes of this Section 7(a), the “General Severance Benefits” shall consist of the following: (i) continued payment of your final base monthly salary for a period of six (6) months following the termination date; (ii) accelerated vesting of any outstanding stock options such that the additional number of shares that would have vested if your employment had continued for six (6) additional months following the termination date will become vested and exercisable effective as of the termination date; and (iii) if you timely elect continued group health insurance coverage pursuant to federal COBRA law or, if applicable, state insurance laws (collectively, “COBRA”), the Company will pay your COBRA premiums to continue your group health insurance coverage (including the cost of dependent coverage) through the earliest of (A) six (6) months following the termination date, (B) the date that you become eligible for group health insurance coverage through a new employer, or (C) the date you cease to be eligible for COBRA coverage. Notwithstanding the foregoing, the General Severance Benefit set forth in (i), above (continued base salary payment) will immediately expire in the event that you obtain new full-time employment (or full-time consulting or similar arrangement) within six (6) months after the termination date, provided, however, that the Company will thereafter continue to pay you, through the six-month severance payment period, the excess, if any, of your Company base salary on the date of termination over the base salary for your new employment relationship. You 

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agree to notify the Company of your acceptance of any employment within the six-month severance payment period. In the event of your death during the six (6) month severance period, the remaining General Severance Benefits shall be paid to your estate. Any severance payments made under this Agreement will be made in the form of salary continuation, and will begin on the next regular Company payday which is at least five (5) business days following the later of the effective date of the Release or the date on which the Release, signed by you, is received by the Company. The first payment, however, will be retroactive to the next business day following the termination date.

	
 
	
b.
	
Change of Control Severance Benefits. You shall be entitled to receive the Change of Control Severance Benefits (as defined below), as your sole severance benefits, if, on or within twelve (12) months after a Change of Control (as defined below), your employment is terminated by the Company without Cause or you voluntarily terminate your employment for Good Reason (as defined below) and if; (i) such termination of employment is not due to your death or disability; (ii) your termination constitutes a “separation from service” (as defined under Treasury Regulation Section 1.409A-1(h)); and (iii) within the timing required by the Company, you sign, date and return to the Company the Release substantially in the form attached hereto as Exhibit A, and such Release becomes effective in accordance with its terms, including through the expiration of any applicable revocation period.

For the purposes of Section 7(b), the “Change of Control Severance Benefits” shall consist of the following: (i) you shall receive the General Severance Benefits as provided above, except that the continued salary payments will not be terminated or reduced in the event that you obtain new employment during the six-month severance payment period; (ii) you will also be eligible to receive a prorated bonus payment for the year in which your employment terminates (notwithstanding that you otherwise would not be eligible for payment of such bonus due to termination of employment prior to the bonus payment date), with such prorated bonus amount to be based on the achievement of the bonus objectives prior to such termination or resignation (provided that, no prorated bonus will be owed if the Board determines that there has been no achievement of such bonus objectives), and (iii) you will be eligible for the Full Acceleration as provided in Section 8 hereof.

	
 
	
c.
	
For purposes of this Agreement, “Cause” for termination of employment shall mean: (i) your failure to substantially perform the principal duties and obligations of your position with the Company; (ii) any act of personal dishonesty, fraud or misrepresentation by you which was intended to or does result in your substantial gain or personal enrichment at the expense of the Company; (iii) your violation of a federal or state law or regulation applicable to the Company’s business or any of the Company’s policies, which violation was or is reasonably likely to be injurious to the Company or its business or reputation; (iv) your conviction of a felony or a plea of nolo contendere under the laws of the United States or any State; or (v) your material breach of the terms of any agreement or contract 

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between you and the Company. The determination that a termination is for Cause shall be made in good faith by the Board in its sole discretion.

	
 
	
d.
	
You may voluntarily terminate your employment for “Good Reason” under Section 7(b) of this Agreement by notifying the Company in writing, within thirty (30) days after the first occurrence of one of the following events taken without your consent, that you intend to terminate your employment for Good Reason on a date not later than the ninetieth (90th) day following such event, if the Company has not cured that event within thirty (30) days after its receipt of your written notice. The events that may give rise to a Good Reason termination are: (i) a material and substantial reduction in the scope of your duties and responsibilities (provided, however, that a change in job position (including a change in title) shall not be deemed a “material reduction” unless your new duties are substantially reduced from your prior duties); (ii) relocation of your principal office that results in a one-way increase in your commute distance of more than 30 miles; or (iii) a reduction in your base salary by more than twenty (20%) percent (provided that an across-the-board reduction in the salary level of all Vice Presidents of the Company by the same (or a greater) percentage amount shall not constitute Good Reason).

	
8.
	
Change of Control.

For purposes of this Agreement, “Change of Control” shall mean the consummation of a transaction or series of transactions that results in: (i) any sale or other disposition of all or substantially all of the assets of the Company. that occurs over a period of not more than twelve (12) months; or (ii) any person, or more than one person acting as a group, acquiring ownership of stock of the Company, that together with the stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of such corporation. However, a Change of Control shall not include (x) any consolidation or merger effected exclusively to change the domicile of the Company, or (y) any transaction or series of transactions principally for bona fide equity financing purposes in which cash is received by the Company or any successor or indebtedness of the Company is cancelled or converted or a combination thereof. This definition of Change of Control is intended to conform to the definitions of “change in ownership of a corporation” and “change in ownership of a substantial portion of a corporations assets” provided in Treasury Regulation Sections 1.409A-3(i)(5)(v) and (vii).

In the event that, on or within twelve (12) months after the consummation of a Change of Control of the Company, your employment with the Company (or its successor, as applicable) is terminated by the Company (or its successor, as applicable) without Cause or you terminate your employment for Good Reason, 100% of the shares subject to any outstanding stock options held by you will be immediately vested and exercisable in full effect as of the employment termination date (the “Full Acceleration”). Notwithstanding the foregoing, as a pre-condition of the Full Acceleration, within the timing required by the Company, you must sign, date and return 

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to the Company the Release substantially in the form attached hereto as Exhibit A, and such Release becomes effective in accordance with its terms, including through the expiration of any applicable revocation period.

	
9.
	
Deferred Compensation.

It is intended that (i) each installment of any amounts or benefits payable under Section 10 of this Agreement be regarded as a separate “payment” for purposes of Treasury Regulations Section 1.409A-2(b)(2)(i) (and each such installment is hereby designated as separate for such purpose), (ii) all payments of any such amounts or benefits satisfy, to the greatest extent possible, the exemptions from the application of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and other guidance thereunder and any state law of similar effect (collectively “Section 409A”), as provided under Treasury Regulations Sections 1.409A-1(b)(4) and 1.409A-1(b)(9)(iii); and (iii) any such amounts or benefits consisting of premiums payable under COBRA also satisfy, to the greatest extent possible, the exemption from the application of Section 409A provided under Treasury Regulations Section 1.409A-1(b)(9)(v). However, if any such amounts or benefits constitute “deferred compensation” under Section 409A and if you are a “specified employee” of the Company, as such term is defined in Section 409A(a)(2)(B)(i), then, solely to the extent necessary to avoid the imposition of the adverse personal tax consequences under Section 409A, the timing of any such benefit payments as to which you are entitled shall be delayed as follows: on the earlier to occur of (a) the date that is six (6) months and one (1) day after your separation from service and (b) the date of your death (such applicable date, the “Delayed Initial Payment Date”), the Company shall (1) pay you a lump sum amount equal to the sum of the benefit payments that you would otherwise have received through the Delayed Initial Payment Date if the commencement of the payment of the benefits had not been delayed pursuant to this Section 12 and (2) commence paying the balance, if any, of the benefits in accordance with the applicable payment schedule.

This Agreement, together with the Confidentiality Agreement, sets for the entire agreement and understanding between you and the Company relating to your employment and supersedes all prior agreements, understandings and discussions between you and the Company, including, without limitation, the Prior Agreement. This letter may not be modified or amended except by a written agreement, signed by the Chief Executive Officer of the Company, although the Company reserves the right to modify unilaterally your compensation, benefits, job title and duties, reporting relationships and other terms of your employment.

Sincerely,

/s/ David M. Renzi

David M. Renzi
President and CEO

 

 

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UNDERSTOOD, ACCEPTED AND AGREED:

	
	
John McKune

	
 

	
 

	
/s/ John McKune

	
Signature

	
 

	
April 15, 2016

	
Date

 

 

 

 

EXHIBIT A

RELEASE AGREEMENT

In exchange for the General Severance Benefits, the Change of Control Severance Benefits, and/or the Full Acceleration, as applicable, to be provided to me pursuant to the Amended and Restated Employment Agreement dated April 15, 2016 (the “Agreement”) between me and Carbylan Therapeutics, Inc. (the “Company”), I hereby provide the following release of claims (the “Release”).

In exchange for the severance pay and benefits provided to me under the Agreement, to which I acknowledge I would not otherwise be entitled, and for other good and valuable consideration, the receipt and sufficiency of which I hereby acknowledge, I hereby generally and completely release the Company, its parent and subsidiary entities, and their respective directors, officers, employees, shareholders, stockholders, partners, agents, attorneys, predecessors, successors, insurers, employee benefit plans, affiliates, and assigns (collectively, the “Released Parties”) of and from any and all claims, liabilities and obligations, both known and unknown, arising out of or in any way related to events, acts, conduct, or omissions occurring at any time prior to or at the time that I sign this Release (collectively, the “Released Claims”). The Released Claims include, but are not limited to: (1) all claims arising out of or in any way related to my employment with the Company (or its successor) or the termination of that employment; (2) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership or equity interests in the Company; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing (including, but not limited to, any claims based on or arising from the Agreement); (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act (as amended) (“ADEA”), the federal Family and Medical Leave Act (as amended) (“FMLA”), the California Family Rights Act (“CFRA”), the California Labor Code (as amended), and the California Fair Employment and Housing Act (as amended).

Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (1) any rights or claims for indemnification I may have pursuant to any written indemnification agreement with the Company to which I am a party, the charter, bylaws, or operating agreements of the Company, applicable law, or applicable directors and officers liability insurance; (2) any rights or claims which are not waivable as a matter of law; and (3) any claims for breach of the Agreement arising after the date that I sign this Release. In addition, nothing in this Release prevents me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, the California Department of Fair Employment and Housing, or any other government agency, except that I acknowledge and agree that I am hereby waiving my right to any monetary benefits 

 

in connection with any such claim, charge or proceeding. I represent that I have no lawsuits, claims or actions pending in my name, or on behalf of any other person or entity, against any of the Released Parties.

The following paragraph shall apply to me only if I am forty (40) years old or older as of the date that I sign this Release: I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA, and that the consideration given for the waiver and release in the preceding paragraph is in addition to anything of value to which I am already entitled. I further acknowledge that I have been advised by this writing that: (1) my waiver and release do not apply to any rights or claims that may arise after the date I sign this Release; (2) I have been advised to consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so) and I have had sufficient opportunity to do so; (3) I have twenty-one (21) days to consider this Release (although I may choose voluntarily to sign it earlier); (4) I have seven (7) days following the date I sign this Release to revoke it by providing written notice of revocation to the Company’s Board of Directors; and (5) this Release will not be effective until the date upon which the revocation period has expired, which will be the eighth calendar day after the date I sign it if I do not revoke it (such date, the “Effective Date”).

The following paragraph shall apply to me only if I am less than forty (40) years old as of the date that I sign this Release: I understand that I have fourteen (14) days to consider this Release (although I may choose voluntarily to sign it earlier), the Release will become effective as of the date that I sign it (such date, the “Effective Date”), and I do not have the right to revoke this Release after signing it.

I UNDERSTAND THAT THIS RELEASE AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS. I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” I hereby expressly waive and relinquish all rights and benefits under that section and any law or legal principle of similar effect in any jurisdiction with respect to my release of claims herein, including but not limited to the release of unknown and unsuspected claims.

I hereby represent that I have been paid all compensation owed and for all time worked, I have received all the leave and leave benefits and protections for which I am eligible, pursuant to FMLA, CFRA, any Company policy or applicable law, and I have not suffered any on-the-job injury or illness for which I have not already filed a workers’ compensation claim.

I further agree: (1) not to disparage the Company, or any of the other Released Parties, in any manner likely to be harmful to its or their business, business reputation, or personal reputation (although I may respond accurately and fully to any question, inquiry or request for information as required by legal process); (2) not to voluntarily (except in response to legal compulsion) assist any third party in bringing or pursuing any proposed or pending litigation, arbitration, 

 

administrative claim or other formal proceeding against the Company, its parent or subsidiary entities, affiliates, officers, directors, employees or agents; and (3) to cooperate fully with the Company, by voluntarily (without legal compulsion) providing accurate and complete information, in connection with the Company’s actual or contemplated defense, prosecution, or investigation of any claims or demands by or against third parties, or other matters, arising from events, acts, or failures to act that occurred during the period of my employment by the Company or any successor thereto.

I understand that, upon the Effective Date, this Release will take effect as a legally binding agreement between me and the Company. This Release sets for the entire agreement and understanding between the Company and me relating to the matters set forth herein and supersedes all prior and contemporaneous agreements, understandings and discussions concerning such matters, whether express or implied. This Release may not be modified or amended except by a written agreement, signed by the Chief Executive Officer of the Company and me.

			
	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
By:
	
 

	
 
	
 
	
[Name]

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
Date:
	
 

	
 
	
 
	
 

 

 

 

 

AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

This Amendment (“Amendment”) to the Amended and Restated Employment Agreement, dated April 15, 2016, by and between Carbylan Therapeutics, Inc. (“Carbylan”) and Executive (the “Agreement”), is made and entered into as of November 21, 2016, by and among John McKune (“Executive”) and KalVista Pharmaceuticals Inc., the successor of Carbylan (the “Company”), which will be assuming the obligations set forth in the Agreement, as modified by this Amendment, upon the close of the share purchase transaction between Carbylan and KalVista Pharmaceuticals Ltd (“KalVista”).  A copy of the Agreement with all of its exhibits is attached hereto as Exhibit 1.  Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.

 

RECITALS

 

A.WHEREAS, KalVista plans to merge with Carbylan (“Merger”) at which Executive is currently the Vice President, Finance.

 

B.WHEREAS, the Company and Executive wish to continue Executive’s service in the role of Vice President, Finance, of the Company, during the transition period following the Merger; and

 

C.WHEREAS, the Company intends to assume the obligations under the Agreement following the Merger, subject to the amendments herein.

 

AMENDMENT

 

NOW THEREFORE, in consideration of the foregoing recitals and the mutual promises and covenants herein contained, and for other good and valuable consideration, and further conditioned upon the successful closing of the merger between Carbylan and KalVista, the parties, intending to be legally bound, agree as follows:

 

1.Amendment to Section 2(a) of the Agreement.  The base salary set forth in Section 2(a) of the Agreement shall be amended to reflect an increase from the annual rate of $213,726 to $250,000, subject to payroll withholdings and deductions (“Increased Base Salary”), with such increase to take effect as of the date the Merger is completed and Executive’s title changes from the Vice President, Finance, of Carbylan to the Vice President, Finance, of the Company (“Merger Closing”).

 

2.Cash Bonus.  In addition to the compensation set forth in Section 2 of the Agreement, as amended herein, the Company agrees to pay Executive a cash bonus up to an aggregate gross amount of $124,997.50, less applicable withholdings and deductions (the “Cash Bonus”), paid in installments in accordance with the following Payout Schedule (each, an “Installment”), provided that Executive is actively employed with the Company as of each Installment payment date.  

 

 

 

Cash Bonus Payout Schedule:

 

	
 
	
•
	
First Installment – $62,500.00 (25% of the Increased Base Salary) – to be paid the first payroll date three months following the Merger Closing;

	
 
	
•
	
Second Installment - $20,832.50 (8.333% of the Increased Base Salary) – to be paid the first payroll date four months following the Merger Closing;

	
 
	
•
	
Third Installment - $20,832.50 (8.333% of the Increased Base Salary) – to be paid the first payroll date five months following the Merger Closing; and

	
 
	
•
	
Fourth Installment - $20,832.50 (8.333% of the Increased Base Salary) – to be paid the first payroll date six months following the Merger Closing.

 

Notwithstanding the foregoing, in the event the Company terminates Executive’s employment without Cause on a date that falls in between the Installment payment dates, the Company will pay Executive, within thirty (30) days following the termination date, the prorated amount of the next Installment payment based on the number of full weeks of Executive’s active employment in between the last paid Installment and the date of termination.  For the avoidance of doubt, in the event the Company terminates Executive’s employment without Cause prior to first Installment payment date, then the Company will pay Executive, within thirty (30) days following the termination date, the prorated amount of the first Installment payment based on the number of full weeks of Executive’s active employment in between the Merger Closing and the date of termination.

 

3.No Effect on Carbylan 2016 Retention Bonus.  The Company and Executive agree that Executive’s employment with the Company following the Merger Closing will not qualify as Comparable Employment as defined in Section 2.6 of the Carbylan 2016 Retention Bonus Plan (“Bonus Plan”), attached hereto as Exhibit 2, to render Executive ineligible for receipt of a Retention Bonus under the terms of the Bonus Plan.  In addition, the Company and Executive agree that the Executive’s Retention Bonus, as defined in the Bonus Plan, is calculated based on his salary in effect prior to the increase provided for in Section 1 above.  In accordance with and pursuant to the Bonus Plan, subject to Executive’s execution of a general release of claims attached as Exhibit 3 (the “Release”) that becomes effective and irrevocable within sixty (60) days following the Merger Closing, the Company shall pay to Executive $71,242, less applicable withholdings and deductions, which represents Executive’s Retention Bonus, on the first payroll period after the date the Release becomes effective and irrevocable.

 

4.Stock Options.  Subject to approval of the Compensation Committee of the Company (the “Compensation Committee”), the Company will grant you an option to purchase an amount of the post- Merger Closing, post-reverse split shares of the Company’s common stock with an exercise price equal to the fair market value per share of the common stock on the date of the grant, as determined by the Compensation Committee (the “Option”).  The Option will vest over six (6) months, in equal monthly installments as long as Executive remains actively employed with and in continuous service to the Company, with vesting to commence on the first day following the Merger Closing.  Subject to the approval of the Compensation Committee, the Company further agrees that the post-employment exercise period for the Option shall continue until the twelve (12) month anniversary of the date of Executive’s termination from the Company.  

 

			
	
 
	
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5.Severance Benefits for Qualifying Termination.  In the event Executive’s employment is terminated by the Company, without Cause or Executive voluntarily terminates his employment for Good Reason, the Company agrees that Executive will be eligible for the Change of Control Severance Benefits and not the General Severance Benefits under the Agreement, subject to the additional conditions as set forth in Section 7(b) of the Agreement.

 

6.Entire Agreement.  Once accepted, this Amendment, together with Exhibits 1-3 and the Option, constitutes the entire agreement between Executive and the Company relating to subject matter hereof and supersedes all prior agreements, negotiations and understandings with respect to such matters, and Executive and the Company acknowledge they have made no agreements, representations or warranties relating to the subject matter hereof which are not set forth herein.

 

7.Modification.  It is expressly agreed that the terms of this Amendment may not be altered, amended, modified, or otherwise changed in any respect except by another written agreement that specifically refers to this Amendment, executed by both Executive and the CEO of the Company.

 

8.No other Amendments.  Except as expressly set forth above, all of the terms and conditions of the Agreement shall remain unchanged and continue in full force and effect to apply to Executive’s employment with Carbylan, prior to the Merger Closing, and Executive’s employment with the Company, on and after the Merger Closing.  

 

9.Counterparts.  This Amendment may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together constitute one and the same instrument.  Execution of a facsimile or PDF copy shall have the same force and effect as execution of an original.

 

KalVista Pharmaceuticals, INC.  

 

				
	
/s/ T. Andrew Crockett
	
 
	
Date:
	
 November 21, 2016

	
T. Andrew Crockett
	
 
	
 
	
 

 

I have read and understood this Amendment and hereby acknowledge, accept and agree to the terms as set forth above and further acknowledge that no other commitments were made to me as part of this Amendment except as specifically set forth herein.

 

EXECUTIVE

 

				
	
/s/ John McKune
	
 
	
Date:
	
 November 21, 2016

	
John McKune
	
 
	
 
	
 

 

 

 

 

			
	
 
	
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Exhibit 3

RELEASE AGREEMENT

 

In exchange for the Retention Bonus to be provided to me pursuant to the Carbylan Therapeutics, Inc. (“Carbylan”) 2016 Retention Bonus Plan (the “Bonus Plan”), I hereby provide the following release of claims (the “Release”). 

 

In exchange for the Retention Bonus provided to me under the Bonus Plan, to which I acknowledge I would not otherwise be entitled, and for other good and valuable consideration, the receipt and sufficiency of which I hereby acknowledge, I hereby generally and completely release Carbylan, KalVista Pharmaceuticals, Inc. (the “Company”), KalVista Pharmaceuticals Ltd., their respective parent and subsidiary entities, and their respective directors, officers, employees, shareholders, stockholders, partners, agents, attorneys, predecessors, successors, insurers, employee benefit plans, affiliates, and assigns (collectively, the “Released Parties”) of and from any and all claims, liabilities and obligations, both known and unknown, arising out of or in any way related to events, acts, conduct, or omissions occurring at any time prior to or at the time that I sign this Release (collectively, the “Released Claims”).  The Released Claims include, but are not limited to: (1) all claims arising out of or in any way related to my employment with Carbylan or the Company (or its successor); (2) all claims related to my compensation or benefits, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership or equity interests in Carbylan or the Company; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act (as amended) (“ADEA”), the federal Family and Medical Leave Act (as amended) (“FMLA”), the California Family Rights Act (“CFRA”), the California Labor Code (as amended), and the California Fair Employment and Housing Act (as amended).  

Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (1) any rights or claims for indemnification I may have pursuant to any written indemnification agreement with the Company to which I am a party, the charter, bylaws, or operating agreements of the Company, applicable law, or applicable directors and officers liability insurance; (2) any rights or claims which are not waivable as a matter of law; (3) my rights under that certain Amended and Restated Employment Agreement by and between Carbylan and me dated April 15, 2016, as amended by that certain letter amendment by and between the Company and me dated as of November 21, 2016; (4) any payments I am entitled to under that certain Share Purchase Agreement dated as of June 15, 2016, by and between the Company, Carbylan, the shareholders of the Company and, solely for the purposes of being bound by certain provisions therein and solely in such person’s capacity as the Seller Representative, Andrew Crockett; (5) claims to continued participation in certain of Carbylan’s or the Company’s benefit plans pursuant to the terms and conditions thereof; and (5) any claims for breach of the Bonus Plan arising after the date that I sign this Release.  In addition, nothing in this Release prevents me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, the California 

 

 

Department of Fair Employment and Housing, or any other government agency, except that I acknowledge and agree that I am hereby waiving my right to any monetary benefits in connection with any such claim, charge or proceeding.  I represent that I have no lawsuits, claims or actions pending in my name, or on behalf of any other person or entity, against any of the Released Parties.  

 

I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA, and that the consideration given for the waiver and release in the preceding paragraph is in addition to anything of value to which I am already entitled.  I further acknowledge that I have been advised by this writing that:  (1) my waiver and release do not apply to any rights or claims that may arise after the date I sign this Release; (2) I have been advised to consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so) and I have had sufficient opportunity to do so; (3) I have twenty-one (21) days to consider this Release (although I may choose voluntarily to sign it earlier); (4) I have seven (7) days following the date I sign this Release to revoke it by providing written notice of revocation to Ben Palleiko, Chief Financial Officer of the Company, at blp@kalvista.com (via hardcopy or via electronic copy to  blp@kalvista.com); and (5) this Release will not be effective until the date upon which the revocation period has expired, which will be the eighth calendar day after the date I sign it if I do not revoke it (such date, the “Effective Date”).

 

I UNDERSTAND THAT THIS RELEASE AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.  I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows:  “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”  I hereby expressly waive and relinquish all rights and benefits under that section and any law or legal principle of similar effect in any jurisdiction with respect to my release of claims herein, including but not limited to the release of unknown and unsuspected claims.

 

I hereby represent that I have been paid all compensation owed and for all time worked up until the date I sign this Agreement, I have received all the leave and leave benefits and protections for which I am eligible through the date of this Agreement, pursuant to FMLA, CFRA, any Company policy or applicable law, and I have not suffered any on-the-job injury or illness for which I have not already filed a workers’ compensation claim through the date of this Agreement.

 

 

 

 

I understand that, upon the Effective Date, this Release will take effect as a legally binding agreement between me and the Company. This Release sets for the entire agreement and understanding between the Company and me relating to the matters set forth herein and supersedes all prior and contemporaneous agreements, understandings and discussions concerning such matters, whether express or implied.  This Release may not be modified or amended except by a written agreement, signed by the Chief Executive Officer of the Company and me.

 

			
	
By:
	
/s/ John McKune

	
 
	
John McKune

	
 
	
 

	
 
	
 

	
Date:
	
 November 21, 2016kalv-ex1012_227.htm

Exhibit 10.12

OFFICE LEASE AGREEMENT

___________________________________________

55 CAMBRIDGE PARKWAY

CAMBRIDGE, MA

by and between

55 CAMBRIDGE PARKWAY, LLC,
a Delaware limited liability company, as Landlord

and

KALVISTA PHARMACEUTICALS, INC.,
a Delaware Corporation, as Tenant

___________________________________________

 

 

 

 

TABLE OF CONTENTS

 

	
 
	
 
	
Page
	
 

	
Article 1.
	
SUMMARY AND DEFINITION OF CERTAIN LEASE PROVISIONS AND EXHIBITS
	
1
	
 

	
Article 2.
	
PREMISES/RIGHT TO USE COMMON AREAS
	
3
	
 

	
Article 3.
	
TERM
	
4
	
 

	
Article 4.
	
MINIMUM MONTIILY RENT
	
5
	
 

	
Article 5.
	
ADDITIONAL RENT/EXPENSE STOP/TAX STOP
	
5
	
 

	
Article 6.
	
PARKING
	
7
	
 

	
Article 7.
	
PERSONAL PROPERTY TAXES
	
7
	
 

	
Article 8.
	
PAYMENT OF RENT/LATE CHARGES/INTEREST ON PAST-DUE OBLIGATIONS
	
7
	
 

	
Article 9.
	
SECURITY DEPOSIT
	
7
	
 

	
Article 10.
	
CONSTRUCTION OF THE PREMISES
	
9
	
 

	
Article 11.
	
ALTERATIONS
	
9
	
 

	
Article 12.
	
PERSONAL PROPERTY/SURRENDER OF PREMISES
	
11
	
 

	
Article 13.
	
LIENS
	
11
	
 

	
Article 14.
	
USE OF PREMISES/RULES AND REGULATIONS
	
11
	
 

	
Article 15.
	
RIGHTS RESERVED BY LANDLORD
	
13
	
 

	
Article 16.
	
QUIET ENJOYMENT
	
14
	
 

	
Article 17.
	
MAINTENANCE AND REPAIR
	
14
	
 

	
Article 18.
	
UTILITIES AND JANITORIAL SERVICES
	
15
	
 

	
Article 19.
	
ENTRY AND INSPECTION
	
17
	
 

	
Article 20.
	
INSURANCE
	
18
	
 

	
Article 21.
	
DAMAGE AND DESTRUCTION OF PREMISES
	
20
	
 

	
Article 22.
	
EMINENT DOMAIN
	
21
	
 

	
Article 23.
	
ASSIGNMENT AND SUBLETTING
	
22
	
 

	
Article 24.
	
SALE OF PREMISES BY LANDLORD
	
23
	
 

	
Article 25.
	
SUBORDINATION/ATIORNMENT/MODIFICATION/ASSIGNMENT
	
23
	
 

	
Article 26.
	
LANDLORD’S DEFAULT AND RIGHT TO CURE
	
24
	
 

	
Article 27.
	
ESTOPPEL CERTIFICATES
	
24
	
 

	
Article 28.
	
TENANT’S DEFAULT AND LANDLORD’ S REMEDIES
	
24
	
 

	
Article 29.
	
TENANT’S RECOURSE
	
27
	
 

	
Article 30.
	
HOLDING OVER
	
28
	
 

	
Article 31.
	
GENERAL PROVISIONS
	
28
	
 

	
Article 32.
	
NOTICES
	
30
	
 

	
Article 33.
	
BROKER’S COMMISSIONS
	
30
	
 

	
Article 34.
	
INDEMNIFICATION/WAIVER OF SUBROGATION
	
31
	
 

	
Article 35.
	
WAIVER OF TRIAL BY JURY
	
31
	
 

 

i

 

EXHIBITS

 

	
(A)
	
PREMISES

	
(B)
	
RULESAND REGULATIONS

	
(C)
	
PARKING RULES AND REGULATIONS

	
(D)
	
TENANT IMPROVEMENTS

	
(D-1)
	
CONTRACTOR RULES AND REGULATIONS

	
(D-2)
	
ENERGY AND SUSTAINABILITY CONSTRUCTION GUIDELINES AND REQUIREMENTS

	
(E)
	
CONFIRMATION OF COMMENCEMENT DATE

	
(F)
	
MOISTURE AND MOLD CONTROL INSTRUCTIONS

	
(G)
	
LANDLORD'S SERVICES

	
(H)
	
LIST OF ISSUING BANKS FOR LETTER OF CREDIT

 

 

ii

 

OFFICE LEASE AGREEMENT
55 Cambridge Parkway, Cambridge, MA

THIS OFFICE LEASE AGREEMENT, dated as of May 30, 2017, is made and entered into by 55 Cambridge Parkway, LLC, a Delaware limited liability company (the “Landlord”) and Kalvista Pharmaceuticals, Inc. a Delaware corporation (the “Tenant”).  In consideration of the mutual promises and representations set forth in this Lease, Landlord and Tenant agree as follows:

Article 1.  SUMMARY AND DEFINITION OF CERTAIN LEASE PROVISIONS AND EXHIBITS

1.1The following terms and provisions of this Lease, as modified by other terms and provisions hereof, are included in this Section 1.1 for summary and definitional purposes only.  If there is any conflict or inconsistency between any term or provision in this Section 1.1 and any other terms or provision of this Lease, the other term or provision or this Lease shall control:

	
(a)   Landlord: 55 Cambridge Parkway, LLC, a Delaware limited liability company

	
 
	
 
	
 
	
 
	
 
	
 

	
(b)   Address of Landlord for Notices:

	
 
	
 
	
 

	
c/o Lincoln Property Company
	
With a
	
Invesco Real Estate

	
55 Cambridge Parkway
	
copy to:
	
1166 Avenue of the Americas

	
Cambridge, MA 02142
	
 
	
New York, NY 10036

	
Attention: Baron Hanley
	
 
	
Attention:
	
Asset Manager

	
Telephone: (617) 494-9197
	
 
	
 
	
55 Cambridge Parkway

	
Telecopy: (617) 494-5459
	
 
	
 
	
Cambridge, MA 02142

	
 
	
 
	
 
	
 
	
Telephone:
	
(212) 278-9224

	
 
	
 
	
 
	
 
	
Telecopy:
	
(212) 278-9624

	
 
	
 
	
 

	
(c)   Tenant: Kalvista Pharmaceuticals, Inc., a Delaware corporation

	
(d)   Address of Tenant for Notices:
	
Kalvista Pharmaceuticals, Inc.

	
(Include Main/Hdq. Address)
	
55 Cambridge Parkway

	
 
	
 
	
 
	
Cambridge, MA 02142

	
 
	
 
	
 
	
Attn: Ben Palleiko
	
 

	
 
	
 

	
(e)   Lease Term: A period commencing on the Commencement Date (as hereinafter defined), and expiring on the day before the fifth (5th ) anniversary of the Commencement Date (provided that if such fifth (5th ) anniversary is not the first day of a month, the Lease Term shall expire on the last day of the month in which such fifth (5th ) anniversary occurs). As used in this Lease, the “Commencement Date” shall mean the earlier of (i) the date on which Landlord substantially completes the Tenant Improvements (as defined in, and determined in accordance with, Exhibit D attached hereto), or (ii) Tenant’s occupancy of the Premises for business purposes.

 

 

(f)Building:  The office building located at 55 Cambridge Parkway, Cambridge, MA (the “Building”).

(g)Premises:  A portion of the ninth (9th) floor of the East Wing of the Building, as shown on Exhibit A, consisting of approximately 2,762 Rentable Square Feet, subject to re-measurement by Landlord after completion of the Tenant Improvements pursuant to the terms and provisions in Exhibit D attached hereto.  The Minimum Annual Rent set forth herein shall be adjusted up or down to account for any changes that result from the re-measurement of the Premises.

(h)Minimum Annual Rent (subject to adjustment following re-measurement of the Premises):

 

	
Lease Year
	
RSF Rule
	
Annual Amount
	
Monthly Amount

	
 
	
 
	
 
	
 

	
Lease Year 1:
	
$80.00/RSF
	
$220,960.00
	
$18,413.33 per month

	
Lease Year 2:
	
$81.00/RSF
	
$223,722.00
	
$18,643.50 per month

	
Lease Year 3:
	
$82.00/RSF
	
$226,484.00
	
$18,873.67 per month

	
Lease Year 4:
	
$83.00/RSF
	
$229,246.00
	
$19,103.83 per month

	
Lease Year 5:
	
$84.00/RSF
	
$232,008.00
	
$19,334 00 per month

As used above, the term “Lease Year” shall mean the one year period beginning on the Commencement Date and each consecutive one year period thereafter, except that if the Commencement Date shall not occur on the first day of a calendar month, then Lease Year 1 shall also include the partial calendar month during which the first (1st) anniversary occurs (i.e., the period of such calendar month after such first anniversary).  The monthly component of Minimum Annual Rent shall be referred to herein as “Minimum Monthly Rent”.

(i)Tenant’s Base Operating Share:  (see Article 5).

(j)Tenant’s Base Tax Share:  (see Article 5).

(k)Expense Stop: An amount equal to the Operating Costs for the calendar year ending December 31, 2017 divided by the Rentable Square Footage of the Building.

(l)Tax Stop:  An amount equal to the Taxes for the tax fiscal year ending June 30, 2018 divided by the Rentable Square Footage of the Building.

(m)Security Deposit:  A Security Deposit of $92,066.65 is required and shall be deposited with Landlord at the time this Lease is signed by Tenant.

(n)Parking:  (see Article 6.)

(o)Building Business Hours:  8 a.m. to 6 p.m.  Monday through Friday; 8 a.m. to 1 p.m. Saturday.  Closed Sundays and all legal holidays.

(p)Sustainability Initiative:  (see Section 14.4).

2

1.2The following exhibits (the “Exhibits”) and addenda are attached hereto and incorporated herein by this reference:

Exhibit APremises

Exhibit BRules and Regulations

Exhibit CParking Rules and Regulations

Exhibit DTenant Improvements

Exhibit D-1Contractor Rules and Regulations

Exhibit D-2Energy and Sustainability Construction Guidelines and Requirements

Exhibit EConfirmation of Commencement Date

Exhibit FMoisture and Mold Control Instructions

Exhibit GLandlord’s Services

Exhibit HList of Issuing Banks for Letter of Credit

The Office Lease Agreement and the Exhibits are collectively referred to herein as the “Lease.”

Article 2.  PREMISES/RIGHT TO USE COMMON AREAS

2.1Landlord leases to Tenant and Tenant leases from Landlord the Premises, for and subject to the terms and provisions set forth in this Lease.  This Lease is subject to all liens, encumbrances, parking and access easements, restrictions, covenants, and all other matters of record, the Rules and Regulations described in Article 14 and the Parking Rules and Regulations described in Article 6.  Tenant and Tenant’s agents, contractors, customers, directors, employees, invitees, officers, and patrons (collectively, the “Tenant’s Permittees”) have a non-exclusive privilege and license, during the Lease Term, to use the non-restricted Common Areas in common with all other authorized users thereof.

2.2For purposes of this Lease, the following terms have the definitions set forth below:

(a)“Automobile Parking Areas” means all areas designated for automobile parking upon the Land.  Automobile Parking Areas are Common Areas, but certain parking areas are restricted.  (See Parking Rules & Regulations).

(b)“Common Areas” means those areas within the Building and Land not leased to any tenant and which are intended by Landlord to be available for the use, benefit, and enjoyment of all occupants of the Building.

(c)“Interior Common Facilities” means lobbies, corridors, hallways, elevator foyers, restrooms, mail rooms, mechanical and electrical rooms, janitor closets, and other similar facilities used by tenants or for the benefit of tenants on a non-exclusive basis.  Access to certain Interior Common Facilities is restricted.

(d)“Project” means the building and land located at 55 Cambridge Parkway, Cambridge, MA.

3

(e)“Load Factor” means the quotient of the Rentable Square Footage of the Building divided by the aggregate Usable Square Footage of all premises and occupiable space in the Building, and is subject to change from time to time.

(f)“Rentable Square Footage” means (1) with respect to the Building, the sum of the total area of all floors in the Building (including Interior Common Facilities but excluding stairs, elevator shafts, vertical shafts, parking areas and exterior balconies), computed by measuring to the exterior surface of permanent outside walls; and (2) with respect to the Premises, the Usable Square Footage of the Premises multiplied by the Load Factor.

(g)“Usable Square Footage” means the area of the Premises (or other space occupiable by tenants as the case may be) computed by measuring to the exterior surface of permanent outside walls, to the midpoint of corridor and demising walls and to the Tenant side of permanent interior walls and Interior Common Facilities walls (other than corridor walls).

Article 3.  TERM

The term of this Lease and the Commencement Date shall be as specified in Section 1.1.  Subject to the terms and provisions hereof, Landlord shall use reasonable efforts to provide the Premises with the Tenant Improvements substantially complete (as such term is defined in Exhibit D) on or before the date that is one hundred fifty (150) days after Plan Approval (as defined in Exhibit D) (the “Estimated Delivery Date”) to the extent reasonably practicable.  If the Premises are not substantially complete by the Estimated Delivery Date (as extended by periods of force majeure or delays caused by Tenant), Landlord shall not be deemed in default of this Lease, nor shall Landlord be liable to Tenant for failing to deliver the Premises to Tenant by any particular date, and except as expressly set forth herein, Tenant shall not have the right to terminate this Lease for Landlord’s failure to timely deliver the Premises by any particular date.  If the Premises are not substantially complete enough that Tenant can reasonably take occupancy of them within ninety (90) days after the Estimated Delivery Date (as extended by periods of force majeure or delays caused by Tenant), Tenant’s sole remedies shall be to either enter into a mutually acceptable revision of the appropriate terms of this Lease with Landlord, or to cancel this Lease with ten (10) days written notice to Landlord.  Notwithstanding the foregoing, if said delays are caused by Tenant, then this Lease, and all of the obligations herein, shall commence on the date that the Commencement Date would have occurred but for such Tenant delays.  By occupying the Premises, Tenant shall be deemed to have accepted the Premises in their condition as of the date of such occupancy, subject to the performance of punch-list items that remain to be performed by Landlord, if any.  Prior to occupying the Premises, Tenant shall execute and deliver to Landlord a letter substantially in the form of Exhibit E hereto confirming: (1) the Commencement Date (as defined in the Basic Lease Information) and the expiration date of the Lease Term (as defined in the Basic Lease Information); (2) that Tenant has accepted the Premises; and (3) that Landlord has performed all of its obligations with respect to the Premises (except for punch-list items specified in such letter); however, the failure of the parties to execute such letter shall not defer the Commencement Date or otherwise invalidate this Lease.  Tenant’s failure to execute such document within ten (10) days of receipt thereof from Landlord shall be a default by Tenant under this Lease and shall be deemed to constitute Tenant’s agreement to the contents of such document.  Occupancy of the Premises by Tenant prior to the Commencement Date (“Early Occupancy”) shall be subject to all of the provisions of this Lease, including the 

4

payment of Minimum Monthly Rent prorated on a per diem basis for each day of Early Occupancy.

Article 4.  MINIMUM MONTIILY RENT

Commencing on the Commencement Date, Tenant shall pay to Landlord, without deduction, setoff, prior notice, or demand, the Minimum Monthly Rent, payable in advance on the first day of each calendar month during the Lease Term.  If the Commencement Date occurs on a date other than the first day of a calendar month, the Minimum Monthly Rent for that month shall be prorated on a per diem basis and be paid to Landlord on or before the Commencement Date.

Article 5.  ADDITIONAL RENT/EXPENSE STOP/TAX STOP

Tenant shall pay as additional rent each year the amount, if any, by which the Tenant’s Share of Operating Costs during each Operating Year of the Lease Term (or portion thereof) exceeds the Base Operating Share.  For purposes of this Lease, “Base Operating Share” means an amount equal to the product of the Rentable Square Footage of the Premises multiplied by the Expense Stop, and “Tenant’s Share of Operating Costs” means an amount equal to the product of the Rentable Square Footage of the Premises multiplied by the actual per square foot Operating Costs for the Project during the applicable Operating Year of the Lease Term.  If the Lease Term begins or ends anytime other than the first or last day of an Operating Year, Operating Costs and the Tenant’s Share of Operating Costs thereof shall be prorated.  Prior to the end of each Operating Year, Landlord shall provide Tenant with a written statement of Landlord’s estimate of Operating Costs and Tenant’s Estimated Share of Operating Costs for the next succeeding Operating Year.  If the Estimated Share of Operating Costs exceeds the Base Operating Share, Tenant shall pay Landlord, concurrently with each payment of the Minimum Monthly Rent for the next Operating Year, an amount equal to one-twelfth (1/12) of the amount by which the Estimated Share of Operating Costs exceeds the Base Operating Share.  Landlord may, at any time, revise the Estimated Share of Operating Costs and adjust the required monthly payment accordingly.  Within ninety (90) days after the end of each Operating Year, or as soon thereafter as reasonably possible, Landlord shall provide Tenant with a statement showing Landlord’s actual Operating Costs and Tenant’s Share of the actual Operating Costs for the preceding Operating Year (the “Actual Share”).  If the Actual Share exceeds the Estimated Share paid by Tenant during that Operating Year, Tenant shall pay the excess at the time the next succeeding payment of Minimum Monthly Rent is payable (or within ten (10) days if the Lease Term has expired or been Terminated).  If the Actual Share is less than the Estimated Share of Operating Costs paid by Tenant, Landlord shall apply such excess to payments next falling due under this paragraph (or, at Tenant’s option, refund the same to Tenant or credit amounts due from Tenant if the Lease Term has expired or been terminated).  In the event the Building is not fully occupied during any Operating Year, an adjustment shall be made by Landlord in calculating the Operating Costs for such Operating Year so that the Operating Costs shall be adjusted to the amount that would have been incurred had the Building been fully occupied during such Operating Year.  For purposes of this Lease (a) “Operating Costs” means and includes all costs of management, maintenance, and operation of the Project not attributable to any other tenant, including but not limited to the costs of cleaning, repairs, utilities, air conditioning, heating, plumbing, elevator, parking, landscaping, insurance, and all other costs which can properly be 

5

considered operating expenses but excluding costs of property additions, alterations for tenants, leasing commissions, advertising, income taxes and administrative costs not specifically incurred in the management, maintenance and operation of the Project; and (b) “Operating Year” means a year beginning January 1 and ending December 31.  Tenants with leases expiring or Terminating prior to the end of the Operating Year shall be responsible for their portion of Operating Costs above the Base Operating Share based on Landlord’s estimate of Operating Costs.

Tenant shall also pay as additional rent each year the amount, if any, by which the Tenant’s Share of Taxes during each Operating Year of the Lease Term (or portion thereof) exceeds the Base Tax Share.  For purposes of this Lease, “Base Tax Share” means an amount equal to the product of the Rentable Square Footage of the Premises multiplied by the Tax Stop, and “Tenant’s Share of Taxes” means an amount equal to the product of the Rentable Square Footage of the Premises multiplied by the actual per square foot Taxes during the applicable Operating Year of the Lease Term.  If the Lease Term begins or ends anytime other than the first or last day of an Operating Year, Taxes and the Tenant’s Share of Taxes shall be prorated.  Prior to the end of each Operating Year, Landlord shall provide Tenant with a written statement of Landlord’s estimate of Taxes and Tenant’s Estimated Share of Taxes for the next succeeding Operating Year.  If the Estimated Share of Taxes exceeds the Base Tax Share, Tenant shall pay Landlord, concurrently with each payment of the Minimum Monthly Rent for the next Operating Year, an amount equal to one-twelfth (1/12) of the amount by which the Estimated Share of Taxes exceeds the Base Tax Share.  Landlord may, at any time, revise the Estimated Share of Taxes and adjust the required monthly payment accordingly.  Within ninety (90) days after the end of each Operating Year, or as soon thereafter as reasonably possible, Landlord shall provide Tenant with a statement showing Landlord’s actual Taxes and Tenant’s Share of the actual Taxes for the preceding Operating Year (the “Actual Tax Share”).  If the Actual Tax Share exceeds the Estimated Share of Taxes paid by Tenant during that Operating Year, Tenant shall pay the excess at the time the next succeeding payment of Minimum Monthly Rent is payable (or within ten (10) days if the Lease Term has expired or been Terminated).  If the Actual Tax Share is less than the Estimated Share of Taxes paid by Tenant, Landlord shall apply such excess to payments next falling due under this Article (or refund the same to Tenant or credit amounts due from Tenant if the Lease Term has expired or been Terminated).  Taxes means all real estate taxes and assessments (including, without limitation, assessments for public improvements or benefits and water and sewer use charges), and other charges or fees in the nature of taxes for municipal services which at any time during or in respect of the Lease Term may be assessed, levied, confirmed or imposed on or in respect of, or be a hen upon, the Project, or any part thereof, or any rent therefrom or any estate, right, or interest therein, or any occupancy, use, or possession of such property or any part thereof, and ad valorem taxes for any personal property used in connection with the Project.  Without limiting the foregoing, Taxes shall also include any payments made by Landlord in lieu of taxes and all business improvement district payments.  Landlord agrees that Tenant’s share of any special assessment shall be determined (whether or not Landlord avails itself of the privilege so to do) as if Landlord had elected to pay the same in installments over the longest period of time permitted by applicable law and Tenant shall be responsible only for those installments (including interest accruing and payable thereon) or parts of installment that are attributable to periods within the Lease Term.

6

Article 6.  PARKING

So long as Tenant shall not be in default under this Lease beyond the expiration of applicable notice and cure periods, Tenant shall have the right to use three (3) parking spaces in the Automobile Parking Areas on an unreserved, unassigned basis, in common with other tenants of the Building.  Tenant shall pay to Landlord each month with the payment of Minimum Annual Rent the then monthly parking charge (currently $250 per space per month) set by Landlord, regardless of whether Tenant or any invitees, employees or contractors of Tenant actually use such spaces, for each of the three (3) parking spaces (the “Parking Charges”).  Such rate shall be subject to change by Landlord during the Lease Term.  Tenant shall be responsible for causing its visitors to park only in spaces or areas marked “Visitor parking” and Tenant and its employees shall not park in spaces or areas marked “Visitor-Parking” or ‘‘No parking”.  Landlord reserves the right to tow any cars parked in “Visitor Parking” or ‘‘No Parking” areas at the sole expense of the owner of the improperly parked car.  Landlord reserves the right to designate reserved parking spaces for the Building’s tenants.  Nothing contained herein shall be deemed to create liability upon Landlord for any damage to motor vehicles of Tenant’s Permittees, or from loss of property from within such motor vehicles while parked in the Automobile Parking Areas.  Landlord has the right to enforce against all users of the Automobile Parking Areas the rules and regulations set forth on Exhibit C (the “Parking Rules and Regulations”), as the same may be amended by Landlord from time to time.

Article 7.  PERSONAL PROPERTY TAXES

Tenant shall pay, prior to delinquency, all taxes levied upon fixtures, furnishings, equipment, and personal property placed on the Premises by Tenant.

Article 8.  PAYMENT OF RENT/LATE CHARGES/INTEREST ON PAST-DUE OBLIGATIONS

Tenant shall pay the rent and all other charges specified in this Lease to Landlord at the address set forth on Section 1.1 of this Lease, or to another person and at another address as Landlord from time to time designates in writing.  All monetary obligations of Tenant, including Minimum Monthly Rent, additional rent, or other charges payable by Tenant to Landlord under the Terms of this Lease shall be deemed “Rent”, and any Rent not received within ten (10) days after the due date (the “Delinquency Date”) thereof shall automatically (and without notice) incur a late charge of five percent (5%) of the delinquent amount.  Except as otherwise provided herein, any Rent due to Landlord not paid when due shall bear interest, from the date due, at the maximum rate then allowable by law or judgments.  Any such late charge and interest shall be payable as additional rent under this Lease, shall not be considered a waiver by Landlord of any default by  Tenant hereunder, and shall be payable immediately on demand; provided, however, that interest shall not be payable on late charges incurred by Tenant.

Article 9.  SECURITY DEPOSIT

Tenant shall, upon execution of this Lease, deposit with Landlord the Security Deposit, as security for the performance of terms and provisions of this Lease by Tenant, which shall be returned to Tenant within thirty (30) days following the date on which this Lease expires or 

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Terminates so long as Tenant is not in default under this Lease.  No interest shall accrue on the Security Deposit, and same shall not be held in a segregated account, unless required by applicable law.  The Security Deposit shall not be used to pay the last month’s lease payment.

At Tenant’s election, the Security Deposit may be provided to Landlord in the form of a clean, irrevocable, non-documentary and unconditional letter of credit (the “Letter of Credit”) issued by and drawable upon any commercial bank satisfactory to Landlord, trust company, national banking association or savings and loan association (the “Issuing Bank”).  A current list of Issuing Banks satisfactory to Landlord is attached to this Lease as Exhibit H.  Landlord reserves the right to amend from time to time the list of issuing Banks that are satisfactory to Landlord.  Such Letter of Credit shall (a) name Landlord as beneficiary, (b) be in the amount of the Security Deposit, (c) have a Term of not less than one year, (d) permit multiple drawings, (e) be fully transferable by Landlord without the payment of any fees or charges by Landlord, and (f) otherwise be in form and content reasonably satisfactory to Landlord.  If upon any transfer of the Letter of Credit, any fees or charges shall be so imposed, then such fees or charges shall be payable solely by Tenant.  The Letter of Credit shall provide that it shall be deemed automatically renewed, without amendment, for consecutive periods of one year each thereafter during the Term unless the Issuing Bank sends a notice (the “Non-Renewal Notice”) to Landlord by certified mail, return receipt requested, not less than forty-five (45) days next preceding the then expiration date of the Letter of Credit stating that the Issuing Bank has elected not to renew the Letter of Credit.  Landlord shall have the right, upon receipt of the Non­ Renewal Notice, to draw the full amount of the Letter of Credit, by sight draft on the Issuing Bank, and shall thereafter hold or apply the cash proceeds of the Letter of Credit pursuant to the Terms of this Article 9 until Tenant provides a suitable substitute Letter of Credit.  The Issuing Bank shall agree with all drawers, endorsers and bona fide holders that drafts drawn under and in compliance with the Terms of the Letter of Credit will be duly honored upon presentation to the Issuing Bank at an office location in Boston or New York or another location acceptable to Landlord.  The Letter of Credit shall be subject in all respects to the Uniform Customs and Practice for Documentary Credits (1993 revision), International Chamber of Commerce Publication No.  500.

While an Event of Default is continuing, Landlord may notify the Issuing Bank and thereupon receive all or a portion of the Security Deposit represented by the Letter of Credit and use, apply, or retain the whole or any part of such proceeds, as the case may be, to the extent required for the payment of any rent or any other sums as to which there is an Event of Default by Tenant including (a) any sum which Landlord may expend or may be required to expend by reason of an Event of Default by Tenant, and/or (b) any damages or deficiency to which Landlord is entitled pursuant to this Lease or applicable legal requirements, whether such damages or deficiency accrues before or after summary proceedings or other reentry by Landlord.  If Landlord applies or retains any part of the Security Deposit as provided above, Tenant, upon demand, shall deposit with Landlord the amount so applied or retained so that Landlord shall have the full Security Deposit on hand at all times during the Term.

Upon a sale of the Project or any financing of Landlord’s interest therein, Landlord shall transfer the Letter of Credit to the vendee or lender (if required by such lender).  With respect to the Letter of Credit, within seven (7) business days after notice of such sale or financing, Tenant, at its sole cost (except as otherwise provided above), shall arrange for the transfer of the Letter of 

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Credit to the new landlord or the lender (if required by such lender), as designated by Landlord in the foregoing notice or have the Letter of Credit reissued in the name of the new landlord or the lender upon receipt from Landlord of the original Letter of Credit.  Provided that such Letter of Credit is transferred to the new landlord or lender, Tenant shall look solely to the new landlord or lender for the return of such Letter of Credit and the provisions hereof shall apply to every transfer or assignment made of the Security Deposit to a new landlord.  Tenant shall not assign or encumber or attempt to assign or encumber the Letter of Credit and neither Landlord nor its successors or assigns shall be bound by any such action or attempted assignment or encumbrance.

Provided that (a) Tenant’s Total Stockholder’s equity shown on its then most recent 10-Q filing shall be at least $34,849,000.00 on the effective date of such reduction and (b) there have been no Event of Default under the Lease through the effective date of such reduction, Tenant may reduce the Letter of Credit, effective as of the first day of the nineteenth (19th) full calendar month of the Lease Term, to $73,365.32 by providing to Landlord an amendment to the Letter of Credit or a replacement Letter of Credit meeting the provisions of this Article 9 and reflecting such $73,365.32 amount on or before the first day of the twenty-first (21st) full calendar month of the Lease Term.

Provided that (a) the Letter of Credit shall have been previously reduced under the prior paragraph, (b) Total Stockholder’s equity shown on its then most 10-Q filing shall be at least $34,849,000.00 on the effective date of such reduction and (c) there have been no Event of Default under the Lease through the effective date of such reduction, Tenant may reduce the Letter of Credit, effective as of the first day of the thirty-seventh (37th) full calendar month of the Lease Term, to $55,239.99 by providing to Landlord an amendment to the Letter of Credit or a replacement Letter of Credit meeting the provisions of this Article 9 and reflecting such $55,239.99 amount on or before the first day of the thirty-ninth (39th) full calendar month of the Lease Term.

Article 10.  CONSTRUCTION OF THE PREMISES

Landlord shall construct the Tenant Improvements in accordance with Exhibit D attached hereto.  Except for the Tenant Improvements, Tenant accepts the Premises in their “as is” condition on the date that this Lease is executed.  Prior to the Commencement Date, any work performed by Tenant or any fixtures or personal property moved onto the Premises shall be at Tenant’s own risk, Tenant’s entry onto the Premises shall be subject to all provisions of this Lease (other than the payment of Minimum Monthly Rent and additional rent) and neither Landlord nor Landlord’s agents or contractors shall be responsible to Tenant for damage or destruction of Tenant’s property.

Article 11.  ALTERATIONS

After completion of Landlord’s performance of the Tenant Improvements pursuant to Exhibit D, Tenant shall not make or cause to be made any further additions, alterations, improvements, Utility Installations or repairs in, on or about the Premises, the Building or the Project without the prior written consent of Landlord.  As used in this Article, the term “Utility Installation” shall mean carpeting, window and wall coverings, power panels, electrical 

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distribution systems, lighting fixtures, air conditioning, plumbing, and telephone and telecommunication wiring and equipment.  At the expiration of the term, Landlord may require the removal of any and all of said additions, alterations, improvements or Utility Installations, and the restoration of the Premises, Building and Project to their prior condition, at Tenant’s expense.  Should Landlord permit Tenant to make its own additions, alterations, improvements or Utility Installations, Tenant may only use such contractor as has been expressly approved by Landlord, and Landlord may require Tenant to provide Landlord, at Tenant’s sole cost and expense, a lien and completion bond in an amount equal to one and one-half times the estimated cost of such improvements, to insure Landlord against any liability for mechanic’s and materialmen’s liens and to insure completion of the work.  Should Tenant make any additions, alterations, improvements or Utility Installations without the prior approval of Landlord, or use a contractor not expressly approved by Landlord, Landlord may, at any time during the Lease Term, require that Tenant remove any part or all of the same.  All additions, alterations, improvements and Utility Installations (whether or not such Utility Installations constitute trade fixtures of Tenant), which may be made to the Premises by Tenant, including but not limited to, floor coverings, panelings, doors, drapes, built-ins, moldings, sound attenuation, and lighting and telephone or communication systems, conduit, wiring and outlets, shall be made and done in a good and workmanlike manner, in compliance with the Contractor Rules and Regulations set forth in Exhibit D-1 and the Energy and Sustainability Construction Guidelines and Requirements set forth in Exhibit D-2, and of good and  sufficient quality and materials and shall be the property of Landlord and remain upon and be surrendered with the Premises at the expiration of the Lease Term, unless Landlord requires their removal as described above.  Provided Tenant is not in default, notwithstanding the provisions of this Article, Tenant’s personal property and equipment, other than that which is affixed to the Premises so that it cannot be removed without material damage to the Premises or Building or Project, and other than Utility Installations, shall remain the property of Tenant and may be removed by Tenant as provided herein.  Tenant shall provide Landlord with as-built plans and specifications for any additions, alterations, improvements or Utility Installations.  All voice, data, video, audio and other low voltage control transport system cabling and/or cable bundles installed in the Building by Tenant or its contractor shall be (A) plenum rated and/or have a composition makeup suited for its environmental  use in accordance with NFPA 70/National Electrical Code (B) labeled every 3 meters with the Tenant’s name and origination and destination points; (C) installed in accordance with all EIA/TIA standards and the National Electric Code; and (D) installed and routed in accordance with a routing plan showing “as built” or “as installed” configurations of cable pathways, outlet identification numbers, locations of all wall, ceiling and floor penetrations, riser cable routing and conduit routing (if applicable), and such other information as Landlord may request.  The routing plan shall be available to Landlord and its agents at the Building upon request.  Notwithstanding anything set forth herein to the contrary, subject to Tenant’s adherence to the above provisions of this Article 11 and Section 17.4, Tenant shall be permitted to make cosmetic, non-structural alterations to the Premises in an amount of $20,000 or less per Lease Year without having to obtain Landlord’s prior approval or submit plans to Landlord.

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Article 12.  PERSONAL PROPERTY/SURRENDER OF PREMISES

All personal property located in the Premises shall remain the property of Tenant and may be removed by Tenant not later than the expiration or the earlier termination of the Lease Term.  Tenant shall promptly repair, at its own expense, any damage resulting from such removal.  All cabinetry, built-in appliances, wall coverings, floor coverings, window coverings, electrical fixtures, plumbing fixtures, conduits, lighting, and other special fixtures that may be placed upon, installed in, or attached to the Premises by Tenant shall, at the termination of this Lease be the property of Landlord unless Landlord requires its removal as set forth in Article 11.  At the expiration or upon the earlier termination of this Lease Term, Tenant shall surrender the Premises in good condition, reasonable wear and tear excepted, and shall deliver all keys to Landlord.

Article 13.  LIENS

Tenant shall keep the Premises, Building, and the Project free from any liens arising out of work performed, material furnished, or obligations incurred due to the actions of Tenant or Tenant’s Permittees or the failure of Tenant to comply with any law.  In the event any such lien does attach against the Premises, Building, or Project, and Tenant does not discharge the lien or post bond (which under law would prevent foreclosure or execution under the lien) within ten (10) days after demand by Landlord, such event shall be a default by Tenant under this Lease and, in addition to Landlord’s other rights and remedies, Landlord may take any action necessary to discharge the lien at Tenant’s expense.

Article 14.  USE OF PREMISES/RULES AND REGULATIONS

14.1Without the prior approval of Landlord, Tenant shall not use the Premises for any use other than for general business office purposes (the “Permitted Use”) and Tenant agrees that it will use the Premises in such manner as to not interfere with or infringe on the rights of other tenants in the Building or Project.  Tenant agrees to comply with all applicable laws, ordinances and regulations in connection with its use of the Premises, agrees to keep the Premises in a clean and sanitary condition, and agrees not to perform any act in the Building which would increase any insurance premiums related to the Building or Project or would cause the cancellation of any insurance policies related to the Building or Project.  Tenant shall not use, generate, manufacture, store, or dispose of, in, under, or about the Premises, the Building, the or the Project or transport to or from the Premises, the Building, the or the Project, any Hazardous Materials.  For purposes of this Lease, “Hazardous Materials” includes, but is not limited to: (i) flammable, explosive, or radioactive materials, hazardous wastes, toxic substances, or related materials; (ii) all substances defined as “hazardous substances,” “hazardous materials,” “toxic substances,” or “hazardous chemical substances or mixtures” in the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601, et seq., as amended by Superfund Amendments and Re-authorization Act of 1986; the Hazardous Materials Transportation Act, 49 U.S.C. § 1901, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. §  6901, et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq.; (iii) those substances listed in the United States Department of Transportation Table (49 CFR 172.10 and amendments thereto) or by the Environmental Protection Agency (or any successor agent) as hazardous substances (40 CFR Part 302 and amendments thereto); (iv) any material, waste, or substance which is 

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(A) petroleum, (B) asbestos, (C) polychlorinated biphenyl’s, (D) designated as a “hazardous substance” pursuant to § 311 of the Clean Water Act, 33 U.S.C. § 1251 et seq.  (33 U.S.C. § 1321) or listed pursuant to the Clean Water Act (33 U.S.C. § 1317); (E) flammable explosives; or (F) radioactive materials; and (v) all substances defined as “hazardous wastes” in the statutes of the state in which the Premises are located (the “State”).

14.2Tenant shall comply with the rules and regulations of the Building which are attached hereto as Exhibit B.  Landlord may, from time to time, change such rules and regulations for the safety, care, or cleanliness of the Building and related facilities, provided that such changes are communicated to Tenant in writing, are applicable to all tenants of the Building, will not unreasonably interfere with Tenant’s use of the Premises and are enforced by Landlord in a non-discriminatory manner.  Tenant shall be responsible for the compliance with such rules and regulations by any assignees claiming by, through, or under Tenant; any subtenants claiming by, through, or under Tenant; and any of their respective agents, contractors, employees, and invitees.  Tenant shall not use or operate the Premises in any manner that will cause the Building or any part thereof not to conform with Landlord’s Sustainability Initiative or certification of the Building in accordance with the Green Certification, as may be determined by Landlord.  Tenant agrees to comply with and cooperate with Landlord ‘s efforts to comply with energy efficiency, green building and/or carbon reduction laws, including without limitation occupant, water, energy and transportation surveys within the city, country, state or any other jurisdiction.  In the event of a conflict between the Terms of this Lease and any rules or regulations adopted by Landlord (including, but not limited to, those set forth in Exhibit B, the Terms of this Lease shall prevail.

14.3Tenant covenants and agrees, at its sole cost and expense: (i) to comply with all present and future laws, orders and regulations of the Federal, State, county, municipal or other governing authorities, departments, commissions, agencies and boards regarding the collection, sorting, separation, and recycling of garbage, trash, rubbish and other refuse (collectively, “trash”); (ii) to comply with  Landlord’s recycling policy as part of Landlord’s Sustainability Initiative (defined below) where it may be more stringent than applicable Law; (iii) to sort and separate its trash and recycling into such categories as are provided by Law or Landlord’s Sustainability Initiative; (iv) that each separately sorted category of trash and recycling sha11 be placed in separate receptacles as directed by Landlord; (v) that Landlord reserves the right to refuse to collect or accept from Tenant any waste that is not separated and sorted as required by Law, and to require Tenant to arrange for such collection at Tenant’s sole cost and expense, utilizing a contractor satisfactory to Landlord; and (vi) that Tenant shall pay all costs, expenses, fines, penalties or damages that may be imposed on Landlord or Tenant by reason of Tenant’s failure to comply with the provisions of this Section.  Tenant shall provide Landlord as reasonably requested and no less than annually with copy of waste manifests for all waste that leaves the Building that is within Tenant’s direct control, including but not limited to off-site paper shredding and electronic waste.

14.4Tenant acknowledges that Landlord may elect, in Landlord’s sole discretion, to implement energy efficient and environmentally sustainable practices (collectively, the “Sustainability Initiative”) and, in furtherance of same may pursue an environmental sustainability monitoring and certification program such as Energy Star, Green Globes-CIEB, LEED, or similar programs (“Green Certification”).  Tenant acknowledges that in 

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order to further its Sustainability Initiative or pursue Green Certification, Landlord may be required to provide information, including a copy of this Lease (redacted if necessary to remove confidential information)  and historical and current data regarding energy use, materials, procedures and systems operation within the Project, Building and/or Premises to the Green Building Certification Institute (“GBCI”) or to another certification body or agency, in order to demonstrate compliance with various program requirements.  Tenant agrees that throughout the Lease Term: (i) Landlord may furnish a copy of this Lease (redacted as necessary) and other information provided from Tenant to Landlord as reasonably necessary to comply with Green Certification requirements; (ii) Tenant shall cooperate in good faith to maintain and provide Landlord with historical and current data regarding energy use, materials, procedures and systems operation by Tenant or within the Premises as Landlord shall reasonably require in order to meet the Sustainability Initiative, including without limitation documentation Tenant (or its consultant or contractor) has or may submit to obtain a “Green Certification” for the Premises; and (iii) Tenant shall cooperate with Landlord and comply with the Sustainability standards including, without limitation, all monitoring and data collection, maintenance, access, documentation and reporting requirements set forth therein.  Tenant will make available to Landlord, upon Landlord’s request, any information in Tenant’s possession or control concerning matters necessary or desirable in its efforts to obtain or maintain Green Certification.  Landlord’s Sustainability Initiative may include, without limitation, matters addressing operations and maintenance, including, without limiting:  chemical use; indoor air quality; energy efficiency; water efficiency; recycling programs; exterior maintenance programs; and systems upgrades to meet green building energy, water, indoor air quality, and lighting performance standards.  Tenant’s construction and maintenance methods and procedures, material purchases, and disposal of waste shall be in compliance with minimum standards and specifications of Landlord’s Sustainability Initiative as Landlord may establish from time to time, in addition to all applicable Laws.  Tenant shall use proven energy and carbon reduction measures, including energy efficient bulbs in task lighting; use of lighting controls; daylighting measures to avoid overlighting interior spaces; closing shades on the South side of the Building to avoid over heating the space; turning off lights and equipment at the end of the work day; and purchasing  ENERGY STAR® qua1ified equipment, including but not limited to lighting, office equipment, commercial and residential quality kitchen equipment, vending and ice machines; and/or purchasing products certified by the U.S. EPA’s Water Sense® program.  Before closing and leaving the Premises at any time, Tenant shall use reasonable efforts to turn off all lights, electrical appliances and mechanical equipment that are not otherwise required to remain on.  The use of space heaters is prohibited.

Article 15.  RIGHTS RESERVED BY LANDLORD

In addition to all other rights, Landlord has the following rights, exercisable without notice to Tenant and without effecting an eviction, constructive or actual, and without giving right to any claim for set off or abatement of rent:  (a) to decorate and to make repairs, alterations, additions, changes, or improvements in and about the Building during Building Business Hours (b) to approve the weight, size, and location of heavy objects in and about the Premises and the Building, and to require all such items to be moved into and out of the Building and Premises in such manner as Landlord shall direct in writing; (c) to prohibit the placing of vending machines in or about the Premises without the prior written consent of Landlord; (d) to take all such reasonable measures for the security of the Building and its occupants (provided 

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that Landlord shall have no obligation to provide any such security unless required by law); (e) to relocate the Premises to another location of substantially equivalent size in the Building provided such relocation does not increase the Minimum Monthly Rent or other costs payable by Tenant under this Lease.  If Landlord elects to move Tenant, the suite into which Tenant is re-located shall have substantially similar leasehold improvements as were in the original Premises and Landlord will pay Tenant’s reasonable costs of moving to the new location, including incidental costs such as reprinting existing stock of stationery and new signage, but Landlord will have no other liability to Tenant with respect to relocation and (f) to temporarily block off parking spaces for maintenance or construction purposes.

Article 16.  QUIET ENJOYMENT

Landlord agrees that, provided a default by Tenant has not occurred, Landlord will do nothing that will prevent Tenant from quietly enjoying and occupying the Premises during the Lease Term.  Tenant agrees this Lease is subordinate to the Rules and Regulations described in Article 14 and the Parking Rules and Regulations described in Article 6.  Except in cases of emergency, scheduled Building maintenance shut-downs and subject to Landlord’s after-hours procedures, Tenant and its personnel shall have access to the Premises 24 hours per day, 7 days per week and 365 days per Lease Year.

Article 17.  MAINTENANCE AND REPAIR

17.1Landlord shall, subject to reimbursement for Operating Costs, keep and maintain in good repair and working order, subject to reasonable wear and tear:  (1) structural elements of the Building; (2) standard mechanical (including HVAC), electrical, plumbing and fire/life safety systems serving the Building generally, together with air filters provided by Landlord for the HVAC serving the Premises, if any and standard light fixtures provided by Landlord to the Premises, if any; (3) Common Areas; (4) the roof of the Building; (5) exterior windows of the Building; and (6) elevators serving the Building, reasonable wear and tear excepted.  Tenant shall give immediate written notice of any required repairs to Landlord and Landlord shall have a reasonable time after receipt by Landlord of such written notice in which to make such repairs.  LANDLORD SHALL NOT BE LIABLE TO TENANT FOR ANY INTERRUPTION OF TENANT’S BUSINESS OR INCONVENIENCE CAUSED DUE TO ANY WORK PERFORMED IN THE PREMISES OR IN THE PROJECT PURSUANT TO LANDLORD’S RIGHTS AND OBLIGATIONS UNDER THIS LEASE.  TO THE EXTENT ALLOWED BY LAW, TENANT WAIVES THE RIGHT TO MAKE REPAIRS AT LANDLORD’S EXPENSE.  If Landlord would be required to perform any maintenance or make any repairs because of: (a) modifications to the roof, walls, foundation, and floor of the Building from that set forth in Landlord’s plans and specifications which are required by Tenant’s design for improvements, alterations and additions; (b) installation of Tenant’s improvements, fixtures, or equipment; (c) a negligent or wrongful act of Tenant or Tenant’s Permittees; or, (d) Tenant’s failure to perform any of Tenant’s obligations under this Lease, Landlord may perform the maintenance or repairs and Tenant shall pay Landlord the cost thereof.

17.2Tenant agrees to: (a) pay Landlord’s cost of maintenance and repair, including additional janitorial costs of any non-Building standard improvements and non-Building standard materials and finishes and (b) repair or replace all ceiling and wall finishes (including painting) and floor 

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or window coverings which require repair or replacement during the Lease Term, at Tenant’s sole cost; (c) at Tenant’s sole cost, maintain and repair interior partitions; doors; electronic, phone and data cabling and related equipment that is installed by or for the benefit of Tenant and located in the Premises or other portions of the Building or Project; supplemental air conditioning units, private showers and kitchens, including hot water heaters, plumbing, dishwashers, ice machines and similar facilities serving Tenant exclusively; phone rooms used exclusively by Tenant; alterations performed by contractors retained by or on behalf of Tenant; and all of Tenant’s furnishings, trade fixtures, equipment and inventory; and (d) Tenant shall adopt and implement the moisture and mold control guidelines set forth on Exhibit F attached hereto.

17.3Notwithstanding anything in this Lease to the contrary, to the extent the Terms and provisions of Article 22 conflict with, or are inconsistent with, the terms and provisions of this Article 17, the Terms and provisions of Article 22 shall control.  Tenant shall take all reasonable precautions to insure that the Premises are not subjected to excessive wear and tear, i.e. chair pads should be utilized by Tenant to protect carpeting.  Tenant shall be responsible for touch-up painting in the Premises throughout the Lease Term.

17.4All alterations and repairs by Tenant shall be performed only by contractors and subcontractors approved in writing by Landlord.  Tenant shall cause all contractors and subcontractors to procure and maintain insurance coverage against such risks, in such amounts, and with such companies as Landlord may reasonably require, but in no event less than: (i) Commercial General Liability insurance on an occurrence basis in amounts not less than $5,000,000 ($1,000,000 of which may be in excess umbrella coverage) naming Landlord, Landlord’s property management company and Invesco Advisers, Inc. (“Invesco”) as additional insureds; (ii) workers’ compensation insurance in amounts required by statute; and (iii) Business Automobile Liability insurance on an occurrence basis in amounts not less than $1,000,000.  Tenant shall provide Landlord with insurance certificates for such contractors and subcontractors prior to commencement of any work.  Tenant shall provide Landlord with the identities, mailing addresses and telephone numbers of all persons performing work or supplying materials prior to beginning such construction and Landlord may post on and about the Premises notices of non-responsibility pursuant to applicable laws.  All such work shall be performed in accordance with all laws and in a good and workmanlike manner so as not to damage the Building (including the Premises, the Building’s structure and the Building’s systems).  All such work which may affect the Building’s structure or the Building’s systems, at Landlord’s election, must be performed by Landlord’s usual contractor for such work or a contractor approved by Landlord.  All work affecting the roof of the Building must be performed by Landlord’s roofing contractor or a contractor approved by Landlord and no such work will be permitted if it would void or reduce the warranty on the roof.

Article 18.  UTILITIES AND JANITORIAL SERVICES

Landlord agrees to furnish through Landlord’s employees or independent contractors, the Building services listed in Exhibit G.  If Tenant shall require electric current, water, heating, cooling, or air which will result in excess consumption of such utilities or services, Tenant shall first obtain the written consent of Landlord to the use thereof.  If, in Landlord’s reasonable discretion, Tenant consumes any utilities or services in excess of the normal consumption of 

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such utilities and services for general office use, Tenant agrees to pay Landlord for the cost of such excess consumption of utilities or services, upon receipt of a statement of such costs from Landlord, at the same time as payment of the Minimum Monthly Rent is made.  Landlord shall have the right to install separate electrical meters, at Landlord’s expense, to measure excess consumption or establish another basis for determining the amount of excess consumption of electrical current.  Further, Landlord shall have the right to install electronic HVAC over-time hour meters for Tenant’s convenience.  These meters shall be used, in part, by Landlord to determine Tenant’s excess HVAC consumption for purposes of billing Tenant for such excess charges.  If Tenant desires HVAC at a time other than normal Building Business Hours as defined in Section 1.1:  (i) Tenant shall give Landlord such prior notice as Landlord shall from time to time establish as appropriate of Tenant’s desired use; (ii) Landlord shall supply such after-hours HVAC to Tenant at such hourly costs to Tenant as Landlord shall from time to time establish; and (iii) Tenant shall pay such cost within ten (10) days after billing.  Notwithstanding the foregoing, as an energy conservation measure, Landlord will not run heating and air conditioning equipment serving the Premises on Saturdays unless requested by Tenant (provided that Tenant shall not be charged for such Saturday service unless it is outside of Building Business Hours).  The costs incurred by Landlord in providing HVAC service to Tenant at a time other than Building Business Hours, shall include costs for electricity, water, sewage, water treatment, labor, metering, filtering, and maintenance reasonably allocated by Landlord to providing such service.  Landlord shall not be liable for damages nor shall rent or other charges abate in the event of any failure or interruption of any utility or service supplied to the Premises, Building or Project by a regulated utility or municipality, or any failure of a Building system supplying any such service to the Premises (provided Landlord uses diligent efforts to repair or restore the same) and no such failure or interruption shall entitle Tenant to abate rent or Terminate this Lease.

Landlord shall have the right to install on-site power (i.e., solar or small wind) at the Building or Project.  Tenant agrees to cooperate with Landlord in connection with the installation and on-going operation of such on-site power.  Tenant shall have no right to any renewable energy credits resulting from on-site renewable energy generation, even if Tenant uses such energy.  Landlord may retain or assign such renewable energy credits in Landlord’s sole discretion.

Tenant shall within ten (10) days of request by Landlord provide consumption data in form reasonably required by Landlord: (i) for any utility billed directly to Tenant and any subtenant or licensee; and (ii) for any submetered or separately metered utility supplied to the Premises for which Landlord is not responsible for reading.  If Tenant utilizes separate services from those of Landlord, Tenant hereby consents to Landlord obtaining the information directly from such service providers and, upon ten (10) days prior written request, Tenant shall execute and deliver to Landlord and the service providers such written releases as the service providers may request evidencing Tenant’s consent to deliver the data to Landlord.  Any information provided hereunder shall be held confidential except for its limited use to evidence compliance with any sustainability standards.  If Tenant fails to deliver any release or to provide any information requested hereunder within the ten (10) day period, then Landlord may charge Tenant the sum of $100.00 per day for each day after the ten (10) day period until delivered (the “Late Reporting Fee”), in addition to any other rights or remedies afforded to Landlord for an Event of Default pursuant to Article 28 of this Lease.  A Tenant Party shall not use, nor allow 

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any of its parent, subsidiary or affiliated entities or architects, engineers, or other consultants or advisors to use, any of such consumption data or other information to challenge any sustainability score, rating, certification or other approval granted by any third party.

Tenant may not operate a Data Center within the Premises without the express written consent of Landlord.  The Term “Data Center” shall have the meaning set forth in the U.S. Environmental Protection Agency’s ENERGY STAR® program and is a space specifically designed and equipped to meet the needs of high-density computing equipment, such as server racks, used for data storage and processing.  The space will have dedicated, uninterruptible power supplies and cooling systems.  Data Center functions may include traditional enterprise services, on-demand enterprise services, high-performance computing, internet facilities and/or hosting facilities.  A Data Center does not include space within the Premises utilized as a “server closet” or for a computer training area.  In conjunction with the completion and operation of the Data Center approved by Landlord, Tenant shall furnish the following information to Landlord:

(a)Within ten (10) days of completion, Tenant shall report to Landlord the total gross floor area (in square feet) of the Data Center measured between the principal exterior surfaces of the enclosing fixed walls and including all supporting functions dedicated for use in the Data Center, such as any raised-floor computing space, server rack aisles, storage silos, control console areas, battery rooms, mechanical rooms for cooling equipment, administrative office areas, elevator shafts, stairways, break rooms and restrooms.  If Tenant alters or modifies the area of the Data Center approved by Landlord in its sole discretion, Tenant shall furnish an updated report to Landlord on the square footage within ten (10) days following completion of the alterations or modifications.

(b)Within ten (10) days following the close of each month of operation of the Data Center, monthly IT Energy Readings at the output of the Uninterruptible Power Supply (UPS), measured in total kWh utilized for the preceding month (as opposed to instantaneous power readings), failing which in addition to same being an Event of Default, Tenant shall be obligated to pay to Landlord the Late Reporting Fee.

Article 19.  ENTRY AND INSPECTION

Upon providing at least 24-hours advance written notice (except in cases of emergency and except in connection with the performance of Landlord’s cleaning and janitorial obligations), Landlord shall have the right to enter into the Premises at reasonable times for the purpose of inspecting the Premises and reserves the right, during the last three months of the Term of this Lease, to show the Premises at reasonable times to prospective tenants.  Except in cases of emergency and except in connection with the performance of Landlord’s cleaning and janitorial obligations, Tenant shall have the right to have one of its personnel accompany Landlord’s agents and any prospective tenants while on the Premises.  Landlord shall be permitted to take any action under this Article without causing any abatement of rent or liability to Tenant for any loss of occupation or quiet enjoyment of the Premises, nor shall such action by Landlord be deemed an actual or constructive eviction.

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Article 20.  INSURANCE

20.1Tenant’s Insurance.  All personal property and fixtures belonging to Tenant shall be placed and remain on the Premises at Tenant’s sole risk.  Effective as of the earlier of: (1) the date Tenant enters or occupies the Premises; or (2) the Commencement Date, and continuing throughout the Lease Term, Tenant shall maintain the following insurance policies:

(a)Commercial General Liability Insurance in amounts of no less than $5,000,000 per occurrence for bodily injury and property damage, $5,000,000 each person or organization for personal and advertising injury, $5,000,000 general aggregate, and $5,000,000 products and completed operations aggregate covering: (A) premises/operations liability,(B) personal and advertising injury liability, (C) independent contractors liability, and (D) broad form contractual liability. Such policy shall: (1) be primary and non­ contributory to any insurance or self insurance maintained by Tenant, Landlord, Landlord’s property management company and Invesco with respect to the use and occupancy of the Premises including all operations conducted thereon; (2) include severability of interests or cross liability provisions; (3) be endorsed to add Landlord, Landlord’s property management company, and Invesco Advisers, Inc. as additional insureds using Insurance Services Office (“ISO”) form CG 20 26 1185 or a substitute equivalent form approved in writing by Landlord; (4) include terrorism coverage up to the full per occurrence and aggregate limits available under the policy; and (5) insure other activities that the Landlord deems necessary, such as insurance for liquor liability.  Limits can be satisfied through the maintenance of a combination of primary and umbrella policies. Tenant may maintain such insurance on a multi-location basis provided that the aggregate limits or sublimits on each policy are dedicated to the Premises and thereby not subject to dilution by claims occurring at other locations. Tenant’s independent contractors liability coverage under clause (C) above shall cover the interest of Tenant (and Landlord, as additional insured) but not the interests of independent contractors. Tenant shall carry product liability insurance on a stand alone, claims made policy basis.

(b)Automobile Liability Insurance covering the ownership, maintenance, and operations of any automobile or automotive equipment, whether such auto is owned, hired, and non-owned.  Tenant shall maintain insurance with a combined single limit for bodily injury and property damage of not less than the equivalent of $1,000,000 per accident.  Limits can be satisfied through the maintenance of a combination of primary and umbrella policies.  Such insurance shall cover Tenant against claims for bodily injury, including death resulting therefrom, and damage to the property of others caused by accident regardless of whether such operations are performed by Tenant, Tenant’s agents, or by any one directly or indirectly employed by any of them.  Tenant’s automobile liability insurance shall be endorsed to add Landlord, Landlord’s property management company, and Invesco as additional insureds.

(c)Commercial Property  Insurance covering at full replacement cost value the following property in the Premises:  (A) inventory; (B) FF&E (unattached furniture, fixtures, and equipment); (C) alterations, improvements and betterments made by the Tenant including but not necessarily limited to all permanently attached  fixtures and equipment; and (D) any other property in which the Tenant retains the risk of loss including electronic data processing equipment, employee personal property or other property owned or leased by Tenant. Such property insurance shall include: (1) coverage against such perils as are commonly included in 

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the special causes of loss form, with no exclusions for wind and hail, vandalism and malicious mischief, and endorsed to add the perils of terrorism; (2) business income coverage providing for the full recovery of loss of rents and continuing expenses on an actual loss sustained basis for a period of not less than 12 months; (3) an “agreed amount” endorsement waiving any coinsurance requirements; and (4) a loss payable endorsement providing that Tenant, Landlord, and Landlord’s mortgagee shall be a loss payee on the policy with regard to the loss of rents coverage.  “Full replacement value,” as used herein, means the cost of repairing, replacing, or reinstating, including demolishing, any item of property, with materials of like kind and quality in compliance with, (and without, an exclusion pertaining to application of), any law or building ordinance regulating repair or construction at the time of loss and without deduction for physical, accounting, or any other depreciation, in an amount sufficient to meet the requirements of any applicable co-insurance clause and to prevent Tenant from being a co-insurer.

(d)Builders’ Risk Insurance on an “all risk” form that does not exclude the perils of flood, earthquake, and terrorism covering on a completed value basis all work incorporated in the Building and all materials and equipment in or about the Premises in connection with construction activities where Tenant notifies Landlord of its intent to undertake a substantial rebuild of the existing structure and Landlord determines that such coverage is necessary.  Limits and terms to coverage are to be determined by Landlord upon notification by Tenant.

(e)Workers Compensation Insurance covering statutory benefits in the state where the Premises is located.  This policy shall include “other states” insurance, so as to include all states not named on the declarations page of the insurance policy, except for the monopolistic states. Tenant is required to carry this insurance regardless of eligibility for waiver or exemption of coverage under any applicable state statute.  Such insurance shall include an employers liability coverage part with limits that shall be not less than $1,000,000 each accident for bodily injury by accident and $1,000,000 each employee and policy limit for bodily injury by disease.

(f)Such other insurance or any changes or endorsements to the insurance required herein, including increased limits of coverage, as Landlord, or any mortgagee or lessor of Landlord, may reasonably require from time to time.

Tenant’s commercial general liability insurance, automobile liability insurance and, all other insurance policies, where such policies permit coverage for Landlord as an additional insured, shall provide primary coverage to Landlord and shall not require contribution by any insurance maintained by Landlord, when any policy issued to Landlord provides duplicate or similar coverage, and in such circumstance Landlord’s policy will be excess over Tenant’s policy.  Tenant shall furnish to Landlord certificates of such insurance, and where applicable with an additional insured endorsement in form CG 20 26 1185 (or other equivalent form approved in writing by Landlord), and such other evidence satisfactory to Landlord of the maintenance of all insurance coverages required hereunder at least ten (10) days prior to the earlier of the Commencement Date or the date Tenant enters or occupies the Premises, and at least fifteen (15) days prior to each renewal of said insurance, and Tenant shall obtain a written obligation on the part of each insurance company to notify Landlord at least thirty (30) days before cancellation, non-renewal or a material change of any such insurance policies.  All such insurance policies shall be in form, and issued by companies licensed to do business in the state where the Premises is located, rated by AM Best as having a financial strength rating of “A-” or 

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better and a financial size category of “IX” or greater, or otherwise reasonably satisfactory to Landlord.  If Tenant fails to comply with the foregoing insurance requirements or to deliver to Landlord the certificates or evidence of coverage required herein, Landlord, in addition to any other remedy available pursuant to this Lease or otherwise, may, but shall not be obligated to, obtain such insurance and Tenant shall pay to Landlord on demand the premium costs thereof, plus an administrative fee of fifteen percent (15%) of such cost.  It is expressly understood and agreed that the foregoing minimum limits of liability and coverages required of Tenant’s insurance shall not reduce or limit the obligation of the Tenant to indemnify the Landlord as provided in this Lease.  All policies required herein shall use occurrence based forms.  Any and all of the premiums, deductibles and self-insured retentions associated with the policies providing the insurance coverage required herein shall be assumed by, for the account of, and at the sole risk of Tenant.  Deductibles or self-insured retentions may not exceed $10,000 without the prior written approval of Landlord.

20.2Landlord’s Insurance.  Throughout the Lease Term, Landlord shall maintain, as a minimum, the following insurance policies: (1) property insurance for the Building’s replacement value (excluding property required to be insured by Tenant, it being agreed that Landlord shall have no obligation to provide insurance for such property), less a commercially-reasonable deductible if Landlord so chooses; and (2) commercial general liability insurance in an amount of not less than $3,000,000 per occurrence for bodily injury and property damage, $3,000,000 each person or organization for personal and advertising injury, $3,000,000 general aggregate, and $3,000,000 products and completed operations aggregate.  Limits can be satisfied through the maintenance of a combination of primary and umbrella policies.  Landlord may, but is not obligated to, maintain such other insurance and additional coverages as it may deem necessary.  Tenant shall pay Tenant’s Share of the cost of all insurance carried by Landlord with respect to the Project.  The foregoing insurance policies and any other insurance carried by Landlord shall be for the sole benefit of Landlord and under Landlord’s sole control, and Tenant shall have no right or claim to any proceeds thereof or any other rights thereunder.

Article 21.  DAMAGE AND DESTRUCTION OF PREMISES

21.1If the Premises or the Building are damaged by fire or other casualty (a “Casualty”), Landlord shall use good faith efforts to deliver to Tenant within sixty (60) days after such Casualty a good faith estimate (the “Damage Notice”) of the time needed to repair the damage caused by such Casualty.

21.2If a material portion of the Premises is damaged by Casualty such that Tenant is prevented from conducting its business in the Premises in a manner reasonably comparable to that conducted immediately before such Casualty and Landlord estimates that the damage caused thereby cannot be repaired within one hundred eighty (180) days after the commencement of repairs (the “Repair Period”), then Tenant may Terminate this Lease by delivering written notice to Landlord of its election to terminate within thirty (30) days after the Damage Notice has been delivered to Tenant; provided however, the foregoing 180-day replacement period shall be reduced to 90 days during the last two (2) years of the Term.

21.3If a Casualty damages the Premises or a material portion of the Building and: (1) Landlord estimates that the damage to the Premises cannot be repaired within the Repair 

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Period; (2) the damage to the Premises exceeds fifty percent (50%) of the replacement cost thereof (excluding foundations and footings), as estimated by Landlord, and such damage occurs during the last two (2) years of the Term; (3) regardless of the extent of damage to the Premises, Landlord makes a good faith determination that restoring the Building would be uneconomical; or (4) Landlord is required to pay any insurance proceeds arising out of the Casualty to a Landlord’s mortgagee, then Landlord may terminate this Lease by giving written notice of its election to terminate within thirty (30) days after the Damage Notice has been delivered to Tenant.

21.4If neither party elects to terminate this Lease following a Casualty, then Landlord shall, within a reasonable time after such Casualty,  begin to repair the Premises and shall proceed with reasonable diligence to restore the Premises to substantially the same condition as they existed immediately before such Casualty; however, other than building standard leasehold improvements Landlord shall not be required to repair or replace any Alterations or betterments within the Premises (which shall be promptly and with due diligence repaired and restored by Tenant at Tenant’s sole cost and expense) or any furniture, equipment, trade fixtures or personal property of Tenant or others in the Premises or the Building, and Landlord’s obligation to repair or restore the Premises shall be limited to the extent of the insurance proceeds actually received by Landlord for the Casualty in question.  If this Lease is terminated under the provisions of this Article 21 Landlord shall be entitled to the full proceeds of the insurance policies providing coverage for all alterations, improvements and betterments in the Premises (and, if Tenant has failed to maintain insurance on such items as required by this Lease, Tenant shall pay Landlord an amount equal to the proceeds Landlord would have received had Tenant maintained insurance on such items as required by this Lease).

21.5If the Premises are damaged by Casualty, Rent for the portion of the Premises rendered untenantable by the damage shall be abated on a reasonable basis from the date of damage until the substantial completion of Landlord’s repairs (or until the date of termination of this Lease by Landlord or Tenant as provided above, as the case may be), unless Tenant or a Tenant Permittee caused such damage, in which case, Tenant shall continue to pay Minimum Monthly Rent and all other rent without abatement and Tenant shall be liable to Landlord for the cost and expense of the repair and restoration of the Premises or the Building caused thereby to the extent that costs and expense is not covered by insurance proceeds.

Article 22.  EMINENT DOMAIN

22.1If the entire Building or Premises are taken by right of eminent domain or conveyed in lieu thereof (a “Taking”), this Lease shall terminate as of the date of the Taking.

22.2If any part of the Building becomes subject to a Taking and such Taking will prevent Tenant from conducting its business in the Premises in a manner reasonably comparable to that conducted immediately before such Taking for a period of more than one hundred eighty (180) days, then Tenant may terminate this Lease as of the date of such Taking by giving written notice to Landlord within thirty (30) days after the Taking, and Rent shall be apportioned as of the date of such Taking.  If Tenant does not terminate this Lease, then Rent shall be abated on a reasonable basis as to that portion of the Premises rendered untenantable by the Taking.

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22.3If any material portion, but less than all, of the Building becomes subject to a Taking, or if Landlord is required to pay any of the proceeds arising from a Taking to a Landlord’s mortgagee, then Landlord may terminate this Lease by delivering written notice thereof to Tenant within thirty (30) days after such Taking, and Rent shall be apportioned as of the date of such Taking.  If Landlord does not so terminate this Lease, then this Lease will continue, but if any portion of the Premises has been taken, Rent shall abate as provided in Section 21.5.

22.4If any Taking occurs, then Landlord shall receive the entire award or other compensation for the Land, the Building, and other improvements taken; however, Tenant may separately pursue a claim (to the extent it will not reduce Landlord’s award) against the condemnor for the value of Tenant’s personal property which Tenant is entitled to remove under this Lease, moving costs, loss of business, and other claims it may have.

Article 23.  ASSIGNMENT AND SUBLETTING

Tenant agrees not to assign, mortgage, or pledge this Lease, and shall not sublet the Premises without Landlord’s prior written consent, which shall not be unreasonably withheld if Landlord does not elect to terminate this Lease as provided herein.  Without limitation, it is agreed that Landlord’s consent shall not be considered unreasonably withheld if: (1) the proposed transferee’s financial condition does not meet the criteria Landlord uses to select Building tenants having similar leasehold obligations; (2) the proposed transferee’s use is not suitable for the Building considering the business of the other tenants and the Building’s prestige, or would result in a violation of another tenant’s rights; (3) the proposed transferee 1s a governmental agency or occupant of the Project; (4) Tenant is in default after the expiration of the notice and cure periods in this Lease; (5) any portion of the Premises or Building would likely become subject to additional or different laws as a consequence of the proposed assignment or subletting or (6) the proposed use or operation in the Premises of the proposed assignee or subtenant may or will cause the Building or any part thereof not to conform with the environmental and green building clauses in this Lease.  Tenant shall not be entitled to receive any monetary damages based upon a claim that Landlord unreasonably withheld its consent to a proposed sublease or assignment and Tenant’s sole remedy shall be an action to enforce any provision through specific performance or declaratory judgment.  Any attempted sublease or assignment in violation of this Article shall, at Landlord’s option, be void.  Any assignment or subletting hereunder shall not release or discharge Tenant of or from any liability under this Lease, and Tenant shall continue to be fully liable thereunder.  As part of its request for Landlord’s consent to a sublease or assignment, Tenant shall provide Landlord with financial statements for the proposed transferee, a complete copy of the proposed sublease, assignment and other contractual documents and such other information as Landlord may reasonably request.  Landlord shall, by written notice to Tenant within twenty (20) days of its receipt of the required information and documentation, either: (1) consent to the sublease or assignment by the execution of a consent agreement in a form reasonably designated by Landlord or reasonably refuse to consent to the sublease or assignment in writing; or (2) if such request to assign or sublease covers forty percent (40%) or more of the Premises, exercise its right to terminate this Lease with respect to the portion of the Premises that Tenant is proposing to sublease or assign.  If Landlord does exercise the recapture right set forth herein, Tenant shall have three (3) business days to rescind its request for sublease or assignment and, provided such rescission is timely made, Landlord shall not have the right to recapture the portion of the Premises that had been the 

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subject of such request.  Provided Tenant does not timely rescind its request for sublease or assignment, any such Termination shall be effective on the proposed effective date the sublease or assignment for which Tenant requested consent.  If Tenant shall assign or sublet this Lease or request the consent of Landlord to any assignment or subletting or if Tenant shall request the consent of Landlord for any act Tenant proposes to do, then Tenant shall pay Landlord’s reasonable out-of-pocket costs and expenses incurred in connection therewith, including attorneys’, architects’, engineers’ or other consultants’ fees, which fee shall be no more than $3000.00.  Consent by Landlord to one assignment, subletting, occupation, or use by another person shall not be deemed to be consent to any subsequent assignment, subletting, occupation, or use by another person.  Tenant shall pay fifty percent (50%) of all rent and other payments which Tenant receives as a result of a sublease or assignment that is excess of the Rent payable to Landlord for the portion of the Premises and Lease Term covered by the sublease or assignment.  Tenant shall pay Landlord for Landlord’s share of any excess within thirty (30) days after Tenant’s receipt of such excess consideration.  Tenant may deduct from the excess all reasonable and customary expenses directly incurred by Tenant attributable to the sublease or assignment (other than Landlord’s costs and expenses), including brokerage fees, legal fees and construction costs.  Notwithstanding the foregoing, Tenant may assign or sublease the Premises without Landlord’s approval (a) to an affiliate or Tenant or (b) in connection with the sale or transfer of the business or assets to which this Lease relates (whether by merger, consolidation, stock sale, asset sale or otherwise) so long as such assignee or transferee has a tangible net worth of at least equal to the tangible net worth of Tenant either immediately before such transfer or as of the date of this Lease, whichever is greater; provided however that Tenant must provide Landlord with notice of such assignment or sublease pursuant to the foregoing clause (a) or clause (b) within ten (10) days after such action is taken.

Article 24.  SALE OF PREMISES BY LANDLORD

In the event of any sale of the Building or the property upon which the Building is located or any assignment of this Lease by Landlord (or a successor in title), the assignee or purchaser shall be deemed, without any further agreement between the parties, to have assumed and agreed to carry out any and all of the covenants and obligations of Landlord under this Lease, and shall be substituted as Landlord for all purposes from and after the sale or assignment: and Landlord (or such successor) shall automatically be entirely freed and relieved of all liability under any and all of Landlord’s covenants and obligations contained in this Lease or arising out of any act, occurrence, or omission occurring after such sale or assignment.

Article 25.  SUBORDINATION/ATIORNMENT/MODIFICATION/ASSIGNMENT

Tenant’s interest under this Lease is subordinate to all terms of and all liens and interests arising under any ground lease, deed of trust, or mortgage (each, as renewed, modified and/or extended from time to time) now or hereafter placed on the Landlord’s interest in the Premises, the Building, or the Project.  Tenant consents to an assignment of Landlord’s interest in this Lease to Landlord’s lender as required under such financing.  If the Premises or the Building is sold as a result of a default under the mortgage, or pursuant to a transfer in lieu of foreclosure, Tenant shall, at the mortgagee’s, purchaser’s or ground lessor’s sole election, attorn to the mortgagee or purchaser.  This Article is self-operative.  However, Tenant agrees to execute and deliver, if Landlord, any deed of trust holder, mortgagee, or purchaser should so request, such 

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further instruments necessary to subordinate this Lease to a lien of any mortgage or deed of trust, to acknowledge the consent to assignment and to affirm the attornment provisions set forth herein.

Article 26.  LANDLORD’S DEFAULT AND RIGHT TO CURE

Landlord shall not be in default unless Landlord fails to perform obligations required of Landlord within a reasonable time, but in no event later than thirty (30) days after written notice by Tenant to Landlord and to the holder of any first mortgage or deed of trust covering the Premises whose name and address shall have theretofore been furnished to Tenant in writing, specifying wherein Landlord has failed to perform such obligation; provided, however, that if the nature of Landlord’s obligation is such that more than thirty (30) days are required for performance then Landlord shall not be in default if Landlord commences performance within such thirty (30) day period and thereafter diligently pursues the same to completion.

Article 27.  ESTOPPEL CERTIFICATES

Tenant agrees at any time and from time to time upon request by Landlord, to execute, acknowledge, and deliver to Landlord, within ten (10) calendar days after demand by Landlord, a statement in writing certifying (a) that this Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating such modifications), (b) the dates to which the Minimum Monthly Rent and other rent and charges have been paid in advance, if any, (c) Tenant’s acceptance and possession of the Premises, (d) the commencement of the Lease Term, (e) the rent provided under this Lease, (f) that Landlord is not in default under this Lease (or if Tenant claims such default, the nature thereof), (g) that Tenant claims no offsets against the rent, and (h) such other information as may be requested with respect to the provisions of this Lease or the tenancy created by this Lease.  Tenant’s failure to deliver such statement within such time shall be conclusive upon Tenant (i) that this Lease is in full force and effect, without modification except as may be represented by Landlord, (ii) that there are no uncured defaults in Landlord’s performance, and (iii) that not more than one month’s rent has been paid in advance.

Article 28.  TENANT’S DEFAULT AND LANDLORD’ S REMEDIES

28.1Tenant will be in default under this Lease if any of the following occurs, and same shall be deemed an “Event of Default”:

(a)If Tenant fails to pay the Minimum Monthly Rent or make any other payment required by this Lease within three (3) Business Days after Landlord sends Tenant a written notice or demand for payment.

(b)If on two or more occasions in any twelve month period Landlord does not receive either Tenant’s regular monthly payment of Minimum Monthly Rent and other regularly recurring charges on or before the first Business Day of the month or any other payment on or before the date it is due.

(c)If Tenant assigns this Lease or mortgages its interest in this Lease or sublets any part of the Premises without first obtaining Landlord’s written consent, as required by Article 23.

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(d)If Tenant abandons the Premises, or ceases to operate its business on the Premises, or becomes bankrupt or insolvent, or makes any general assignment of all or a substantial part of its property for the benefit of creditors, or if a receiver is appointed to operate Tenant’s business or to take possession of all or a substantial part of Tenant’s property.

(e)If a lien attaches to this Lease or to Tenant’s interest in the Premises, and Tenant fails to post a bond or other security or to have the lien released within ten (10) days of its notification thereof, or if a mortgagee institutes proceedings to foreclose its mortgage against Tenant’s leasehold interest or other property and Tenant fails to have the foreclosure proceedings dismissed within ten (10) calendar days after the entry of any judgment or order declaring the mortgage to be valid and Tenant to be in default on the obligation secured thereby, or directing enforcement of the mortgage.

(f)If Tenant fails to maintain any of the insurance as required by this Lease within three (3) days after Landlord sends it written notice of the breach.

(g)If Tenant breaches any other provision of this Lease and fails to cure the breach within fifteen (15) days after Landlord sends it written notice of the breach, or if the breach cannot be cured within fifteen (15) days, then if Tenant does not proceed with reasonable diligence to cure the breach within such additional time as may be reasonably necessary under the circumstances, not to exceed sixty (60) days.

28.2If Tenant is in default, then Landlord may take any one or more of the following actions:

(a)Terminate this Lease by giving Tenant written notice thereof or by making entry thereon for the express purpose of terminating this Lease, and upon the delivery of such notice or the making of such entry this Lease shall terminate.

(b)Landlord may re-enter and take possession of all or any part of the Premises without committing a trespass or becoming liable for any loss or damage that may be occasioned thereby.  Except if expressly intended by Landlord as described in Section 28.2(a), re­ entry and possession of the Premises will not by themselves terminate this Lease.

(c)If Landlord shall have taken possession of the Premises, Landlord may remove any property, including fixtures, from the Premises and store the same at Tenant’s expense in a warehouse or any other location, or Landlord may lease the property on the Premises pending sale or other disposition.  If Landlord leaves the property on the Premises or stores it at another location owned or controlled by Landlord, then Landlord may charge Tenant a reasonable fee for storing and handling the property comparable to what Landlord would have had to pay to a third party for such services.  Landlord will not be liable under any circumstance to Tenant or to anyone else for any damage to the property.  Landlord may proceed to sell Tenant’s property, which shall be sold in accordance with the laws of the state ll1which the Premises are located.

(d)Landlord may collect any rents or other payments that become due from any subtenant, concessionaire or licensee, and may in its own name or in Tenant’s name bring suit for such amounts, and settle any claims therefore, without approving the Terms of the sublease or Tenant’s agreement with the concessionaire or licensee and without prejudice to Landlord’s 

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right to Terminate the sublease or agreement without cause and remove the subtenant, concessionaire or licensee from the Premises.

(e)If the Lease shall be Terminated due to Tenant’s default, Landlord shall use commercially reasonable efforts to relet the Premises but may relet the Premises at whatever rent and on whatever Terms and conditions it deems advisable.  The Term of any new lease may be shorter or longer than the remaining Term of this Lease.  In reletting the Premises, Landlord may make any alterations or repairs to the Premises it feels necessary or desirable; may subdivide the Premises into more than one unit and lease each portion separately; may sell Tenant’s improvements, fixtures and other property located on the Premises to the new tenant, or include such improvements, fixtures and property as part of the Premises without additional cost; may advertise the Premises for sale or lease; and may hire brokers or other agents.  Tenant will be liable to Landlord for all costs and expenses of the reletting including but not limited to rental concessions to the new tenant, broker’s commissions and tenant improvements, and will remain liable for the Minimum Monthly Rent and all other charges arising under this Lease, less any income received from the new tenant, unless this Lease is Terminated as set forth below.  In the event an existing tenant of the project is moved into the Premises, Tenant will be liable for the damages suffered by Landlord (as calculated herein) as the result of the vacancy of the premises occupied by the existing tenant.

(f)Landlord may recover from Tenant all costs and expenses Landlord incurs as a direct or indirect consequence of Tenant’s breach, including the cost of storing and selling Tenant’s property, reletting the Premises, and bringing suit against Tenant for possession or damages.  If Landlord made or paid for any improvements to the Premises, or granted Tenant any improvement allowance or credit against the Minimum Monthly Rent or other charges due hereunder for Tenant’s improvements, then Landlord shall also be entitled to recover the unamortized portion of the cost of such improvements or the amount of such allowance or credit, determined by multiplying the total amount of such cost or allowance or credit by a fraction, the denominator of which is the total number of months of the initial Lease Term and the numerator of which is the number of months of the Lease Term remaining at the time of Tenant’s default.  Also, if this Lease provides for any months for which no Minimum Monthly Rent or a reduced Minimum Monthly Rent is payable, or for any other rent concession to Tenant, then, upon default, Tenant shall become liable for the full amount of the Minimum Monthly Rent (or other rent concession), plus applicable taxes, for such months, and Landlord shall be entitled to recover as additional rent the amount that would have been payable by Tenant for such months if the Minimum Monthly Rent provided for herein had been payable by Tenant throughout the entire Lease Term.  If Landlord does Terminate this Lease, then Tenant will remain liable for all sums accrued under this Lease to the date of termination, as well as for all costs and expenses incurred by Landlord and any other damages sustained by Landlord as a consequence of Tenant’s breach.  Also Landlord may elect to recover from Tenant the difference between the present value at the date of termination of the Minimum Monthly Rent and other charges that were to have been due under this Lease from such termination date to the end of the Lease Term and the present value as of such termination date of the Minimum Monthly Rent and other charges Landlord could have obtained if Landlord had rented the Premises for the same period at its fair rental value.  The present value of the amounts referred to in the preceding sentence shall be computed using a discount rate equal to the prime rate charged by Wells Fargo Bank (or its successor) at the date of termination.  Tenant shall be liable to Landlord for any difference 

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between the Minimum Monthly Rent and other charges called for by this Lease and the rent and other charges collected by Landlord from any new tenant.  For any month in which Landlord collects less from a successor tenant than is payable under this Lease, Landlord may demand that Tenant immediately make up the difference, and Landlord may bring suit against Tenant if Tenant fails to do so, provided that Landlord shall give Tenant credit for any sums collected by Landlord, if any, from Tenant under the fourth sentence of this paragraph.

(g)Landlord may sue Tenant for possession of the Premises, for damages for breach of this Lease, and for other appropriate relief, either in the same or in separate actions.  Landlord may recover all costs and expenses it incurs in any such suit, including reasonable attorneys’ fees.

(h)Landlord may exercise any other right or remedy available at law or in equity for breach of contract, damages or other appropriate relief.  The rights and remedies described herein are cumulative, and Landlord’s exercise of any one right will not preclude the simultaneous exercise of any other right or remedy.

28.3[INTENTIONALLY OMITTED]

28.4If Tenant is in arrears in payment of Rent, Tenant waives its right, if any, to designate the items to which any payments made by Tenant are to be credited, and Landlord may apply any payments made by Tenant to such items as Landlord sees fit, irrespective of any designation or request by Tenant as to the items to which any such payments shall be credited.

28.5Tenant shall not interpose any counterclaim (other than a compulsory counterclaim) in any summary proceeding commenced by Landlord to recover possession of the Premises and shall not seek to consolidate such proceeding with any action which may have been or will be brought by Tenant or any other person or entity.

Article 29.  TENANT’S RECOURSE

THE LIABILITY OF LANDLORD (AND ITS PARTNERS, SHAREHOLDERS OR MEMBERS) TO TENANT (OR ANY PERSON OR ENTITY CLAIMING BY, THROUGH OR UNDER TENANT) FOR ANY DEFAULT BY LANDLORD UNDER THE TERMS OF THIS LEASE OR ANY MATTER RELATING TO OR ARISING OUT OF THE OCCUPANCY OR USE OF THE PREMISES AND/OR OTHER AREAS OF THE BUILDIN’G OR PROJECT SHALL BE LIMITED TO TENANT’S ACTUAL DIRECT, BUT NOT CONSEQUENTIAL (OR OTHER SPECULATIVE), DAMAGES THEREFOR AND SHALL BE RECOVERABLE ONLY FROM THE INTEREST OF LANDWRD IN’ TIIE BUILDING, AND LANDLORD (AND ITS PARTNERS, SHAREHOLDERS OR MEMBERS) SHALL NOT BE PERSONALLY  LIABLE FOR ANY DEFICIENCY.  ADDITIONALLY, TO THE EXTENT ALLOWED BY LAW, TENANT HEREBY WAIVES ANY STATUTORY LIEN IT MAY HAVE AGAINST LANDWRD OR ITS ASSETS, INCLUDING WITHOUT LIMITATION, THE BUILDING.

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Article 30.  HOLDING OVER

If Tenant holds over after the expiration of the Lease Term, (i) Tenant shall be a tenant at sufferance, the Minimum Monthly Rent shall be increased to 150% of the then current lease rate at the Building or the Tenant’s lease rate at the time this Lease expired, whichever is higher, plus any amounts due under Article 5, which shall be payable in advance on the first day of such holdover period and on the first day of each month thereafter, and (ii) Tenant shall also be liable for any damages that Landlord incurs as a result of such holdover.  Notwithstanding the prior sentence, Landlord shall not be prevented from instituting eviction proceedings against Tenant in the event of such holdover.

Article 31.  GENERAL PROVISIONS

31.1This Lease is construed in accordance with the laws of the State.

31.2If Tenant is composed of more than one person or entity, then the obligations of such entities or parties are joint and several.

31.3If any term, condition, covenant, or provision of this Lease is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the terms, conditions, covenants, and provisions hereof shall remain in full force and effect and shall in no way be affected, impaired, or invalidated.

31.4The various headings and numbers herein and the grouping of the provisions of this Lease into separate articles and sections are for the purpose of convenience only and are not be considered a part hereof.

31.5Time is of the essence of this Lease.

31.6Other than for Tenant’s obligations under this Lease that can be performed by the payment of money (e.g., payment of Rent and maintenance of insurance, and Tenant’s obligations pursuant to Exhibit D attached hereto), whenever a period of time is herein prescribed for action to be taken by either party hereto, such party shall not be liable or responsible for, and there shall be excluded from the computation of any such period of time, any delays due to strikes, riots, acts of God, shortages of labor or materials, war (declared or undeclared), acts of terrorism, governmental laws, regulations, or restrictions, or any other causes of any kind whatsoever which are beyond the control of such party.

31.7In the event either party initiates legal proceedings or retains an attorney to enforce any right or obligation under this Lease or to obtain relief for the breach of any covenant hereof, the party ultimately prevailing in such proceedings or the non-defaulting party shall be entitled to recover all costs and reasonable attorneys’ fees.

31.8This Lease, and any Exhibit or Addendum attached hereto, sets forth all the Terms, conditions, covenants, provisions, promises, agreements, and undertakings, either oral or written, between the Landlord and Tenant.  No subsequent alteration, amendment, change, or addition to this Lease is binding upon Landlord or Tenant unless reduced to writing and signed by both parties.

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31.9Subject to Article 23 the covenants herein contained shall apply to and bind the heirs, successors, executors, personal representatives, legal representatives, administrators, and assigns of all the parties hereto.

31.10No term, condition, covenant, or provision of this Lease shall be waived except by written waiver of Landlord, and the forbearance or indulgence by Landlord in any regard whatsoever shall not constitute a waiver of the Term, condition, covenant, or provision to be performed by Tenant to which the same shall apply, and until complete performance by Tenant of such term, condition, covenant, or provision, Landlord shall be entitled to invoke any remedy available under this Lease or by law despite such forbearance or indulgence.  The waiver by Landlord of any breach or Term, condition, covenant, or provision hereof shall apply to and be limited to the specific instance involved and shall not be deemed to apply to any other instance or to any subsequent breach of the same or any other Term, condition, covenant, or provision hereof.  Acceptance of rent by Landlord during a period in which Tenant is in default in any respect other than payment of rent shall not be deemed a waiver of the other default.  Any payment made in arrears shall be credited to the oldest amount outstanding and no contrary application will waive this right.

31.11The use of a singular Term in this Lease shall include the plural and the use of the masculine, feminine, or neuter genders shall include all others.

31.12Landlord’s submission of a copy of this Lease form to any person, including Tenant, shall not be deemed to be an offer to lease or the creation of a lease unless and until this Lease has been fully signed and delivered by Landlord.

31.13Every term, condition, covenant, and provision of this Lease, having been negotiated in detail and at arm’s length by both parties, shall be construed simply according to its fair meaning and not strictly for or against Landlord or Tenant.

31.14If the time for the performance of any obligation under this Lease expires on a Saturday, Sunday, or legal holiday, the time for performance shall be extended to the next succeeding day which is not a Saturday, Sunday, or legal holiday.

31.15If requested by Landlord, Tenant shall execute written documentation with signatures acknowledged by a notary public, to evidence when and if Landlord or Tenant has met certain obligations under this Lease.

31.16Within fifteen (15) days after Landlord’s request, Tenant will furnish Tenant’s most recent audited financial statements (including  any notes to them) to Landlord, or, if no such audited statements have been prepared, such other financial statements (and notes to them) as may have been prepared by an independent certified public accountant or, failing those, Tenant’s internally prepared financial statements.

31.17Tenant represents and warrants as follows:

(i)Tenant represents and warrants to, and covenants with, Landlord that neither Tenant nor any of its respective constituent owners or affiliates currently are, or shall be at any time during the Term hereof, in violation of any laws relating to terrorism or money 

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laundering (collectively, the “Anti-Terrorism Laws”), including without limitation Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001 and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (the “Executive Order”) and/or the Uniting and Strengthening America  by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56) (the “USA Patriot Act”).

(ii)Tenant covenants with Landlord that neither Tenant nor any of its respective constituent owners or affiliates is or shall be during the Term hereof a “Prohibited Person,’’ which is defined as follows: (A) a person or entity that is listed in the Annex to, or is otherwise subject to, the provisions of the Executive Order; (B) a person or entity owned or controlled by, or acting for or on behalf of, any person or entity that is listed in the Annex to, or is otherwise subject to the provisions of, the Executive Order; (C) a person or entity with whom Landlord is prohibited from dealing with or otherwise engaging in any transaction by any Anti­Terrorism Law, including without limitation the Executive Order and the USA Patriot Act; (D) a person or entity who commits, threatens or conspires to commit or support “terrorism” as defined in Section 3(d) of the Executive Order; (E) a person or entity that is named as a “specially designated national and blocked person” on the then-most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, http://www.treas.gov/offices/eotffc/ofac/sdn/tllsdn.pdf, or at any replacement website or other replacement official publication of such list; or (F) a person or entity who is affiliated with a person or entity listed in items (A) through (E), above.

(iii)At any time and from time-to-time during the Term, Tenant shall deliver to Landlord, within ten (10) days after receipt of a written request therefor, a written certification or such other evidence reasonably acceptable to Landlord evidencing and confirming Tenant’s compliance with this Section 31.17.

Article 32.  NOTICES

Wherever in this Lease it is required or permitted that notice or demand be given or served by either party to or on the other, such notice or demand shall be in writing and shall be given or served and shall not be deemed to have been duly given or served unless (a) in writing; (b) either (1) delivered personally, (2) deposited with the United States Postal Service, as registered or certified mail, return receipt requested, bearing adequate postage, or (3) sent by overnight express courier (including, without limitation, Federal Express, DHL Worldwide Express, Airborne Express, United States Postal Service Express Mail) with a request that the addressee sign a receipt evidencing delivery; and (c) addressed to the party at its address in Section 1.1.  Either party may change such address by written notice to the other.  Service of any notice or demand shall be deemed completed forty-eight (48) hours after deposit thereof, if deposited with the United States Postal Service, or upon receipt if delivered by overnight courier or in person.

Article 33.  BROKER’S COMMISSIONS

Tenant represents and warrants that there are no claims for brokerage commissions or finder’s fees in connection with this Lease (excepting commissions or fees due to Newmark 

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Grubb Knight Frank and Lincoln Property Company in connection with this Lease pursuant to separate agreements approved or authorized in writing by Landlord).  Tenant shall indemnify, defend and hold Landlord harmless for, from and against all costs, expenses, attorneys’ fees, liens and other liability for commissions or other compensation claimed by any broker or agent claiming the same by, through or under Tenant.  The foregoing indemnity shall survive the expiration or earlier termination of this Lease.

Article 34.  INDEMNIFICATION/WAIVER OF SUBROGATION

34.1Waiver of Subrogation.  Notwithstanding anything to the contrary herein, to the extent permitted by law and without affecting the coverage provided by insurance required to be maintained hereunder, Landlord and Tenant shall each agree to waive any right to recover against the other party (and the other party’s agents, officers, directors and employees) on account of any and all claims it may have against the other party (and the other party’s agents, officers, directors and employees) with respect to the insurance actually maintained, or required to be maintained hereunder, under subparagraphs 20.1 (a) through (f) inclusive, and to the extent proceeds are realized from such insurance coverage that are applied to such claims.  Each policy described in this Lease shall contain a waiver of subrogation endorsement that provides that the waiver of any right to recovery shall not invalidate the policy in any way.

34.2Indemnity.  Subject to Section 34.1 Tenant shall indemnify, defend and hold harmless Landlord and its property manager, Invesco, any subsidiary or affiliate of the foregoing, and their respective officers, directors, shareholders, partners, employees, managers, contractors, attorneys and agents from and against all claims, demands, liabilities, causes of action, suits, judgments, damages, and expenses (including attorneys’ fees) and all losses and damages (collectively, the “Claims”) arising from: (1) any injury to or death of any person or the damage to or theft, destruction, loss, or loss of use of any property or inconvenience (a “Loss”) arising from any occurrence in the Premises, the use of the Common Areas by any Tenant Permittee, or the installation, operation, maintenance, repair or removal of any of Tenant’s Off-Premises Equipment; or (2) Tenant’s failure to perform its obligations under this Lease, The indemnities set forth in this Section 34.2 shall survive termination or expiration of this Lease and shall not Terminate or be waived, diminished or affected in any manner by any abatement or apportionment of Minimum Monthly Rent under any provision of this Lease.  If any proceeding is filed for which indemnity is required hereunder, Tenant agrees, upon request therefor, to defend Landlord in such proceeding at its sole cost utilizing counsel satisfactory to Landlord in its sole discretion.  The term “Tenant’s Off-Premises Equipment” means any of Tenant’s equipment or other property that may be located on or about the Project (other than inside the Premises).

Article 35.  WAIVER OF TRIAL BY JURY

LANDLORD AND TENANT WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTER OF THIS LEASE OR THE USE AND OCCUPANCY OF THE PREMISES.  THIS WAIYER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY TENANT, AND TENANT ACKNOWLEDGES THAT NEITHER LANDLORD OR ANY PERSON ACTING ON BEHALF OF LANDLORD HAS MADE ANY REPRESENTATIONS OF FACT TO 

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INDUCE THIS WAIYER OF TRIAL BY JURY OR IN ANY WAY TO MODIFY OR NULLIFY ITS EFFECT.  TENANT FURTHER ACKNOWLEDGES THAT IT HAS BEEN REPRESENTED (OR HAS HAD THE OPPORTUNITY TO BE REPRESENTED) IN THE SIGNING OF THIS LEASE AND IN THE MAKING OF THIS WANER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND THAT TENANT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIYER WITII COUNSEL.  TENANT FURTHER ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THE MEANING AND RAMIFICATIONS OF THIS WAIVER PROVISION, AS EVIDENCED BY ITS SIGNATURE BELOW.

[Signature page follows]

 

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IN WITNESS WHEREOF, the parties have duly executed this Lease of as the day and year first above written.

 

	
LANDLORD
	
 
	
TENANT

	
 
	
 
	
 
	
 

	
55 CAMBRIDGE PARKWAY, LLC
	
 
	
KALVISTA PHARMACEUTICALS, INC.

	
a Delaware limited liability company
	
 
	
a Delaware corporation

	
 
	
 
	
 
	
 

	
By:
	
Invesco ICRE Massachusetts REIT
	
 

	
 
	
Holdings, LLC, Its sole member
	
 
	
By:
	
/s/ Ben Palleiko

	
 
	
 
	
 
	
 
	
Name: Ben Palleiko

	
 
	
 
	
 
	
 
	
Title: CFO

	
By:
	
/s/ Perry Chudnoff
	
 
	
Execution Date:
	
5/26/17

	
 
	
Name: Perry Chudnoff
	
 
	
 

	
 
	
Title: Vice President
	
 
	
 

	
 
	
 
	
 

	
Execution Date:
	
5/30/17
	
 
	
 

 

 

 

 

 

EXHIBIT “A”

PREMISES

Exhibit “A” is intended only to show the general outline of the Premises as of the beginning of the Lease Term.  It does not in any way supersede any of Landlord’s rights set forth in the Lease with respect to arrangements and/or locations of public parts of the Building and changes in such arrangements and/or locations.  It is not to be scaled; any measurements or distances shown should be taken as approximate.  The inclusion of elevators, stairways electrical and mechanical closets, and other similar facilities for the benefit of occupants of the Building does not mean such items are part of the Premises.

[See Attached Plan]

 

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EXHIBIT “B”

RULES AND REGULATIONS

The following rules and regulations shall apply to the Premises, the Building, the parking garage associated therewith, and the appurtenances thereto:

l.      Sidewalks, doorways, vestibules, halls, stairways, and other similar areas shall not be obstructed by tenants or used by any tenant for purposes other than ingress and egress to and from their respective leased premises and for going from one to another part of the Building.

2.      Plumbing, fixtures and appliances shall be used only for the purposes for which designed, and no sweepings, rubbish, rags or other unsuitable material shall be thrown or deposited therein.  Damage resulting to any such fixtures or appliances from misuse by a tenant or its agents, employees or invitees, shall be paid by such tenant.

3.      No signs, advertisements or notices (other than those that are not visible outside the Premises) shall be painted or affixed on or to any windows or doors or other part of the Building without the prior written consent of Landlord.  Landlord shall provide Tenant, at Landlord’s sole cost and expense, with Building standard signage (a) on the main directory in the Building lobby and (b) in the elevator lobby for the ninth (9th) floor of the Building.

4.      Landlord shall provide all door locks in each tenant’s leased premises, at the cost of such tenant, and no tenant shall place any additional door locks in its leased premises without Landlord’s prior written consent.  Landlord shall furnish to each tenant a reasonable number of keys to such tenant’s leased premises, at such tenant’s cost, and no tenant shall make a duplicate thereof.

5.      If the Building is multi-tenant, movement in or out of the Building of furniture or office equipment, or dispatch or receipt by tenants of any bulky material, merchandise or materials which require use of elevators or stairways, or movement through the Building entrances or lobby shall be conducted under Landlord’s supervision at such times and in such a manner as Landlord may reasonably require.  Each tenant assumes all risks of and shall be liable for all damage to articles moved and injury to persons or public engaged or not engaged in such movement, including equipment, property and personnel of Landlord if damaged or injured as a result of acts in connection with carrying out this service for such tenant.

6.      Landlord may prescribe weight limitations and determine the locations for safes and other heavy equipment or items, which shall in all cases be placed in the Building so as to distribute weight in a manner acceptable to Landlord which may include the use of such supporting devices as Landlord may require.  All damages to the Building caused by the installation or removal of any property of a tenant, or done by a tenant’s property while in the Building, shall be repaired at the expense of such tenant.

7.      Corridor doors, when not in use, shall be kept closed.  Nothing shall be swept or thrown into the corridors, halls, elevator shafts or stairways.  No birds or animals (other than seeing-eye dogs) shall be brought into or kept in, on or about any tenant’s leased premises.  No 

 

			
	
 
	
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portion of any tenant’s leased premises shall at any time be used or occupied as sleeping or lodging quarters.

8.      Tenant shall not make or permit any vibration or improper, objectionable or unpleasant noises or odors in the Building or otherwise interfere in any way with other tenants or persons having business with them.

9.      No machinery of any kind (other than normal office equipment) shall be operated by any tenant on its leased area without Landlord’s prior written consent, nor shall any tenant use or keep in the Building any flammable or explosive fluid or substance (other than typical office supplies [e.g., photocopier toner] used in compliance with all Laws).

10.      Landlord will not be responsible for lost or stolen personal property, money or jewelry from tenant’s leased premises or public or common areas regardless of whether such loss occurs when the area is locked against entry or not.

11.      No vending or dispensing machines of any kind may be maintained in any leased premises without the prior written permission of Landlord, other than those used for Tenant’s employees.

12.      Tenant shall not conduct any activity on or about the Premises or Building which will draw pickets, demonstrators, or the like.

13.      No tenant may enter into phone rooms, electrical rooms, mechanical rooms, or other service areas of the Building unless accompanied by Landlord or the Building manager.

14.      No smoking is allowed anywhere in the Building.  Smoking is allowed only in Landlord-designated smoking areas that are at least fifty (50) feet from the Building entry or elevators, public walkways and the Building’s outdoor air intakes, outdoor louvers, or operable windows.  Tenant shall not permit its employees, invitees or guests to smoke in the Premises or Building, or anywhere within the foregoing fifty (50) foot area (including without limitation e-cigarettes).

15.      Canvassing, soliciting or peddling in or about the Premises or the Project is prohibited and Tenant shall cooperate to prevent same.

16.      The Premises shall not be used for any use that is disreputable or may draw protests.

17.      Tenant shall not use or permit space heaters or energy-intensive equipment unnecessary to conduct Tenant’s business without written approval by Landlord.  Any space conditioning equipment that is placed in the Premises by Tenant for the purpose of increasing comfort to occupants shall be operated on sensors or timers that limit operation of equipment to hours of occupancy in the areas immediately adjacent to the occupying personnel.

18.      Tenant shall operate the Premises in a manner consistent with Landlord’s Sustainability Initiative.

 

			
	
 
	
B-2
	
 

 

19.      Tenant shall not mark, paint, drill into, or in any way deface any part of the Building or Premises.  No boring, driving of mails, or screws, cutting or stringing of wires shall be permitted, except with the prior written consent of Landlord, and as Landlord may direct.  Tenant shall not install any resilient tile or similar floor covering the Premises.  The use of cement or other similar adhesive material is expressly prohibited.

20.      Tenant shall not waste electricity or water and agrees to cooperate fully with landlord to assure the most effective operation of the Building’s heating and air conditioning.  Tenant shall keep corridor doors closed except when being used for access.

21.      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 thrown therein.

22.      No smoking shall be permitted in any portion of the Building (including the Premises and all common areas within the Building).  Landlord may also limit smoking in exterior areas to such location or locations as Landlord may designate from time to time.  No sale or distribution of tobacco or tobacco products shall be permitted anywhere in the Building or on the Lot or any other facilities operated in connection with the Building or the Lot.

23.      Building employees shall not be required to perform, and shall not be requested by any tenant or occupant to perform, any work outside of their regular duties, unless under specific instructions from the office of the Manager of the Building.

24.      Tenant may request heating and/or air conditioning during other periods in addition to normal Building Business Hours by submitting its request in writing to the office of the Manager of the Building no later than 12:00 p.m. the preceding work day (Monday through Friday) on forms available from the office of the Manager.  The request shall clearly state the start and stop hours of the “off-hour” service.  Tenant shall submit to the Building Manager a list of personnel authorized to make such request.  The Tenant shall be charged for such operation in the form of additional rent; such charges are to be determined by the Landlord.

25.      Tenant covenants and agrees that its use of the Premises shall not cause a discharge of more than the gallonage per foot of rentable square feet per day of sanitary (non-industrial) sewage allowed under the sewage discharge permit for the Building.  Discharges in excess of that amount, and any discharge of industrial sewage, shall only be permitted if Tenant, at its sole expense, shall have obtained all necessary permits and licensees therefor, including without limitation permits from state and local authorities having jurisdiction thereof.

26.      Landlord may establish reasonable rules and regulations regarding the use of the roofdeck located on the third floor of the Building, and provide for an orderly and reasonable method for the reservation of such space, which may include, if Landlord so elects, a reasonable charge therefor.

27.      Janitorial services shall be provided in accordance with Exhibit G.  Tenants shall not cause unnecessary labor by reason of carelessness or indifference in the preservation of good order and cleanliness.  The work of the janitor or cleaning personnel shall not be hindered by Tenant and such work may be done at any time when the offices are vacant.  The windows, doors 

 

			
	
 
	
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and fixtures may be cleaned at any time without interruption of purpose for which the Premises are let.  Tenant shall provide adequate waste and rubbish receptacles, cabinets, bookcases, map cases, etc. necessary to prevent unreasonable hardship to Landlord in discharging its obligation regarding cleaning service.  Boxes should be broken down to fit into containers.

These Building Rules and Regulations are subject to change and are not limited to what is contained herein.  Landlord and the building manager reserve the right to implement additional Building Rules and Regulations as may be prudent.B-2

 

 

 

 

			
	
 
	
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EXHIBIT “C”

PARKING RULES AND REGULATIONS

The parking rules & regulations are designed to assure our tenants and visitors safe use and enjoyment of the facilities.  Please remove or hide any personal items of value from plain sight to avoid temptation leading to vandalism of vehicles.  Please exercise added caution when using parking lot at night.  Please keep vehicle locked at all times.  Please report violations of these rules to the Landlord immediately.  Please report any lights out or other possibly dangerous situations to the Landlord as soon as possible.

Restrictions

	
•
	
Damage caused by vehicles is the responsibility of vehicle owner.

	
•
	
Landlord is not responsible for theft or damage to any vehicle.

	
•
	
Landlord is not responsible for water damage from leaks in the garage or any surface parking area.

	
•
	
Landlord is not responsible for damage due to height limitations of garage.

	
•
	
Vehicles not to exceed 2 miles per hour speed limit in the garage.

	
•
	
Vehicles that leak excessive fluids will be required to protect parking surface.

	
•
	
Mechanical repairs to vehicles are not permitted on property.

	
•
	
Large or oversize vehicles such as motor homes, boats or trailers are not permitted.

	
•
	
No parking in fire lanes, loading zones or any other areas not designated as a parking space.

	
•
	
Landlord, at Landlord’s sole discretion, may add or modify the parking rules.

	
•
	
Landlord reserves the right to relocate the location of reserved spaces from time to time.

	
•
	
Rental for reserved spaces shall be paid to Landlord by Tenant along with, and on the same due date as, the Minimum Monthly Rent.

Violations of rules & regulations may result in towing from the Project.  Towing from the Project can only be ordered by Landlord or Landlord’s property manager.  Charges for towing are to be paid by vehicle owner.

These Parking Rules and Regulations are subject to change and are not limited to what is contained herein.  Landlord and the Building manager reserve the right to implement additional Parking Rules and Regulations as may be prudent.

 

 

 

			
	
 
	
C-1
	
 

 

 

EXHIBIT “D”

TENANT IMPROVEMENTS

This Exhibit ”D” is attached to and made a part of the Office Lease Agreement (the “Lease”) by and between 55 Cambridge Parkway, LLC, a Delaware limited liability company (“Landlord”), and Kalvista Pharmaceuticals, Inc., a Delaware corporation (“Tenant”), for space in the Building located at 55 Cambridge Parkway, Cambridge, Massachusetts 02142.  Capitalized terms used but not defined herein shall have the meanings given in the Lease.

D.1      Existing Conditions.  Subject only to Landlord’s obligation to perform the Tenant Improvements as provided below, Tenant has inspected, and is satisfied with, the existing, “as-is” condition of the Premises, including any existing improvements and base building elements now located therein.

D.2      Tenant Improvements.  Landlord shall perform, at Landlord’s cost, the initial leasehold improvements (the “Tenant Improvements”) depicted and described on the space plan and the scope of work attached hereto as Schedule D (the “Space Plan”), using only new materials that are consistent with Building standard for materials, quantities and finishes.  The Tenant Improvements shall be constructed by Landlord in accordance with, and subject to, the provisions of this Exhibit D and all federal state and local applicable laws rules regulations and codes.  Landlord shall use reasonable efforts to “substantially complete” (as hereinafter defined) the Tenant Improvements on or before the Estimated Commencement Date to the extent reasonably practicable.  The time for completion of the Tenant Improvements shall be extended by (i) any delays caused by Tenant or Tenant’s agents, contractors or employees, and (ii) the duration of any delay beyond Landlord’s reasonable control.  For purposes hereof, “substantially complete” and “substantial completion” shall mean that (i) the Tenant Improvements have been completed in compliance with the Lease (including, but not limited to, the provisions of this Exhibit D), other than minor punchlist-type items, the completion of which will not unreasonably delay or interfere with Tenant’s occupancy of the Premises for the regular conduct of business, and (ii) a certificate of occupancy covering the Premises has been issued by the City of Cambridge.

D.3      Plans.  Within twenty (20) days after the execution of the Lease, Landlord’s architect shall prepare preliminary plans for the Tenant Improvements (the “Plans”), consistent with the Space Plan, and shall submit such Plans to Tenant for its approval, which approval shall not be unreasonably withheld or delayed.  In the event that Tenant disapproves of the Plans, Tenant shall provide the reasons therefor within three (3) business days, and Landlord shall revise the Plans and resubmit the same to Tenant for its reasonable approval within five (5) business days after receipt of Tenant’s comments.  Such process shall repeat as necessary until the Plans are approved by Tenant.  Any failure by Tenant to timely respond to any submission or resubmission of the Plans within three (3) business days after submission or resubmission shall be deemed to be an approval thereof The date on which the Plans are approved or deemed approved by Tenant shall be referred to herein as “Plan Approval”.

D.4      Cost of the Tenant Improvements.  Landlord shall perform the Tenant Improvements described on Schedule D at Landlord’s sole expense.  Any change or addition to 

 

			
	
 
	
D-1
	
 

 

the Tenant Improvements shown on Schedule D shall constitute a Tenant Improvements Change Order under Paragraph D.5 below, and Tenant shall be responsible for all additional costs arising from any such Tenant Improvements Change Order (the “Excess Tenant Work Costs”).  Landlord may from time to time require Tenant to pay the estimated Excess Tenant Work Costs to Landlord before performing the Tenant Improvements (as affected by such Tenant Improvements Change Order) or otherwise within ten (10) days following receipt of each of Landlord’s invoices for each such Tenant Improvements Change Order.

D.5      Change Orders.  Tenant may, from time to time, by written order to Landlord on a form specified by Landlord (each, a “Tenant Improvements Change Order” or “Change Order”), request a change in the Tenant Improvements shown on the Plans.  Landlord shall cause the Tenant Improvements to be performed in accordance with such Tenant Improvements Change Order after approval thereof by Landlord.  The Plans shall not be modified in any material respect except with Landlord’s prior written approval; and all modifications to the Plans, whether material or not, shall be made only by Tenant Improvements Change Order submitted to and approved by Landlord.  Tenant shall be responsible for all additional costs arising from any Tenant Improvements Change Order as provided in Paragraph D.4 above and shall pay such Excess Tenant Work Costs to Landlord as provided in Paragraph D.4 above.

D.6      Landlord’s Performance of the Work.  Following Plan Approval, Landlord shall submit the approved Plans to the applicable governmental authorities to obtain the necessary permits for the Tenant Improvements.  Upon receipt of such permits, and subject to the provisions of this Exhibit D, Landlord shall thereafter commence and proceed to complete construction of the Tenant Improvements.  Landlord may require that the Plans or any Tenant Improvements Change Order be revised if, in Landlord’s reasonable judgment, (i) the requested work would delay completion of the Tenant Improvements beyond the Estimated Commencement Date (unless Tenant acknowledges that such delay shall constitute a Tenant delay), (ii) would increase the cost of operating the Building or performing any other work in the Building (unless Tenant pays such additional costs), (iii) are incompatible with the design, quality, equipment or systems of the Building, (iv) would require unusual expense to readapt the Premises to general purpose office use, or (v) otherwise do not comply with the provisions of the Lease.  Tenant assumes full responsibility to ensure that the Tenant Improvements are adequate to fully meet the needs and requirements of Tenant’s business operations within the Premises and Tenant’s use of the Premises.  Neither the approval by Landlord of the Plans, or of any other plans, specifications, drawings or other items associated with the Tenant Improvements nor Landlord’s performance, supervision or monitoring of the Tenant Improvements shall constitute any warranty or covenant by Landlord to Tenant that the Plans or Tenant Improvements are adequate for any use or comply with any law.

D.7      Measurement of Premises.  Following completion of the Tenant Improvements, Landlord’s architect shall certify the Rentable Square Feet in the Premises, as computed in accordance with BOMA Standard Methods of Measurement for Office Buildings.  In the event the Rentable Square Feet in the Premises so certified by Landlord’s architect shall be different from the Rentable Square Feet in the Premises referenced in Section 1.1(g) of the Lease, then the Minimum Annual Rent shall be proportionately adjusted based on the revised square footage of the Premises multiplied by the applicable square foot rental rate; Base Operating Share, Tenant’s Share of Operating Costs, Base Tax Share and Tenant’s Share of Taxes, all as defined in 

 

			
	
 
	
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Article 5, shall be adjusted accordingly; and Landlord and Tenant agree to promptly execute an amendment to this Lease to revise the applicable sections of this Lease.

D.8      Construction Representatives.  Landlord’s and Tenant’s representatives for coordination of construction and approval of Change Orders will be as follows, provided that either party may change its representative upon written notice to the other:

 

		
	
Landlord’s Representative:
	
Megan Kenny

	
 
	
Lincoln Property Company

	
 
	
53 State Street, 8th Floor

	
 
	
Boston, MA 02109

	
 
	
 

	
Tenant’s Representative:
	
Ben Palleiko

	
 
	
Chief Financial Officer

	
 
	
KalVista Pharmaceuticals, Inc.

	
 
	
Phone: 857.999.0075

 

 

 

			
	
 
	
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SCHEDULE D

SPACE PLAN

[See Attached Scope of Work and Space Plan]

 

 

 

			
	
 
	
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EXHIBIT “D-1”

CONTRACTOR RULES AND REGULATIONS

Any and all improvements, alterations or additions performed by Tenant will be performed in accordance with this Exhibit D-1, and any modifications thereto by Landlord, notwithstanding any more permissive local building codes or ordinances.

1.WORK APPROVAL

The general contractor (“Contractor”) and all subcontractors must be approved to conduct their trades in the jurisdiction in which the Building is located by any and all governmental entities with such authority.  Tenant or Contractor must provide Landlord with names, addresses and phone numbers for all subcontractors prior to commencement of work by the subcontractor.  Construction drawings must be approved by Landlord prior to the start of construction.  All projects shall be reviewed for potential impact to reduction targets and environmental programs.  An agent or representative of Contractor must be present on the site at all times when work is in process.

2.INSURANCE

Prior to commencement of work, Contractor shall provide to Landlord a certificate of insurance in the form of an ACORD certificate with the approved limits of coverage and naming Landlord and the Building manager as additional insureds.

3.PERMITS

Permits and licenses necessary for the onset of all work shall be secured and paid for by Contractor and posted as required by applicable law.

4.INSPECTIONS

All inspections which must be performed by testing any or all of the life safety system, e.g., alarms, annunciator, voice activated, strobe lights, etc., must be performed prior to 7:00 a.m. or after 6:00 p.m., and the on-site engineer must be present.  At least 48 hours notice must be provided to the Building manager and the on-site engineer advising that an inspection has been requested.

5.ELEVATORS

The use of the freight elevator for deliveries and removals shall be scheduled in advance by Contractor with the Building engineer’s office for the transfer of all construction materials, tools, and trash to and from the construction floor.  Passenger elevators shall not be used for these purposes.  The elevator walls and floor shall be protected at all times during Contractor’s use.  From time to time, Contractor may be required to share the freight elevator with the cleaning crew, other tenants, etc.  Large transfers of materials, whether for deliveries or removals, must be done prior to 7:00 a.m.  or after 6:00 p.m.  No deliveries of any kind or nature shall be brought in through the front door of the Building at any time.

 

			
	
 
	
D-1-1
	
 

 

6.NON-CONSTRUCTION AREAS

Contractor shall take all necessary precautions to protect all walls, carpets, floors, furniture, fixtures and equipment outside of the work area and shall repair or replace damaged property without cost to Landlord.  Masonite must be placed as a walkway on the public corridors from the freight elevator to the construction site to protect the carpet and/or flooring.  Common area carpet and flooring protection is to be used and removed daily and the carpet and flooring vacuumed or dust mopped, whichever is appropriate, on a daily basis.

7.EROSION AND SEDIMENT CONTROL

Contractor agrees to provide a management plan prior to any exterior ground work being performed to prevent loss of soil during construction by stormwater runoff and/or wind erosion, including protecting topsoil by stockpiling for reuse, preventing sedimentation of storm sewer or receiving streams, and preventing polluting the air with dust and particulate matter.  Contractor shall log building operations and maintenance activity to ensure that the plan has been followed.

8.GREEN BUILDINGS

Contractor agrees to incorporate Sustainability Standards into the preparation of the Plans and Specifications, including, without limitation, those “Energy and Sustainability Construction Guidelines & Requirements,” attached hereto as Exhibit D-2, when such compliance will not cause a material increase in-Construction Costs.

9.WATER AND ELECTRICITY

Sources of water and electricity will be furnished to Contractor without cost, in reasonable quantities for use in lighting, power tools, drinking water, water for testing, etc. “Reasonable quantities” will be determined on a case-by-case basis but are generally intended to mean quantities comparable to the water and electrical demand Tenant would use upon taking occupancy.  Contractor shall make all connections, furnish any necessary extensions, and remove same upon completion of work.

10.DEMOLITION AND DUSTY WORK

Demolition of an area in excess of 100 square feet must be performed before 7:00 am. or after 6:00 p.m.  Contractor shall notify the Building engineer’s office at least one full business day prior to commencement of extremely dusty work (sheet rock cutting, sanding, extensive sweeping, etc.) so arrangements can be made for additional filtering capacity on the affected HVAC equipment.  Failure to make such notification will result in Contractor incurring the costs to return the equipment to its proper condition.  All lights must be covered during high dust construction due to a plenum return air system.

 

			
	
 
	
D-1-2
	
 

 

11.CONSTRUCTION MANAGEMENT PLAN FOR INDOOR AIR QUALITY

Contractor agrees to develop and implement an Indoor Air Quality (IAQ) Management Plan for the construction and occupancy phases of the area being built out as follows:

☐During construction, meet or exceed the recommended Design Approaches of the Sheet Metal and Air Conditioning National Contractors Association (SMACNA) IAQ Guideline for Occupied Buildings Under Construction, 1995, Chapter 3.

☐Protect stored on-site or installed absorptive materials from moisture damage.

☐If air handlers must be used during construction, use filtration media with a Minimum Efficiency Reporting Value (MERV) of 8 at each return air grill, as determined by ASHRAE 52.2-1999.

☐Replace all filtration media immediately prior to occupancy.

Make every reasonable effort to minimize the off-gassing of volatile organic compounds used in construction materials within the building.  Efforts may include the use of no- and low-VOC products and materials, allowing products to off-gas before being brought into the building, and flushing out the space with outside air or air purifiers.

12.WATER USE EFFICIENCY

Contractor agrees to comply with the following:

☐Maintain maximum fixture water efficiency within the Building to reduce the burden on potable water supply and wastewater systems.

☐Keep fire systems, domestic water systems, landscape irrigation systems as separate systems to be maintained and metered separately.  Modifications to the water systems must maintain the integrity of these three systems.

☐Submeter process water used directly by tenant and for the sole benefit of tenant.  

☐Irrigation lines are not to be connected to domestic supply lines.

13.PURCHASING

If Landlord has a comprehensive sustainable purchasing policy as part of its Sustainability Initiative, Contractor agrees to provide information about all material purchases for facility improvements, additions and alterations.  Landlord will supply a standard format for reporting purposes that will include, but not be limited to, data on cost, quantity purchased and product sustainability features.  Contractor shall timely and fully report to Landlord all such information including product specification sheets on all materials used in connection with the job, as Landlord may require from time to time.

 

			
	
 
	
D-1-3
	
 

 

14.REMOVAL OF WASTE MATERIALS

Any and all existing building materials removed and not reused in the construction shall be disposed of by Contractor as waste or unwanted materials, unless otherwise directed by the Building manager.

Contractor shall comply with all laws and Landlord’s waste and recycling practices.  Contractor shall at all times keep areas outside the work area free from waste material, rubbish and debris and shall remove waste materials from the Building on a daily basis.

15.CLEANUP

Upon construction completion, Contractor shall remove all debris and surplus material and thoroughly clean the work area and any common areas impacted by the work.

16.HOUSEKEEPING PRACTICES

Contractor agrees to comply with Landlord’s cleaning and maintenance practices.

17.MATERIAL SAFETY DATA SHEETS (MSDS)

Contractor agrees to provide the Building manager with at least 72 hours advance notice of all chemicals to be used on site through written notice and delivery of MSDS sheets.

18.WORKING HOURS

Standard construction hours are 6:30 a.m. - 5:00 p.m.  The Building engineer must be notified at least two full business days in advance of any work that may disrupt normal business operations, e.g., drilling or cutting of the concrete floor slab.  The Building manager reserves the right to determine what construction work is considered inappropriate for normal business hours.  Work performed after standard construction hours requires an on-site engineer, who shall be billed at the then overtime rate, payable by Contractor.

19.WORKER CONDUCT

Contractor and subcontractors are to use care and consideration for others in the Building when using any public areas.  No abusive language or actions on the part of the workers will be tolerated.  It will be the responsibility of Contractor to enforce this regulation on a day-to-day basis.  Contractor and subcontractors sha11 remain in the designated construction area so as not to unnecessarily interrupt other tenants.  No sleeveless shirts are allowed.  Long pants and proper work shoes are required.  All workers must wear company identification.

20.CONSTRUCTION INSPECTIONS

Contractor is to perform a thorough inspection of all common areas to which it requires access prior to construction to document existing Building conditions.  Upon completion of work, if necessary, Contractor shall return these areas to the same condition in which they were originally viewed.  Any damage caused by Contractor shall be corrected at its sole cost.

 

			
	
 
	
D-1-4
	
 

 

21.SIGNAGE

Contractor or subcontractor signage may not be displayed in the Building common areas or on any of the window glass.

22.POSTING OF RULES AND REGULATIONS

A copy of these rules and regulations must be posted on the job site in a manner allowing easy access by all workers.  It is Contractor’s responsibility to instruct all workers, including subcontractors, to familiarize themselves with these rules and regulations.

23.INSURANCE REQUIREMENTS

Contractor will provide and maintain at its own expense the following minimum insurance:

(a)Worker’s Compensation for statutory limits in compliance with applicable State and Federal laws.

(b)Comprehensive General Liability with limits not less than $5,000,000 combined single limit per occurrence for Bodily Injury and Property Damage.

(c)Automobile liability including owned, non-owned and hired automobiles with limits not less than:

		
	
Bodily Injury
	
$500,000 each person

	
 
	
$500,000 each accident

	
Property Damage
	
$500,000 each accident

24.CERTIFICATE OF INSURANCE

		
	
NAMED INSUREDS:
	
_________________________________, OWNER, ANY BUILDING MANAGER FOR OWNER, AND ANY MORTGAGEE AND/OR GROUND LESSOR OF THE BUILDING AND/OR THE LANDD

Certificates of Insurance in the form of an ACORD 25-S certificate evidencing the required coverages and naming the additional insureds as stated MUST be furnished thirty (30) days prior to starting the contract work.  Each certificate will contain a provision that no cancellation or material change in the policies will be effective except upon thirty (30) days prior written notice.

25.EMERGENCY PROCEDURES

In case of emergency, Contractor shall call the police/fire department and/or medical services, followed immediately by a call to the Building manager.

 

			
	
 
	
D-1-5
	
 

 

26.DELIVERIES

At no time will the Building staff accept deliveries on beha1f of Contractor or any subcontractor.

27.CHANGES

THESE CONTRACTOR RULES AND REGULATIONS ARE SUBJECT TO CHANGE AND ARE NOT LIMITED TO WHAT IS CONTAINED HEREIN.  LANDLORD AND THE BUILDING MANAGER RESERVE THE RIGHT TO IMPLEMENT ADDITIONAL RULES AND REGULATIONS AS MAY BE PRUDENT BASED ON EACH INDIVIDUAL PROJECT.

 

 

			
	
 
	
D-1-6
	
 

 

 

EXHIBIT “D-2”

ENERGY AND SUSTAINABILITY
CONSTRUCTION GUIDELINES AND REQUIREMENTS

Any and all improvements, alterations or additions performed by Tenant and/or its employees, Contractors, subcontractors, consultants or agents will be performed in accordance with this Exhibit D-2, and any modifications thereto by Landlord, notwithstanding any more permissive local building codes or ordinances.

HVAC Equipment

	
 
	
–
	
Tenant-installed HVAC and refrigeration equipment and fire suppression systems shall not contain CFCs.  

	
 
	
–
	
Ensure tenant-installed HVAC systems tie into the Building’s Building Automation System.

	
 
	
–
	
Avoid the installation of HVAC and refrigeration equipment containing HCFCs when reasonable.

Appliances & Equipment

Install only ENERGY STAR-certified appliances.  Recommend the use of ENERGY STAR-certified office equipment, electronics and commercial food service equipment in all instances where such product is available.

Plumbing

Install only new plumbing fixtures that meet the following:

	
 
	
–
	
Lavatory faucets: [0.5] gallons per minute (GPM) tamper-proof aerators

	
 
	
–
	
Pantry/Kitchenette faucets: [1.5] GPM tamper-proof aerators

	
 
	
–
	
Water closets: [1.28] gallons per flush (GPF)

	
 
	
–
	
Urinals: (0.125] GPF

	
 
	
–
	
Showerheads: Meet the requirements of EPA WaterSense-labeled products 

	
 
	
–
	
Commercial Pre-rinse Spray valves (for food service applications): [1.6] or less GPM

Lighting

	
 
	
–
	
Lighting loads shall not exceed ASHRAE/IES Standard 90.1- 2010.  For example, the Maximum Lighting Power Density for office use is 0.9 watts per square foot.

	
 
	
–
	
At a minimum, install occupancy/vacancy sensors with manual override capability in all regularly occupied office spaces.  Lighting controls shall be tested prior to occupancy to ensure that control elements are calibrated, adjusted and in proper working condition to achieve optimal energy efficiency.

 

			
	
 
	
D-2-1
	
 

 

	
 
	
–
	
Recommend installation of daylight-responsive controls in all regularly occupied office spaces within 15 feet of windows.

Data Center within the Premises

(i)      Tenant may not operate a Data Center within the Premises without the express written consent of Landlord.  The term “Data Center” shall have the meaning set forth in the U.S.  Environmental Protection Agency’s ENERGY STAR® program and is a space specifically designed and equipped to meet the needs of high-density computing equipment, such as server racks, used for data storage and processing.  The space will have dedicated, uninterruptible power supplies and cooling systems.  Data Center functions may include traditional enterprise services, on-demand enterprise services, high-performance computing, internet facilities and/or hosting facilities.  A Data Center does not include space within the Premises utilized as a “server closet” or for a computer training area.  In conjunction with the completion and operation of the Data Center, Tenant shall furnish the following information to Landlord:

(l)      Within ten (10) days of completion, Tenant shall report to Landlord the total gross floor area (in square feet) of the Data Center measured between the principal exterior surfaces of the enclosing fixed walls and including all supporting functions dedicated for use in the Data Center, such as any raised-floor computing space, server rack aisles, storage silos, control console areas, battery rooms, mechanical rooms for cooling equipment, administrative office areas, elevator shafts, stairways, break rooms and restrooms.  If Tenant alters or modifies the area of the Data Center, Tenant shall furnish an updated report to Landlord on the square footage within ten (10) days following completion of the alterations or modifications.

(2)       Within ten (10) days following the close of each month of operation of the Data Center, monthly IT Energy Readings at the output of the Uninterruptible Power Supply (UPS), measured in total kWh utilized for the preceding month (as opposed to instantaneous power readings), failing which in addition to same being an Event of Default, Tenant shall be obligated to pay to Landlord the Late Reporting Fee.

Building Materials

	
 
	
–
	
Architect and general contractor shall endeavor to specify low-VOC paints, coatings, primers, adhesives, sealants, sealant primers, coatings, stains, finishes and the like.  Suggested VOC limits are at the end of this document.

	
 
	
–
	
Architect and general contractor shall endeavor to specify materials that meet the following criteria:

	
 
	
–
	
Harvested and processed or extracted and processed within a 500-mile radius of the project site.  Contain at least 10% post-consumer or 20% pre-consumer materials.

	
 
	
–
	
Contain material salvaged from offsite or on-site.  Contain rapidly renewable material.

	
 
	
–
	
Made of wood-based materials, excluding movable furniture, certified as harvested from sustainable sources, specifically Forest Stewardship Council (FSC)-certified wood.

 

			
	
 
	
D-2-2
	
 

 

	
 
	
–
	
Carpet meeting or exceeding the requirements of the CRI Green Label Plus Testing Program and recyclable where available.

	
 
	
–
	
Carpet cushion meeting or exceeding the requirements of the CRI Green Label Testing Program.  Preferably, at least 25% of the hard surface flooring (not carpet) will be FloorScore-certified.

	
 
	
–
	
Composite wood or agrifiber products shall contain no added urea-formaldehyde resins.

Contractor Practices

	
 
	
–
	
General Contractor shall implement the Building’s Waste Management Plan to reuse, recycle and salvage building materials and waste during both demolition and construction phases.

	
 
	
–
	
General Contractor shall implement appropriate Indoor Air Quality Protocols for construction activity.

Resources

For actual regulations, rules and standards visit:

SCAQMD

BAAQMD
Green Seal

 

			
	
 
	
D-2-3
	
 

 

SCAQMD VOC Limits—January 7, 2005

	
Architectural Coatings
	
VOC Limit [g/L less water]
	
 

	
Clear Wood Finishes - Varnish
	
350
	
 

	
Clear Wood Finishes - Lacquer
	
550
	
 

	
Waterproofing Sealers
	
250
	
 

	
Sanding Sealers
	
275
	
 

	
All Other Sealers
	
200
	
 

	
Shellacs - Clear
	
730
	
 

	
Shellacs - Pigmented
	
550
	
 

	
All Stains
	
 
	
 

	
 
	
 
	
 

	
Architectural Applications
	
VOC Limit [g/L less water]
	
Specialty Applications
	
VOC Limit [g/L less water]

	
Indoor Carpet Adhesives
	
50
	
PVC Welding
	
510

	
Carpet Pad Adhesives
	
50
	
CPVC Welding
	
490

	
Wood Flooring Adhesives
	
100
	
ABS Welding
	
325

	
Rubber Floor Adhesives
	
60
	
Plastic Cement Welding
	
250

	
Subfloor Adhesives
	
50
	
Adhesive Primer for Plastic
	
550

	
Ceramic Tile Adhesives
	
65
	
Contact Adhesive
	
80

	
VCT & Asphalt Adhesives
	
50
	
Special Purpose Contact Adhesive
	
250

	
Drywall & Panel Adhesives
	
50
	
Structural Wood Member Adhesive
	
140

	
Cover Base Adhesives
	
50
	
Sheet Applied Rubber Lining Operations
	
850

	
Multipurpose Construction Adhesives
	
70
	
Top & Trim Adhesive
	
250

	
Structural Glazing Adhesives
	
100
	
 
	
 

	
Single-Ply Roof Membrane Adhesives
	
250
	
 
	
 

	
 
	
 
	
 
	
 

	
Substrate Specific Applications
	
VOC Limit [g/L less water]
	
Specialty Applications
	
VOC Limit [g/L less water]

	
Metal to Metal
	
30
	
Architectural
	
250

	
Plastic Foams
	
50
	
Nonmembrane Roof
	
300

	
Porous Material (except wood)
	
50
	
Roadway
	
250

	
Wood
	
30
	
Single-Ply Roof Membrane
	
450

	
Fiberglass
	
80
	
Other
	
420

	
 
	
 
	
 
	
 

	
Sealant Primers
	
VOC Limit [g/L less water]
	
 
	
 

	
Architectural Non Porous
	
250
	
 
	
 

	
Architectural Porous
	
775
	
 
	
 

	
Other
	
750
	
 
	
 

 

 

			
	
 
	
D-2-4
	
 

 

Green Seal Standard VOC Limits-October 19, 2000

	
Paints
	
VOC Limit (g/L less water)

	
Flat
	
50

	
Non-flat
	
150

	
Anti-corrosive/anti-rust
	
250

	
 
	
 

	
Aerosol Adhesives
	
VOC Weight (g/L minus water)

	
General Purpose Mist Spray
	
65% voes by weight

	
General Purpose Mist Spray
	
55% voes by weight

	
Special Purpose Aerosol Adhesives (all types)
	
70% voes by weight

 

 

			
	
 
	
D-2-5
	
 

 

BAAQMD VOC Limits—August 2001

	
Architectural
	
VOC Limit [g/L less water]
	
Specialty Applications
	
VOC Limit 
[g/L less water]

	
Indoor Floor Covering Installation
	
150
	
Computer Diskette Jacket Manufacturing
	
850

	
Multipurpose Construction
	
200
	
ABS Welding
	
400

	
Nonmembrane Roof Installation/Repair
	
300
	
CPVC Welding
	
490

	
Outdoor Floor Covering Installation
	
250
	
PVC Welding
	
510

	
Single-Ply Roof Material Installation/Repair
	
250
	
Other Plastic Welding
	
500

	
Structural Glazing
	
100
	
Thin Metal Laminating
	
780

	
Ceramic Tile Installation
	
130
	
Tire Retread
	
100

	
Cove Base Installation
	
150
	
Rubber Vulcanization Bonding
	
850

	
Perimeter Bonded Sheet Vinyl Flooring
	
660
	
Waterproof Resorcinol Glue
	
170

	
 
	
 
	
Immersible Product Manufacturing
	
650

	
 
	
 
	
Top and Trim Installation
	
540

	
 
	
 
	
 
	
 

	
Adhesive Primers
	
VOC Limit [g/L less water]
	
Contact Bond Adhesive
	
VOC Limit 
[g/L less water]

	
Automotive Glass Primer
	
700
	
Contact Bond Adhesive
	
250

	
Pavement Marking Tape Primer
	
150
	
Contact Bond Adhesive - Special Substrates
	
400

	
Plastic Welding Primer
	
650
	
 
	
 

	
Other
	
650
	
 
	
 

	
 
	
 
	
 
	
 

	
Adhesive Projects
	
VOC Limit [g/L less water]
	
Sealants
	
VOC Limit 
[g/L less water]

	
Metal
	
30
	
Architectural
	
250

	
Porous Materials
	
120
	
Marine Deck
	
760

	
Wood
	
120
	
Roadways
	
250

	
Pre-formed Rubber Products
	
250
	
Single-Ply Roof Materials Installation/Repair
	
450

	
All Other Substrates
	
250
	
Nonmembrane Roof Installation/Repair
	
300

	
 
	
 
	
Other
	
420

	
 
	
 
	
 
	
 

	
 
	
 
	
Sealant Primers
	
VOC Limit 
[g/L less water]

	
 
	
 
	
Architectural -Nonporous
	
250

	
 
	
 
	
Architectural -Porous
	
775

	
 
	
 
	
Other
	
750

 

 

 

 

			
	
 
	
D-2-6
	
 

 

 

EXHIBIT “E”

CONFIRMATION OF COMMENCEMENT DATE 

_____________, 20__

	
	
 

	
 

	
 

	
 

 

	
 
	
Re:
	
Lease Agreement (the “Lease”) dated May __, 2017, between 55 Cambridge Parkway, LLC, a Delaware limited liability company (“Landlord”), and Kalvista Pharmaceuticals, Inc., a Delaware corporation (“Tenant”).  Capitalized terms used herein but not defined shall be given the meanings assigned to them in the Lease.

Ladies and Gentlemen:

Landlord and Tenant agree as follows:

1.      Condition of Premises.  Tenant has accepted’ possession of the Premises pursuant to the Lease.  Any improvements required by the terms of the Lease to be made by Landlord have been completed to the full and complete satisfaction of Tenant in all respects except for the punchlist items described on Exhibit A hereto (the “Punchlist Items”), and except for such Punchlist Items, Landlord has fulfilled all of its duties under the Lease with respect to such initial tenant improvements.  Furthermore, Tenant acknowledges that the Premises are suitable for the Permitted Use.

2.      Commencement Date.  The Commencement Date of the Lease is ___________, 20__.

3.      Expiration Date.  The Lease Term is scheduled to expire on the last day of the sixtieth (60th) full calendar month of the Lease Term, which date is 20_.

4.      Contact Person.  Tenant’s contact person in the Premises is:

		
	
 

	
 

	
 

	
Attention: 
	
 

	
Telephone: 
	
 

	
Telecopy: 
	
 

 

5.      Ratification.  Tenant hereby ratifies and confirms its obligations under the Lease, and represents and warrants to Landlord that it has no defenses thereto.  Additionally, Tenant further confirms and ratifies that, as of the date hereof, (a) the Lease is and remains in good standing and in full force and effect, and (b) Tenant has no claims, counterclaims, set-offs or 

E-1

defenses against Landlord arising out of the Lease or in any way relating thereto or arising out of any other transaction between Landlord and Tenant.

6.      Binding Effect; Governing Law.  Except as modified hereby, the Lease shall remain in full effect and this letter shall be binding upon Landlord and Tenant and their respective successors and assigns.  If any inconsistency exists or arises between the terms of this letter and the terms of the Lease, the terms of this letter shall prevail.  This letter shall be governed by the laws of the state in which the Premises are located.

E-2

Please indicate your agreement to the above matters by signing this letter in the space indicated below and returning an executed original to us.

 

	
Agreed and accepted:
	
 
	
Sincerely,

	
 
	
 
	
 

	
KALVISTA PHARMACEUTICALS, INC.,
	
 
	
55 CAMBRIDGE PARKWAY, LLC,

	
a Delaware corporation
	
 
	
a Delaware limited liability company

	
 
	
 
	
 
	
 

	
 
	
 
	
By: Invesco ICRE Massachusetts REIT Holdings, LLC, Its sole member

	
By:
	
 
	
 
	
 
	
 

	
Name:
	
 
	
 
	
By:
	
 

	
Title:
	
 
	
 
	
 
	
Name:
	
 

	
 
	
 
	
 
	
 
	
Title:
	
 

 

 

 

E-3

 

EXHIBIT A

PUNCHLIST ITEMS

Please insert any punchlist items that remain to be performed by Landlord.  If no items are listed below by Tenant, none shall be deemed to exist.

 

E-4

 

EXHIBIT ‘‘F”

MOISTURE AND MOLD CONTROL INSTRUCTIONS

Because exercising proper ventilation and moisture control precautions will help maintain Tenant’s comfort and prevent mold growth in the Premises, Tenant agrees to adopt and implement the following guidelines, to avoid enveloping excessive moisture or mold growth:

1.Report any maintenance problems involving water, moist conditions, or mold to the Property Manager promptly and conduct its required activities in a manner that prevents unusual moisture conditions or mold growth.

2.Do not block or inhibit the flow of return or make up air into the HVAC system.  Maintain the Premises at a consistent temperature and humidity level in accordance with the Property Manager’s instructions.

3.Regularly conduct janitorial activities, especially in bathrooms, kitchens, and janitorial spaces, to remove mildew and prevent or correct moist conditions.

4.Maintain water in all drain taps at all times.  

 

	
Dated:   May __, 2017
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
TENANT:

	
 
	
 
	
 

	
 
	
 
	
KALVISTA PHARMACEUTICALS, INC.,

	
 
	
 
	
a Delaware corporation

	
 
	
 
	
 
	
 

	
 
	
 
	
By:
	
 

	
 
	
 
	
Name:
	
 

	
 
	
 
	
Title:
	
 

 

 

 

F-1

 

EXHIBIT “G”

LANDLORD’S SERVICES

I.CLEANING

A.Office Area

Daily: (Monday through Friday, inclusive.  Legal Holidays excepted.)

	
 
	
1.
	
Empty and clean all waste receptacles; wash receptacles as necessary.

	
 
	
2.
	
Sweep and dust mop all uncarpeted areas using a dust-treated mop.

	
 
	
3.
	
Vacuum all rugs and carpeted areas.

	
 
	
4.
	
Hand dust and wipe clean with treated cloths all horizontal surfaces including furniture, office equipment, window sills, door ledges, chair rails, and convector tops, within normal reach.

	
 
	
5.
	
Wash clean all water fountains.

	
 
	
6.
	
Remove and dust under all desk equipment and telephones and replace same.

	
 
	
7.
	
Wipe clean all brass and other bright work.

	
 
	
8.
	
Hand dust all grill work within normal reach.

Weekly:

	
 
	
1.
	
Dust coat racks, and the like.

	
 
	
2.
	
Remove all finger marks from private entrance doors, light switches and doorways.

Quarterly:

	
 
	
1.
	
Clean and spray wax vinyl tile floors in tenant areas.

	
 
	
2.
	
Render high dusting not reached in daily cleaning to include:

	
 
	
a.
	
Dusting all pictures, frames, charts, graphs, and similar wall hangings.

	
 
	
b.
	
Dusting all vertical surfaces, such as walls, partitions, doors, and ducts.

	
 
	
c.
	
Dusting all pipes, ducts, and high moldings.

B.Lavatories

Daily: (Monday through Friday, inclusive.  Legal Holidays excepted.)

	
 
	
1.
	
Sweep and damp mop floors.

	
 
	
2.
	
Clean all mirrors, powder shelves, dispensers and receptacles, bright work, flushometers and piping.

	
 
	
3.
	
Wash all toilet seats.

	
 
	
4.
	
Wash all basins, bowls and urinals.

G-1

	
 
	
5.
	
Dust and clean all powder room fixtures.

	
 
	
6.
	
Empty and clean paper towel and sanitary disposal receptacles.

	
 
	
7.
	
Refill tissue holders, soap dispensers, towel dispensers, vending sanitary dispensers; materials to be finished by Landlord.

	
 
	
8.
	
A sanitizing solution will be used in all lavatory cleaning.

Monthly:

	
1.
	
Machine scrub lavatory floors.

	
2.
	
Wash all partitions and tile walls in lavatories.

C.Main Lobby, Elevators, Building Exterior and Corridors

Daily: (Monday through Friday, inclusive.  Legal Holidays excepted.)

	
 
	
1.
	
Sweep and wash all floors.

	
 
	
2.
	
Wash all rubber mats.

	
 
	
3.
	
Clean elevators, wash or vacuum floors, wipe down walls and doors.

	
 
	
4.
	
Spot clean any metal work inside lobby.

	
 
	
5.
	
Spot clean any metal work surrounding Building entrance doors.  Monthly: All resilient tile floors in public areas to be treated equivalent to spray buffing.

D.Window Cleaning

Windows of exterior walls will be washed quarterly.

II.HEATING, VENTILATING, AND AIR CONDITIONING

	
 
	
1.
	
Heating, ventilating, and air conditioning as required to provide reasonably comfortable temperatures for normal business day occupancy (excepting holidays); Monday through Friday from 8:00 a.m. to 6:00 p.m. and Saturday from 8:00 a.m. to 1:00 p.m., subject to the provisions of Article 18 of the Lease.

	
 
	
2.
	
Maintenance of any additional or special air conditioning equipment and the associated operating cost will be at Tenant’s expense.

III.WATER

Hot water for lavatory purposes and cold water for drinking, lavatory and toilet purposes.

IV.ELEVATORS

Elevators for the use of all tenants and the general for access to and from all floors of the Building.  Programming of elevators (including, but not limited service elevators) shall be as Landlord from time to determines best for the Building as a whole.

G-2

V.RELAMPING OF LIGHT FIXTURES

Tenant will reimburse Landlord for the cost of lamps, ballasts and starters and the cost of replacing same within the Premises.

VI.CAFETERIA AND VENDING INSTALLATIONS

	
 
	
1.
	
Any space to be used primarily for lunchroom or cafeteria operation shall be Tenant’s responsibility to keep clean and sanitary, it being understood that Landlord’s approval of such use must be first obtained in writing.

	
 
	
2.
	
Vending machines or refreshment service installations by Tenant must be approved by Landlord in writing and shall be restricted in use to employees and business callers.  All cleaning necessitated by such installations shall be at Tenant’s expense.

VII.ELECTRICITY

	
 
	
A,
	
Landlord, at Landlord’s expense, shall furnish electrical energy required for lighting, electrical facilities, equipment, machinery, fixtures, and appliances used in or for the benefit of the Premises in accordance with the provisions of the Lease of which this Exhibit is a part.

	
 
	
B.
	
Electricity to the Premises shall be submetered or check metered to the Premises.  Tenant shall pay for all charges for electric consumption in the Premises as reasonably determined by Landlord, but without mark-up above actual cost, within ten (10) days of Landlord’s invoice therefor, from time to time, but not more often than monthly; provided that upon written notice from Landlord, Tenant shall pay an estimate of such charges, as reasonably determined by Landlord from time to time, monthly at the same time and in the same manner as payments of Minimum Annual Rent, with appropriate payment (or credit against future electric charges) to be made annually based upon Landlord’s revised estimates for the prior year.  If at any time electric charges for the Premises are payable to the utility therefor, because of the installation of submeters or check meters or otherwise, Tenant shall pay such charges before they become due.  The foregoing shall not constitute Landlord’s consent to the installation of any such meters.  Landlord shall have the exclusive right to designate the electric service provider to serve the Building.

Tenant covenants and agrees that its use of electric current (exclusive of HVAC) shall not exceed 8.0 watts per square foot of rentable floor area and that its total connected lighting load will not exceed the maximum load from time to time permitted by applicable governmental regulations.

 

G-3

 

EXHIBIT “H”

LIST OF ISSUING BANKS FOR LETTER OF CREDIT

1.Bank of America

2.BB&T Co.

3.Fifth Third Bank

4.Citibank

5.JPMorgan Chase Bank

6.National City Bank

7.Northern Trust Bank

8.PNC Bank

9.US Bank, N.A.

10.Wells Fargo Bank

11.Silicon Valley Bank

 

H-1

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