Document:

Sublease

     

    Exhibit
      10.20

    
 

    SUBLEASE

     

    THIS
      SUBLEASE made as of this 15th day of June, 2005, by and between Accupath
      Diagnostic Laboratories,
      Inc. dba U.S. Labs, a California corporation (hereinafter called "Sublandlord"),
      and
      CombiMatrix Molecular Diagnostics, Inc., a California corporation (hereinafter
      called "Subtenant").

    

    RECITALS

    

    A.  Pursuant
      to that certain Lease Agreement by and between Edison Spectrum Partners, LLC
      (hereinafter called "Landlord") and Sublandlord dated August 9, 2004, including
      all
      exhibits and amendments thereto, if any, a copy of all of which is attached
      hereto as Exhibit A
      (collectively, as the same may be amended from time to time, hereinafter call
      the "Lease"), Sublandlord
      is the lessee of certain real property located at 310 Goddard Way, Suite 150,
      Irvine,
      California (hereinafter called the "Leased Premises") more particularly
      described in Exhibit A, together with all improvements constructed
      thereon.

    

    B.  Subtenant
      desires to sublease from Sublandlord and Sublandlord desires to sublease
to
      Subtenant all of the Leased Premises (hereinafter called the "Subleased
      Premises"), which are
      depicted
      on Exhibit
      A
to
      the
      Lease.

    

    C.  Sublandlord
      and Subtenant desire to enter into this Sublease defining their respective
      rights, duties, and liabilities to the Subleased Premises.

    

    NOW,
      THEREFORE, in consideration of the mutual promises and covenants contained
      herein,
      and
      other good and valuable consideration, the receipt and sufficiency of which
      are
      hereby acknowledged, Sublandlord and Subtenant hereby agree as
      follows:

    

    1.  TERM. 
      Sublandlord,
      for and in consideration of the payment of the rent and the performance
      of the covenants hereinafter mentioned, does hereby sublease unto Subtenant,
      the Subleased
      Premises for a term (hereinafter called the "Term") commencing on the date
      first
      set
      forth
      above (the "Commencement Date") and ending on August 31, 2006.

    

    Sublandlord
      shall use commercially reasonable efforts to deliver the Subleased Premises
      to
      Subtenant on or about the Commencement Date. If Sublandlord fails to timely
      deliver the Sublease
      Premises, Sublandlord shall not be liable to Subtenant for any loss or damage
      resulting
      therefrom, and this Sublease shall not be void or voidable except as may be
      provided hereinbelow. If Sublandlord does not deliver the Sublease Premises
      within five (5) days of the Commencement Date for any reason other than for
      reasons outside the reasonable control of Sublandlord, this Sublease may be
      terminated by Sublandlord or Subtenant by written notice to the other, and
      if so
      terminated neither Sublandlord nor Subtenant shall have any further rights,
      duties
      or
      obligations under this Sublease, except with respect to provisions that
      expressly survive
      termination of this Sublease. If neither Sublandlord nor Subtenant elects to
      terminate this Sublease within five (5) business days of the lapse of such
      five
      (5) day period, such right to terminate shall be waived and this Sublease shall
      remain in full force and effect.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    Subtenant
      acknowledges, represents and warrants that, notwithstanding anything to the
      contrary
      in this
      Sublease or in the Lease, Subtenant has had an opportunity to inspect the
      Subleased Premises
      and hereby accepts the Subleased Premises in their "AS IS"
      condition, subject only to
      Sublandlord's removal of its personal property from the Subleased Premises.
      Possession of the Subleased Premises by Subtenant shall be conclusive evidence
      that Subtenant accepts the Subleased
      Premises "AS IS," and that the Subleased Premises are suited
      for Subtenant's use and
      are in
      good and satisfactory condition as of the time possession is taken. Subtenant
      acknowledges that neither Landlord nor Sublandlord, nor their respective agents
      or representatives, has made any representations, warranties, or promises with
      respect to the Building or the Subleased Premises, except as may be expressly
      set forth in this Sublease.

     

    2.  RENT.
      The rent
      during the Term
      (hereinafter
      called the "Rent") shall be the actual monthly rent and all other sums otherwise
      required to be paid by Sublandlord to Landlord for the Subleased Premises under
      the Lease, as and when due thereunder, including, without limitation, the Base
      Rent and the Operating Expenses, as set forth in the Lease. Rent for any partial
      month shall be prorated accordingly. All Rent shall be paid in advance to
      Sublandlord on the first day of
      each
      month during the Term., at 2601 Campus Drive, Irvine, California 92612
      Attention: Glen
      Fredenberg. Notwithstanding anything to the contrary contained in this Section
      2, Subtenant shall not be obligated to pay (i) any Bonus Rent that may come
      due
      under Section 12.4 of the Lease or (ii) any Rent that comes due as a result
      of
      Sublandlord's sole failure to comply with the Lease.

     

    3.  SUBJECT TO LEASE.
      This
      Sublease is subject and subordinate to the Lease and to all matters to which
      the
      Lease is now or hereafter made subordinate. Subtenant's interest in the
Sublease
      Premises and rights under this Sublease are derivative of the Sublandlord's
      rights under the
      Lease
      and Subtenant acknowledges and agrees that, notwithstanding anything to the
      contrary
      in this
      Sublease, Subtenant's rights hereunder and with respect to the Sublease Premises
      shall be no greater than those of Sublandlord pursuant to the Lease. Except
      as
      may be inconsistent with the terms, covenants and conditions of this Sublease,
      all the terms, covenants, and conditions in the Lease shall be deemed a part
      of
      this Sublease, with references in the Lease to "Lessor" deemed made to
      "Sublandlord", references to "Lessee" deemed made to "Subtenant", and references
      to the "Leased Premises" deemed made to the "Subleased Premises". The
      termination of the Lease for any reason whatsoever shall cause
      an
      automatic and contemporaneous termination
      of this Sublease. Sublandlord represents and warrants that, as of the
      Commencement
      Date, it
      is in compliance with all terms, covenants and conditions of the Lease and
      will,
      in the future, continue to so comply.

     

    The
      following sections of and Exhibits to the Lease are not applicable to this
      Sublease: 1.1, 1.10, 1.13, 2.2, 3.1.1, 3.3, 5, 15, and Exhibit B.

     

    In
      the
      case of any breach or default of this Sublease by Subtenant, Sublandlord shall
      have the rights
      against Subtenant as would be available to the Lessor against the Lessee under
      the Lease if
      such
      breach were by the Lessee thereunder. Subtenant, with respect to the Subleased
      Premises, will duly and faithfully observe all the terms, covenants and
      conditions and perform all the obligations imposed upon Sublandlord as Lessee
      under the Lease, except for those sections and Exhibit listed
      above.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    Subtenant
      shall not commit any act that requires Landlord's consent under the Master
      Lease
      without first obtaining the consent of Master Landlord and Sublandlord.
      Notwithstanding any contrary
      provision of this Sublease or any other agreement between Sublandlord and
      Subtenant,
      Sublandlord shall have no obligation to obtain Landlord's consent on behalf
      of
      Subtenant, and shall not be liable for any failure of Landlord to grant its
      consent.

    

    Neither
      Sublandlord nor Subtenant shall do or permit anything to be done which would
      cause the
      Lease to
      be terminated or forfeited by reason of any right of termination or forfeiture
      reserved or vested in the Lessor under the Lease.

    

    Sublandlord
      agrees to execute all documents reasonably requested by Subtenant
      evidencing
      Subtenant's compliance with all the terms, covenants and conditions of this
      Sublease.

    

    Subtenant
      shall keep and maintain all insurance required of Lessee pursuant to the Lease,
      on the
      terms,
      covenants and conditions as provided in the Lease.

    

    Subtenant
      shall provide at its expense the removal of any bio-hazardous waste generated
      by
      Subtenant on the Subleased Premises.

    

    At
      the
      expiration of the Term or upon the earlier termination of this Sublease,
      Subtenant shall vacate
      the Subleased Premises in accordance with the Lease and Subtenant will have
      no
      further
      interest
      in the Subleased Premises or any additions, improvements or alterations
      thereto.

    

    4.  PERSONAL
      PROPERTY. Subtenant
      shall have the right to install, place and use any and all fixtures, equipment,
      inventory, and supplies (collectively the "Personal.
      Property") on the Subleased Premises as it deems fit and for any purpose
      whatsoever and shall have the right to remove the Personal Property form the
      Subleased Premises at anytime.

    

    
      	5.	
               
                INDEMNIFICATION.

            

    

     

    
      
        	
              	5.1	
                Indemnification of Landlord and Sublandlord. Subtenant
                  shall indemnify, protect, defend, and hold harmless Landlord and
                  Sublandlord and each of their respective affiliates, partners,
                  members, directors, officers, employees, and agents, from and against
                  any
                  and
                  all claims, suits, demands, liabilities, damages and expenses of
                  every
                  kind and description,
                  including reasonable attorneys' fees and costs, arising from or
                  in
                  connection with
                  (i) Subtenant's use of the Subleased Premises or the conduct of
                  its
                  business therein.; (ii) any
                  activity performed or permitted by Subtenant or any of its affiliates,
                  partners, members,
                  directors, officers, employees, agents, contractors or licensees
                  on the
                  Project; (iii) any
                  Event of Default; or (iv) the willful misconduct or negligent acts
                  or
                  omissions of
                  Subtenant or any of its affiliates, partners, members, directors,
                  officers, employees,
                  agents, contractors, or
                  licensees.

              

      

    

    

    
      	
            	5.2	
              Exclusions from Liability.
                In
                no event shall Landlord or Sublandlord be liable to Subtenant
                for any injury to any person: in or about the Subleased Premises
                or damage
                to
                the Subleasd Premises or for any loss, damage or injury to any property
                of
                Subtenant therein unless and to the extent such loss, damage or injury
                is
                caused by the gross

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
       

    

    negligence
      or willful misconduct of Landlord or Sublandlord. Without limiting the
foregoing,
      in no event shall Landlord or Sublandlord be liable to Subtenant for (i) loss
      of records
      kept within the Subleased Premises, (ii) injury to Subtenant's business or
      loss
      of
      income
      relating to any damage or destruction of personal property (including without
      limitation, any loss of such records), or (iii) damages arising from any act,
      omission or neglect of any tenant in the Building or of any other third
      party.

     

    
      	
            	5.3	
              Sublandlord's Obligations. The
                obligations of Sublandlord under this Sublease do not constitute
                personal obligations of the individual directors, officers, employees,
                partners
                or
                shareholders of Sublandlord, and Subtenant shall not seek recourse
                against
                said individual directors, officers
                or shareholders
                of any of their personal assets for satisfaction of any liability
                with
                respect to this Sublease.

            

    

    

    
      	
            	5.4	
              Limitation. The
                indemnities set forth in
                Section
                5.1 shall not apply to the extent any liability
                or damage is covered by insurance maintained by Sublandlord and
                Subtenant, respectively.
                The indemnities pursuant to Section 5.1 are not intended to and shall
                not relieve
                any insurance carrier of its obligations under policies required
                to be or
                actually
                carried by either party pursuant to this
                Sublease.

            

    

     

    
      	
            	5.2	
              Indemnity of Subtenant. Sublandlord
                does hereby indemnify and hold Subtenant harmless
                from and against any loss, cost, claim, damage, liability or expense,
                including reasonable
                attorneys' fees, which Subtenant may suffer, incur, or expend arising
                out
                of any
                failure on the part of Sublandlord to perform fully any of its obligations
                hereunder.

            

    

    
    

     

    
      	6.	
              USE AND MAINTENANCE.

            

    

    

    
      	
            	6.1	
              Subtenant's Use of the Subleased Premises. Subtenant
                shall use the Subleased Premises
                only for purposes that are consistent with
                the Use
                provision of the Lease and/or
                for such other purposes not specifically prohibited by this Sublease
                or
                the Lease and shall not do or
                permit
                any unlawful act within the Subleased Premises. The parties hereto
                understand and agree that the Subleased Premises shall be dedicated
                to the
                Subtenant's use at all times during the Term of this
                Sublease.

            

    

    

    
      	
            	6.2	
              Subtenant's Maintenance and Repair. Except
                for
                any obligations
                of Sublandlord under the Lease that are specifically set forth and
                assumed
                by Sublandlord in this Sublease and any obligations of Landlord under
                the
                Lease, Subtenant shall, at Subtenant's sole expense, keep the Subleased
                Premises and every part thereof in good condition, ordinary wear
                and tear,
                condemnation and insured casualty excepted. If Sublandlord reasonably
                determines that (i) any maintenance and/or repair of the Subleased
                Premises is required under the terms of the Lease, or (ii) any maintenance
                and/or repair to the Building is required by reason of the negligent
                act
                or omission or willful misconduct of Subtenant or its agents, employees,
                contractors, invitees}
                or
                licensees, and Sublandlord or Landlord performs the required maintenance
                or repair work,
                Subtenant shall pay to Sublandlord or Landlord (as applicable) the
                reasonable cost
                of
                such maintenance and rcpairs.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
            	6.3	
              Subtenant's Alterations and Improvements. Unless
                specifically permitted by the terms of this Sublease, Subtenant shall
                not
                make any alterations or improvements to the Subleased
                Premises without the consent of Landlord and Sublandlord. Sublandlord
                shall
                reasonably cooperate and assist Subtenant in obtaining the consent
                of
                Landlord under the Lease, and Sublandlord shall not unreasonably
                withhold,
                condition or delay its consent to any alteration or improvement requested
                by Subtenant that is approved by
                Landlord.

            

    

    

    
      	
            	6.4	
              Sublandlord's Maintenance and Repair. Sublandlord
                shall have no obligation to operate, maintain, or repair the Sublease
                Premises or the Building. Subtenant shall have the right to notify
                Sublandlord of any needed maintenance and/or repairs that are the
                obligation of Landlord under the Lease, and Sublandlord shall inform
                Landlord of such items and shall use commercially reasonable efforts
                to
                cause Landlord to complete such maintenance
                or repairs to the extent Landlord is obligated to do so under the
                terms of
                the
                Lease. Unless specifically provided in this Sublease, there shall
                be no
                abatement of Rent
                with respect to, and Sublandlord shall not be liable for, any injury
                to or
                interference
                with Subtenant's business arising from any repairs, maintenance,
                alteration, or improvement
                in or to any portion of the Project or the Building, including the
                Subleased
                Premises, or in or to the fixtures, appurtenances, and equipment
                therein.
                Subtenant hereby waives and releases any right to make repairs at
                Sublandlord's expense under Section 1942 of the California Civil
                Code and
                the provisions of Section 1932(1) of the California Civil Code or
                under any applicable Law now or hereafter in
                effect.

            

    

    

    
      
        	
              	6.5	
                Alterations and Improvements. Sublandlord
                  shall have no obligation to alter, remodel,
                  improve, repair, decorate,, or paint the Subleased Premises or
                  any part
                  thereof.

              

      

    

    

    
      	
            	6.6	
              Abatement of Rent. In
                the event the Subleases Premises are damaged, as described in Section
                9.1
                of the Lease, the Rent shall abate in accordance with Section 9.6
                of the
                Lease.

            

    

     

    7.  Parking
      Privileges. Subtenant
      is hereby granted the Vehicle Parking privileges. Subtenant shall at all times
      comply with the terms of the Lease with respect to its use of such Vehicle
      Parking privileges. Subtenant shall pay all costs, fees and charges applicable
      to such Vehicle Parking privileges imposed or charged in accordance with the
      terms of the Lease or other rules and regulations established by
      Landlord.

    

    8.  Compliance
      With Laws and Permits. Subtenant
      shall, at Subtenant's sole cost and expense, comply throughout the Sublease
      Term
      with all Applicable Law now or hereafter in effect
      with respect to the Subleased Premises and Subtenant's use and
      occupancy thereof. 
      If any governmental
      license, permit, or similar consent or authorization is required with respect
      to
      Subtenant's use or occupancy of the Subleased Premises, including, without
      limitation, any improvements or alterations performed therein, Subtenant shall
      be responsible, at its sole cost and
      expense, for obtaining and maintaining such required licenses, permits, and
      authorizations,
      and
      shall at all times comply with the terms and conditions thereof.

    

    9.  Tax
      on Subtenant's Personal
      Property. Prior
      to
      delinquency, Subtenant shall pay all taxes levied or assessed upon Subtenant's
      personal property in or about the Subleased Premises or other personal property
      from time to time located within the Subleased Premises for or on
      the

     

    
      
        
        

      

      
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    account
      of Subtenant, including any improvements existing as of the Commencement Date
      that are used by Subtenant (collectively, "Subtenant's
      Property"). If
      the
      assessed value of Landlord's
      or Sublandlord's property is increased by the inclusion therein of a value
      placed upon
      Subtenant's Property, then Subtenant shall pay Sublandlord, within 10 business
      days of Subtenant's receipt of a written demand and evidence of said increased
      assessment, the proportion of taxes so levied against Landlord or Sublandlord
      resulting from any such direct assessment or said increase in
      assessment.

    

    10.  Landlord's
      Sublandlord's Right
      of Entry. Landlord
      or Sublandlord, as applicable, and their employees, agents and representatives
      shall have the right to enter the Subleased Premises for purposes of inspection,
      to post notices of non-responsibility, to supply any services to be provided
      by
      or under the Lease or this Sublease, to perform
      all
      required or permitted work therein, for the purpose of making alterations,
      repairs or additions to the Subleased Premises or the
      Building that are permitted under the Lease or this Sublease, as required
      by
      Law,
      or in cases of
      emergencies. Landlord or Sublandlord shall use commercially reasonable efforts
      to minimize
      interference with Subtenant's use of the Subleased Premises during any such
      entry by Sublandlord. During the last ninety (90) days of the Terra, Landlord
      or
      Sublandlord, as applicable,
      and their employees, agents and representatives shall also have the right to
      show the
      Subleased Premises to prospective tenants, mortgagees, prospective mortgagees
      or
      prospective purchasers of the Building or Project. No entry permitted hereunder
      shall be construed
      under any circumstances as a forcible or unlawful entry into, or a detainer
      of,
      the Subleased Premises, or an eviction of Subtenant. Subtenant hereby waives
      any
      claim against Sublandlord, Landlord and their respective employees, agents
      or
      representatives for damages for interference with Subtenant's business or quiet
      enjoyment of the Subleased Premises in connection with the right of entry
      set
      forth
      in this section.

    

    
      	11.	
              Assignment and Subletting

            

    

     

    
      	
            	11.1	
              Subtenant
                shall have the right to assign its interest in this Sublease or to
                sub-sublet the Subleased
                Premises with the prior written consent and approval of Sublandlord
                (which consent
                shall not be unreasonably withheld or delayed) and the consent and
                approval of
                Landlord pursuant to the terms of the Lease. Subtenant shall submit
                any
                request for consent and approval by Sublandlord and Landlord to any
                proposed sub-sublease or assignment not less than 30 days prior to
                such
                proposed sub-sublease or
                assignment.

            

    

    

    
      	
            	11.2	
              Subtenant
                hereby waives the provisions of any Law, now or hereafter in force
                (including, without limitation, Section 1995.3 10 of the California
                Civil
                Code), that provide that Subtenant may terminate this Sublease if
                Sublandlord is determined to have
                unreasonably refused consent and approval to an assignment or sub-sublease
                by
                Subtenant in violation of Subtenant's rights under this Section,
                it being
                agreed that Subtenant's sole remedy in such a case will be the recovery
                of
                any contract damages caused by Sublandlord's
                actions.

            

    

     

    
      	
            	11.3	
              Notwithstanding
                any assignment or sub-sublease, Subtenant shall at all times remain
                fully
                and primarily responsible and liable for the payment of Rent and
                for
                compliance
                with all of Subtenant's other obligations under this
                Sublease.

            

    

     

    
      	12.	
              Surrender
                of Subleased Premises and Removal of Subtenant's Property.

            

    

     

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    
      	
            	
              12.1

            	
              Subtenant's Surrender of the Subleased Premises. Upon
                the expiration or earlier termination of this Sublease, Subtenant
                shall
                quit and surrender possession of the Subleased
                Premises to Sublandlord, broom clean, free and clear of all personal
                property
                of
                Subtenant and with all appurtenant systems, equipment and fixtures
                that
                are Subtenant's obligation to maintain and repair in good order and
                repaired in serviceable condition, reasonable wear and tear, condemnation
                and insured casualty excepted, and shall, without expense to Sublandlord,
                remove or cause to be removed from the Subleased Premises all debris
                and
                rubbish, all Subtenant's personal property, and Subtenant shall repair
                all
                damage to the
                Subleased
                Premises resulting from such
                removal.

            

    

     

    
      	
            	12.2	
              Surrender
                of Subleased Premises and
                Removal of Alterations and Improvements.
                In
                the event Landlord requires the removal of any Lessee Owned Alterations
                or
                Utility
                Installations upon the expiration or earlier termination of the Lease,
                as
                set forth in Section
                7.4.2 of the Lease,
                Subtenant
                shall be responsible for the cost of such removal
                and any related restoration of the Subleased
                Premises.

            

    

     

    13.  Rules
      and Regulations. The
      Rules
      and Regulations, as amended from time to time, for the Building attached as
      Exhibit D
      to the
      Lease are hereby incorporated herein and made a part of this Sublease. Subtenant
      agrees to abide by and comply with each and every of said Rules and Regulations
      and any amendments, modifications and/or additions thereto as may hereafter
      be
      adopted by Landlord or Sublandlord.

    

    
      	14.	
              General Provisions

            

    

     

    
      	
            	14.1	
              Notices. All
                notices to be given pursuant to this Sublease shall be delivered
                and
                deemed given in accordance with Section 23 of the Lease. All notices
                to be
                given pursuant to this Sublease shall be given to the parties at
                the
                following respective addresses:

            

    

     

    
      	
            	If
              to Sublandlord:	
              2601
                Campus Drive 

              Irvine,
                California 92612 

              Attn:
                CEO

            

    

     

    
      	
            	with
              a copy to:	
              Laboratory
                Corporation of America Holdings

              430
                South Spring Street, 1st Floor

              
                Burlington,
                  North Carolina 27215

                Attn:
                  General Counsel

              

            

    

     

    
      	
            	
              If to Subtenant:

            	
              310
                Goddard Way, Suite 150

              Irvine,
                California 92818 

              Attn:
                Matt Watson

            

    

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
            	with
              a copy to:	
              CombiMatrix,
                Inc.

              6500
                Harbour Heights Parkway, Suite 301

              Mukilteo,
                Washington 98275

              Attn:
                General Counsel

            

    

    

    
      	
            	To
              Landlord:	
              Edison
                Spectrum Partners, LLC

              c/o
                La Quinta Development

              320
                Goddard Way, Suite 150 

              Irvine,
                California 92818

              Attn:
                Thom Falcon

            

    

    

    
      	14.2	
              Entire
                Agreement; No Oral Amendment. All
                prior written and oral understandings, representations, warranties,
                and
                agreements between Sublandlord and Subtenant with respect to the
                Subleased
                Premises are superseded by and merged into this Sublease, which alone
                fully and completely sets forth the understanding of Sublandlord
                and
                Subtenant
                with respect to the Subleased Premises. Subtenant acknowledges that
                neither
                Sublandlord nor Landlord, nor any agent of either such party has
                made any
                representation or warranty, except as maybe expressly provided in
                this
                Sublease, with respect to the Subleased Premises, the Building, or
                any
                other portion of the Project. This
                Sublease may not be
                amended or modified in any respect whatsoever except by an
                instrument in writing signed by Sublandlord and Subtenant and, if
                required
                by the Lease, consented to in writing by
                Landlord.

            

    

    

    
      	14.3	
              No Waiver. The
                waiver by Sublandlord or Subtenant of any breach or default of any
                term,
                provision, covenant, or condition contained in this Sublease, or
                the
                failure of such party
                to insist on the strict performance by the other party, shall not
                be
                deemed to be a
                waiver of such term, provision, covenant, or condition as to any
                subsequent breach or default
                thereof or of any other term, covenant, or condition contained in
                this
                Sublease. The
                acceptance of Rent hereunder by Sublandlord or the payment of Rent
                hereunder by Subtenant
                shall not be deemed to be a waiver of any breach or default by Subtenant
                or Sublandlord,
                respectively, of any term, provision, covenant, or condition herein,
                other
                than the failure of Subtenant to pay the particular rent so accepted,
                regardless of Sublandlord's or Subtenant's respective knowledge of
                such
                breach or default at the time of acceptance or payment of
                rent.

            

    

    

    
      	14.4	
              Successors and Assigns. This
                Sublease shall be binding upon and shall inure to the benefit
                of the heirs, executors, administrators, representatives, and permitted
                successors
                and assigns of the parties hereto.

            

    

    

    
      	14.5	
              Severability. If
                any term or provision of this Sublease, the deletion of which would
                not
                adversely affect the receipt of any material benefit by either party
                hereunder, shall be held invalid or unenforceable to any
                extent,
                the remaining terms, conditions, and covenants of this Sublease shall
                not
                be affected thereby and each of said terms, covenants,
                and conditions shall be valid and enforceable to the fullest extent
                permitted
                by
                applicable Laws.

            

    

     

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
      	
              14.6

            	
              Attorneys' Fees. If
                either Sublandlord or Subtenant reasonably seeks legal services with
                respect to the proper interpretation or enforcement of this Sublease,
                the
                party receiving substantially the result it sought or defended (the
                "Prevailing Party"), whether by award, judgment, stipulation, settlement,
                workout, default, or otherwise and whether or not any legal action
                may
                have been instituted or instituted and then voluntarily dismissed,
                shall
                be entitled to recover from the adverse party all actual fees and
                costs
                incurred by the Prevailing Party in connection with such legal services
                ("Legal Fees").
                Legal
                Fees include, without limitation, (i) fees, costs, and expenses of
                any
                engineers, accountants, appraisers, consultants, brokers, and other
                professionals or experts retained or consulted by the Prevailing
                Party,
                and other costs and expenses of investigation or analysis incurred
                by the
                Prevailing Party in support of its position, and (ii) all such fees,
                costs, and expenses incurred in any aspect of the legal process,
                whether
                out-of-court negotiations, mediation, arbitration, commencement of
                suit,
                discovery, law and motion, trial, appellate proceedings, or any action
                or
                participation in, or in
                connection with, any case or proceeding under Chapter 7, 11, or 13
                of the
                Bankruptcy Code, 11 U.S.C. Section 101 et seq., or any successor
                statutes.

            

    

    

    
      	14.7	
              No
                Partnership
                or Joint Venture. Nothing
                in this Sublease shall be construed as creating a partnership or
                joint
                venture between Sublandlord, Subtenant or any other party, or cause
                Subtenant or Sublandlord to be responsible for the debts of the other
                or
                of any third party.

            

    

     

    
      	14.8	
              Counterparts. This
                Sublease may be executed in two or more counterparts, and, when so
                executed, will have the same force and effect as though all signatures
                appeared on a single document. Any signature page of this Sublease
                may be
                detached from any counterpart without impairing the legal effect
                of any
                signatures thereon, and may be attached to another counterpart identical
                in form thereto by having attached to it one or more additional signature
                pages.

            

    

    

    
      	14.9	
              No Recordation. Neither
                this Sublease nor a memorandum thereof shall be filed by or on behalf
                of
                Subtenant in any public record.

            

    

    

    
      	14.10	
              Time. Time
                is of the essence as to the performance of Subtenant's obligations
                under
                this Sublease.

            

    

     

    
      	14.11	
              No Third Party Benefits. Except
                to the extent expressly provided otherwise in this Sublease, Sublandlord
                and Subtenant do not intend by any provision of this Sublease to
                confer
                any right, remedy, or benefit upon any third party, and no third
                party
                shall be entitled to enforce, or otherwise shall acquire any right,
                remedy, or benefit by reason of, any provision of this
                Sublease..

            

    

    

    
      	14.12	
              Quiet Enjoyment. So
                long as Subtenant shall perform all of the covenants and agreements
                herein
                required to be performed by Subtenant, Subtenant shall, subject to
                the
                terms of this Sublease, at all times during the Sublease Term, have
                peaceful and quiet enjoyment of the Sublease Premises against any
                person
                claiming by, through or under
                Sublandlord.

            

    

     

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	14.13	
              Captions. The
                captions or section headings used in this Sublease are for
                convenience
                only and shall not affect the meaning, construction or interpretation
                of
                any term, condition or provision of this
                Sublease.

            

    

     

    
      	15.	
              Non-Solicitation

            

    

     

    
      	
            	15.1	
              During
                the Term
                of this
                Sublease, Subtenant will not, and will cause each of its employees
                to not, directly or indirectly, solicit the medical laboratory testing
                business
                of
                any customer of US LABS, nor in any way attempt to service the medical
                laboratory testing needs
                of such
                customers. As used herein, the word "indirectly" includes, but is
                not
                limited to, Subtenant's or any
                Subtenant
                employee's use of the name of any of Subtenant's employees in the
                solicitation of any of US LABS' employees. The parties understand
                and
                agree that the restrictions set forth in this subsection 15.1 only
                apply
                to the menu of tests offered by US LABS on the date of execution
                of this
                Sublease, which menu includes, but is not limited
                to, US LABS'
                contemplated offering of the B&T
                chip.

            

    

     

    
      	
            	15.2	
              During
                the Term of this Sublease, Subtenant will not, and will cause each
                of its
                employees
                to not, directly or indirectly, solicit any
                employee
                of US LABS on behalf of
                Subtenant. As used herein, the
                work "indirectly"
                includes, but is not limited to, Subtenant's or any Subtenant employee's
                use of the name of any of Subtenant's employees in the solicitation
                of any
                of US LABS' employees.

            

    

     

    
      	
            	15.3	
              In
                the event this Sublease is terminated for any reason prior to the
                ending
                date of August 31, 2006, the parties agree and understand that the
                restrictions set forth in subsections
                15.1 and 15.2 shall continue through the close of business on August
                31,
                2006.

            

    

     

    [Signatures
      on following page.]

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the
      parties hereto have executed this Sublease as ofthe date first above
      written.

    

    

      
        	
                SUBLANDLORD:

              	
                Accupath
                  Diagnostic Laboratories, Inc.

                a
                  California Corporation

              
	 	 
	 	
                By:
                  /s/ Glen Fredenberg

              
	 	
                Printed
                  Name: Glen Fredenberg

              
	 	
                Its:
                  VP - Finance

              
	 	 
	
                SUBTENANT:

              	
                CombiMatrix
                  Molecular Diagnostics, Inc.,

                a
                  California Corporation

              
	 	 
	 	
                By:
                  /s/ Matt Watson

              
	 	
                Printed
                  Name: Matt Watson

              
	 	
                Its:
                  CEO

              

      

       

       

      CONSENT
        AND ADOPTION OF LESSOR

      

      Lessor
        executes this Sublease to evidence its consent of the terms, covenants and
        conditions set forth in this Sublease.

       

      
        
          	
                  WITNESS:

                	
                  LESSOR:
                    Edison Spectrum Partners, LLC

                
	 	 
	 	
                  By:
                    /s/ Thomas M. Falcon, Pres

                
	 	
                  Name:
                    Thomas M. Falcon

                
	 	
                  Title:
                    Member

                
	 	 

        

        
 

      

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    AMENDMENT
      OF SUBLEASE AGREEMENT BETWEEN

    ACCUPATH
      DIAGNOSTIC LABORATORIES, INC. AND

    COMBIMATRIX
      MOLECULAR DIAGNOSTICS, INC.

    

    

    THIS
      AMENDMENT is
      effective as of the 15th day of June, 2005 by and between Accupath Dignostic
      Laboratoreis,
      Inc dba U.S. Labs, with a principal place of business located at 2601 Campus
      Drive, Irvine,
      CA 92612
      ("Sublandlord"), and CombiMatrix Molecular Diagnostics, Inc., which has a
      principal place of business located at 310 Goddard Way, Suite 150, Irvine,
      California 92818 ("Subtenant")

    

    WHEREAS,
      the
      parties have heretofore entered into a sublease agreement on the 15th day of
      June, 2005
      for
      the sublease of Suite 150 located in the building at 310 Goddard Way, Irvine,
      California 92818, a
      copy of
      which is attached, labeled as Exhibit A and incorporated herein by reference
      (the "Sublease"); and

    

    WHEREAS,
      the
      parties, by this Amendment, desire to amend the Sublease to clarify certain
      provisions of
      the
      Sublease.

    

    NOW,
      THEREFORE, for
      and
      in consideration of the covenants and agreements made herein and of the mutual
      benefits occasioned by the terms of this Amendment, the presence of which are
      mutually acknowledged and confessed, the parties each agree as
      follows:

    

    
      	1.	
              The
                third sentence of Section 3 of the Sublease is changed (i) by substituting
                "Notwithstanding anything to the contrary contained in
                this
                Sublease, in the event of any conflict between the terms and provisions
                of
                the Sublease and the Lease," for "Except as may be inconsistent with
                the
                terms, covenants and conditions of this Sublease,", and (ii) by adding
                "and shall control" between "Sublease" and the comma in the eighth
                line of
                Section 3.

            

    

    

    
      	2.	
              Section
                4
                of the Sublease is changed by adding "Except as set forth in the
                Lease,"
                at the beginning of Section 4.

            

    

    

    
      	3.	
              Section
                5.2 of the Sublease
                is
                changed
                by
                changing the first sentence
                of
                Section 5.2 to read as
                follows:
                "in no event shall Landlord or Sublandlord be liable to Subtenant
                for any
                injury to any person in
                or about the Subleased Premises or damage to the Subleased Premises
                or for
                any loss, damage or
                injury to any property of Subtenant therein, unless and to the extent
                such
                loss, damage or injury is caused by the gross negligence or willful
                misconduct of Sublandlord or by Landlord's negligence and/or breach
                of
                express warranties of the Lease."

            

    

    

    
      	4.	
              Section
                6.4 of the Sublease is changed by adding "Except as to the
                extent provided in the Lease," at the beginning of Section
                6.4.

            

    

    

    
      	5.	
              All
                capitalized terms used herein without definition but which are defined
                in
                the Lease shall have the same
                meaning herein as therein, all of such terms and their definitions
                being
                incorporated herein by
                this reference.

            

    

    

    All
      other
      terms and provisions of the Agreement as contained in said Exhibit A shall
      be
      continued and are
      hereby
      ratified and confirmed by each of the parties hereto,

    

    This
      Amendment may be executed in any number of counterparts, each of which when
      so
      executed and delivered shall be deemed to be an original for all purposes,
      but
      all such counterparts shall constitute but one in the same
      instrument.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      

        
          	
                  Accupath
                    Diagnostic Laboratories, Inc.

                	
                  CombiMatrix
                    Molecular Diagnostics, Inc.

                
	 	 
	
                  By:
                    /s/
                    R. Judd Jessup

                	
                  By:
                    /s/ M.C.
                    Watson

                
	
                  Print
                    Name: R. Judd Jessup

                	
                  Print
                    Name: M.C. Watson

                
	
                  Title:
                    CEO

                	
                  Title:
                    CEO

                
	 	 

        

         

        
 

        CONSENT
          OF LESSOR

        

        Lessor
          executes this amendment of Sublease Agreement to evidence its consent of
          the
          terms, covenants and conditions, as amended hereby.

        

        Lessor:
          Edison Spectrum Partners, LLC

        

        By:
          /s/
          Thomas M. Falcon, Pres.

        Name:
          Thomas M. Falcon

        Title:
          MemberLease between Wiredzone and CBMX

    EXHIBIT
      10.21

     

     

    BASIC
      LEASE INFORMATION

    

    

    
      	
              LEASE
                EXECUTION DATE:

            	
              October
                19, 2000

            
	 	 
	
              TENANT:

            	
              COMBIMATRIX
                CORPORATION

            
	 	 
	
              ADDRESS
                OF TENANT:

            	
              6500
                Harbour Heights Parkway, Suite 301, Mukilteo, Washington
                98275

            
	 	 
	
              CONTACT:

            	
              Patrick
                de
                Maynadier               
                Telephone (425) 396-5940 (ext. 219)

            
	 	 
	
              LANDLORD:

            	
              WIREDZONE
                PROPERTY, L.P.

            
	 	 
	
              ADDRESS
                OF LANDLORD:

            	
              6060
                N. Central Expressway, Suite 642

              Dallas,
                Texas 75206

            
	 	 
	
              CONTACT:

            	
              Scott
                Anderson             Telephone: 
                (425) 315-1354

            
	 	 
	
              PREMISES:

            	
              Suites
                No.201 and 301 and the hazardous materials storage area in the office
                building (the "Building") located on the land described as 6500 Harbour
                Heights Parkway, Mukilteo, Washington and known as Harbour Pointe
                Tech
                Center, as more particularly described on Exhibit
                "A"
                (the "Land"). The Premises
                shall also include that certain hazardous materials storage area
                on
                the
                ground floor level of the Building. The Premises are outlined on
                the plan
                attached
                to the Lease as Exhibit
                "B"
                and are deemed to contain 85,414 square feet
                of Rentable Space based on a useable square footage of 74,273 and
                a
                load
                factor of 15%. Tenant hereby acknowledges that Tenant's architect
                has
                certified to the Rentable Space in the Premises.

            
	 	 
	
              LEASE
                TERM:

            	
              Ninety-six
                (96) months, commencing November 1, 2000 (the "Commencement
                Date")
                and ending at 5:00 p.m., October 31, 2008, subject to
                extension and earlier termination as provided in the Lease. Following
                Lease
                execution, Landlord shall provide Tenant with immediate access to
                the
                Premises at no charge.

            
	 	 
	
              BASE
                RENTAL:

            	
              $
                *
                per month, which is
                based
                on an annual Base Rental of $ *
                per rentable square foot per year, which Tenant agrees to pay to
                Landlord
                at P.O. Box 972170 Dept. Code 7002, Dallas, Texas 75397-2170 (or
                at such
                other
                place as Landlord from time to time may designate in writing) in
                advance
                and without demand on the first day of each calendar month during
                and
                throughout the Lease Term. Payments may also be wired to Landlord
                as
                follows: Bank One - Texas; ABA #111000614; WiredZone Property, L.P.
                Lockbox; Acct. No. 1588316057.

            
	 	 
	 	
              *see
                Schedule 106 attached hereto and incorporated herein for all
                purposes

            
	 	 
	
              PREPAID
                RENTAL:

            	
              $64,837.85,
                representing payment of Base Rental for the first month of the Lease
                Term,
                to be paid on the date of execution of this Lease.

            
	 	 
	
              SECURITY
                DEPOSIT:

            	
              The
                Security Deposit hereunder shall be in the amount which represents
                all of
                Landlord's transaction costs associated with this Lease plus the
                value of
                the tenant improvement Allowance described in the Leasehold Improvements
                Agreement attached hereto as Exhibit
                "D".
                Such Security Deposit shall be held by Landlord pursuant to the provisions
                of Paragraph 29 of the Lease. As an alternative to a cash security
                deposit, Tenant may deposit with Landlord a clean, irrevocable letter
                of
                credit from an institution acceptable to Landlord. At the time of
                Lease
                execution, Tenant shall deliver to Landlord the sum of $640,000 (either
                in
                cash or in the form of a letter of credit as set forth above) with
                such
                amount to thereafter be increased (either by supplemental cash deposit
                or
                amendment to the previously delivered letter of credit) as the tenant
                improvement allowance is advanced by Landlord pursuant to the terms
                of the
                Leasehold Improvements Agreement. At the time Landlord has fully
                advanced
                such tenant improvement allowance the Security Deposit shall be in
                the
                aggregate amount of $1,500,000. Such security deposit, however, shall
                be
                reduced to $301,084.35 (i.e., the equivalent of two months of full
                Base
                Rental) once Tenant achieves and provided it thereafter maintains
                a net
                cash reserve in excess of $100,000,000 or has successfully completed
                an
                Initial Public Offering resulting in and thereafter maintaining a
                capitalization value in excess of $100,000,000. After execution of
                the
                Lease, the parties shall have the option of negotiating a mutually
                satisfactory substitution of all or a portion of such Security Deposit,
                for a warrant for common equity in the Tenant.

            
	 	 

    

    

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

    

    

    
      	
              SOLE
                PERMITTED USE:

            	
              General
                office, research, development, production and sale of biological
                array processors with related instrumentation, software, bio-informatics
                and related chemicals and other materials, products and services
                related
                to the foregoing used primarily in the bio-tech/bio-pharmaceutical,
                life
                science, material science, energy, agricultural and defense industries
                (subject to applicable zoning ordinances and building codes). In
                addition,
                Tenant may request to broaden the definition of Sole Permitted Use
                with
                Landlord's prior written consent, such consent not to be unreasonably
                withheld or delayed. Tenant
                shall be responsible for verifying that its proposed use complies
                with
                applicable
                zoning laws and building codes and by its execution hereof certifies
                that
                it has received satisfactory evidence of such compliance. To the
                best of
                Landlord's knowledge, there are no restrictions for Tenant's intended
                use
                or any eminent domain or condemnation proceedings pending that could
                adversely affect Tenant's intended use of the Premises.

            
	 	 
	
              TENANT'S
                PROPORTIONATE SHARE:

            	
              25.52%,
                which is the percentage obtained by dividing (i) the 85,414 rentable
                square feet in the Premises by (ii) the 334,758 rentable square feet
                in
                the Building;
                provided, however, Tenant's Proportionate Share shall be
                calculated utilizing
                the Rentable Space in the Premises from time to time per the
                schedule
                and terms of Rider No. 106 to this Lease (i.e., in months 1-10 the
                rentable square footage will be 42,868 and therefore Tenant's
                Proportionate Share would equal 12.81%).

            
	 	 
	 	 

    

    

    The
      foregoing Basic Lease Information is incorporated into and made a
      part of
      the
      Lease
      identified above. If any conflict
      exists
      between any Basic Lease Information and the Lease, then the Lease shall
      control.

    

    
      	
              LANDLORD:

            	 	
              TENANT:

            
	 	 	 
	
              WIREDZONE
                PROPERTY, L.P.

            	 	
              COMBIMATRIX
                CORPORATION

            

    

     

    
      	
              By:

            	
              WiredZone
                Property GenPar, LLC,

            	 	
              By:

            	
              /s/
                signature

            
	 	
              its
                general partner

            	 	
              Its:

            	
              Executive
                Vice President

            

    

     

    
      	 	By:	
               /s/s
                signature

            	 	 	 
	 	Its:	
              G.P.

            	 	 	 

    

    

    
      
        
        

      

      
        ii

        
          

        

      

      
        
        

      

    

    

    TABLE
      OF CONTENTS

     

     

     

    
      	Paragraph	 	Page
              No.
	
              l.

            	
              Definitions
                and Basic Provisions 

            	
              l

            
	
              2.

            	
              Lease
                of Premises 

            	
              2

            
	
              3.

            	
              Services
                by Landlord 

            	
              2

            
	
              4.

            	
              Additional
                Rental 

            	
              3

            
	
              5.

            	
              Electricity

            	
              4

            
	
              6.

            	
              Payments
                and Performance

            	
              4

            
	
              7.

            	
              Tenant
                Plans and Specifications - Installation of Improvements 

            	
              4

            
	
              8.

            	
              Completion
                of Improvements and Commencement of Rent 

            	
              5

            
	
              9.

            	
              Relocation
                of Premises 

            	
              5

            
	
              10.

            	
              Repairs
                and Reentry 

            	
              5

            
	
              
                11.

              

            	
              Assignment
                and Subletting 

            	
              5

            
	
              12.

            	
              Alterations
                and Additions by Tenant 

            	
              6

            
	
              13.

            	
              Legal
                use; Violations of Insurance Coverage; Nuisance

            	
              6

            
	
              14.

            	
              Laws
                and Regulations 

            	
              6

            
	
              15.

            	
              Indemnity,
                Liability and Loss or Damage 

            	
              5

            
	
              16.

            	
              Rules
                of the Building
                

            	
              7

            
	
              17.

            	
              Entry
                for Repairs and Inspection

            	
              7

            
	
              18.

            	
              Condemnation
                

            	
              7

            
	
              19.

            	
              Landlord's
                Lien and Security Interest

            	
              8

            
	
              20.

            	
              Abandoned
                Property 

            	
              8

            
	
              21.

            	
              Holding
                Over 

            	
              8

            
	
              22.

            	
              Fire
                and Casualty

            	
              8

            
	
              23.

            	
              Entire
                Agreement and Amendment; No Representations or Warranties; No Memorandum
                of Lease

            	
              9

            
	
              24.

            	
              Transfer
                of Landlord's Rights 

            	
              9

            
	
              25.

            	
              Default

            	
              9

            
	
              26.

            	
              Waiver;
                Attorney's Fees 

            	
              11

            
	
              27.

            	
              Quiet
                Possession 

            	
              11

            
	
              28.

            	
              Severability

            	
              
                11

              

            
	
              29.

            	
              Security
                Deposit

            	
              
                12

              

            
	
              30.

            	
              No
                Subrogation; Insurance 

            	
              
                12

              

            
	
              31.

            	
              Binding
                Effect 

            	
              
                12

              

            
	
              32.

            	
              Notices

            	
              
                13

              

            
	
              33.

            	
              Brokerage
                

            	
              
                13

              

            
	
              34.

            	
              Subordination
                

            	
              13

            
	
              35.

            	
              Joint
                and Several Liability 

            	
              
                13

              

            
	
              36.

            	
              Building
                Name and Address 

            	
              
                13

              

            
	
              37. 

            	
              Estoppel
                Certificates; Financial Statements

            	
              14

            
	
              38.

            	
              Mechanic's
                Liens

            	
              
                14

              

            
	
              39.

            	
              Taxes
                and Tenant's Property 

            	
              
                14

              

            
	
              40.

            	
              Constructive
                Eviction

            	
              
                15

              

            
	
              41.

            	
              Landlord's
                Liability 

            	
              
                15

              

            
	
              42.

            	
              Execution
                by Landlord 

            	
              
                15

              

            
	
              43.

            	
              No
                Waiver 

            	
              
                15

              

            
	
              44.

            	
              No
                Third Party Beneficiary 

            	
              
                15

              

            
	
              45.

            	
              Number
                and Gender 

            	
              
                15

              

            
	
              46.

            	
              Force
                Majeure

            	
              
                15

              

            

    

    

    
      
        
        

      

      
        iii

        
          

        

      

      
        
        

      

    

    

    
      	
              47.

            	
              Hazardous
                and Toxic Materials 

            	
              
                15

              

            
	
              48.

            	
              Telecommunications

            	
              
                17

              

            
	
              49.

            	
              Landlord's
                Fees 

            	
              
                17

              

            
	
              50.

            	
              No
                Light, Air or View Easement

            	
              
                17

              

            
	
              51.

            	
              APPLICABLE
                LAW; CONSENT TO JURISDICTION 

            	
              
                17

              

            
	
              52.

            	
              WAIVER
                OF JURY TRIAL

            	
              
                17

              

            
	
              53.

            	
              Confidentiality

            	
              
                17

              

            
	
              54.

            	
              Back-Up
                Generator 

            	
              
                17

              

            
	
              55.

            	
              Signage

            	
              
                18

              

            
	
              56.

            	
              Special
                Tenant Installations 

            	
              
                18

              

            
	
              57.

            	
              Category
                5 Cabling

            	
              
                18

              

            
	
              58.

            	
              Miscellaneous

            	
              
                18

              

            

    

    

    
      	
              Exhibit
                "A"

            	
              Legal
                Description

            
	
              Exhibit
                "B"

            	
              Floor
                Plan of Premises

            
	
              Exhibit
                "C"

            	
              Holidays

            
	
              Exhibit
                "D"

            	
              Leasehold
                Improvements Agreement

            
	
              Exhibit
                "E"

            	
              Acceptance
                of Premises Memorandum

            
	
              Exhibit
                "F"

            	
              Building
                Rules and Regulations

            
	
              Rider
                No. 101

            	
              Parking
                Facilities

            
	
              Rider
                No. 102

            	
              Tenant's
                Option to Renew

            
	
              Rider
                No. 103

            	
              Expansion
                Option

            
	
              Rider
                No. 104

            	
              Right
                of First Refusal

            
	
              Rider
                No. 106

            	
              Schedule
                of Base Rental

            
	 	 

    

    

    

    
      
        
        

      

      
        iv

        
          

        

      

      
        
        

      

    

    LEASE
      AGREEMENT

     

    THIS
      LEASE AGREEMENT (the "Lease") is made and entered into as of the 19 day of
      October, 2000, by and between WIREDZONE
      PROPERTY, L.P.
      ("Landlord") and COMBIMATRIX CORPORATION, a Delaware corporation
      ("Tenant").

    

    1.     Definitions
      and Basic Provisions.
      The
      definitions and basic provisions set forth in the Basic Lease Information (the
      "Basic Lease Information") executed by Landlord and Tenant contemporaneously
      herewith are incorporated
      herein by reference for all purposes. The additional terms defined below shall
      have the respective meanings stated
      when used elsewhere in this Lease, and such terns and the following basic
      provisions constitute an integral part of
      this
      Lease:

    

    (a) "Normal
      Business Hours": From
      7:00
      a.m. until 6:00 p.m. on weekdays (except Holidays, as defined on Exhibit
      "C"
      attached
      hereto and made a part hereof for all purposes) and 7:00 a.m. until 12:00
      p.m. on Saturdays (except Holidays). Tenant shall have access to the Building
      and its Common Facilities (including,
      without limitation, the freight elevators, shipping and receiving docks,
      cafeteria and fitness room) on a
      24
      hours per day, 7 days a week basis; subject, however, to reasonable limitations
      resulting from Landlord's
      access
      control systems implemented for security purposes. Note that Tenant shall also
      have access to the Building's
      conference room facilities on a reservation and cost basis on the same terns
      available to other tenants
      as
      established by Landlord in Landlord's reasonable discretion.

    

    (b) "Rentable
      Space":
      (per
      BOMA 1996 standards) (i) in the case of a single tenancy floor, all floor area
      measured at the floor from the inside surface of the outer glass line of the
      Building to the inside surface
      of the opposite outer glass line excluding only the areas (the "Service Areas")
      used for Building stairs, fire
      towers, elevator shafts, flues, vents, stacks, major pipe shafts and vertical
      ducts (which Service Areas shall be
      measured from the outside face of wall is enclosing such Service Areas), but
      including any such Service Areas which
      are
      for the specific use of the particular tenant such as special stairs or
      elevators, plus an allocation of the square
      footage of the Building's elevator machine rooms, mechanical and electrical
      rooms, and public lobbies, and
      (ii)
      in the case of a floor to be occupied by more than one tenant, all floor areas
      within the inside surface of the
      outer
      glass walls enclosing the Premises and measured to either (A) the mid-point
      of
      the walls separating areas
      leased by or held for lease to other tenants and/or (B) to the tenant's side
      of
      walls adjacent to corridors, elevator
      foyers, restrooms, mechanical rooms, janitor closets, vending areas and other
      similar facilities for the use
      of
      all tenants on the particular floor (hereinafter sometimes called the "Common
      Areas"), but including a proportionate
      part of the Common Areas located on such floor based upon the ratio which the
      tenant's rentable
      space
      (excluding Common Areas) on such floor bears to the aggregate rentable space
      (excluding Common Areas)
      on
      such floor, or other reasonable basis mutually agreed to by Landlord and Tenant,
      plus an allocation of
      the
      square footage of the Building's elevator machine rooms, mechanical and
      electrical rooms, and public lobbies. No deductions from Rentable Space shall
      be
      made for columns or projections necessary to the Building.
      The Rentable Space in the Premises has been calculated on the basis of the
      foregoing definition and is
      hereby
      stipulated for all purposes hereof to be as stated in the Basic Lease
      Information, whether the same should
      be
      more or less as a result of minor variations resulting from actual construction
      and completion of the Premises
      for occupancy so long as such work is done in substantial accordance with
      the tens
      and
      provisions hereof.
      Notwithstanding anything to the contrary contained herein, the standard of
      measurement utilizes a load
      factor
      of 15%.

     

    (c) "Rider":
      Collectively, Rider No(s). 101, 102, 103, 104 and 106, which are attached
      hereto, contain additional provisions of this Lease, and are hereby incorporated
      in, and made a part of, this Lease.

    

    (d) "Exhibits":
      The
      following Exhibits are attached to and trade a part of this Lease for all
      purposes:

    

    A
      -
      Land

    B
      - Floor
      Plan of Premises

    C
      -
      Holidays

    D
      -
Leasehold
      Improvements Agreement

    E
      -
      Acceptance of Premises Memorandum

    F
      -
      Building Rules and Regulations

    
      
        
        

      

      
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    2.     Lease
      of Premises.
      In
      consideration of the obligation of Tenant to pay rent as herein provided and
      in
consideration
      of the other terms, covenants, and conditions hereof, Landlord hereby demises
      and leases to Tenant, and Tenant
      hereby leases and takes from Landlord, the Premises, together with the right
      to
      use in common with others the Common
      Areas, for the Lease Term specified herein, all upon and subject to the terms
      and conditions set forth herein. This
      Lease and the obligations of Landlord hereunder are conditioned upon faithful
      performance by Tenant of all of the agreements
      and covenants herein set out and agreed to by Tenant. Tenant agrees and
      acknowledges that there is excluded from
      Tenant's use of the Premises (whether the Premises are or include one or more
      full floors within the Building) and
      Landlord
      hereby expressly reserves for its
      sole
      and
      exclusive use, any and all mechanical, electrical, telephone and singular rooms,
      janitor closets, elevator, pipe and other vertical shafts and ducts, flues,
      stairwells, any area above the acoustical ceiling, and any other areas not
      specifically shown on Exhibit
      "B"
      as being
      part of the Premises. Landlord acknowledges
      that Paragraph 56 of this Lease identifies certain special installations by
      Tenant that shall require access to some
      of
      the aforementioned Service Areas and to the extent such special installations
      are approved as part of Tenant's
      Approved
      Working Drawings and Section 56 of this Lease, Tenant shall also have access
      to
      such areas on a non-exclusive basis and in coordination with Landlord's on-site
      property manager.

     

    3.     Services
      by Landlord. Landlord
      agrees to furnish the following services to the Premises, as long as
Tenant
      is
      not in default of a material obligation under this Lease, all of such services
      to be at Landlord's cost and expense
      except
      as specifically provided to the contrary elsewhere in this Lease:

    

    (a) Cold
      water (at the normal temperature of the supply of water to the Building) for
      Tenant's
      laboratory
      use and lavatory, water fountain and toilet purposes, and hot water (from the
      regular Building supply
      at
      prevailing temperatures) for lavatory purposes, all of such water service to
      be
      supplied from the regular supply
      of
      water to the Building at points of supply provided for general use of tenants
      of
      the Building through fixtures
      installed by Landlord or by Tenant with Landlord's consent which consent shall
      not be unreasonably withheld,
      conditioned or delayed; provided, however, nothing contained herein shall
      require Landlord to furnish hot
      water
      to any kitchen, bar or other such lavatory facility in the Premises. Tenant
      acknowledges that to the extent
      Tenant's laboratory use results in an excessive level of water being used by
      Tenant as compared to other tenants
      in the Building, that Landlord may require the Premises'
      water
      consumption to be separately metered, at Tenant's
      cost, and for Tenant to thereafter reimburse Landlord directly for Tenant's
      water usage in the Premises.

    

    (b) Heated
      and refrigerated air conditioning in season during Normal Business Hours, and
      at
      such temperature and in such amounts as are reasonably considered by Landlord
      to
      be standard. Such services at all other times shall be furnished only at the
      request of Tenant, who shall bear the entire cost thereof. Whenever machines
      or
      equipment that generate abnormal heat and affect the temperature otherwise
      maintained by the air conditioning system are used in the Premises, Landlord
      shall have the right to install supplemental air
      conditioning units in the Premises, and the cost thereof, including the cost
      of
      installation, operation, use and
      maintenance, shall be paid by Tenant to Landlord from time to time promptly
      on
      demand. The hourly charge for heating, ventilation and air conditioning ("HVAC")
      overtime usage shall be an amount equal to the actual cost associated with
      providing such overtime HVAC plus an administrative charge of 15%.
      Notwithstanding the foregoing, Tenant shall not be charged for HVAC
      overtime usage while and to the extent either the existing 80-ton chiller is
      (1)
      operating during Normal Business Hours or (2) dedicated solely for Tenant's
      use. Tenant shall
      have a four (4) month option period following the Commencement Date in which
      to
      request that Landlord dedicate
      for Tenant's sole use the existing 80-ton chiller in connection with Tenant's
      activities on the second floor
      of
      the Building and upon demonstrating reasonable basis for such need, Landlord
      shall use its best efforts to
      so
      dedicate the chiller; provided, however, Tenant shall be solely responsible
      for
      the costs associated with using, maintaining and repairing same. Tenant shall
      reimburse Landlord on a monthly basis for all such costs associated therewith
      and Tenant acknowledges that Landlord will perform. such maintenance and repair
      obligations. Tenant acknowledges that the costs associated with using,
      maintaining and repairing any of the HVAC
      systems related to all of Tenant's "clean room" facilities shall be
      Tenant's
      sole
      cost and responsibility.

    

    (c) Operatorless
      passenger elevator service in common with other tenants for ingress and egress
      from
      the
      Premises, provided that Landlord may reasonably limit the number of elevators
      to
      be in operation at times
      other than Normal Business Hours, and service elevator(s) in common with other
      tenants but only when
      scheduled through the management of the Building.

    

    (d) Such
      janitorial cleaning services as may, in the reasonable judgment of Landlord,
      be
      standard for office use.

     

    (e) Electric
      current in the manner and to the extent deemed by Landlord to be standard for
      the Building, but in no event less than 7 watts per square foot (i.e., 5 watts
      for power and 2 watts for Building standard lighting).

    

    (f) Security
      services which shall consist of two security personnel during Normal Business
      Hours and
      one
      security person at all other times, with such personnel to be primarily
      stationed in the main entrance of
      the
      Building's lobby.

    
      
        
        

      

      
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    (g) Food
      services in the Building's common cafeteria at such time as either (1) the
      Building is 75% occupied or (2) Tenant and other tenants at the Building have,
      in the aggregate, over 500 employees located
      at the Building. Prior to such time, Landlord will use its good faith efforts
      to
      provide or facilitate lunch
      catering
      services to Tenant.

    

              
      Except as provided hereinbelow, failure to any extent to furnish or any stoppage
      of these defined utilities and services
      resulting from any cause whatsoever shall not render Landlord liable in any
      respect for damages to either person, property
      or business, nor be construed as an eviction of Tenant, nor entitle Tenant
      to
      any abatement of rent, nor relieve
      Tenant
      from fulfillment of any covenant or agreement contained herein. Except as
      provided hereinbelow should any malfunction of the Building improvements or
      facilities (which by definition do not include any improvements or facilities
      of
      Tenant) occur for any reason, Landlord shall use reasonable diligence to repair
      same promptly, but Tenant shall have no claim for rebate or abatement of rent
      or
      damages on account of such malfunction or of any interruptions in service
      occasioned thereby or resulting therefrom. Notwithstanding the foregoing, in
      the
      event such stoppage or interruption of utilities or services exists for more
      than seven (7) consecutive days and is the result of a cause other than (i)
      a
      fire or casualty which shall be controlled by Section 22 of this Lease, (ii)
      the
      actions of Tenant or its agents, servants, contractors, employees, business
      invitees or guests, or (iii) force majeure as described in Section 46 of this
      Lease, Tenant's rental (including Base Rental and Additional Rental, as defined
      below) shall abate to the extent any portion of the
      Premises is rendered untenantable (for purposes hereof untenantable shall
      include lack of HVAC services, electrical
      services
      and elevator service which materially interferes with Tenant's enjoyment of
      the
      Premises). In addition, notwithstanding anything to the contrary contained
      herein, following such seven (7) consecutive day period (but as limited by
      clauses (i), (ii) and (iii) above), Tenant shall also be entitled to pursue
      a
      suit for specific performance and/or damages against Landlord. Notwithstanding
      anything to the contrary contained herein, in the event of stoppage or
interruption
      of utilities or services, or the malfunction of Building improvements (other
      than improvements installed by
      Tenant)
      or facilities, as more fully described above (but as limited by clauses (i),
      (ii) and (iii) above), which shall continue
      for seven (7) consecutive days, Tenant shall have all rights and remedies
      available and provided under the laws
      of the
      State of Washington.

     

    4.     Additional
      Rental.

    

    (a) In
      addition to Base Rental, Tenant shall during the Lease Term, pay an amount
      per
      square foot of Rentable Space within the Premises ("Tenant's Additional Rental")
      equal to Tenant's Proportionate Share
      of
      the Operating Expenses. Prior to the commencement of each calendar year of
      Tenant's occupancy, Landlord
      may make a good faith estimate of the anticipated amount of Tenant's
      Additional Rental ("Tenant's Forecast
      Additional Rental") and Tenant agrees to pay Tenant's Forecast Additional Rental
      in equal monthly installments
      in advance and without demand on the first day of each calendar month during
      and
      throughout the Lease
      Term and any renewal or extension thereof, subject to adjustment of Tenant's
      Forecast Additional Rental
      pursuant
      to any audit conducted pursuant to Paragraph 4(c) hereof.

    

           
      (b) Within one hundred fifty (150) days after the end of each calendar year
      during the Lease Term and any renewal or extension thereof, or as soon as
      reasonably possible thereafter, Landlord shall provide Tenant a statement
      showing the Operating Expenses for said calendar year and a statement prepared
      by Landlord comparing Tenant's Forecast Additional Rental theretofore paid
      by
      Tenant with Tenant's Additional Rental. In
      the
      event that Tenant's Forecast Additional Rental paid by Tenant exceeds
      Tenant's
      Additional Rental
      for said calendar year, Landlord, at Landlord's option, shall either pay Tenant
      an amount equal to such excess
      by
      direct payment to Tenant within thirty (30) days of the date of such statement,
      or credit such excess payment
      against the next accruing installment(s) of Tenant's Forecast Additional Rental.
      In the event that the Tenant's
      Additional Rental exceeds Tenant's Forecast Additional Rental for said calendar
      year, Tenant shall pay
      Landlord, within thirty (30) days of receipt of the statement, an amount equal
      to such difference. Such obligation of Landlord to refund and of Tenant to
      pay
      shall survive expiration or termination of this Lease. Subject
      to the right of Tenant to audit set forth in Section 4(c) below, Landlord's
      statement showing Operating Expenses
      shall be conclusive and binding for all purposes on Tenant as to any and all
      items contained therein to
      which
      Tenant has not objected in writing to Landlord within thirty (30) days after
      Tenant's receipt of such statement, which writing shall specify each item
      objected to and the detailed reason for each such objection.

    

    (c) Tenant
      at
      its sole expense shall have the right during the Lease Term, but no more
      frequently than
      once
      per calendar year following prior written notice to Landlord, to audit
      Landlord's books and records relating
      to Operating Expenses, or at Landlord's sole election, Landlord will provide
      at
      Tenant's reasonable
      expense
      a copy of such audit prepared by an independent certified public
      accountant.

    
      
        
        

      

      
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    (d) The
      term
      "Operating Expenses" shall mean all costs of management, operation (specifically
      including
      the cost of electricity to the common areas of the Building and related
      improvements but not to any
      tenants'
      premises which are submetered), and maintenance of the Land, the Building,
      and
      all other improvements
      on the Land and any and all appurtenances thereto (the "Common Facilities"),
      all
      accrued and based
      on
      an annual period consisting of a calendar year. By way of illustration but
      not
      limitation, Operating Expenses
      shall include expenditures for maintenance and repairs not otherwise paid for
      by
      tenants; amortization of
      any
      capital expenditures in accordance with generally accepted accounting practices
      and principles which are incurred
      by Landlord to (i) attempt to effect a reduction in the Operating Expenses
      of
      the Building, or (ii) keep the
      Building in compliance with all applicable governmental rules and regulations
      from time to time, which the Building
      is not otherwise in compliance with; assessments and governmental charges
      (including taxes on rents
      or
      services); ad valorem property taxes with respect to the Land and/or the
      Building or any part of either thereof,
      charges for water, sewerage, and gas; cleaning, including supplies, janitorial
      services and pest control; licenses,
      permits and inspection fees; fiber connectivity and related telecommunications
      charges (but not the cost
      for
      upgrading of such for the benefit of new tenants at the Building after the
      Commencement Date); refuse
      collection; security services; insurance; costs and expenses related to the
      maintenance and operation of the Building's
      freight elevator, shipping and receiving areas, common cafeteria (or the
      alternative catering services described
      above), fitness facilities and conference facilities; administrative expenses
      relating to the Building, including
      salaries, benefits, taxes and other expenses for labor and management, office
      equipment, telephone, and
      supplies; management fees payable by Landlord with respect to the Land, Building
      and Common Facilities;
      fire
      protection; snow and ice removal; landscape maintenance; professional services
      (including legal, property-related
      consulting and accounting expenses); and security services. The following shall
      be excluded
      from
      Operating Expenses: depreciation; capital expenditures other than those
      referenced in the previous sentence;
      cost of Building alterations or renovations for other tenants in the Building;
      advertising; commissions or
      fees
      paid for leasing; cost of repairs occasioned by fire, windstorm, or other
      casualty (but only to the extent reimbursed
      by insurance proceeds); and wages, salaries, or other compensation paid to
      any
      executive above the grade
      of
      building manager; interest on debt or amortization payments on any mortgage
      or
      mortgages or rental
      under
      any ground or underlying leases or lease, if any; all services for which any
      tenant of the Building specifically reimburses Landlord or for which Tenant
      pays
      directly to third persons; and costs (including penalties, fines and associated
      legal expenses) incurred due to the violation by Landlord for the terms and
      conditions
      of the Lease, or any applicable federal, state and local governmental laws,
      ordinances, orders, rules
      and
      regulations, which costs would not have been incurred but for such violation
      by
      Landlord.

    

    5.     Electricity.
      Tenant
      shall be solely responsible for the costs of electrical consumption within
      the
      Premises ("Electricity") and will reimburse Landlord on a monthly basis (at
      the
      actual cost for such service without mark-up
      by Landlord following Landlord's reading of such meters) for such electrical
      consumption. Without in any way limiting
      Tenant's responsibility for Electricity, Tenant shall not without the express
      prior written consent of Landlord use
      electric
      current in excess
      of
      the capacity of
      the
      feeders or lines to the Building or the Premises. Tenant shall be responsible
      for all costs associated with separate metering of Electricity for the Premises,
      including, but not limited to, the cost of installing, maintaining, repairing
      and reading the separate metering devices and subpanels. Tenant acknowledges
      that the cost to provide, install and maintain submeters shall be at Tenant's
      sole expense.

     

    6.     Payments
      and Performance.
      Tenant
      agrees to pay all rents and sums provided to be paid by Tenant hereunder at
      the
      times and in the manner herein provided, without any setoff, deduction or
      counterclaim whatsoever except as may otherwise be provided in Section 3 above.
      Should this Lease commence on a day other than the first day of
      a
      calendar month or terminate on a
      day
      other
      than the last day of a calendar month, the rent for such partial month
      shall
      be
      proportionately reduced. The Base Rental for the first partial month, if any,
      shall be payable at the beginning of said period or as Prepaid Rental. The
      obligation of Tenant to pay such rent is an independent covenant, and except
      as
provided
      in Section 3 above, no act or circumstance whatsoever, whether such act or
      circumstance constitutes a breach of
      covenant
      by Landlord or not, shall release Tenant from the obligation to pay rent. Time
      is of the essence in the performance of all of Tenant's and Landlord's
      obligations hereunder. Any amount that becomes owing by Tenant to Landlord
      hereunder shall bear interest at the rate of 15% per annum from the due date
      until paid. In addition, at Landlord's
      option, but only to the extent allowed by applicable law and not in excess
      of
      the amount allowed by applicable
      law,
      Tenant shall pay a late charge in the amount (as solely determined by Landlord)
      of five percent (5%) of any installment
      of rental hereunder which is not paid within five (5) days of the date on which
      it is due in order to compensate
      Landlord
      for the additional expense involved in handling delinquent
      payments.

    

    7.     Tenant
      Plans and Specifications - Installation of
      Improvements. Tenant
      shall install or cause to be installed
      in the Premises substantially all of the improvements shown on the Approved
      Working Drawings (as defined in Exhibit
      "D"
      attached
      hereto) upon the terms and conditions set forth in the Leasehold Improvements
      Agreement attached
      hereto
      as Exhibit
      "D" and
      made
      a part hereof (subject, however, to the change order provisions set forth
      therein).

    
      
        
        

      

      
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    8.     Completion
      of Improvements and Commencement of Rent.
      By
      moving into the Premises or taking possession
      thereof, Tenant accepts the Premises as suitable for the purposes for which
      the
      same are leased and accepts the Building
      and every appurtenance thereof, and waives any and all defects therein (other
      than latent defects) and on request
      from
      Landlord, Tenant shall promptly execute and deliver to Landlord an Acceptance
      of
      Premises Memorandum in the form attached hereto as Exhibit "E"
      and made
      a part hereof for all purposes.

    

    9.     Relocation
      of Premises.
      [Intentionally Deleted]

    

    10.    Repairs
      and Reentry.
      Tenant
      will, at Tenant's own cost and expense, maintain and keep the Premises and
      any
      alterations and additions thereto in sound condition and good repair, and shall
      pay for the repair of any damage or injury done to the Building or any part
      thereof (not otherwise covered by the property insurance to be maintained by
      Landlord
      on the Building, excluding Tenant's Premises) by Tenant or Tenant's agents,
      employees and invitees; provided, however,
      that Tenant shall make no repairs to the Premises without the prior written
      consent of Landlord, which consent
      shall
      not be unreasonably withheld, conditioned or delayed. Notwithstanding the
      foregoing, in the event Landlord's property insurance is used to repair any
      damage or injury done to the Building (excluding Tenant's Premises for which
      Tenant's
      property insurance shall be used) by Tenant or Tenant's
      agents,
      employees and invitees, Tenant shall (i) pay the
      deductible associated with such repairs, (ii) pay all amounts in excess of
      insurance proceeds available for such repairs, and (iii) pay for any increase
      Landlord incurs in its premium for such coverage as a direct result of insurance
      proceeds being
      used to fund Tenant's repair obligations. The performance by Tenant of its
      obligation to maintain and make repairs shall
      be
      conducted only by contractors approved by Landlord after plans and
      specifications therefor have been approved by
      Landlord. Tenant
      will
not
      commit or allow any waste or damage to be committed on any portion of the
      Premises, and
      upon the
      termination of this Lease by lapse of time or otherwise, Tenant shall deliver
      up
      the Premises to Landlord in as good
      condition as at date of possession, ordinary wear and tear excepted. Upon such
      termination of this Lease, Landlord
      shall
      have the right to reenter and resume possession of the Premises. Notwithstanding
      the foregoing provisions of this Paragraph 10, any repairs to the Premises
      or
      the Building that are necessitated because of
      any
      damage caused by fire or other
      casualty shall be governed by the provisions of Paragraph 22 below. Landlord
      shall be responsible for maintenance
      to the
      exterior, structural and Common Areas of the Building (e.g., the structural
      roof, roof membrane, walls and foundation and utilities serving the Building
      and/or located outside Tenant's Premises). Notwithstanding the foregoing,
      Landlord may, as provided in Section 4(d) of this Lease, include the cost of
      normal repair and maintenance items in the Building's
      Operating Expenses and shall be reimbursed for same to the extent of Tenant's
      Proportionate Share. Landlord represents
      and warrants that to the best of its knowledge as of the date hereof, all
      Building systems (i.e., HVAC system,
      elevators, electrical system, plumbing system, fire prevention system),
      structural components of the Building, roofs and foundations are in good working
      order as of the Commencement Date of this Lease.

    

    11.     Assignment
      and Subletting.
      In the
      event that Tenant desires to encumber this Lease, assign this Lease or
      sublet
      all or any part of the Premises or grant any license, concession or other right
      of occupancy of any portion of the
      Premises, Tenant shall notify Landlord in writing and shall state the name
      of
      the proposed assignee, sublessee or other transferee
      and the terms of the proposed assignment, sublease or transfer. Tenant shall
      also provide financial information
      and
      state and provide information requested by Landlord as to the nature and
      character of the business of the proposed assignee,
      sublessee or transferee. Tenant shall not assign or mortgage this Lease or
      any
      right hereunder or interest herein,
      and
      Tenant shall not sublet the Premises in whole or in part or grant any license,
      concession or other right of occupancy of any portion of the Premises, without
      the prior written consent of Landlord, which consent shall not be unreasonably
      withheld,
      delayed or conditioned based upon Landlord's reasonable determination of the
      creditworthiness and nature and character
      of the business of the proposed assignee, sublessee or transferee. Any such
      assignment, mortgage or subletting
      without
      such consent shall be void and shall, at the sole option of Landlord, be deemed
      an event of default by Tenant under this Lease. Notwithstanding any assignment
      or subletting consented to by Landlord, Tenant and any guarantor of Tenant's
      obligations under this Lease and each assignee shall at all times remain jointly
      and severally fully responsible and liable for the payment of the rent herein
      specified and for compliance with all of Tenant's other covenants and
      obligations under this Lease. No consent to any assignment or mortgage of this
      Lease or any subletting of the Premises shall constitute a waiver of the
      provisions of this Paragraph except as to the specific instance covered thereby.
      In the event
      that the monthly rental per square foot of space subleased which is payable
      by
      any sublessee to Tenant shall exceed
      the
      monthly rental per square foot for the same space payable for the same month
      by
      Tenant to Landlord (including any bonuses or any other consideration paid
      directly or indirectly by the sublessee to Tenant), Tenant shall be obligated
      to
      pay fifty percent (50%) of the amount of such excess to Landlord as additional
      rent hereunder within five (5) days of the date it is received by Tenant from
      the sublessee. In the event Tenant shall receive any consideration from an
      assignee other
      than the assumption by the assignee of Tenant's obligations hereunder, Tenant
      shall be obligated to pay fifty percent
      (50%) of
      the amount of such consideration to Landlord as additional rent hereunder on
      the
      same date it is received by Tenant. Landlord, at Landlord's option, may elect
      to
      require that rental payable by any sublessee be paid directly to Landlord and
      offset Tenant's rent obligations accordingly. At no time during the Lease Term
      shall Tenant be entitled to (i)
      advertise the Premises for sublease without the prior written consent of
      Landlord, such consent not to be unreasonably
      withheld, (ii) market the Premises for sublease to another tenant of the
      Building or person or entity with whom Landlord is negotiating to lease space
      in
      the Building, and (iii) market the Premises for sublease at a rate less than
      the
      fair market value of the Premises. Any transfer by operation of law shall also
      constitute an assignment prohibited by this Paragraph 11. Tenant shall reimburse
      Landlord, on demand, for its reasonable attorneys'
      fees and
      other expenses incurred in connection with considering any request for
      Landlord's consent to an assignment or sublease of the
      Premises.

    
      
        
        

      

      
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    Notwithstanding
      anything to the contrary hereinabove, Tenant may assign or sublet the Premises
      to a subsidiary
      or
      affiliate under common ownership or control of Tenant, or to any entity merging
      with or into Tenant (collectively, "Affiliated
      Assignment"), without any further action by Landlord and such action shall
      be
      deemed a permitted assignment
      or
      subletting subject to the provisions hereunder so long as (i) the original
      Tenant and the transferee tenant shall be jointly and severally liable for
      the
      performance of the Lease obligations and (ii) the Permitted Use,
      creditworthiness and business character of the transferee tenant following
      such
      transfer or merger is comparable with Tenant's use, business character and
      creditworthiness prior to such transfer or merger. In addition, the following
      types of transactions shall not be
      deemed
      assignments or transfers for purposes of this Paragraph 11 for which Landlord's
      prior written consent must be obtained;
      provided, however, that the limitations set forth in clauses (i) and (ii) above
      shall still be applicable: (a) the sale
      or
      issuance of stock or other securities of the Tenant to a new investor or
      investors, even if such sales or issuance results in a change of control and/or
      a change in management; (b) the sale or other transfer by Tenant's present
      parent corporation
      of all or any portion of the stock of Tenant, even if such sale or transfer
      results in a change of control and/or a
      change
      in management; or (c) the sale or issuance of stock or other securities of
      the
      Tenant in a public offering or as a part of a private placement to raise
      additional capital or create liquidity for investors.

     

    12.     Alterations and Additions by Tenant.
      Tenant
      shall make no alterations in or additions to the Premises
      without the prior written consent of Landlord which shall not be unreasonably
      withheld, conditioned or delayed.
      All
      alterations, additions, and improvements made to or fixtures or improvements
      placed in or upon the Premises by either party (except only moveable trade
      fixtures of Tenant) if not otherwise identified within thirty (30) days of
      installation by Tenant as removable upon execution of the Lease (or otherwise
      required to be removed by Landlord as a condition
      to its consent to such alteration or addition) shall be deemed a part of the
      Building and the property of Landlord at
      the
      time they are placed in or upon the Premises, and they shall remain upon and
      be
      surrendered with the Premises as a
      part
      thereof at the termination of this Lease, unless Landlord shall elect otherwise,
      whether such termination shall occur by the lapse of time or otherwise. In
      the
      event Landlord shall elect that certain alterations, additions and improvements
      made by Tenant in the Premises shall be removed by Tenant, Tenant shall remove
      them and Tenant shall restore the Premises to its original condition, at
      Tenant's own cost and expense, prior to the termination of the Lease Term.
      Alterations and additions to the Premises will be performed by Landlord (unless
      otherwise designated by Landlord) at Tenant's cost and expense. Tenant
      acknowledges that Landlord's approval of any alterations or additions shall
      not
      be a representation by Landlord that such alterations, additions or improvements
      comply with applicable laws. The initial alterations and additions to the
      Premises by Tenant shall be controlled by the terms and conditions of the
      Leasehold Improvements Agreement attached hereto. In connection with such
      initial improvements, Tenant shall have the right to pursue Landlord's
      permission to construct certain special installations as more particularly
      described in Paragraph 56 below.

    

    13.     Legal
      Use, Violations of Insurance Coverage; Nuisance.
      Tenant
      will not occupy or use any portion of the Premises for any purpose other than
      the Sole Permitted Use or for any purpose which is unlawful or which, in the
      reasonable
      judgment of Landlord, is unduly hazardous due to risk of fire,
      explosion or other casualty, nor permit anything to
      be
      done which will in any way (i) increase the rate of fire and casualty insurance
      on the Building or its contents, or (ii)
      create
      unreasonable elevator loads or otherwise interfere with standard Building
      operations, or (iii) affect the structural integrity
      or design capabilities of the Building or (iv) result in the storage of any
      hazardous materials or substances at the
      Building
      except as permitted by law and the express terms and conditions of this Lease.
      In the event that, by reason of any act or conduct of business of Tenant, there
      shall be any increase in the rate of insurance on the Building or its contents
      created by Tenant's acts or conduct of business, then Tenant hereby agrees
      to
      pay Landlord the amount of such increase on demand. Tenant shall not erect,
      place, or allow to be placed any sign, advertising matter, stand, booth or
      showcase in, upon or visible from the vestibules, halls, corridors, doors,
      outside walls, outside windows or pavement of the Building or the Land without
      the prior written consent of Landlord. Tenant will conduct its business, and
      use
      commercially reasonable efforts to control its agents, employees, and invitees
      in such a manner as not to create any nuisance or interfere with, materially
      annoy or disturb other tenants or Landlord in the management of the
      Building.

    

    14.     Laws
      and Regulations.
      Tenant
      at its sole expense will maintain the Premises in a clean, safe and healthful
      condition and will comply with all laws, ordinances, orders, rules and
      regulations of any governmental authority
      having
      jurisdiction over the use, conditions or occupancy of the Premises.

    

    15.     Indemnity,
      Liability and Loss or Damage.

    

    (a)
      Landlord shall not be liable to Tenant or Tenant's agents, employees,
      contractors, guests, invitees or any
      person claiming by, through or under Tenant for any injury to person, loss
      of or
      damage to property, or for loss of or
      damage
      to Tenant's
      business, occasioned by or through the acts or omissions of Landlord, or by
      any
      cause whatsoever except to the extent arising from or out of Landlord's
      negligence or willful wrongdoing. Except to the extent arising from or out
      of
      Landlord's negligence or willful wrongdoing, Landlord shall not be liable for,
      and Tenant shall defend and indemnify
      Landlord and save it harmless from, all suits, actions, damages, liability
      and
      expense in connection with loss of
      life,
      bodily or personal injury or property damage arising from or out of any
      occurrence in, upon, at or from the Premises (except for any
      pre-existing

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    circumstances,
      conditions or occurrences in the Premises) or the occupancy or use by Tenant
      of
      the Premises or any part thereof, or occasioned wholly or in part by any action
      or omission of Tenant, its agents, contractors, employees, invitees, or
      licensees. If Landlord shall be made a party to any action commenced by or
      against Tenant, Tenant shall protect and hold Landlord harmless therefrom and
      on
      demand shall pay all costs, expenses, and reasonable attorney's fees incurred
      by
      Landlord in connection therewith. The indemnification obligations contained
      in
      this Paragraph 15 shall not be limited by any worker's compensation, benefit
      or
      disability laws, and each indemnifying party hereby waives any immunity that
      said party may have under the Washington Industrial Insurance Act, Title 51
      RCW,
      and similar worker's compensation, benefit or disability laws. LANDLORD AND
      TENANT ACKNOWLEDGE BY THEIR EXECUTION OF THIS LEASE THAT EACH INDEMNIFICATION
      PROVISION OF THIS LEASE (INCLUDING, BUT LIMITED TO, THOSE RELATING TO WORKER'S
      COMPENSATION, BENEFITS AND LAWS) WAS SPECIFICALLY NEGOTIATED AND AGREED TO
      BY
      LANDLORD AND TENANT).

    

    (b)
      Tenant shall not be liable to Landlord or Landlord's agents, employees,
      contractors, guests, invitees or any
      person claiming by, through or under Landlord for any injury to person, loss
      of
      or damage to property, or for loss of or
      damage
      to Landlord's business, occasioned by or through the acts or omissions of
      Tenant, or by any cause whatsoever except
      to
      the extent arising from or out of Tenant's negligence or willful wrongdoing.
      Except to the extent arising from
      or out
      of Tenant's negligence or willful wrongdoing, Tenant shall not be liable for,
      and Landlord shall defend and indemnify
      Tenant and save it harmless from, all suits, actions, damages, liability and
      expense in connection with loss of life,
      bodily or personal injury or property damage arising from or out of any
      occurrence in, upon, at or from the Premises
      or the
      Building or any part thereof, or occasioned wholly or in part by any action
      or
      omission of Landlord, its agents, contractors, employees, invitees, or
      licensees. If Tenant shall be made a party to any action commenced by or against
      Landlord,
      Landlord shall protect and hold Tenant harmless therefrom and on demand shall
      pay all costs, expenses, and reasonable
      attorney's fees incurred by Tenant in connection therewith. The indemnification
      obligations contained in this Paragraph
      15 shall not be limited by any worker's
      compensation, benefit or disability laws, and each indemnifying
      party hereby
      waives any immunity that said party may have under the Washington Industrial
      Insurance Act, Title 51 RCW, and
      similar
      worker's compensation, benefit or disability laws. LANDLORD AND TENANT
      ACKNOWLEDGE BY THEIR EXECUTION OF THIS LEASE THAT EACH INDEMNIFICATION PROVISION
      OF THIS LEASE (INCLUDING, BUT LIMITED TO, THOSE RELATING TO WORKER'S
      COMPENSATION, BENEFITS AND LAWS) WAS SPECIFICALLY NEGOTIATED AND AGREED TO
      BY
      LANDLORD AND TENANT).

    

    16.     Rules
      of the Building.
      Tenant
      will comply fully, and will use reasonable efforts to cause Tenant's
agents,
      employees, and invitees to comply fully with all Rules and Regulations of the
      Building which are attached hereto
      as
Exhibit
      "F"
      and made
      a part hereof as though fully set out herein. As more particularly provided
      therein, Landlord shall
      at
      all times have the right to change such Rules and Regulations or to amend them
      in such reasonable manner as Landlord
      may deem advisable for the safety, protection, care and cleanliness-of the
      Building and appurtenances and for preservation
      of good order therein, all of which Rules and Regulations, changes and
      amendments will be forwarded to Tenant
      in
      writing and shall be complied with and observed by Tenant and Tenant's agents,
      contractors, employees and
      invitees.

    

    17.     Entry
      for Repairs and Inspection.
      Landlord
      and its agents and representatives shall have the right following
      24 hours prior notice to enter into and upon any and all parts of the Premises
      at all reasonable hours (or, in an emergency,
      at any hour without prior notice) to inspect same or clean or make repairs
      or
      alterations or additions to the Building
      and the Premises (whether structural or otherwise) as Landlord may deem
      necessary, and during the continuance
      of any
      such work, Landlord may temporarily close doors, entryways, public spaces and
      corridors and interrupt or temporarily suspend Building services and facilities,
      and subject to the terms and conditions of Paragraph 3 above, Tenant
      shall not be entitled to any abatement or reduction of rent by reason thereof.
      During the Lease Term, Landlord may
      exhibit the Premises to prospective purchasers and lenders at reasonable hours
      and upon 24 hours' prior notice to
      Tenant.
      Furthermore, during the one-year period prior to the expiration date of this
      Lease, Landlord and Landlord's agents
      may exhibit the Premises to prospective tenants during Normal Business Hours
      and
      upon 24 hours' prior notice to
      Tenant.

    

    18.     Condemnation.
      If all
      of the Premises, or so much thereof as would materially interfere with Tenant's
      use of the remainder, shall be taken or condemned for any public use or purpose
      by right of eminent domain, with or without
      litigation, or be transferred by agreement in connection with or in lieu of
      or
      under threat of condemnation, then the
      Lease
      Term and the leasehold estate created hereby shall terminate as of the date
      title shall vest in the condemnor or transferee.
      If all or any portion of the Building or a material portion of the Land required
      for the Building's operation is taken
      or
      condemned or transferred as aforesaid, Landlord or Tenant shall have the option
      to terminate this Lease effective as
      of the
      date title shall vest in the condemnor or transferee. Landlord shall receive
      the
      entire award from any taking or condemnation
      (or the entire compensation paid because of any transfer by agreement), and
      Tenant shall have no claim thereto;
      provided, however, Tenant shall be entitled to recover in a separate action
      against such condemning authority, an
      award
      for relocation benefits, if any, and an award with respect to Tenant's above
      Building standard finish-out at the Premises.

    
      
        
        

      

      
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    19.     Landlord's
      Lien and Security Interest.
      Landlord
      shall not have a landlord's lien of any kind under this Lease.

    

    20.     Abandoned
      Property.
      All
      personal property of Tenant remaining in the Premises later than ten (10) days
      after the termination or expiration of the Lease Term or after the abandonment
      of the Premises by Tenant may be treated by Landlord as having been abandoned
      by
      Tenant and Landlord may, at its option and election, thereafter take possession
      of such property and either (i) declare same to be the property of Landlord,
      or
      (ii) at the cost and expense of Tenant,
      store and/or dispose of such property in any manner and for whatever
      consideration that Landlord, in its sole discretion,
      shall deem advisable. Except as otherwise provided in a prior notification
      from
      Tenant to Landlord providing
      a
      reasonable explanation that Tenant is not abandoning the Premises, Tenant shall
      be presumed conclusively to have abandoned
      the Premises if the amount of Tenant's property removed by Tenant from the
      Premises is substantial enough to indicate
      a probable intent to abandon the Premises and such removal is not in the normal
      course of Tenant's business, or
      if
      Tenant removes any material amount of Tenant's personal property from the
      Premises at a time when Tenant is in default
      in the payment of rental due hereunder or in the performance of any other
      obligation of Tenant hereunder and
      such
      removal is not in the normal course of Tenant's business.

     

    21.     Holding
      Over.
      Should
      Tenant continue to hold the Premises after this Lease terminates, whether by
      lapse
      of
      time or otherwise, such holding over shall, unless otherwise agreed by Landlord
      in writing, constitute and be construed
      as a tenancy from month to month at a rental equal to the greater of (i) 150%
      of
      the amount of the monthly rental
      payable during the last month prior to the termination of this Lease or (ii)
      150% of the rate for which similar space in
      the
      Building is then being leased by Landlord, and upon and subject to all of the
      other terms and provisions set forth herein
      except any right to renew this Lease, expand the Premises or lease additional
      space. This provision shall not be construed,
      however, as permission by Landlord for Tenant to holdover. No payments of money
      by Tenant to Landlord after
      the
      termination of this Lease shall reinstate, continue, or extend the Lease Term
      and no extension of this Lease after the
      termination hereof shall be valid unless and until the same shall be reduced
      to
      writing and signed by both Landlord and
      Tenant. Tenant shall be liable to Landlord for all damage which Landlord shall
      suffer by reason of any holding over
      by
      Tenant, and Tenant shall indemnify and hold Landlord harmless against all claims
      made by any other tenant or prospective
      tenant against Landlord resulting from delay by Landlord in delivering
      possession of the Premises (or any
      portion
      thereof) to such other tenant or prospective tenant.

    

          
      22.    Fire
      and Casualty.

    

    (a) If
      the
      Premises are damaged by fire or other casualty and if such damage is not
      susceptible of repair within two hundred seventy (270) days (as estimated,
      as
      soon as reasonably practicable after the occurrence
      of such damage, by an architect of recognized good reputation selected by
      Landlord), then in such
      event
      this Lease, at the option of either Landlord or Tenant, exercised by giving
      written notice thereof to the other
      within thirty (30) days after receipt of such written estimate of the architect
      so selected, shall terminate as of
      the
      date of such loss, and Tenant shall pay the rent hereunder apportioned to the
      time of such loss and shall pay
      all
      other obligations of Tenant owing on the date of termination, and Tenant shall
      have no longer than thirty
      (30)
      days in which to surrender the Premises to Landlord.

    

    (b) If
      the
      damage described above is susceptible of repair within two hundred seventy
      (270)
      days, or
      if the
      damage is not susceptible of repair within two hundred seventy (270) days but
      Landlord and Tenant fail to
      exercise the option to terminate this Lease, and so long as Landlord does not
      elect to terminate this Lease pursuant
      to Subparagraph (c) below, Landlord shall enter and make the necessary repairs
      without affecting this
      Lease,
      but the rent hereunder shall be reduced or abated as shall be equitable, in
      the
      good faith judgment of Landlord,
      until such repairs are made, unless such damage has been so slight that Tenant's
      occupancy of the
      Premises
      is not materially interfered with, in which case the rent hereunder shall not
      be
      abated or reduced. Notwithstanding
      the foregoing, Landlord shall have the option to terminate this Lease and shall
      not be obligated
      to
      repair the Premises or the Building if the damage is not covered by insurance
      or
      if Landlord's mortgagee applies any portion of the insurance proceeds to the
      unpaid balance of its loan.

    

    (c) In
      the
      event the Building is so badly damaged or injured by fire or other casualty,
      even though the Premises may not be affected, that Landlord decides, within
      ninety (90) days after such damage, not to rebuild
      or repair the Building (such decision being vested exclusively in the discretion
      of Landlord), then in such
      event Landlord shall so notify Tenant in writing and this Lease shall terminate
      as of the date specified for termination
      in the notice from Landlord to Tenant, and Tenant shall pay rent hereunder
      apportioned to the date of
      such
      termination and shall pay all other obligations of Tenant owing on the date
      of
      termination, and Tenant
      shall
      have no longer than thirty (30) days in which to surrender the Premises to
      Landlord.

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

    (d) Notwithstanding
      the foregoing provisions of this Paragraph 22, Tenant agrees that if the
Premises
      or any other portion of the Building is damaged by fire or other casualty
      resulting from the fault or negligence
      of Tenant or any of its agents, employees, or invitees, then the cost of
      restoring the property damage in
      excess
      of the policy limits of the property insurance proceeds which Landlord is
      required to maintain under this
      Lease shall be paid by Tenant within thirty (30) days following demand, and
      there shall be no abatement of
      rent
      before or during the repair of such damage.

    

    23.     Entire
      Agreement and Amendment; No Representations or Warranties; No Memorandum of
      Lease. This
      Lease contains the entire agreement between the parties hereto with respect
      to
      the subject matter hereof and supersedes
      any and all prior and contemporaneous agreements, understandings, promises,
      and
      representations made by either
      party to the other concerning the subject matter hereof and the terms applicable
      hereto. It is expressly agreed by Tenant,
      as a material consideration to Landlord for the execution of this Lease, that
      there have been no representations,
      understandings, stipulations, agreements or promises pertaining to the Premises,
      the Building or this Lease not incorporated in writing herein. This Lease shall
      not be altered, waived, amended or extended, except by a written agreement
      signed by the parties hereto, unless otherwise expressly provided herein.
      LANDLORD'S DUTIES AND WARRANTIES ARE LIMITED TO THOSE SET FORTH IN THIS LEASE,
      AND SHALL NOT INCLUDE ANY IMPLIED DUTIES OR WARRANTIES, ALL OF WHICH ARE HEREBY
      DISCLAIMED BY LANDLORD AND WAIVED BY TENANT. LANDLORD AND TENANT EXPRESSLY
      DISCLAIM ANY IMPLIED WARRANTY THAT
      THE
      PREMISES ARE SUITABLE FOR TENANT'S INTENDED COMMERCIAL PURPOSE, AND
      EXCEPT AS
      OTHERWISE PROVIDED IN PARAGRAPH 3, TENANT'S OBLIGATION TO PAY RENT HEREUNDER
      IS NOT
      DEPENDENT UPON THE CONDITION OF THE PREMISES OR THE PERFORMANCE BY LANDLORD
      OF
      ITS
      OBLIGATIONS HEREUNDER, AND, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN,
      TENANT SHALL CONTINUE TO PAY THE RENT, WITHOUT ABATEMENT, SETOFF OR DEDUCTION,
      NOTWITHSTANDING ANY BREACH BY LANDLORD OF ITS DUTIES OR OBLIGATIONS HEREUNDER,
      WHETHER EXPRESS OR IMPLIED. Neither this Lease nor a memorandum of this Lease
      shall be recorded in the public
      records of the county in which the Building is located without the prior written
      consent of Landlord, which maybe withheld
      in Landlord's sole discretion. Notwithstanding anything to the contrary set
      forth in this Paragraph 23, Landlord hereby
      represents and warrants to Tenant as follows: (a) Landlord has fee simple title
      to the Land and the Building, (b) Landlord
      has been duly authorized to enter into this Lease, and (c) the persons signing
      this Lease on Landlord's behalf
      have
      been duly authorized to do so by appropriate resolution and
      consent.

    

    24.     Transfer
      of Landlord's Rights.
      In the
      event Landlord transfers its interest in the Building, Landlord shall
      thereby automatically be released from any further obligations hereunder if
      Landlord transfers the Security Deposit
      to such
      transferee and such transferee agrees to expressly assume all obligations of
      Landlord hereunder, and Tenant agrees to look solely to the successor in
      interest of Landlord for the performance of such obligations.

     

    25.     Default.

    

    (a)
      The
      following events shall be deemed to be events of default (herein so called)
      by
      Tenant under this Lease:

    

    (i) Tenant
      shall fail to pay any rental or other sum payable by Tenant hereunder as and
      when such rental or other sum becomes due and payable; provided, however, that
      Tenant shall be entitled
      to receive, three (3) times each calendar year, a written notice of such failure
      from Landlord
      and a
      five (5) day period thereafter to cure such payment default;

    

    (ii) Tenant
      shall fail to comply with any other provision, condition or covenant of this
      Lease
      and
      any such failure is not cured within thirty (30) days after Landlord gives
      written notice of
      such
      failure to Tenant; provided, however, Tenant shall not be deemed to have failed
      to comply hereunder if such default cannot be cured within said thirty (30)
      days
      and Tenant is diligently proceeding to do so;

    

    (iii) Tenant
      shall desert or vacate any substantial portion of the Premises;

    

    (iv) Tenant
      shall assign this Lease or sublet all or any part of the Premises or grant
      any
      license, concession or other right of occupancy of any portion of the Premises,
      without the prior written consent of Landlord except as permitted by the terms
      of Paragraph 11 of this Lease;

    
      
        
        

      

      
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    (v) Any
      petition shall be filed by or against Tenant or any guarantor of Tenant's
obligations
      under this Lease pursuant to any section or chapter of the present federal
      Bankruptcy Act or
      under
      any future federal Bankruptcy Act or under any similar law or statute of the
      United States or any
      state
      thereof (which as to any involuntary petition shall not be and remain discharged
      or stayed within
      a
      period of thirty (30) days after its entry), or Tenant or any guarantor of
      Tenant's obligations
      under
      this Lease shall be adjudged bankrupt or insolvent in proceedings filed under
      any section or chapter
      of the present federal Bankruptcy Act or under any future federal bankruptcy
      act
      or under any
      similar
      law or statute of the United States or any state thereof;

    

    (vi) Tenant
      or
      any guarantor of Tenant's obligations under this Lease shall become insolvent
      or
      make a transfer in fraud of creditors;

    

    (vii) Tenant
      or
      any guarantor of this Lease shall make an assignment for the benefit of
      creditors; or

    

    (viii) A
      receiver or trustee shall be appointed for Tenant or any guarantor of this
      Lease
      or for any of the assets of Tenant or any guarantor of this Lease.

    

    (b)
      Upon
      the occurrence of any event of default, Landlord shall have the option to do
      any
      one or more
      of
      the following without any further notice or demand, in addition to and not
      in
      limitation of any other
      remedy
      permitted by law or by this Lease:

    

    (i)
      Enforce, by all legal suits and other means (including both judicial and non
      judicial means
      to
      the extent provided under applicable Washington law), its rights hereunder,
      including the collection
      of Base Rental, Tenant's Additional Rental and other sums payable by Tenant
      hereunder and
      the
      reimbursement for all unamortized tenant allowances and concessions, without
      reentering or resuming possession of the Premises and without terminating this
      Lease.

    

    (ii)
      Terminate this Lease by issuing written notice of termination to Tenant, in
      which event
      Tenant shall immediately surrender the Premises to Landlord, but if Tenant
      shall
      fail to do so,
      Landlord
      may without notice and without prejudice to any other remedy Landlord may have,
      enter upon
      and
      take possession of the Premises and expel or remove Tenant and its effects
      without being liable
      to
      prosecution or any claim for damages therefor, and upon any such termination,
      Tenant agrees that
      in
      addition to its liability for the payment of arrearages of Base Rental, Tenant's
      Additional Rental and
      other
      sums due and owing by Tenant to Landlord under this Lease upon such termination,
      Tenant shall
      be
      liable to Landlord for damages. Tenant shall pay to Landlord as damages on
      the
      same days as Base
      Rental, Tenant's Additional Rental and other payments which are expressed to
      be
      due under the provisions
      of this Lease, the total amount of such Base Rental, Tenant's Additional Rental
      and other payments,
      less such part, if any, of such payments that Landlord shall have been able
      to
      collect from a new
      tenant upon reletting; provided, however, that Landlord shall have an obligation
      to use commercially
      reasonable efforts to relet the Premises so as to mitigate the amount for which
      Tenant is
      liable
      provided such mitigation efforts would not have a material adverse effect on
      Landlord's marketing of other space in the Building. Landlord shall have the
      right at any time to accelerate rent and demand final settlement. Upon demand
      for a final settlement, Landlord shall have the right to receive, and Tenant
      hereby agrees to pay, as damages for Tenant's
      breach,
      the difference between the total rental provided for in this Lease for the
      remainder of the Lease Term and the reasonable rental value of the Premises
      for
      such period, such difference to be discounted to present value at a rate equal
      to the rate of interest allowed by law (at the time the demand for final
      settlement is made) when the parties
      to a contract have not agreed on
      any
      particular rate of interest (or, in the absence of such law, at
      the rate
      of 6% per annum).

    

    (iii) Enter
      upon and take possession of the Premises without terminating this Lease and
      expel or remove Tenant and its effects therefrom without being liable to
      prosecution or any claim for damages therefor, and Landlord may relet the
      Premises for the account of Tenant. Tenant shall pay to Landlord all arrearages
      of Base Rental, Tenant's Additional Rental and other sums due and owing by
      Tenant to Landlord, and Tenant shall also pay to Landlord during each month
      of
      the unexpired Lease Term the installments of Base Rental, Tenant's Additional
      Rental and other sums due hereunder, less such part, if any, that Landlord
      shall
      have been able to collect from a new tenant upon reletting; provided, however,
      that Landlord shall have no obligation to relet the Premises so as to mitigate
      the amount
      for which Tenant is liable. In the event Landlord exercises the rights and
      remedies afforded to
      it under
      this Paragraph 25(b)(iii) and then subsequently elects to terminate this Lease,
      Tenant shall be liable to Landlord for damages as set forth in Paragraph
      25(b)(ii) above and Landlord shall have the right at any time to demand final
      settlement as provided therein.

    
      
        
        

      

      
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    (iv) Landlord
      may do whatever Tenant is obligated to do by the provisions of this Lease and
      may enter the Premises in order to accomplish this purpose. Tenant agrees to
      reimburse Landlord immediately upon demand for any expenses which Landlord
      may
      incur in its actions pursuant to this Subparagraph, and Tenant further agrees
      that Landlord shall not be liable for damages resulting to Tenant from such
      action, whether caused by the negligence of Landlord or otherwise.

     

    Pursuit
      of any of the foregoing remedies shall not preclude pursuit of any of the other
      remedies herein provided
      or any
      other remedies provided by law or equity. Any entry by Landlord upon the
      Premises may be by use of a master
      or
      duplicate key or electronic pass card or any locksmith's entry procedure or
      other means. Any reletting
      by
      Landlord shall be without notice to Tenant, and if Landlord has not terminated
      this Lease, the reletting may be in the name of Tenant or Landlord, as Landlord
      shall elect. Any reletting shall be for such term or terms (which may be greater
      or less than the period which, in the absence of a termination of this Lease,
      would otherwise constitute the balance of the Lease Term) and on such terms
      and
      conditions (which may include free rent, rental concessions or tenant
      inducements of any nature) as Landlord in its absolute discretion may determine,
      and Landlord may collect and receive any rents payable by reason of such
      reletting. In the event of any reletting, Tenant shall pay to Landlord on demand
      the cost of renovating, repairing and altering the Premises for a new tenant
      or
      tenants, and the cost of advertisements, brokerage fees, reasonable attorneys'
      fees and other costs and expenses incurred by Landlord in connection with such
      reletting. In the event any rentals actually collected by Landlord upon any
      such
      reletting for any calendar month are in excess of the amount of rental
      payable by Tenant under this Lease for the same calendar month, the amount
      of
      such excess shall belong
      solely
      to Landlord and Tenant shall have no right with respect thereto. In the event
      it
      is necessary for Landlord to institute suit against Tenant in order to collect
      the rental due hereunder or any deficiency between the rental provided for
      by
      this Lease for a calendar month and the rental actually collected by Landlord
      for such calendar month,
      Landlord shall have the right to allow such deficiency to accumulate and to
      bring an action upon several or
      all of
      such rental deficiencies at one time. No suit shall prejudice in any way the
      right of Landlord to bring a
      similar
      action for any subsequent rental deficiency or deficiencies.

     

    26.     Waiver;
      Attorney's Fees.
      No act
      or thing done by Landlord or its agents during the Lease Term shall be deemed
      an
      acceptance of an attempted surrender of the Premises, and no agreement to accept
      a surrender of the Premises shall be valid unless made in writing and signed
      by
      Landlord. No reentry or taking possession of the Premises by
      Landlord shall be construed as an election on its part to terminate this Lease,
      unless a written notice of such intention,
      signed
      by Landlord, is given by Landlord to Tenant. Notwithstanding any such reletting
      or reentry or taking possession, Landlord may at any time thereafter elect
      to
      terminate this Lease for a previous event of default. Landlord's acceptance
      of
      rent following an event of default hereunder shall not be construed as
      Landlord's waiver of such event of default. No waiver by Landlord or Tenant
      of
      any violation or breach of any of the terms, provisions and covenants herein
      contained shall be deemed or construed to constitute a waiver of any other
      violation or breach of any of the terms, provisions and covenants herein
      contained. Forbearance by Landlord to enforce one or more of the remedies herein
      provided upon an event of default shall not be deemed or construed to constitute
      a waiver of any other violation or default. The failure of Landlord
      to enforce any of the Rules and Regulations described in Paragraph 16 against
      Tenant or any other tenant in the Building
      shall not be deemed a waiver of any such Rules and Regulations. No provision
      of
      this Lease shall be deemed to have
      been
      waived by Landlord unless such waiver is in writing and is signed by Landlord.
      The rights granted to Landlord
      and
      Tenant in this Lease shall be cumulative of every other right or remedy which
      Landlord of Tenant may otherwise have
      at
      law or in equity, and the exercise of one or more rights or remedies shall
      not
      prejudice or impair the concurrent or
      subsequent exercise of other rights or remedies. If either Landlord or Tenant
      brings any action under this Lease, or consults
      or places this Lease or any amount payable by the other party hereunder with
      an
      attorney for the enforcement of
      any of
      either party's rights hereunder, then the non-prevailing party agrees to pay
      to
      the prevailing party, on demand, the reasonable attorneys' fees and other costs
      and expenses incurred by such prevailing party in connection
      therewith.

     

    27.     Quiet
      Possession.
      Landlord
      hereby covenants that Tenant, upon paying rent as herein reserved, and
performing
      all covenants and agreements herein contained on the part of Tenant, shall
      and
      may peacefully and quietly have,
      hold and enjoy the Premises without any disturbance from Landlord or from any
      other person claiming by, through
      or under
      Landlord, subject to the terms, provisions, covenants, agreements and conditions
      of this Lease, specifically including, but without limitation, the matters
      described in Paragraph 34 hereof.

    

    28.     Severability.
      If any
      clause or provision of this Lease is illegal, invalid or unenforceable under
      present or future laws effective during the Lease Term, then and in that event,
      it is the intention of the parties hereto that the remainder
      of this Lease shall not be affected thereby, and it is also the intention of
      the
      parties to this Lease that in lieu of
      each
      clause or provision that is illegal, invalid or unenforceable, there be added
      as
      a part of this Lease a clause or provision
      as similar in terms to such illegal, invalid or unenforceable clause or
      provision as may be possible and be legal,
      valid
      and enforceable.

    
      
        
        

      

      
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    29.     Security
      Deposit.
      The
      Security Deposit shall be held by Landlord without liability for interest and
      as
      security for the performance by Tenant of Tenant's covenants and obligations
      under this Lease, it being expressly understood
      that the Security Deposit shall not be considered an advance payment of rental
      or a measure of Landlord's damages
      in case of default by Tenant upon the occurrence of any event of default by
      Tenant or upon termination of this
      Lease.
      Landlord may commingle the Security Deposit with other funds. Landlord may,
      from
      time to time, without prejudice
      to any other remedy, use the Security Deposit to the extent necessary to make
      good any arrearages of rent or to satisfy
      any other covenant or obligation of Tenant hereunder. Following any such
      application of the Security Deposit,
      Tenant
      shall pay to Landlord on demand the amount so applied in order to restore the
      Security Deposit to its original amount. At the termination of this Lease,
      the
      balance of the Security Deposit remaining after any such application
(including
      any amount necessary to reasonably cure a Tenant default) shall be returned
      by
      Landlord to Tenant within thirty
      (30) days following the expiration of the Lease Term. If Landlord transfers
      its
      interest in the Premises during the Lease
      Term, Landlord shall assign the Security Deposit to the transferee who expressly
      assumes this Lease and thereafter
      shall
      have no further liability for the return of, or any other matter relating to,
      such Security Deposit.

    

    30.    No
      Subrogation: Insurance.

    

    (a) Tenant
      hereby waives any cause of action it might have against Landlord on account
      of
      any loss
      or
      damage that is insured against under any insurance policy that covers the
      Premises, Tenant's
      fixtures,
      personal
      property, leasehold improvements or business and which names Tenant as a party
      insured, or additional
      insured. Landlord hereby waives any cause of action it might have against Tenant
      because of any loss
      or
      damage arising under Paragraph 10 that is insured against under any insurance
      policy that covers the Building
      or any property of Landlord used in connection with the Building and which
      names
      Landlord as a party
      insured,
      provided that if the cost of restoring the loss or damage exceeds the amount
      of
      property damage insurance
      proceeds paid to Landlord on account of the loss or damage, Tenant shall remain
      liable to Landlord
      for the
      amount of such excess. This provision is cumulative of Paragraph
      15.

    

    (b) Tenant
      shall procure and maintain throughout the Lease Term a policy or policies of
      commercial
      general liability insurance, at its sole cost and expense, insuring Tenant
      and
      Landlord against any and
      all
      liability for injury to or death of a person or persons, occasioned by or
      arising out of or in connection with
      the
      use or occupancy of the Premises and the operations and activities of Tenant
      and
      its employees, agents,
      contractors and invitees, the limits of such policy or policies to be in an
      amount not less than $2,000,000.00 with respect to injuries to or death of
      any
      one person and in an amount of not less than $2,000,000.00 with respect
      to any one accident or disaster, and shall furnish evidence satisfactory to
      Landlord of the maintenance of
      such
      insurance. This insurance coverage shall include blanket contractual liability
      and broad form property damage liability and shall contain an exception to
      any
      pollution exclusion which insures damage or injury arising
      out of heat, smoke or fumes from a hostile fire. Landlord, Landlord's agent,
      Landlord's mortgagee, and any
      other
      parties which Landlord shall deem necessary shall be named as an additional
      insured therein as their respective
      interests may appear. This insurance shall be written on an occurrence basis
      and
      shall be primary and noncontributory
      to any other insurance carried by Landlord and shall be with companies rated
      A-XV or better in Best's
      Insurance Guide and authorized to transaction business in the State of
      Washington. Tenant shall obtain a
      written
      obligation on the part of each insurance company to notify Landlord at least
      ten
      (10) days prior to cancellation,
      expiration or material alteration of such insurance. It is recommended that
      Tenant carry fire and
      extended
      coverage insurance on its personal property, as Landlord shall in no event
      be
      required to rebuild, repair
      or
      replace any part of the furniture, equipment, personal property, fixtures and
      other improvements which
      may have
      been placed by Tenant on or within the Premises.

    

    (c) Landlord
      shall maintain throughout the Lease Term, a policy or policies of insurance
      as
      required pursuant to the terms and conditions of Landlord's lender, but in
      no
      event less than $50,000,000 coverage on the Building.

    

    31.     Binding
      Effect.
      The
      provisions of this Lease shall be binding upon and inure to the benefit of
      Landlord
      and Tenant, respectively, and to their respective heirs, personal
      representatives, successors and assigns, subject
      to the
      provisions of Paragraphs 11, 24 and 41 hereof.

    

    32.     Notices.
      Any
      notice required or permitted to be given hereunder by one party to the other
      shall be deemed to be given when deposited in the United States mail, certified
      or registered, return receipt requested, with sufficient
      postage prepaid, or hand delivered, addressed to the respective party to whom
      notice is intended to be given at the
      address of such party set forth on the Basic Lease Information. Either party
      hereto may at any time by giving written notice
      to
      the other party in the aforesaid manner designate any other address, which,
      in
      regard to notices to be given to Tenant,
      must be within the continental United States, in substitution of the foregoing
      address to which any such notice shall
      be
      given. Any notice from Tenant to Landlord regarding a material default by
      Landlord hereunder shall also be sent
      concurrently to Landlord's lender, at the last address supplied by Landlord
      or
      such lender to Tenant.

    
      
        
        

      

      
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    33.     Brokerage.
      Tenant
      warrants that it has not had any dealings with any broker or agent in connection
      with the negotiation or execution of this Lease other than Kidder Mathews &
Segner Inc. (Tenant's
      agent)
      and Colliers International, Inc. (Landlord's
      agent)
      and Tenant agrees to indemnify Landlord and hold Landlord harmless from and
      against any and all cost, expense or liability for commissions or other
      compensation or charges claimed by any other broker or agent with respect to
      this Lease. Pursuant to the terms of separate written agreements between
      Landlord and Colliers
      International, Inc. and Kidder Matthews & Segner Inc., Landlord shall be
      solely responsible for the payment of
      all
      commissions, compensation or charges claimed by each such broker in connection
      with the execution of this Lease.

    

    34.     Subordination. This
      Lease and all rights of Tenant hereunder are subject and subordinate to any
      deed
      of trust, mortgage or other instrument of security which does now or may
      hereafter cover the Building and the Land or any interest of Landlord therein,
      and to any and all advances made on the security thereof, and to any and all
      increases, renewals,
      modifications, consolidations, replacements and extensions of any of such deed
      of trust, mortgage or instrument of
      security. This provision is hereby declared by Landlord and Tenant to be
      self-operative and no further instrument shall be
      required to effect such subordination of this Lease. Tenant shall, however,
      upon
      demand at any time or times execute, acknowledge
      and deliver to Landlord any and all instruments and certificates that, in the
      judgment of Landlord, may be
      necessary or proper to confirm or evidence such subordination, and Tenant hereby
      irrevocably appoints Landlord as Tenant's
      agent and attorney-in-fact for the purpose of executing, acknowledging and
      delivering any such instruments and certificates.
      However, notwithstanding the generality of the foregoing provisions of this
      Paragraph 34, Tenant agrees that any
      such
      mortgagee shall have the right at any time to subordinate any such deed of
      trust, mortgage or other instrument of
      security
      to this Lease on such terms and subject to such conditions as such mortgagee
      may
      deem appropriate in its discretion. Tenant further covenants and agrees upon
      demand by Landlord's mortgagee at any time, before or after the institution
      of any proceedings for the foreclosure of any such deed of trust, mortgage
      or
      other instrument of security, or
      sale
of
      the
      Building pursuant to any such deed of
      trust,
      mortgage or other instrument of
      security
      or voluntary sale, to attorn to the purchaser upon any such sale and to
      recognize and attorn to such purchaser as Landlord under this Lease. The
      agreement of Tenant to attorn upon demand of Landlord's mortgagee contained
      in
      the immediately preceding sentence shall survive any such foreclosure sale
      or
      trustee's sale. Tenant hereby agrees to execute, acknowledge and deliver
      to Landlord's mortgagee any and all instruments and certificates that Landlord's
      mortgagee may request in order to
      confirm
      or evidence such attornment. In addition, Tenant acknowledges that following
      any
      foreclosure by Landlord's lender, such lender shall not be: (1) liable for
      any
      previous act or omission of Landlord under this Lease; (2) subject to any
      credit, demand, claim, counterclaim, offset or defense which theretofore accrued
      to Tenant against Landlord, (3)
      unless consented to by such lender or permitted without such lender's consent
      under the terms of any loan documents, bound
      by
      any previous modification of this Lease, or by any previous prepayment of more
      than one month's fixed rent or additional
      rent; (4) bound by any covenant or obligation of Landlord to perform, undertake
      or complete any work in the Premises
      or to prepare it for occupancy; (5) required to account for any security deposit
      of Tenant other than any security
      deposit
      actually delivered to such lender by Landlord; (6) bound by any obligation
      to
      make any payment to Tenant or grant
      any
      credits, except for services, repairs, maintenance and restoration provided
      for
      under this Lease to be performed
      by
      Landlord after the date of such attornment; and (7) responsible for any monies
      owing by Landlord to Tenant. Notwithstanding anything to the contrary contained
      herein, (a) Landlord agrees to use its good faith efforts to obtain a
subordination,
      non-disturbance and attornment agreement from its existing mortgagee within
      30
      days of the execution of
      this
      Lease, and (b) the subordination by Tenant to future mortgagees provided for
      in
      this Section 34 shall be subject to the
      delivery of a non-disturbance agreement in favor of Tenant on such mortgagee's
      standard form of subordination, non-disturbance
      and attornment agreement.

    

    35.     Joint
      and Several Liability.
      If there
      is more than one Tenant, the obligations hereunder imposed upon Tenant shall
      be
      joint and several. If there is a guarantor(s) of Tenant's obligations hereunder,
      the obligations of Tenant shall be joint and several obligations of Tenant
      and
      each such guarantor, and Landlord need not first proceed against Tenant
      hereunder before proceeding against each such guarantor, nor shall any such
      guarantor be released from its guarantee
      for any reason whatsoever, including, without limitation, any amendment of
      this
      Lease, any assignment of this
      Lease or
      sublease of all or any part of the Premises, any forbearance by Landlord or
      waiver of any of Landlord's rights, the failure to give Tenant or any such
      guarantor any notices, or the release of any party liable for the payment or
      performance of any of Tenant's obligations hereunder.

     

    36.     Building
      Name and Address.
      Landlord
      reserves the right at any time to change the name by which the Building is
      designated and its address, and Landlord shall have no obligation or liability
      whatsoever for costs or expenses incurred by Tenant as a result of such name
      change or address change of the Building.

    
      
        
        

      

      
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    37.     Estoppel
      Certificates; Financial Statements.

    

    (a)
      Tenant agrees to furnish from time to time, within ten (10) business days
      following the request by Landlord or any successor to Landlord or by the holder
      of any deed of trust or mortgage covering the Land and Building or any interest
      of Landlord therein, an estoppel certificate signed by Tenant to the effect
      that
      this Lease is then presently in full force and effect and specifying any
      modifications; that the Lease Term has commenced
      and the full rental is then accruing hereunder; that Tenant has accepted
      possession of the Premises and
      that
      any improvements required by the terms of this Lease to be made by Landlord
      have
      been completed to
      the
      satisfaction of Tenant; that no rent under this Lease has been paid more than
      thirty (30) days in advance of its due date; that the address for notices to
      be
      sent to Tenant is
      as
      set
      forth in this Lease; that Tenant, as of the date
      of
      such certificate, has no charge, lien or claim of offset under this Lease or
      otherwise against rents or other
      charges
      due or to become due hereunder; and that to the knowledge of Tenant, Landlord
      is
      not then in default under this Lease. To the extent that Tenant believes any
      of
      the foregoing to be inaccurate, Tenant shall specifically
      enumerate
      in
the
      certificate the alleged inaccuracy and Tenant's basis for refusing to certify
      to
      such
      facts.
      At Landlord's option, any such certificate may also contain an acknowledgment
      by
      Tenant of receipt of notice
      of
      the assignment of this Lease to such holder and the agreement by Tenant with
      such holder that from and
      after
      the date of such certificate, Tenant will not pay any rent under this Lease
      more
      than thirty (30) days in advance
      of its due date, will not surrender or consent to the modification of any of
      the
      terms of this Lease nor to
      the
      termination of this Lease by Landlord, and will not seek to terminate this
      Lease
      by reason of any act or omission
      of Landlord until Tenant shall have given written notice of such act or omission
      to the holder of such deed
      of
      trust or mortgage (at such holder's last address furnished to Tenant) and until
      a reasonable period of
      time
      shall have elapsed following the giving of such notice, during which period
      such
      holder shall have the right,
      but shall not be obligated, to remedy such act or omission; provided, however,
      that (i) the agreement of Tenant
      described in this sentence will be of no effect under such certificate unless
      Tenant is furnished by such holder
      with a copy of any assignment to such holder of Landlord's
      interest in this Lease within ninety (90) days
      after
      the date of such certificate, and (ii) the agreement of Tenant with such holder
      that is embodied in such certificate
      shall terminate upon the subsequent termination of any such assignment. In
      the
      event Tenant shall
      fail or
      neglect to execute, acknowledge and deliver any such certificate, Landlord
      may,
      as the agent and attorney-in-fact of Tenant, execute, acknowledge and deliver
      the same, and Tenant hereby irrevocably nominates,
      constitutes and appoints Landlord as Tenant's proper and legal agent and
      attorney-in-fact for such
      purpose.
      Such power of attorney shall not terminate on disability of the
      principal.

     

    (b)
      Tenant shall also furnish to Landlord within fifteen (15) days following a
      written request by Landlord,
      but no more often than one time per calendar year, a statement of the financial
      condition of Tenant
      prepared
      by an independent certified public accountant in a form reasonably satisfactory
      to Landlord.

    

    38.     Mechanic's
      Liens.
      Nothing
      contained in this Lease shall authorize Tenant to do any act which shall in
      any
      way
      encumber the title of Landlord in and to the Premises or the Building or any
      part thereof; and if any mechanic's or
      materialman's lien is filed or claimed against the Premises or Building or
      any
      part thereof in connection with any work performed,
      materials furnished or obligation incurred by or at the request of Tenant,
      Tenant will promptly pay same or cause
      it
      to be released of record. If the lien is not released of record within, or
      default in payment thereof shall continue for,
      twenty (20) days after written notice thereof from Landlord to Tenant, without
      limiting or otherwise affecting any of Landlord's
      other rights or remedies and without waiving any event of default by Tenant,
      Landlord shall have the right and privilege
      at Landlord's option of paying the same or any portion thereof without inquiry
      as to the validity thereof, and any amounts
      so paid, including expenses and interest, shall be so much additional rent
      hereunder from Tenant to Landlord and
      shall
      be repaid to Landlord immediately on demand therefor. Notwithstanding the
      foregoing, Tenant shall have the right,
      after written notice to Landlord, to contest in good faith and with all due
      diligence any mechanic's lien and shall not be
      required to pay any claim secured by such mechanic's lien provided that such
      lien would not be satisfied out of the
      interest
      of Landlord in the Premises or the Building by reason of such delay, and further
      provided that Tenant will at Tenant's
      expense, defend
      Landlord and pay all costs reasonably incurred by Landlord relating to the
      contest in the event Landlord
      is joined in any suit pertaining thereto or in the event any lien affidavit
      is
      filed claiming a lien upon Landlord's
      interest
      in the Premises or in the Building. The foregoing sentence shall not imply
      any
      right on the part of Tenant to affect Landlord's interest in the Premises or
      the
      Building.

    

    39.     Taxes
      and Tenant's Property. Tenant
      shall be liable for
      all
      taxes
      levied or assessed against personal property,
      furniture or fixtures placed by Tenant in the Premises. If any such taxes for
      which Tenant is liable are levied or
      assessed
      against Landlord or Landlord's property and if Landlord elects to pay the same
      or if the assessed value of Landlord's
      property is increased by inclusion of personal property, furniture or fixtures
      placed by Tenant in the Premises, and
      Landlord elects to pay the taxes based on such increase, Tenant shall pay
      Landlord upon demand that part of such
      taxes
      for which Tenant is primarily liable hereunder.

    
      
        
        

      

      
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    40.     Constructive
      Eviction.
      Tenant
      shall not be entitled to claim a constructive eviction from the Premises
unless
      Tenant shall have first notified Landlord in writing of the condition or
      conditions giving rise thereto, and, if the complaints
      be justified, unless Landlord shall have failed to remedy such conditions within
      thirty (30) days after receipt
      of said
      notice, provided, that if such default cannot be cured within such 30-day period
      and Landlord is diligently pursuing to cure same, Landlord shall be afforded
      additional time in order to cure or remedy such default..

    

    41.     Landlord's
      Liability.
      The
      liability of Landlord to Tenant for any default by Landlord under the terms
      of
      this
      Lease shall be limited to Tenant's actual direct, but not consequential, damages
      therefor and shall be recoverable
      only
      from the interest of Landlord in the Building and the Land, and Landlord shall
      not be personally liable for any deficiency
      except that Landlord shall at all times have personal liability to Tenant for
      repayment of the Security Deposit
      in the
      event of foreclosure as provided in Section 34 hereof. This clause shall not
      be
      deemed to limit or deny any remedies which Tenant may have in the event of
      default by Landlord hereunder which do not involve the personal liability of
      Landlord. Notwithstanding anything to the contrary contained in this Lease,
      in
      the event Landlord sells, assigns, transfers or conveys its interest in the
      Building and the Land, Landlord shall have no liability for any acts or
      omissions that occur after the date of said sale, assignment, transfer or
      conveyance.

    

    42.     Execution
      by Landlord.
      The
      submission of this Lease to Tenant shall not be construed as an offer,
and
      Tenant shall not have any rights with respect hereto unless and until Landlord
      shall, or shall cause its managing agent to,
      execute a copy of this Lease already executed and delivered by Tenant to
      Landlord, and deliver the same to Tenant.

    

    43.     No
      Waiver.
      No
      waiver by Landlord of any of its rights or remedies hereunder, or otherwise,
      shall be considered a waiver of any other or subsequent right or remedy of
      Landlord; no delay or omission in the exercise or enforcement by Landlord of
      any
      rights or remedies shall ever be construed as a waiver of any right or remedy
      of
Landlord;
      and no exercise or enforcement of any such rights or remedies shall ever be
      held
      to exhaust any right or remedy
      of
      Landlord.

     

    44.      
      No
      Third Party Beneficiary.
      This
      Lease is for the sole benefit of Landlord, its successors and assigns, and
      Tenant, its permitted successors and assigns, and it is not for the benefit
      of
      any third party.

     

    45.    
Number
      and Gender.
      Words of
      any gender used in this Lease shall be held and construed to include any other
      gender, and words in the singular number shall be held to include the plural,
      unless the context otherwise requires.

     

    46.     Force
      Majeure.
      Whenever
      a period of time is herein prescribed for action to betaken by Landlord or
      Tenant,
      neither Landlord nor Tenant, as the case may be, shall be liable or responsible
      for, and there shall be excluded
      from the
      computation for any such period of time, any delays due to strikes, riots,
      acts
      of God, shortages and/or unavailability
      of labor or materials, war, governmental laws, regulations or restrictions,
      or
      any other cause of any kind
      whatsoever which are beyond the reasonable control of either Landlord or Tenant;
      provided that the affected party provides
      prompt written notice of the circumstances to the other party and uses its
      commercially reasonable efforts to mitigate
      the consequences. If this Lease specifies a time period for performance of
      an
      obligation, that time period shall be
      extended by the period of any delay in performance caused by any of the events
      of force majeure described herein.
      Notwithstanding the foregoing, force majeure shall not excuse Tenant from its
      obligation to timely pay rent.

     

    47.     Hazardous
      and Toxic Materials.

     

    (a) For
      purposes of this Lease, hazardous or toxic materials shall mean asbestos
      containing materials and all
      other
      materials, substances, wastes and chemicals classified as hazardous or toxic
      substances, materials, wastes or
      chemicals or otherwise regulated under then-current applicable federal, state
      or
      local governmental laws, rules or regulations.

     

    (b) Tenant
      shall not knowingly incorporate into, or generate, store, use or otherwise
      place
      or dispose of at, or
      transport to or from, the Premises, the Building or on the Land any hazardous
      or
      toxic materials, except in the ordinary course
      of
      Tenant's business and then only if (i) such materials are handled and disposed
      of in accordance with industry
      standards for safety, storage, use and disposal, (ii) Tenant provides to
      Landlord an annual summary of permits that Tenant has or has applied for from
      local, state and federal agencies regarding Tenant's activities at the Building
      in connection with hazardous or toxic materials together with a copy of Tenant's
      most current environmental health and safety
      plan which contains Tenant's storage and disposal protocol(s) (herein referred
      to collectively as "Tenant's EH&S
      Plan"),
      and (iii) such materials are used, transported, stored, handled and disposed
      of
      in accordance with all applicable governmental
      laws, rules and regulations. Landlord shall have the right, but not the
      obligation, to periodically inspect and
      otherwise investigate the Premises for the presence of hazardous or toxic
      materials.

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (c) Landlord
      shall, at its sole cost and expense, investigate, remove and remediate pursuant
      to and in compliance
      with all applicable governmental standards, laws, rules and regulations, any
      hazardous or toxic materials whose
      presence at the Premises, Building or Land arises from the act or omission
      of
      Landlord. Landlord shall defend and indemnify
      Tenant and save it harmless from all suits, actions, damages, liability and
      expense arising from any release of
      hazardous or toxic materials to or from the Premises, Building or Land that
      either (i) occurred or existed prior to the Lease
      Term or (ii) arises from an act or omission of Landlord or its invitees
      (excluding tenants at the Building). Landlord
      shall
      not dispose of or release at the Premises, Building or the Land any hazardous
      or
      toxic materials in violation of applicable
      law and shall remove or remediate all hazardous or toxic materials disposed
      of
      or released by Landlord or its invitees
      (excluding tenants at the Building) at the Premises, Building or Land of which
      Landlord becomes aware when and
      if
      required by applicable law and in a manner that will not materially and
      adversely affect Tenant's access, use or
      occupancy of the Premises.

     

    (d) If
      Tenant
      or Landlord ever has any knowledge of the presence in the Premises or the
      Building or the Land
      of
      hazardous or toxic materials which affect the Premises, Tenant shall notify
      Landlord and vice versa in writing promptly
      after obtaining such knowledge. Tenant acknowledges that Landlord has advised
      Tenant of the existence of asbestos
      containing materials used during the initial construction of the Building.
      An
      operation and maintenance plan has been
      established to monitor such materials and has been made available to Tenant;
      however, Landlord has been advised that
      such
      materials do not pose a health hazard. Landlord represents and warrants, as
      of
      the date hereof and to the best of its
      knowledge, that there are no hazardous materials or environmental conditions
      at
      the Building that could adversely
      affect
      Tenant or its Sole Permitted Use. Tenant acknowledges that Landlord has provided
      copies of its latest environmental reports for Tenant's review.

     

    (e) If
      Tenant
      or its employees, agents or contractors shall ever violate the provisions of
      Paragraph (b) of this subsection or otherwise contaminate the Premises or the
      Building or Land, then Tenant shall, at its sole cost and expense,
      clean up, remove and dispose of the material causing the violation, or remove
      or
      remediate the contamination pursuant
      to and in compliance with all applicable governmental standards, laws, rules
      and
      regulations and shall repair any damage
      to
      the Premises or Building arising from the violation or contamination within
      such
      period of time as may be reasonable
      under the circumstances after written notice by Landlord (collectively,
      "Tenant's Environmental Corrective Work").
      Tenant shall notify Landlord of its method, time and procedure for any clean
      up
      or removal and Landlord shall have
      the
      right to require reasonable changes in such method, time or procedure or to
      require the same to be done after
      normal
      business hours to the extent reasonably feasible. Tenant's obligations under
      this subsection shall survive the termination or expiration of this
      Lease.

     

    (f) If
      any
      Tenant's Environmental Corrective Work (i) is to occur outside of the
      Premises or (ii) will in any way
      affect any portion of the Building other than the Premises, then Landlord shall
      have the right, but not the obligation,
      after
      giving Tenant advance notice and an opportunity to perform such Work, to
      undertake Tenant's Environmental Corrective
      Work, and Tenant shall reimburse Landlord for reasonable expenses incurred
      by
      Landlord in undertaking
      Tenant's
      Environmental Corrective Work. Tenant shall allow Landlord, its agents,
      employees and contractors such access
      to
      the Premises as Landlord may reasonably request in order to perform such
      Tenant's Environmental Corrective
      Work. In
      addition, Tenant shall protect, indemnify, defend and hold harmless Landlord
      and
      its directors, partners, officers, employees, agents, parents, subsidiaries,
      successors and assigns from any loss, damage cost, fine, penalty, expense
      or liability (including reasonable attorneys' fees and costs) directly or
      indirectly arising out of or attributable to the
      use,
      generation, manufacture, production, storage, release, discharge, disposal
      or
      presence of a hazardous or toxic material
      on the Premises, Building or Land caused by Tenant and its employees, agents,
      contractors, licensees or invitees, or
      a
      breach of any representation, warranty, covenant or agreement contained in
      this
      Paragraph 47, including, without limitation,
      the costs of any required or necessary repairs, cleanup or detoxification of
      the
      Premises, Building or Land and the
      preparation and implementation of any closure, remedial or other required plans
      and any natural resources damage.
      Tenant's
      obligations under this subsection shall survive the termination or expiration
      of
      this Lease.

     

    (g)
      Landlord acknowledges that Tenant uses hazardous and toxic materials in its
      business. Prior to the execution of this Lease, Tenant has provided a
      comprehensive list of all chemicals and hazardous materials used in Tenant's
      business. In addition, prior to bringing any hazardous or toxic materials into
      the Building or onto the Land, Tenant
      shall provide to Landlord a copy of Tenant's EH&S Plan, which shall be in
      compliance with applicable laws, for such
      hazardous or toxic materials. Tenant agrees to comply with Tenant's EH&S
      Plan and may utilize other hazardous or toxic
      materials which were not previously approved by Landlord, without Landlord's
      prior written consent, provided such usage
      complies with all of the applicable provisions of this Lease. Tenant hereby
      agrees to be responsible for the cost of any
      increased insurance resulting solely from Tenant's use of such hazardous
      materials. Landlord shall have the right to
      conduct
      an environmental audit of the Premises, at Landlord's sole expense, no more
      than
      one (1) time per year.

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    48.     Telecommunications.
      Tenant
      and its telecommunications companies, including but not limited to local
      exchange telecommunications companies and alternative access vendor services
      companies, shall have no right of
      access
      to and within the Building, for the installation and operation of
      telecommunications systems including but not limited to voice, video, data,
      and
      any other telecommunications services provided over wire, fiber optic,
      microwave, wireless,
      and any other transmission systems, for part or all of Tenant's
      telecommunications within the Building and from
      the
      Building to any other location without Landlord's prior written consent, which
      consent shall not be unreasonably, withheld or delayed, provided such provider
      executes Landlord's standard form of Telecommunications License Agreement.
      Tenant expressly understands and agrees that Landlord reserves the right to
      grant or deny access (to the Building
      or any portion thereof, including, without limitation, the Premises) to any
      telecommunications service provider whatsoever,
      and that Tenant shall have no right to demand or attempt to require Landlord
      to
      grant any access to any such
      telecommunications service provider. Moreover, Tenant acknowledges and agrees
      that, in the event any such telecommunications
      service provider desires access to the Building to serve any or all tenants
      thereof, such access shall be
      prescribed and governed by the terms and provisions of Landlord's standard
      Telecommunications License Agreement, which
      must be executed and delivered to Landlord by such telecommunications service
      provider before it is allowed any access
      whatsoever to the Building. Subject to the requirements provided herein,
      Landlord acknowledges that Tenant will select
      its own telecommunications provider who, subject to the execution of
      Landlord's
      standard Telecommunications
      License
      Agreement, shall have access to the Building and its transmission systems to
      accomplish the purposes hereof.

     

    49.     Landlord's
      Fees.
      Whenever
      Tenant requests Landlord to take any action or give any consent required
or
      permitted under this Lease, Tenant will reimburse Landlord for Landlord's
      reasonable costs incurred in reviewing the proposed
      action or consent, including without limitation reasonable attorneys',
      engineers' or architects' fees, within ten
      (10)
      days after Landlord's delivery to Tenant of a statement of such costs. Tenant
      will be obligated to make such reimbursement without regard to whether Landlord
      consents to any such proposed action.

    

    50.     No
      Light, Air or View Easement.
      Any
      diminution or shutting off of light, air or view by any structure
      which may be erected on the Land or lands adjacent to the Building shall in
      no
      way affect this Lease or impose
      any
      liability on Landlord (even if Landlord is the adjacent land
      owner).

    

    51.     APPLICABLE
      LAW; CONSENT TO JURISDICTION.
      THIS
      LEASE SHALL BE
      GOVERNED
      BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WASHINGTON AND
      THE
      LAWS OF THE UNITED STATES APPLICABLE TO TRANSACTIONS IN THE STATE OF WASHINGTON.
      TENANT HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR PROCEEDING AGAINST
      IT
      WITH RESPECT TO THIS LEASE MAY BE MAINTAINED IN THE COURTS OF SNOHOMISH COUNTY,
      WASHINGTON OR IN THE U.S. DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON,
      AND TENANT HEREBY CONSENTS TO THE JURISDICTION AND VENUE OF SUCH
      COURTS.

    

    52.     WAIVER
      OF JURY TRIAL.
      TO THE
      MAXIMUM EXTENT PERMITTED BY LAW, LANDLORD AND TENANT EACH WAIVE RIGHT TO TRIAL
      BY JURY IN ANY LITIGATION ARISING OUT OF OR WITH RESPECT TO THIS
      LEASE.

    

    53.     Confidentiality.
      Tenant
      acknowledges that the terms and conditions of this Lease are to remain
confidential
      for Landlord's benefit, and may not be disclosed by Tenant to anyone, by any
      manner or means, directly or indirectly,
      without Landlord's prior written consent. Notwithstanding anything contained
      herein to the contrary, Landlord acknowledges
      and consents to Tenant's obligation to make such disclosures pertaining to
      this
      Lease that it shall deem necessary
      to comply with all securities laws and any other laws, statutes, rules,
      regulations or order of a court of law. The
      consent
      by Landlord to any disclosures shall not be deemed to be a waiver on the part
      of
      Landlord of any prohibition against any future disclosure.

    

    54.     Back-Up
      Generator.
      Landlord
      agrees to provide a location that Tenant may use, on a non-exclusive
basis,
      to
      install an emergency generator and fuel system at Tenant's sole cost and
      expense. Such generator and area will
      be
      designated by Landlord (in an area reasonably acceptable to Tenant) and, to
      the
      extent permitted by applicable ordinance,
      located adjacent to the Building and shall be subject to Landlord's review
      and
      approval of the configuration,
      placement and type of equipment that will be installed by Tenant, such approval
      not to be unreasonably withheld, conditioned
      or delayed. Once the location for the generator has been established, Tenant
      shall provide screening or other reasonable
      means to secure the generator. The space provided for the generator shall not
      be
      included in the calculation of
      Rentable
      Space of the Premises. Tenant shall be responsible for and shall pay all costs
      and expenses of providing,  installing,
      maintaining, operating, testing, repairing and, upon termination of this Lease,
      removing such back-up generator and
      fuel
      system. Tenant shall pay directly to its supplier for all fuel consumed by
      the
      back-up generator and Tenant shall comply
      with all federal, state and local laws, rules and ordinances and the operative
      office association, together with the provisions
      of this Lease, concerning the installation, use storage and disposal of diesel
      fuel and storage tanks. Provided,
      further,
      that Tenant shall procure and maintain throughout the term of this Lease, all
      permits, licenses, registrations, financial
      assurances necessary for the installation, construction and operation of the
      back-up generator and fuel tanks.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    

    55.     Signage.
      Tenant
      shall be allowed to utilize a portion of Landlord's exterior monument signage
      equal to at
      lest
      25% of the overall signage. In addition, Tenant shall be entitled to Building
      standard lobby signage equal to at least
      25%
      of the overall signage. Notwithstanding the foregoing, Tenant shall be
      responsible for the cost of installing and maintaining
      such signage and the location, type and size of such signage shall be reasonably
      acceptable to Landlord. In
      addition, all signage must conform to all governmental codes and ordinances.
      Landlord represents and Tenant understands
      that there will be no signage of any kind permitted on the Building exterior
      except the Building address and
      signage
      regarding Landlord's ownership of the Building which shall only be displayed
      on
      the Building's entry doors.

    

    56.     Special
      Tenant Installations.
      Landlord
      acknowledges that Tenant desires certain special installations in
      the
      Premises and certain Service Areas more particularly described hereinbelow.
      Subject to Landlord's review and approval
      of the Approved Working Drawings which shall be delivered in accordance with
      the
      terms of Exhibit D hereto
      and
      which in all cases shall specifically address such desired special
      installations, such Landlord consent not to be unreasonably withheld,
      conditioned or delayed, Tenant shall be permitted to complete the following:
      (a)
      installation, maintenance,
      operation, modification and removal of an HVAC system on the Building's
      roof
      related to Tenant's clean
      room
      facilities; (b) locate lab hoods and antennae on the Building's roof (such
      rooftop equipment to be governed by Landlord's standard rider related to rooftop
      equipment); (c) installation, maintenance, operation, modification and removal
      of an emergency generator and fuel system as more particularly described herein;
      (d) construct an internal stairwell between its floors (provided, further,
      that
      said stairwell shall not impact the overall square footage of the Premises);
      and
      (e) obtain access from time to time, with a representative of Landlord present,
      to the areas above the acoustical
      ceiling to install, maintain and inspect special tenant installations to the
      Premises. In connection with all such
      special tenant installations, Landlord shall have the option of requiring Tenant
      to remove same, at Tenant's cost, following
      the expiration of the Lease Term. In addition, Tenant acknowledges that Landlord
      shall not be unreasonable in its
      denial of any such special installation in the event (i) Landlord's third-party
      engineering consultant determines that such
      tenant installation will subject the Building or its occupants to unnecessary
      structural or safety risks or potential
      harm
      (e.g., an assessment of the structural integrity resulting from the desired
      internal stairwell), or (ii) violates local ordinance, or (iii) impairs the
      rights of other existing or prospective tenants of the Building.

    

    57.     Category
      5 Cabling.
      Landlord
      agrees to keep the existing Category 5 cabling system located on the
      2nd
      and
      3rd
      floors
      of
      the Building in place during the Lease Term and to permit Tenant to utilize
      such
      existing Category 5
      cabling
      system on those floors so long as, in the reasonable judgment of Landlord,
      that
      it does not adversely impact Landlord's plans for the Building.

    

    58.     Miscellaneous.
      Notwithstanding anything to the contrary in this Lease, (a) if another tenant
      of
      the Building
      is violating the terms of its lease and such violation is harming Tenant,
      Landlord agrees to take commercially reasonable
      action to enforce its rights under said other lease so as to eliminate or
      mitigate the harm caused by such tenant to
      Tenant; and (b) the liability of either party under the terms of this Lease
      shall be limited to the other party's actual, direct,
      but not consequential damages, including, without limitation, damages for loss
      or profits or special or punitive
      damages.

    

    

    IN
      WITNESS WHEREOF,
      this
      Lease Agreement is entered into by the parties hereto on the day and year
      first
      set
      forth above.

    

    

    
      	
              LANDLORD:

            	
              TENANT:

            
	 	 
	
              WIREDZONE
                PROPERTY, L.P.

            	
              COMBIMATRIX
                CORPORATION

            

    

    

    
      	
              By:

            	
              WiredZone
                Property GenPar, LLC,

            	 
	 	
              its
                general partner

            	
              By:  
                /s/ signature        

            
	 	 	 	
              Its:  
                Executive Vice President

            
	 	
              By:

            	
              /s/
                signature        

            	
               

            
	 	
              Its:
                

            	G.P.	 
	 	 	 	 

    

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    STATE
      OF
      TEXAS     §

                    
§

    COUNTY
      OF
      DALLAS   §

    

    I
      certify
      that I know or have satisfactory evidence that Judson Pankey, is the person
      who
      appeared before me, and said person acknowledged that he/she signed this
      instrument, on oath stated that he/she was authorized to execute this instrument
      and acknowledged it as the General Partner of
      WiredZone Property GenPar, LLC, general partner
      of
      WIREDZONE PROPERTY, L.P., to be the free and voluntary act of such party for
      the
      uses and
      purposes mentioned in this instrument.

    

    DATED:
      October 19, 2000

    

    [notary
      stamp]                 /s/
      Jeanne L. Bartel            

    Print
      Name: Jeanne L. Bartel

    NOTARY
      PUBLIC in and for the State of Texas

    residing
      at Snohomish

    My
      Appointment expires: 6/16/01

    

    

    STATE
      OF
      WASHINGTON    §

                 §

    COUNTY
      OF
      KING       
§

    

    I
      certify
      that I know or have satisfactory evidence that Patrick de Maynader, is the
      person who appeared before me, and said person acknowledged that he/she signed
      this instrument, on oath stated that he/she was authorized to execute this
      instrument and acknowledged it as the Executive Vice President of
      COMBIMATRIX CORPORATION a Delaware corporation,
      to be
      the free and voluntary act of such party for the
      uses and
      purposes mentioned in this instrument.

    

    DATED:
      October __, 2000.

    

    [notary
      stamp]                 /s/
      Linda Lawrence            

    Print
      Name: Linda Lawrence

    NOTARY
      PUBLIC in and for the State of Texas

    residing
      at Kent

    My
      Appointment expires: April 27, 2004

    

    

     

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    EXHIBIT
      "A" TO LEASE AGREEMENT

     

    

     

    Legal
      Description of the Land

     

     

    Tracts
      3
      and 4 of Snohomish County Binding Site Plan recorded under Recording No.
      8311075005. Situated in
      the
      County of Snohomish, State of Washington.

     

     

    

     

    

    
      
        
        

      

      
        EXHIBIT
          "A" - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

    
      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    EXHIBIT
      "C" TO LEASE AGREEMENT

     

    Holidays

    
      	
               

              January
                1st

            	
               

              New
                Years Day

            
	 	 
	
              Last
                Monday in May

            	
              Memorial
                Day

            
	 	 
	
              July
                4th*

            	
              Independence
                Day

            
	 	 
	
              First
                Monday in September

            	
              Labor
                Day

            
	 	 
	
              Fourth
                Thursday in November
                plus Friday following

            	
              Thanksgiving
                Holidays

            
	 	 
	
              December
                25th

            	
              Christmas
                Day

            

    

     

    *or
      date
      legally celebrated

     

    

    
      
        
        

      

      
        EXHIBIT
          "C" - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      "D" TO LEASE AGREEMENT

     

    Leasehold
      Improvements Agreement

     

    This Leasehold
      Improvements Agreement (this "Agreement")
      is made
      and entered into this 19 day of October,
      2000, in connection with that certain Lease Agreement (the
"Lease"), executed concurrently herewith by and
      between
      WIREDZONE PROPERTY, L.P. ("Landlord")
      and
      COMBIMATRIX CORPORATION ("Tenant"),
      and constitutes
      the entire agreement of Landlord and Tenant with respect to the construction
      and
      completion of the Premises described
      in the Lease. In the event of a conflict between the provisions of this
      Agreement and other provisions of the Lease,
      the provisions of this Agreement will control. Terms defined in the Lease,
      when
      used herein, shall have the same
      meanings
      as are ascribed to them in the Lease.

    

    1. 
      Since
      the Premises have been occupied by a previous tenant, Tenant hereby agrees
      to
      accept the Premises in its "as is" condition; provided, however, the Premises
      shall be in broom-clean condition and all Building systems
      (including, without limitation, the structural roof, roof membrane, walls,
      foundations, existing HVAC and utility systems)
      shall be in good working order prior to the delivery of the Premises to Tenant.
      Landlord agrees, at Landlord's expense,
      to upgrade the Building common lobby and central elevator lobby, central
      elevator lobby cabs and security area
      to
      "WiredZone" specifications at Landlord's sole cost and expense within 180 days
      following applicable city approval/permits
      related to such work, which city approval and permitting shall be diligently
      sought within 60 days of the
      Commencement Date of the Lease.

    

    2. Initially,
      Tenant shall provide to Landlord for its reasonable approval space plans for
      the
      Premises prior
      to
      commencing working drawings. Following Landlord's written approval of such
      space
      plans (with a response to be
      provided within five (5) business days following receipt thereof), Tenant shall
      provide to Landlord for its reasonable approval
      final working drawings, prepared by Tenant's Architect/Engineer, of all
      improvements that Tenant proposes to install
      in the Premises; such working drawings shall include the partition layout,
      internal stairwell, ceiling-plan, electrical outlets
      and switches, telephone outlets, built-in kitchen equipment, drawings for any
      modifications to the mechanical and plumbing
      systems of the Building, and detailed plans and specifications for the
      construction of the improvements called for
      in
      the Lease (including, without limitation, those detailed in Paragraph
56
      of the
      Lease) and under this Exhibit in
      accordance with all applicable governmental laws, codes, rules, and regulations.
      Such plans will also address the installation
      of Tenant's switching equipment. If Tenant's proposed construction work will
      affect the Building's HVAC,
      electrical, mechanical, and plumbing systems, the working drawings pertaining
      thereto shall be prepared by Tenant's engineer
      with Landlord approval. Such working drawings and the improvements depicted
      thereon shall (a) comply with all
      applicable governmental laws, codes, rules, and regulations, (b) be sufficiently
      detailed to allow construction of the improvements
      in a good and workmanlike manner, and (c) conform to the reasonable rules and
      regulations promulgated
      from
      time to time by the Landlord for the construction of tenant improvements. As
      used herein, "Approved
      Working Drawings"
      shall
      mean the final working drawings reasonably approved by Landlord, as amended
      from
      time to time by
      any
      approved changes thereto, and "Work"
      shall
      mean all improvements to be constructed in accordance with and as indicated
      on the Approved Working Drawings. The Approved Working Drawings shall be
      generated from and based upon
      Tenant's architect's initial programming for the Premises, which Landlord has
      reviewed and provided conceptual
      approval. Landlord acknowledges that the Work will be performed in several
      phases during the Lease Term, each of which
      shall collectively constitute the "Work" for purposes hereof. Landlord's
      approval of the Working Drawings shall not
      be a
      representation or warranty by Landlord that such drawings are adequate for
      any
      use, purpose, or condition, or
      that
      such drawings comply with any applicable law or code, but shall merely be the
      consent of Landlord to the performance of the Work. All changes in the Work
      for
      partition changes or other material or structural changes must receive the
      prior
      written approval of Landlord which approval shall not be unreasonably withheld,
      delayed or conditioned,
      and in the event of any such approved change Tenant shall, upon completion
      of
      the Work, furnish Landlord with
      an
      accurate, reproducible "marked-up" plan (e.g., sepia) of the improvements as
      constructed, which plan shall be incorporated
      into this Lease by this reference for all purposes, as well as copies of all
      specifications and warranties on
      equipment installed and connected to the Building's systems.

    

    3. The
      Work
      shall be performed only by contractors and subcontractors approved in writing
      by
      Landlord, in Landlord's reasonable discretion, such consent not to be
      unreasonably withheld, conditioned or delayed. Tenant's construction
      manager shall also be subject to the review and approval of Landlord, such
      consent not to be unreasonably
      withheld
      or delayed based upon Landlord's review of the qualifications and
      creditworthiness of such proposed construction
      manager candidates. Tenant hereby advises Landlord that it is submitting these
      candidates to be considered for
      the
      position of construction manager for the tenant improvements to the Premises:
      DPR Contractors, Rafn Contractors
      and
      Howard S. Wright Contractors. Landlord reserves the right to provide other
      suggested contractors to Tenant for Tenant
      to
      review and consider. All contractors and subcontractors shall be required to
      procure and maintain insurance against
      such risks, in such amounts, and with such companies as Landlord may reasonably
      require. Certificates of such insurance,
      must be received by Landlord before the Work is commenced. The Work shall be
      performed in a good and workmanlike
      manner that is free of defects and is in conformance with the Approved Working
      Drawings, and shall be performed
      in such a manner and at such times as to maintain harmonious labor relations
      and
      not to interfere with or delay Landlord's
      other contractors, the operation of the Building, and the occupancy thereof
      by
      other tenants. All
      contractors and
      subcontractors shall contact Landlord and schedule reasonable time periods
      during which they may use Building facilities in connection iwth the Work (e.g.,
      elevators, excess electricity, etc.). Landlord agrees to cooperate with Tenant
      in order to expedite the completion of the Work.

    

    4. Tenant
      shall bear the entire cost of performing the Work (including, without
      limitation, design of the Work
      and
      preparation of the Working Drawings, costs of construction labor and materials,
      additional janitorial services
      and
      trash removal to the extent the contractor fails to provide such services,
      related taxes and insurance costs, all of which
      costs are herein collectively called the "Total
      Construction Costs"),
      subject
      to the reimbursement from the Tenant
      Improvement Allowance (as herein defined).

     

    
      
        
        

      

      
        EXHIBIT
          "D" - PAGE 1 OF 3

        
          

        

      

      
        
        

      

    

    5. In
      the
      event Tenant desires any changes to the Approved Working Drawings, Tenant shall
      submit the proposed
      change order to Landlord in writing for Landlord's approval, such approval
      not
      to be unreasonably withheld,
      conditioned or delayed. Landlord shall advise Tenant of such approval or
      disapproval within five (5) business days following receipt by Landlord of
      such
      request, which approval shall not be unreasonably withheld, conditioned or
      delayed.
      If Landlord fails to approve or disapprove the Change Order within five (5)
      business days following delivery of the
      Change Order by Tenant to Landlord, Landlord shall be deemed to have approved
      the proposed change and it may be
      implemented by Tenant.

     

    6. The
      Lease
      Term and Tenant's rental obligations under the Lease will commence upon the
      Commencement Date set forth in the Lease, and Tenant shall cause certain
      identified portions of the Work to be completed in accordance with the build-out
      schedule for the Premises set forth in Rider No. 106 to the Lease. Tenant
agrees
      that upon substantial completion of the Work and each phase thereof, Tenant
      will
      occupy and accept the Premises.
      Except
      as otherwise provided in this Lease, Tenant shall not enter into possession
      of
      the Premises prior to substantial completion for purposes other than
      construction and/or preparing the Premises for move-in (which entry shall be
      at
      Tenant's sole risk since Tenant is causing the construction of the Premises)
      without Landlord's written consent, which consent
      shall not be unreasonably withheld, conditioned or delayed, other than in such
      event, Tenant acknowledges that
      its
      indemnity contained in the Lease shall be applicable to such period of early
      possession.

     

    7. Landlord
      shall provide a construction allowance (the "Allowance")
      of
      $10.00
      per square foot of Rentable
      Space in the Premises. Such funds shall be paid to Tenant within 30 days
      following the completion of the Work
      (or
      applicable stages thereof) and Landlord's receipt of the following: (i)
      submission of an AIA draw request, (ii) a certification from Landlord's and
      Tenant's construction managers that such work was completed in a good and
      workmanlike manner, (iii) copies of executed lien waivers and invoices, and
      (iv)
      a certificate of occupancy from the appropriate governmental authority as well
      as copies of any licenses required for Tenant's use and occupancy of the
      Premises and any auxiliary equipment installed by Tenant (but in no event
      earlier than Tenant's occupancy of the Premises
      and the payment of the first month of Base Rental). The Allowance may be used
      by
      Tenant for any construction
      obligations of Tenant (but not for the payment of Base Rental and such shall
      not
      be applied to any obligations of Landlord
      under Paragraph 47 of the Lease). Any unused portion of the Allowance shall
      not
      be available for subsequent construction
      or alterations by Tenant. In the event the Work is completed in identified
      stages, Landlord agrees to make
      available the applicable portion of the Allowance (i.e., the allocable portion
      of the Allowance in connection with the square
      footage of the area being constructed for Tenant's use and occupancy and for
      which Base Rental will thereafter be
      paid
      upon), provided that Landlord receives documentation evidencing the completion
      of such portion of the Work as well as lien waivers from the applicable
      contractors and subcontractors in connection with such portion of the Work.
      With
      regard to disbursement, Landlord agrees, with regard to each identified stage
      of
      the Work, to make the applicable portion
      of the Allowance available as follows: the first third shall be made available
      to Tenant at the commencement of such
      phase or stage of Work; the second third shall be made available to Tenant
      when
      two-thirds of such phase or stage
      of Work
      is completed as verified by Landlord's inspectors; and the final third shall
      be
      made available to Tenant when such
      phase or stage of Work is completed, as verified by Landlord's inspectors,
      and
      the materials described in clauses (ii)
      through
      (iv) above which relate to such portion of the Work have been
      delivered.

     

    8. Tenant,
      through its Landlord-approved agent, shall supervise the Work. Landlord or
      its
      construction manager
      shall coordinate with Tenant, Tenant's construction manager and its contractor
      with respect to the relationship between
      the Work (including, but not limited to scheduling of Work, Building policies
      and procedures and inspection of the
      Work), the Building, and the Building's systems. Tenant shall be obligated
      to
      pay a construction supervision fee of five
      percent (5%) of the Total Construction Costs to Landlord or Landlord's
      construction manager, such fee not to exceed $75,000.
      Tenant hereby covenants to comply with Landlord's guidelines regarding
      construction policies and procedures and
      further agrees to cause all contractors and subcontractors to abide by such
      policies and procedures. Landlord shall, prior
      to
      commencement of construction hereunder, provide Tenant's contractors with a
      staging area not to exceed 1,006 square
      feet which shall be reasonably located and adequate for performing the Work.
      Landlord may, from time to time,
      relocate
      the staging area if it interferes with Landlord's or another tenant's usage
      of
      the Building. In addition to the indemnification
      for mechanic's liens set forth in this Lease, Tenant hereby indemnifies Landlord
      and its property manager
      from any
      and all claims, damages, liabilities and causes of action arising from the
      construction of the tenant improvements
      to the Premises except to the extent caused by the gross negligence or
      intentional misconduct of Landlord.
      Tenant
      understands that Landlord will require weekly construction
      meetings.

     

    9. All
      sums
      payable by Tenant to Landlord under this Agreement shall constitute additional
      rental under the Lease. In the event Tenant shall fail to pay any amount of
      such
      additional rental when due, and any such failure continues for a period of
      ten
      (10) days after written notice of such failure is issued by Landlord to Tenant,
      then such failure
      shall constitute an Event of Default under the Lease and hereunder and Landlord
      shall have the right to exercise all
      of its
      rights and remedies under the Lease and under applicable law. In no event shall
      any termination of the Lease by Landlord relieve Tenant of Tenant's obligation
      to pay to Landlord the sums payable by Tenant hereunder.

     

    
      
        
        

      

      
        EXHIBIT
          "D" - PAGE 2 OF 3

        
          

        

      

      
        
        

      

    

     

    

     

    EXECUTED
      as of the day and year first above written. 

     

    
      	 	 	 
	 	LANDLORD:
	 	 
	 	WIREDZONE
              PROPERTY, L.P.
	 
 	 
 	 
 
	 	By:  	WiredZone
              Property
              GenPar, LLC,
its general partner
	 	 	 
	 	 	By:
              /s/ signature    
	 	 	Its:
              GP

    

     

    
      	 	 	 
	 	TENANT:
	 	 
	 	COMBIMATRIX
              CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ signature        
	 	Title:	Executive
              Vice President
	 	
            
	 	 

    

    

     

    
      
        
        

      

      
        EXHIBIT
          "D" - PAGE 3 OF 3

        
          

        

      

      
        
        

      

    

    EXHIBIT
      "E" TO LEASE AGREEMENT

     

    Acceptance
      of Premises Memorandum

    

    

    THIS
      ACCEPTANCE OF PREMISES MEMORANDUM
      (this
      "Memorandum")
      is
      entered into on this ____ day of October, 2000, by and between WIREDZONE
      PROPERTY, L.P., as Landlord ("Landlord"), and COMBIMATRIX
      CORPORATION, as Tenant ("Tenant"). Unless otherwise defined herein, all
      capitalized terms used
      herein
      shall have the same meaning ascribed to such terms in the Lease (as hereinafter
      defined).

    

    RECITALS:

    

    WHEREAS,
      on
      October __,
      2000,
      Landlord and Tenant entered into that certain Lease Agreement (the "Lease")
      whereby
      Landlord leased certain Premises located in the Building to Tenant pursuant
      to
      certain terms and provisions more particularly described therein;

    

    WHEREAS,
      as
      provided in Paragraph 8 of the Lease, Tenant desires to take possession of
      and
      accept the Premises subject to the terms and provisions hereof.

    

    NOW,
      THEREFORE, for
      and
      in consideration of the premises, and the mutual covenants and agreements
contained
      herein and in the Lease, Landlord and Tenant hereby expressly covenant,
      acknowledge and agree as follows:

    

    1. Except
      as
      set forth in Exhibit "D" to the Lease, Landlord has no further obligation to
      install or construct any leasehold improvements, modifications or alterations
      to
      the Premises.

    

    2. The
      Commencement Date shall be November 1, 2000. Pursuant to the provisions ofthe
      Lease, the first monthly installment of Base Rental shall become due and payable
      on November 1, 2000.

    

    3. The
      expiration date of the Lease shall be October 31, 2008.

    

    4. The
      Premises contain 85,414 square feet of Rentable Space.

    

    5. Except
      as
      specifically set forth herein, as of the date of this Memorandum the Lease
      has
      not been modified, altered, supplemented, superseded or amended in any
      respect.

    

    6. All
      terms,
      provisions and conditions of the Lease are and remain in full force and effect,
      and are hereby expressly ratified, confirmed, restated and reaffirmed in each
      and every respect.

    

    IN
      WITNESS WHEREOF, this Memorandum is entered into by Landlord and Tenant on
      the
      date first set forth
      above.

    

    
      	
              LANDLORD:

            	 	
              TENANT:

            
	 	 	 
	
              WIREDZONE
                PROPERTY, L.P.

            	 	
              COMBIMATRIX
                CORPORATION

            

    

    

    
      	
              By:

            	
              WiredZone
                Property GenPar, LLC,

            	 	 	 
	 	
              its
                general partner

            	 	
              By:
                

            	 
	
               

            	 	 	
              Its:

            	 

    

    

    
      	 	
              By:

            	 	 	 	 
	 	
              Its:

            	 	 	 	 

    

    

    
      
        
        

      

      
        EXHIBIT
          "E" - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      "F" TO LEASE AGREEMENT

     

    Building
      Rules and Regulations

     

    1. Sidewalks,
      doorways, vestibules, corridors, stairways and other similar areas shall not
      be
      obstructed by Tenant
      or
      used by Tenant for any purpose other than ingress and egress to and from the
      Premises and for going from or 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 materials shall be thrown or placed therein.
      Damage resulting to any such
      fixtures
      or appliances or surrounding areas from misuse by Tenant shall be repaired
      at
      the sole cost and expense of Tenant, and Landlord shall not in any case be
      responsible therefor.

     

    3. No
      signs,
      advertisements or notices shall be painted or affixed on or to any windows
      or
      doors or other parts of the Building except of such color, size and style and
      in
      such places as shall be first approved in writing by Landlord.
      No nails, hooks or screws shall be driven or inserted in any part of the
      Building which would impact Building
      systems
      except by the Building maintenance personnel nor shall any part of the Building
      be defaced by Tenant.

     

    4. Tenant
      shall not place any additional lock or locks on any doors in or to the Premises
      without Landlord's
      prior written consent. Two keys to the locks on the doors which access the
      Premises from the Common Areas shall
      be
      furnished by Landlord to Tenant, and Tenant shall not have any duplicate keys
      made. Additional keys required by
      Tenant
      shall be made by Landlord at Tenant's sole expense. Upon termination of the
      Lease, Tenant shall return all
      keys to
      Landlord and shall provide to Landlord a means of opening all safes, cabinets
      and vaults being left with the Premises.

     

    5. With
      respect to work being performed by Tenant in the Premises with the approval
      of
      Landlord, Tenant will refer all contractors, contractor's representatives and
      installation technicians rendering any service to them to Landlord for
      Landlord's supervision, approval and control before the performance of any
      contractual services. This provision
      shall apply to work performed in the Building including, but not limited to,
      installation of telephones, telegraph
      equipment, electrical devices and attachments, and any and all installation
      of
      every nature affecting floors, walls, woodwork, trim, windows, ceilings,
      equipment and any other physical portion of the Building. Tenant must have
      Landlord's written approval prior to employing any contractor. Any and all
      such
      contractors shall comply with these Rules and Regulations for such services
      including, but not limited to, insurance requirements. All work in or on the
      Building
      shall comply with any and all codes. (To the extent the terms and conditions
      of
      this Rule 5 conflict with the
      terms
      and conditions of the Leasehold Improvements Agreement, the terms and conditions
      of such Leasehold Improvements Agreement shall control.)

     

    6. Movement
      in or out of the Building of furniture or office equipment, or dispatch or
      receipt by Tenant of
      any
      bulky materials, merchandise or materials which require use of elevators or
      stairways, or movement through the Building
      entrances or lobby shall be restricted to such hours as Landlord shall
      reasonably designate. All such movement shall
      be
      under the supervision of Landlord and in the manner agreed between Tenant and
      Landlord by prearrangement before
      performance. Such prearrangement initiated by Tenant will include determination
      by Landlord, and subject to its decision
      and control, as to the time, method and routing of movement and as to
      limitations for safety or other concerns which
      may
      prohibit any article, equipment or any other item from being brought into the
      Building. Tenant is to assume
      all risk
      as to damage to articles moved and injury to person or public engaged or not
      engaged in such movement, including
      equipment, property and personnel of Landlord and other tenants if damaged
      or
      injured as a result of acts in connection
      with carrying out this service for Tenant from the time of entering the property
      to completion of work; and Landlord
      shall not be liable for acts of any person engaged in, or any damage or loss
      to
      any of said property or persons
      resulting from any act in connection with such service performed for
      Tenant.

     

    7. Landlord
      shall have the power to prescribe the weight and position of safes and other
      heavy equipment, which
      shall, in all cases, be positioned to distribute the weight and stand on
      supporting devices approved by Landlord. All
      damage done to the Building by taking in or putting out any property of Tenant,
      or done by Tenant's property while in
      the
      Building, shall be repaired at the expense of Tenant.

     

    8. Corridor
      doors, when not in use, shall be kept closed.

     

    9. Tenant
      shall cooperate with Landlord's employees in keeping its Premises neat and
      clean. Tenant shall not
      employ any person for the purpose of such cleaning other than the Building's
      cleaning and maintenance personnel. Landlord
      shall be in no way responsible to Tenant, its agents, employees, contractors
      or
      invitees for any loss of property
      from the
      Premises or public areas or for any damage to any property thereon from any
      cause whatsoever.

     

    10. To
      insure
      orderly operation of the Building, Landlord and Tenant shall, prior to the
      Commencement Date, agree on reasonable rules and policies respecting deliveries
      to the Premises on Tenant's behalf or required for Tenant's
      operations.

     

    11. Should
      Tenant require telegraphic, telephonic, annunciator or other communication
      service, Landlord will
      direct the electrician where and how wires are to be introduced and placed
      and
      none shall be introduced or placed except
      as
      Landlord shall direct. Electric current shall not be used for power in excess
      of
      standard office use or heating
      without
      Landlord's prior written permission.

    

    
      
        
        

      

      
        EXHIBIT
          "F" - PAGE 1 OF 2

        
          

        

      

      
        
        

      

    

    12. Tenant
      shall not make or permit any improper noises in the Building or otherwise
      interfere in any way
      with
      other tenants or persons having business with them.

    

    13. Nothing
      shall be swept or thrown into the corridors, halls, elevator shafts or
      stairways. No animals
      shall be
      brought into or kept in, on or about the Premises.

    

    14. Tenant
      shall not permit its employees to install or utilize space heaters in the
      Premises.

    

    15. No
      portion of the Premises shall at any time be used or occupied as sleeping or
      lodging quarters.

    

    16. Landlord
      will not be responsible for money, jewelry or other personal property lost
      or
      stolen in or from the
      Premises or public areas regardless of whether such loss or theft occurs when
      the area is locked against entry or not.

    

    17. The
      Premises shall not be occupied by an average of more than one (1) person per
      200
      square feet of
      Rentable
      Space in the Premises without the prior written consent of
      Landlord.

    

    18. Landlord
      reserves the right to rescind any of these rules and regulations and to make
      such other and further
      rules and regulations as in its judgment shall from time to time be advisable
      for the safety, protection, care and cleanliness
      of the Building, the use and operation thereof, the preservation of good order
      therein and the protection and comfort
      of the tenants and their agents, employees and invitees, which rules and
      regulations, when made and written
      notice
      thereof is given to Tenant, shall be binding upon Tenant in like manner as
      if
      originally herein prescribed. No subsequent changes shall be permitted to the
      extent they are inconsistent with the terms and conditions of the
      Lease.

    

    19. Notwithstanding
      anything to the contrary contained herein, the Building Rules and Regulations
      to
      be applied
      to Tenant shall in no event be less favorable or adversely inconsistent with
      those applied to other tenants in the
      Building.

    
      
        
        

      

      
        EXHIBIT
          "F" - PAGE 2 OF 2

        
          

        

      

      
        
        

      

    

    

    Rider
      No.
      101 

     

    PARKING
      FACILITIES

    

    

    At
      all
      times during the Lease Term and any renewal or extension thereof, and so long
      as
      this Lease and any renewal or extension thereof is in full force and effect
      and
      no event of default shall have occurred and be continuing under
      this Lease, Tenant shall be permitted the use of the surface parking lot
      associated with the Building for parking
      automobiles owned by Tenant and its employees, agents and invitees. Landlord
      hereby agrees to make available to Tenant,
      and Tenant hereby agrees to take, subject to the further provisions of this
      Rider No. 101, during the Lease Term, and
      any
      extension or renewal thereof, all or some of the following permits to park
      automobiles on the surface parking lot:

     

    A
      total
      of   * 
      permits
      for unassigned and unreserved parking in the surface parking lot.

    

    Landlord
      and its parking lot operator shall have the right from time to time to
      reconfigure the surface parking lot
      and to
      promulgate reasonable rules and regulations regarding the parking permits
      available to Tenant hereunder and others,
      including, but not limited to, the flow of traffic to and from various parking
      areas, angles and direction of parking,
      and the
      like. Tenant agrees to comply, and to cause its employees, agents and visitors
      to comply, with such rules and regulations
      (and reasonable additions and amendments thereto) as Landlord and its parking
      lot operator may promulgate
      from
      time to time. Landlord and its parking lot operator will not be responsible
      for
      money, jewelry or other personal property
      lost or stolen in or from the parking lot or public areas regardless of whether
      such loss or theft occurs when the
      parking
      lot or such area is locked or otherwise secured against entry or
      not.

    

    

    *
      based
      on a ratio of 3.1 permits for every 1,000 square feet of Rentable Space in
      the
      Premises for which Base Rental is
      being
      paid per Rider No. 106 hereto.

     

    

     

    
      
        
        

      

      
        RIDER
          NO.
          101 - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

    Rider
      No.
      102 

     

    TENANT'S
      OPTION TO RENEW

    

    

    Tenant
      may, at its option and subject to the terms hereof, renew the Lease Term for
      two
      (2) additional term(s) of sixty.(60)
      months each, provided that this Lease must be in full force and effect and
      no
      event of default may exist under this
      Lease at the time of exercise of such option or at the time the renewal term
      would begin. Such renewal shall be upon the
      same
      terms and conditions as provided elsewhere in this Lease, except that (i) this
      Lease may not be renewed more often
      than as set forth above, (ii) Landlord shall have no obligation to install
      improvements in the Premises, and (iii) the annual
      Base Rental for such renewal period(s), and each monthly installment thereof,
      shall be determined as provided
      below.
      Each such option shall be exercised by Tenant giving notice to Landlord by
      certified mail, return receipt requested,
      at least twelve (12) months prior to the end of the then-existing terns, and,
      if
      not so exercised, such option not so
      exercised and any subsequent option to renew shall automatically expire and
      terminate. Notwithstanding anything to the
      contrary contained herein, Tenant's option herein shall be subject to a
      determination by Landlord, at Landlord's sole discretion,
      that Tenant's financial condition at the time it makes such election is
      comparable or better than the financial condition
      of Tenant at the time Tenant had executed this Lease (i.e., Tenant must have
      a
      total equity capitalization at the
      time of
      each such renewal notice of at least $50,000,000). If Tenant so elects to renew
      the Lease Tern, following Tenant's
      exercise of such renewal option, upon request from Landlord, Tenant and Landlord
      will enter into a renewal
      agreement by which this Lease will be renewed in accordance with the terms
      set
      forth in this Rider.

    

    The
      annual Base Rental for each renewal period shall be the Prevailing Market Rental
      Rate for comparable buildings in the "North End Submarket of Seattle" taking
      into consideration the unique features and location of the Building,
      and the use, location and floor level within the Building for the subject space
      as well as the intended term of such
      lease under consideration and the date such renewal term is to commence. The
      Prevailing Market Rental Rate shall
      be
      exclusive of the tenant improvements which are above the initial Allowance
      under
      the Lease. The parties shall negotiate in good faith to establish the Prevailing
      Market Rental Rate. If the parties are unable to agree on such rate within
      thirty (30) days after Tenant gives Landlord is notice exercising the Renewal
      Option (the "Notice
      Date"), then
      each
      party shall appoint an appraiser who is a member of the American Institute
      of
      Real Estate Appraisers (an "Appraiser") and has at least five (5) years
      experience appraising rental properties in the greater Seattle area. If the
      Appraisers are unable to reach agreement about Prevailing Market Rental Rate
      within forty-five (45) days after the Notice Date, then either party on written
      notice to the other may request appointment of a single arbitrator by the
American
      Arbitration Association ("AAA") in accordance with its then prevailing real
      estate valuation arbitration rules as modified
      by this Rider. Once the arbitrator is appointed, each Appraiser shall promptly
      submit his/her determination of Prevailing
      Market Rental Rate to the arbitrator. The arbitrator shall determine Prevailing
      Market Rental Rate (applying
      the
      standards of determination set forth above) within ten (10) days based solely
      on
      the materials submitted by the Appraisers and the determination shall not exceed
      or be less than the Market Rent determinations of the Appraisers. Each
      party shall bear the expense of retaining its Appraiser. The fees and expenses
      of the arbitrator and other expenses of
      the
      arbitration shall be borne equally by the parties. The arbitrator's
      determination of Prevailing Market Rental Rate shall
      be
      final and binding on the parties. Judgment upon the determination of Prevailing
      Market Rental Rate rendered by
      the
      arbitrator may be entered into any court having jurisdiction over this
      matter.

     

    

     

    
      
        
        

      

      
        RIDER
          NO.
          102 - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

    Rider
      No.
      103 

     

    EXPANSION
      OPTION

     

    Provided
      (i) there is no event of default hereunder and (ii) Tenant's total equity
      capitalization at the time of such
      expansion notice is at least $50,000,000.00, Tenant shall have the right between
      the 48th
      and
      50th
      month of
      the Lease Term to provide Landlord with 18 months advance written notice of
      Tenant's need for additional space equal to an amount
      up
      to 25% of the 85,414 actual square footage initially leased (the "Expansion
      Space"). If such notice is given, Landlord
      shall and guarantees to provide Tenant with a solution for accommodating said
      request. If the solution is within the
      Building, the term of the lease with respect to such Expansion Space shall
      be
      coterminous with the Lease Term for the
      original
      Premises. If the solution is in a structure to be constructed as an addition
      to
      the Building or as another stand alone
      building adjacent to the Building, then the term of the lease for the Expansion
      Space shall be a minimum of seven years.
      In
      either case rental rates will be negotiated based upon 100% of the then current
      market rents for similar space at
      the time
      of the renewal notice by Tenant. The other terms and conditions relating to
      such
      Expansion Space shall be substantially
      similar to those in the Lease. The process for determining the fair market
      rent
      shall be as set forth in Rider
      No. 102
      to this Lease. In the event Tenant in its notice requires more than 25% of
      the
      85,414 actual square footage leased, Landlord shall use its best efforts to
      provide a reasonably acceptable solution for Tenant in the Building, any
adjacent
      buildings or elsewhere. Said solution shall be mutually agreeable to the parties
      with respect to location, timing
      and
      determination of fair market rent.

     

     

    

    
      
        
        

      

      
        RIDER
          NO.
          103 - PAGE 1 OF 1

        
          

        

      

      
        
        

      

    

     

    Rider
      No.
      104 

     

    RIGHT
      OF FIRST OPPORTUNITY

     

    1.     Right
      of First Opportunity. Provided
      this Lease is then in full force and effect and no event of default as defined
      in Paragraph 25 of this Lease has occurred and remains uncured, and subject
      to
      the terms hereof, Tenant shall have the right of first opportunity during the
      first sixty (60) months of the Lease Term to lease all (or a portion)
      of the additional space consisting of the area on the 2ndand
      3rdfloors
      designated and referred to on Exhibit
      "B-2" attached
      to this Lease as the "Right
      of First Opportunity Space",
      for a
      term beginning on the Effective Date (as hereinafter defined) and ending
      contemporaneously with the expiration of the Lease Term (unless sooner
      terminated pursuant to the terms of this Lease, and subject to any rights of
      extension contained in this Lease). The right of first opportunity contained
      herein shall automatically terminate following the expiration of such sixty
      (60)
      month period (unless sooner terminated pursuant to the terms of this
      Lease).

     

    2.     Notice
      by Landlord.
      Prior to
      entering into bona fide negotiations with an existing tenant in the Building
      or a prospective tenant to lease all or any part of the Right of First
      Opportunity Space (or if an existing tenant of the
      Right
      of First Opportunity Space desires to extend the term of its lease thereof),
      Landlord shall notify Tenant of such fact
      and
      shall include in such notice the Prevailing Market Rental Rate for such space.
      Tenant,
      shall
      have a period of ten (10)
      business days from the date of delivery of such notice to notify Landlord
      whether Tenant elects to exercise the right
      granted
      hereby to lease such portion of the Right of First Opportunity Space. If Tenant
      fails to give any notice to Landlord
      within the required ten (10) business day period, Tenant shall be deemed to
      have
      refused its right to lease the Right
      of
      First Opportunity Space. Notwithstanding anything to the contrary contained
      herein, Tenant's option herein shall be
      subject to a determination by Landlord, in Landlord's
      reasonable discretion, that Tenant's financial condition (i.e.,
      total
      equity
      capitalization at the time of such notice of at least $50,000,000) is
      unchanged.

     

    3.     Refusal
      by Tenant.
      If
      Tenant so refuses its right to lease the Right of First Opportunity Space
      (either by
      giving
      written notice thereof or by failing to give any notice), Landlord shall have
      the right to lease all or any portion of
      the
      Right of First Opportunity Space to an existing tenant in the Building or a
      prospective tenant (or to extend the tern of
      the
      lease of an existing tenant) on such terns and provisions as may be acceptable
      to Landlord. If Tenant so refuses its right
      to
      lease the Right of First Opportunity Space, then if Landlord shall enter into
      a
      lease with a prospective tenant (or extend
      the term of the lease of an existing tenant) for all or any part of the Right
      of
      First Opportunity Space, Tenant's right
      of
      first opportunity as to such portion of such Right of First Opportunity Space
      shall terminate with respect to that
      lease
      but not with respect to future opportunities for the space in the event such
      shall become available.

     

    4.     Acceptance
      by Tenant.
      Upon the
      exercise by Tenant of its right of first opportunity as provided in Paragraph
      2,
      Landlord and Tenant shall, within ten (10) business days after Tenant delivers
      to Landlord notice of its election,
      enter into a written amendment modifying and supplementing this Lease and
      containing other appropriate terms and
      provisions relating to the addition of the Right of First Opportunity Space
      to
      the Premises (including specifically any increase,
      adjustment, or augmentation of rent as a result of such addition). The annual
      Base Rental to be paid under this Lease
      for
      the Right of First Opportunity Space so leased shall be at the Prevailing Market
      Rental Rate as determined in the
      manner described in Rider No. 102 hereto. The payment of the new Base Rental
      for
      the Right of First Opportunity Space
      shall commence on the Effective Date, which shall be the later of (a) thirty
      (30) days following the expiration date of
      the
      term of any lease with another tenant covering the Right of First Opportunity
      Space, or (b) the date agreed upon by Landlord
      and Tenant if the Right of First Opportunity Space is not covered by a prior
      tenant lease, or, in the event they are
      unable to agree, shall be the date ninety (90) days from the date upon which
      Tenant notified Landlord of its election to
      lease
      the Right of First Opportunity Space. Rent for a partial month shall be
      prorated. Possession of the Right of First Opportunity
      Space shall be delivered to Tenant in an "as is" condition. Landlord shall
      not
      be liable for the failure to give possession
      of the Right of First Opportunity Space on the Effective Date by reason of
      the
      holding over or retention of possession
      of any tenant, tenants, or occupants (provided Landlord uses commercially
      reasonable diligence in prosecuting
      eviction
      of such tenant or occupant), or for any other reason, and any such failure
      shall
      not impair the validity of this Lease,
      or
      extend the Term, but the rent for such Right of First Opportunity Space shall
      be
      abated and the Commencement Date
      extended until possession is delivered to Tenant, and such abatement shall
      constitute full settlement of all claims
      that
      Tenant might otherwise have against Landlord by reason of such failure to give
      possession of the Right of-First Opportunity Space to Tenant on the effective
      date.

     

    5.     Termination
      of Right.
      Any
      termination of this Lease during the original Lease Term (or any extension
      thereon or any non-permitted assignment or subleasing by Tenant pursuant to
      this
      Lease shall terminate the
      right of
      first opportunity of Tenant contained herein.

     

    6.     Subordinate
      Right.  [Intentionally
      Deleted.]

     

    7.     Additional
      Right of First
      Opportunity.
      In
      addition to the right described in Paragraph 2 above, Tenant
      shall have the right of first opportunity to lease the entirety of any new
      structure or extension to the Building that Landlord
      may construct on the land. Such right shall be for the first eighty-four (84)
      months of the Lease Term. Rental rates
      shall be negotiated based upon 100% of the then current market rents for similar
      space in the North End Submarket at
      the
      time. The other terms and conditions relating to such new structure or extension
      shall be substantially similar to those
      in
      the Lease. The Prevailing Market Rental Rate shall be calculated using the
      methodology set forth in Rider No. 102
      to
      the Lease. In the event Tenant exercises this option and leases the entire
      new
      structure or extension, then Tenant
      may
      relinquish the entirety of its presence on the 3rd
      floor
      of
      the initial Premises.

     

    
      
        
        

      

      
        RIDER NO. 104
          - PAGE 1
          OF 1

        
          

        

      

      
        
        

      

    

     

    Rider
      No.
      106 

    SCHEDULE
      OF BASE RENTAL

     

    Base
      Rental shall be payable as follows:

     

    
      	
               

              Months

               

            	
               

              Size
                (RSF)

               

            	
               

              Annual
                NNN

              Rent

            	
               

              Monthly
                NNN

              Rent

            
	
               

              1-10

            	
               

              42,868

            	
               

              $18.15

            	
               

              $64,837.85

            
	
               

              11-20

            	
               

              63,537

            	
               

              $18.15

            	
               

              $96,099.71

            
	
               

              21-24

            	
               

              85,414

            	
               

              $18.15

            	
               

              $129,188.68

            
	
               

              25-48

            	
               

              85,414

            	
               

              $19.15

            	
               

              $136,306.51

            
	
               

              49-72

            	
               

              85,414

            	
               

              $20.15

            	
               

              $143,424.34

            
	
               

              73-96

            	
               

              85,414

            	
               

              $21.15

            	
               

              $150,542.18

            

    

     

    Although
      Tenant intends to complete the build-out of the entire Premises, it is intended
      that Tenant will not
      utilize certain portions of the Premises until a later date. The schedule of
      Base Rental set forth above defines the
      minimum take down schedule of square footage in the Premises. Said Base Rental
      schedule shall be applicable regardless
      if Tenant occupies and uses less than the minimum space set forth above;
      provided, however, if Tenant
      occupies
      and uses more than the minimum square footage stated above, Tenant shall be
      obligated to pay the additional Base Rental and Additional Rental (i.e.,
      Tenant's Proportionate Share
      of
      Operating Expenses) associated
      with such additional square footage. Tenant agrees to advise Landlord
      at any time
      that
      Tenant uses square
      footage in excess of the intended take down schedule. Landlord shall have the
      right, from time to time, to verify
      Tenant's actual usage of space in the Premises and shall advise Tenant if
      Landlord reasonably believes that
      Tenant
      is utilizing excess square footage for which it will thereafter be charged
      Base
      Rental and Additional Rental hereunder.

     

     

    RIDER
      NO. 106 - PAGE 1 OF 1

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