Guilford Pharmaceuticals Inc. (Form: 8-K)

AGREEMENT OF PURCHASE AND SALE
(6411 Beckley Street & 6611 Tributary Street, Baltimore, Maryland)

This Agreement of Purchase and Sale (“Agreement”) is made as of the 17th day of December 2004 (“Effective Date”) between Guilford Pharmaceuticals Inc., a Delaware corporation (“Seller”), and BioMed Realty, L.P., a Maryland limited partnership (“Purchaser”).

A. Beckley Property. Guilford Real Estate Trust 1998-1, a common law trust (the “Guilford Real Estate Trust”), is the owner of the following property (collectively, the “Beckley Property”):

(i) an approximately 77,225 square foot building located at 6411 Beckley Street, Baltimore, Maryland 21224, as more fully described in Exhibit A-1 attached hereto (the “Beckley Real Property”);

(ii) all tangible personal property permanently affixed to the Beckley Real Property, including, without limitation, the equipment and machinery listed on Schedule 1-A attached hereto (the “Beckley Tangible Personal Property”); and

(iii) the plans and specifications for the improvements; warranties, indemnities, applications, permits, approvals and licenses (to the extent applicable in any way to the above referenced Beckley Property or the Beckley Tangible Personal Property and assignable); and insurance proceeds and condemnation awards or claims thereto, including, without limitation, the items listed on Schedule 1-B attached hereto (the “Beckley Intangible Personal Property”).

B. Existing Beckley Lease. Seller is the sole tenant of the Beckley Property pursuant to that certain Lease Agreement dated as of February 5, 1998 (the “Existing Beckley Lease”).

C. Beckley Trust Interests. Seller holds 100% of the beneficial interest in the Guilford Real Estate Trust (the “Beckley Trust Interests”).

D. Tributary Property. Crown Royal Limited Partnership, a Maryland limited partnership (the “Crown Royal Partnership”), is the owner of the following property (collectively, the “Tributary Property” and, together with the Beckley Property, the “Properties”):

(i) an approximately 91,592 square foot building located at 6611 Tributary Street, Baltimore, Maryland 21224, as more fully described in Exhibit A-2 attached hereto (the “Tributary Real Property”);

(ii) all tangible personal property permanently affixed to the Tributary Real Property, including, without limitation, the equipment and machinery listed on Schedule 1-C attached hereto (the “Tributary Tangible Personal Property” and, together with the Beckley Tangible Personal Property, the “Tangible Personal Property”); and

(iii) the plans and specifications for the improvements; warranties, indemnities, applications, permits, approvals and licenses (to the extent applicable in any way to the above referenced Tributary Property or the Tributary Tangible Personal Property and assignable); and insurance proceeds and condemnation awards or claims thereto, including, without limitation, the items listed on Schedule 1-D attached hereto (the “Tributary Intangible Personal Property”).

E. Existing Tributary Lease. Seller is the sole tenant of the Tributary Property pursuant to that certain Standard Net Lease Agreement dated August 30, 1994 (the “Existing Tributary Lease” and, together with the Existing Beckley Lease, the “Existing Leases”).

F. Crown Royal Interests. Wilmac II Partnership, William J. McCarthy, Michael J. McCarthy, Stephen D. McCarthy and Mary Sue McCarthy (collectively, the “Tributary Sellers”) are the holders of 100% of the general and limited partnership interests in the Crown Royal Partnership.

G. Purpose. The parties are entering into this Agreement, in order, among other things, to provide a mechanism for Seller to sell to Purchaser, and Purchaser to purchase, all of the Beckley Trust Interests and all of the interests in the entity that owns the Tributary Property. More specifically, the parties intend, subject to the terms and conditions of this Agreement, to provide, among other things, for the following:

(i) The Tributary Sellers and Seller have entered into that certain Agreement of Sale of Membership Interests, attached hereto as Exhibit B (the “Purchase Agreement Re: Crown Royal Interests”), pursuant to which (a) the Tributary Sellers shall commit to convert the Crown Royal Partnership into a Maryland limited liability company named BMR-6611 Tributary Street LLC (“BMR-Tributary LLC” and, collectively with the Guilford Real Estate Trust and the Crown Royal Partnership, the “Property Entities”), and (b) the Tributary Sellers shall commit to sell, and Seller shall commit to purchase, all of the membership interests in BMR-Tributary LLC (“Crown Royal Interests”), on the terms and conditions set forth therein.

(ii) The following to occur subsequent to the conversion described in subparagraph (i) above and substantially concurrently with each other, all upon the terms and conditions set forth herein:

(a) Seller shall assign to Purchaser all of Seller’s right, title and interest in the Purchase Agreement Re: Crown Royal Interests;

(b) Guilford Real Estate Trust, as landlord, and Seller, as tenant, will amend and restate the Existing Beckley Lease (the “Beckley Lease”); and

(c) BMR-Tributary LLC, as landlord, and Seller, as tenant, will amend and restate the Existing Tributary Lease, pursuant to which the Seller shall terminate Seller’s option to purchase the Tributary Property (“Tributary Lease” and, together with the Beckley Lease, the “Subject Leases”).

(iii) Seller shall sell to Purchaser, and Purchaser shall purchase, all of the Beckley Trust Interests and the rights under the Purchase Agreement Re: Crown Royal Interests.

In consideration of the foregoing and of the covenants and conditions hereinafter set forth, and intending to be legally bound hereby, the parties hereto agree:

1.1. Subject Rights. Subject to the terms and conditions of this Agreement, Seller hereby agrees to assign, sell, transfer, convey and set over to Purchaser, and Purchaser hereby purchases and accepts the following property (“Subject Rights”):

(a) Beckley Trust Interests. All of Seller’s right, title and interest in the Beckley Trust Interests, free and clear of all liens, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever; and

(b) Crown Royal Interests. All of Seller’s right, title and interest under the Purchase Agreement Re: Crown Royal Interests, free and clear of all liens, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever.

1.2. Purchase Price. The total purchase price to be paid to Seller by Purchaser for the Subject Rights shall be Twenty-Five Million Dollars ($25,000,000) (the “Purchase Price”). The Purchase Price shall be paid as follows: (a) $3,810,000 shall be paid to the Tributary Sellers pursuant to the Purchase Agreement Re: Crown Royal Interests, (b) Purchaser shall be credited for the costs and expenses of the survey of the Tributary Real Property, premium for the Tributary Title Policy (as defined below), recording fees on the deed to the Tributary Real Property and one-half of the Escrow Agent’s closing fees payable by the “Purchaser” under Section 7.5 of the Purchase Agreement Re: Crown Royal Interests, and (c) the remainder shall be paid to Seller, as adjusted for prorations, deposits and other adjustments pursuant to and in accordance with the terms of the Closing Statement (as defined below).

1.3. Deposit of Earnest Money. Within two (2) Business Days after the Effective Date, Purchaser shall deposit $250,000 in cash as a good faith refundable deposit (such amount, including any interest earned thereon, the “Earnest Money”) with the Escrow Agent (as defined below). For purposes of this Agreement, a “Business Day” shall mean any day of the year other than any Saturday or Sunday or any other day on which banks located in San Diego, California generally are closed for business. The Escrow Agent shall hold and disburse the Earnest Money in accordance with the escrow provisions in Exhibit C. Following the expiration of the Due Diligence Period (as defined below), the Earnest Money shall be non-refundable, except as otherwise provided herein, including, without limitation, Sections 4.3, 4.4 and 5.5. In the event of a termination of this Agreement prior to the expiration of the Due Diligence Period, the Earnest Money shall be returned to Purchaser upon any such termination. Seller agrees that it shall not deliver any instruction to the Escrow Agent calling for disbursement of the Earnest Money to Seller except following delivery of notice to Purchaser and Escrow Agent of a Purchaser default hereunder and following the expiration of any applicable cure period, and Seller further agrees to provide Purchaser with a copy of such disbursement instruction concurrently with the delivery thereof to the Escrow Agent. Provided such supplemental escrow instructions are not in conflict with this Agreement as it may be amended in writing from time to time, Seller and Purchaser agree to execute such supplemental escrow instructions as may be appropriate to enable Escrow Agent to comply with the terms of this Agreement.

1.4. Title Company and Escrow Agent. The “Escrow Agent” and “Title Company” are: Chicago Title Insurance Company, 925 B. Street, San Diego, California 92101, Attn: Renee Marshall (Tel #: (619) 544-6239; Fax #: (619) 544-6229).

1.5. Closing Date. The “Closing Date” shall mean December 17, 2004, subject to the extension rights pursuant to Sections 3.3, 4.3 and 4.4, and Purchaser’s right to shorten the Due Diligence Period pursuant to Section 2.2(c).

2.1. Seller’s Delivery of Specified Documents. Seller shall provide or make available to Purchaser at each Property or at Seller’s office: (i) the information and documents set forth on Exhibit D-1 attached hereto that are within Seller’s or its property manager’s possession or control (the “Property Information”) for each Property within two (2) Business Days after the Effective Date, and (ii) the information and documents set forth on Exhibit D-2 regarding the Crown Royal Partnership and the Guilford Real Estate Trust (the “Entity Information” and, together with the Property Information, the “Pertinent Information”) within two (2) Business Days after the Effective Date. Seller agrees to cooperate with Purchaser and make copies, at Seller’s expense, of such documentation as Purchaser may reasonably request during the course of Purchaser’s review of the Pertinent Information. The terms “Rent Roll,” “Operating Statements,” “Commission Schedule” and “Service Contracts” are defined in Exhibit D-1. Seller shall have the continuing obligation during the pendency of this Agreement to provide Purchaser with any document described above and coming into Seller’s or its property manager’s possession or produced by or for Seller after the initial delivery of the Pertinent Information.

(a) Purchaser shall have until December 15, 2004 (the “Due Diligence Period”) in which to examine, inspect, and investigate the Properties, and, in Purchaser’s sole and absolute discretion, to determine whether the Properties or their tenants are satisfactory to Purchaser to proceed with this transaction.

(b) In the event Purchaser completes its due diligence prior to the expiration of the Due Diligence Period, Purchaser shall have the right to shorten the Due Diligence Period by up to five (5) days, by giving written notice to Seller on or before the expiration of the Due Diligence Period specifying the exact date the Due Diligence Period expires.

(c) Purchaser may terminate this Agreement pursuant to this Section 2.2 by giving written notice of termination to Seller on or before the last day of the Due Diligence Period. This Agreement shall continue in full force and effect if Purchaser does not give the written notice of termination. Upon such termination, the Earnest Money shall be refunded to Purchaser immediately upon request, and all further rights and obligations of the parties under this Agreement shall terminate except for those that expressly survive such termination.

2.3. Access. Upon reasonable notice to Seller, Purchaser and its agents, employees, consultants, lenders and representatives shall have reasonable access to the Properties during Seller’s normal business hours, and all books and records for the Properties that are in Seller’s or its property manager’s possession or control for the purpose of conducting surveys, appraisals, architectural, engineering, structural, mechanical, geotechnical, physical, soil and environmental inspections and tests, and any other inspections, studies, or tests reasonably required by Purchaser, provided, however, Purchaser may not conduct any invasive testing which would interrupt the conduct of Seller’s business, without Seller’s prior written consent. All access shall be subject to any rights of tenants, restrictions in tenant leases and procedures necessary to secure or preserve any confidential information of Seller. If any inspection or test disturbs either Property, Purchaser will restore such Property to its condition before any such inspection or test. During the pendency of this Agreement, Purchaser and its agents, employees, consultants, lenders and representatives shall have a continuing right of reasonable access to the Properties during Seller’s normal business hours in a manner which would not interrupt the conduct of Seller’s business, and any office where the records of the Properties are kept, with notice, for the purpose of examining and making copies of all books and records and other materials relating to the Properties in Seller’s or its property manager’s possession or control. During the Due Diligence Period, Purchaser may conduct tenant interviews. Purchaser shall have the right to conduct a “walk-through” of each Property before the Closing. In the course of its investigations, Purchaser may make inquiries to third parties, including, without limitation, tenants (and subtenants), representatives, contractors, property managers, parties to Service Contracts and municipal, local and other government officials and representatives, and Seller consents to such inquiries; provided, however, that all communications to tenants/subtenants, and property management personnel shall be coordinated exclusively through Seller.

2.4. Service Contracts; Property Management and Leasing Agreements; Property Employees. During the Due Diligence Period, Purchaser shall notify Seller as to which Service Contracts Seller will be required to cause to be terminated prior to Closing. In addition, Seller shall cause to be terminated all property management or leasing agreement affecting the Properties.

3.1. Title Commitment and Survey. Purchaser shall cause a certified land surveyor to deliver to Purchaser on or prior to the date that is five (5) days before the expiration of the Due Diligence Period a separate ALTA-ACSM Urban survey for each of the Beckley Real Property and the Tributary Real Property (the “Surveys”) dated December 2004. Each Survey shall plot all plotable easements benefiting such property. Within five (5) days of the Effective Date, Purchaser shall cause the Escrow Agent to deliver: (a) a current, effective commitment for title policy for each of the Beckley Real Property and the Tributary Real Property, together with the legible copies of all documents referenced as exceptions therein, and (b) a current, effective commitment to issue the title insurance products described in Section 5.2(g) (the “Title Commitment”) for each of the Beckley Real Property and the Tributary Real Property issued by the Title Company, together with legible copies of all documents referenced as exceptions therein. Prior to the Closing Date, Purchaser shall upon seventy-two (72) hours written notice from Seller, order a date-down of the Title Commitments to the date of the request. If there are any new exceptions on the Title Commitment, then Seller shall either (i) work with the Title Company to remove the new exceptions, or (ii) have the Title Company revise such Title Commitment to incorporate the new exceptions.

3.2. UCC Commitment. Within two (2) days after the Effective Date, Purchaser shall order a UCC search with the applicable Secretary of State for each Seller, the Guilford Real Estate Trust and the Crown Royal Partnership. Purchaser acknowledges receipt of a UCC Search for each of the Tributary Sellers. On the date that is five (5) days before the expiration of the Due Diligence Period, Lawyers Title Insurance Corporation shall deliver to Purchaser a current effective commitment for UCC insurance (“UCC Commitments”) for each of the Beckley Trust Interests, the Crown Royal Interests and Purchaser’s entitlement to the Purchase Agreement Re: Crown Royal Interest, pursuant to which Lawyers Title Insurance Corporation shall insure the non-real estate assets for validity, enforceability, attachment, perfection and priority, and protection against fraud and forgery. The Title Commitments, the documents referred to therein, the UCC Commitments and the Surveys are referred to herein collectively as the “Title Documents.”

3.3. Title Review and Cure. During the Due Diligence Period, Purchaser shall review title to each Property as disclosed by the Title Documents. Purchaser shall be entitled to object to any title matters shown in the Title Documents, in its sole discretion, by a written notice of objections delivered to Seller on or before the expiration of the Due Diligence Period. At Closing, whether or not Purchaser makes any objection with respect thereto, Seller shall cause to be removed any liens and security interests including, without limitation, mechanics and materialmens liens or claims thereof, and any exceptions or encumbrances to title which are created by or through Seller after the Effective Date. If Purchaser does not terminate this Agreement before the expiration of the Due Diligence Period pursuant to Section 2.2, then Purchaser shall have been deemed to have approved any title exception set forth in the Title Documents that Seller is not obligated to remove and did not agree in writing to remove or cure. If after the expiration of the Due Diligence Period the Title Company revises either Title Commitment or any of the UCC Commitments, or the surveyor revises either Survey, to add or modify exceptions, or to add or materially modify the conditions to obtaining any endorsement requested by Purchaser during the Due Diligence Period, then Purchaser may terminate this Agreement and receive a refund of the Earnest Money if provision for their removal or modification satisfactory to Purchaser is not made. In such case, the Closing Date shall be extended for up to ten (10) days in order for Purchaser and Seller to determine if such exception can be resolved and to give Purchaser the opportunity to terminate this Agreement and receive a refund of the Earnest Money if the exception is not removed.

3.4. Permitted Exceptions and Endorsements. “Permitted Exceptions” means the following exceptions approved or deemed approved by Purchaser pursuant to this Agreement: real estate taxes not yet due and payable; tenants in possession as tenants only under the Subject Leases without any option to purchase or acquire an interest in either Property to the extent approved by Purchaser in accordance with Article 4 hereof. For the avoidance of doubt, the general exceptions in the Title Commitments will be removed upon issuance of the ALTA extended coverage title policy to be issued in this transaction and are not Permitted Exceptions. “Customary Endorsements” shall mean, to the extent such endorsements are available under the laws of the state in which the Properties are located: (a) owner’s comprehensive; (b) access; (c) survey (accuracy of survey); (d) location (survey legal matches title legal); (e) separate tax lot; (f) subdivision map act; (g) zoning 3.1, with parking and loading docks; (h) mechanic’s lien; (i) deletion of creditors’ rights exception; (j) endorsement over environmental protection liens; (k) utilities endorsement; (l) non-imputation endorsement (the knowledge of any prior buyer, member or beneficial interest holder is not imputed to Seller); and (m) fairway endorsement (the Title Company treats the title policy as though nothing has changed even though a partner or member of the insured assigns its membership or partnership interests, but the insured does not change). In addition, Purchaser shall have the right to request such other endorsements as Purchaser may reasonably require during the Due Diligence Period based on its review of the Title Commitments and Surveys.

3.5. Owner’s Affidavit. Seller shall execute at Closing an Owner’s Affidavit relating to the Beckley Real Property in the form attached hereto as Exhibit E.

(a) Beckley Documents. Within five (5) days after Purchaser notifies Seller that it has received all of the Pertinent Information, Seller shall deliver to Purchaser:

(i) a draft of the Amended and Restated Trust Agreement (“Guilford Trust Agreement”), evidencing (1) Seller’s ownership of 100% of the beneficial interest in the Guilford Real Estate Trust, free and clear of all liens, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever, and (2) that the Guilford Real Estate Trust owns the Beckley Property free and clear of all claims, monetary liens and debt (including, without limitation, the cancellation of $18,000,000 in debt and the termination of all notes and deeds of trust evidencing the same); and

(ii) a draft of the Assignment of Beckley Trust Interests (“Assignment of Beckley Trust Interests” and, together with the Guilford Trust Agreement, the “Beckley Documents”), vesting in Purchaser good title to the Beckley Trust Interests free and clear of all liens, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever.

Purchaser shall have seven (7) days after receipt of the Beckley Documents to notify Seller in writing of any changes to the Beckley Documents that Purchaser determines are necessary and appropriate, in Purchaser’s sole and absolute discretion. If Purchaser fails to notify Seller within such seven (7) day period, then Purchaser shall be deemed to have approved the Beckley Documents. If Purchaser notifies Seller within such seven (7) day period, then Seller shall endeavor in good faith to cause the changes to be implemented in the Beckley Documents during the Due Diligence Period. In the event Seller objects to any of the proposed changes, Seller shall negotiate in good faith with Purchaser to come to a resolution. In any event, at least five (5) days prior to the expiration of the Due Diligence Period, Seller shall deliver an executed copy of each of the Beckley Documents, in a form approved by Purchaser in a writing delivered to Escrow Agent, to Purchaser. If the terms of the Assignment of Beckley Trust Interests cannot be agreed upon for any reason at least two (2) days prior to the expiration of the Due Diligence Period, this Agreement shall terminate, in which event the Earnest Money shall be returned to Purchaser.

(b) Formation of BMR-Tributary LLC. Seller has delivered to Purchaser a draft of the BMR-Tributary LLC Agreement (“BMR-Tributary LLC Agreement”), pursuant to which: (i) the Tributary Sellers maintain the same share of profits and losses as they held in the Crown Royal Partnership, and (ii) the Tributary Sellers represent and warrant that the membership interests are free and clear of all liens, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever. Purchaser shall have until December 15, 2004 to notify Seller in writing of any changes to the BMR-Tributary LLC Agreement that Purchaser determines are necessary and appropriate, in Purchaser’s sole and absolute discretion. If Purchaser fails to notify Seller on or before December 15, 2004, then Purchaser shall be deemed to have approved the BMR-Tributary LLC Agreement. If Purchaser notifies Seller on or before December 15, 2004, then Seller shall endeavor in good faith to cause the changes to be implemented in the BMR-Tributary LLC Agreement. In the event Seller objects to any of the proposed changes, Seller shall negotiate in good faith with Purchaser to come to a resolution. In any event, if by December 15, 2004, Seller shall fail to deliver an executed copy of the BMR-Tributary LLC Agreement, in a form approved by Purchaser, this Agreement shall terminate, in which event the Earnest Money shall be returned to Purchaser.

(c) Purchase Agreement Re: Crown Royal Interests. The Tributary Sellers and Seller have entered into that certain Agreement of Sale of Membership Interests, attached hereto as Exhibit B, pursuant to which:

(i) the Tributary Sellers: (1) are the holders of 100% of the general and limited partnership interests in the Crown Royal Partnership, and (2) after the conversion of the Crown Royal Partnership into BMR-Tributary LLC, will be the holders of 100% of the membership interests in BMR-Tributary LLC;

(ii) the Tributary Sellers shall transfer all of their membership interests in BMR-Tributary LLC to Seller or its assignee in accordance with the terms of the Purchase Agreement Re: Crown Royal Interests;

(iii) each of the Tributary Sellers shall be signatories to the Purchase Agreement Re: Crown Royal Interests;

(iv) the Tributary Sellers shall represent and warrant: (1) as of the effective date of the Purchase Agreement Re: Crown Royal Interests, that they own their interests free and clear of any liens, rights, encumbrances or other claims of any other party whatsoever; and (2) as of the closing date of the Purchase Agreement Re: Crown Royal Interests, the transfer of all such interests shall be made free and clear of any liens, rights, encumbrances or other claims of any other party whatsoever. The representations and warranties set forth in this subparagraph (iv) shall survive closing as provided therein and are enforceable by the buyer thereunder; and

(v) during the executory period, the Tributary Sellers shall not further assign or encumber their interests or enter into any further agreements with respect to the Tributary Property.

(d) Concurrent Closing of Transactions. Seller shall perform, execute and deliver, any further actions, documents and will obtain such consents, as may be reasonably necessary to cause the Beckley Property to be vested in the Guilford Real Estate Trust and shall use commercially reasonable efforts to cause the Tributary Sellers to cause the Tributary Property to be vested in BMR-Tributary LLC. Seller shall further perform, execute and deliver, any further actions, documents and will obtain such consents, as may be reasonably necessary and within its control as to (iii) below, to cause the following to occur concurrently with the Closing Date:

(ii) Seller’s assignment of the Purchase Agreement Re: Crown Royal Interests to Purchaser; and

(iii) the Tributary Sellers’ conveyance of the Crown Royal Interests to Purchaser on the Closing Date.

(a) Guilford Real Estate Trust. Seller shall not enter into or amend, terminate, waive any default under, or grant concessions regarding the Guilford Trust Agreement (except as provided in Section 4.1(a)), or enter into any contract or agreement or act or refrain from acting in such a way that could change the status of the Guilford Real Estate Trust as a “grantor trust” or in any way jeopardize Seller’s beneficial interest in the Guilford Real Estate Trust.

(b) Purchase Agreement Re: Crown Royal Interests. Seller shall use commercially reasonable efforts to cause the Tributary Sellers to enter into the Purchase Agreement Re: Crown Royal Interests. Seller shall not enter into or amend, terminate, waive any default under, or grant concessions regarding the Purchase Agreement Re: Crown Royal Interests (except as provided in Section 4.1(c)), or enter into any contract or agreement or act or refrain from acting in such a way that could change the status of the Crown Royal Partnership or in any way jeopardize the Tributary Sellers’ partnership interests in the Crown Royal Partnership.

(c) Preservation of Business. Seller and the Guilford Real Estate Trust: (i) shall cause the Beckley Property to be operated only in the ordinary and usual course of business and consistent with past practice, shall preserve intact the Beckley Property, preserve the good will and advantageous relationships of Seller and the Guilford Real Estate Trust with customers, suppliers, independent contractors, employees and other persons or entities material to the operation of its business in the ordinary and usual course of business, (ii) shall perform its obligations under leases and other agreements affecting the Beckley Property, and (iii) shall not take any action or omission which would cause any of the representations or warranties of Seller contained herein to become inaccurate or any of the covenants of Seller to be breached.

(d) Maintenance of Insurance. Seller shall continue to carry its existing insurance through the Closing Date, and shall not allow any breach, default, termination or cancellation of such insurance policies or agreements to occur or exist.

(e) New Contracts. Without Purchaser’s prior written consent in each instance, neither Seller nor the Guilford Real Estate Trust shall enter into or amend, terminate, waive any default under, or grant concessions regarding any contract or agreement that will be a material obligation affecting either Property or binding on Purchaser after the Closing.

(f) Leasing Arrangements. Seller will not enter into any lease, or amend, terminate, waive any default under, grant concessions regarding, or incur any obligation for leasing commissions or otherwise in connection with any lease without Purchaser’s prior written consent in each instance.

(g) Removal and Replacement of Tangible Personal Property. Seller will not remove any Tangible Personal Property unless it is replaced with a comparable item of equal quality and quantity as existed as of the time of such removal.

(h) Maintenance of Permits. Seller and the Guilford Real Estate Trust shall maintain in existence all licenses, permits and approvals, if any, in its name necessary or reasonably appropriate to the ownership, operation or improvement of either Property.

4.3. Damage. All risk of loss with respect to the Properties shall remain with Seller until the Closing Date, when full risk of loss with respect to the Properties shall pass to Purchaser. Seller shall promptly give Purchaser written notice of any Material Damage to either Property, describing such damage, whether such damage is covered by insurance and the estimated cost of repairing such damage. Seller shall, to the extent possible, begin repairs prior to the Closing out of any insurance proceeds received by Seller for any damage which is not Material Damage, and shall transfer and assign any remaining insurance proceeds or rights thereto to Purchaser. Purchaser may elect by notice to Seller given within ten (10) days after Purchaser is notified of any Material Damage (and the Closing shall be extended, if necessary, to give Purchaser such ten (10) day period to respond to such notice) that Purchaser is electing to terminate this Agreement, in which event the Earnest Money shall be returned to Purchaser. “Material Damage” shall mean the cost to repair such damage exceeds $1,000,000. If Purchaser fails to timely elect to terminate this Agreement, Purchaser shall be obligated to proceed to Closing.

4.4. Condemnation. Seller shall promptly give Purchaser notice of any eminent domain proceedings that are contemplated, threatened or instituted with respect to either Property. By notice to Seller given within ten (10) days after Purchaser receives notice of Material proceedings in eminent domain that are threatened or instituted by any body having the power of eminent domain with respect to either Property, and if necessary the Closing Date shall be extended to give Purchaser the full ten (10) day period to make such election, Purchaser may terminate this Agreement (in which event the Earnest Money shall be returned to Purchaser) or proceed under this Agreement, in which event Seller shall, at the Closing, assign to Purchaser its entire right, title and interest in and to any condemnation award, and Purchaser shall have the right during the pendency of this Agreement to negotiate and otherwise deal with the condemning authority in respect of such matter. The term “Material” as used herein shall mean the value of the condemnation award is in excess of $1,000,000. If Purchaser fails to timely elect to terminate this Agreement, Purchaser shall be obligated to proceed to Closing.

5.1. Conditions to Seller’s Obligation to Close. In addition to all other conditions set forth herein, the obligation of Seller to consummate the transactions contemplated hereunder shall be contingent upon the following:

(a) Representations. Purchaser’s representations and warranties contained herein shall be true and correct as of the date of this Agreement and the Closing Date; and

(b) Performance. As of the Closing Date, Purchaser shall have performed its obligations hereunder, in connection with the Closing hereunder, the obligations of the “Purchaser” under the Purchase Agreement Re: Crown Royal Interests, and all deliveries to be made by Purchaser at Closing have been tendered.

5.2. Conditions to Purchaser’s Obligation to Close. In addition to all other conditions set forth herein, the obligation of Purchaser to consummate the transactions contemplated hereunder shall be contingent upon the following:

(a) Representations. Seller’s and the Property Entities’ representations and warranties contained herein or in Seller’s Closing Certificate shall be true and correct as of the date of this Agreement and the Closing Date; and any update to Seller’s representations and warranties effectuated pursuant to this Agreement shall not have disclosed new facts that are material and adverse in relation to the applicable original representations and warranties. The balance sheet of the Guilford Real Estate Trust attached to Seller’s Closing Certificate shall not show additional assets or liabilities beyond those balance sheets approved by Purchaser during the Due Diligence Period, unless otherwise approved by Purchaser;

(b) Performance. As of the Closing Date, Seller and the Property Entities shall have performed their obligations hereunder and all deliveries to be made by Seller at Closing have been tendered;

(c) Default. As of the Closing Date, Seller shall not be in default under any agreement to be assigned to, or obligation to be assumed by, Purchaser under this Agreement;

(d) Physical Condition. Subject to Section 4.3, the physical condition of the Properties shall be substantially the same on the Closing Date as on the Effective Date, reasonable wear and tear excepted;

(i) as of the Effective Date, the Existing Leases are in full force and effect, and (ii) Seller is the sole tenant at each of the Properties; and

(ii) as of the Closing Date, (1) Seller and Purchaser shall have executed the Subject Leases, (2) the Subject Leases shall be in full force and effect, (3) Seller shall be the sole tenant at each of the Properties, and (4) all of the leases affecting any portion of either Property;

(f) Title. Upon the sole condition of payment of the premium, at Closing, the Title Company shall be irrevocably committed to issue to Purchaser:

(i) an ALTA Owner’s Policy of title insurance (Revised 10-13-70 and 10-17-84), with extended coverage (i.e., with ALTA General Exceptions deleted), dated as of the Closing Date, in the amount of $15,000,000, insuring Guilford Real Estate Trust 1998-1 and Purchaser, not individually, but solely as Owner Trustee under the Guilford Real Estate Trust 1998-1, as owner of good, marketable and indefeasible fee simple title to the Beckley Property, subject only to the Permitted Exceptions, and containing the Customary Endorsements (the “Beckley Title Policy”); and

(ii) an ALTA Owner’s Policy of title insurance (Revised 10-13-70 and 10-17-84), with extended coverage (i.e., with ALTA General Exceptions deleted), dated as of the Closing Date, in the amount of $10,000,000, insuring BMR-Tributary LLC, as owner of good, marketable and indefeasible fee simple title to the Tributary Property, subject only to the Permitted Exceptions, and containing the Customary Endorsements (the “Tributary Title Policy” and, together with the Beckley Title Policy, the “Title Policies”);

(g) UCC Title Insurance. Upon the sole condition of payment of the premium, at Closing, the Title Company shall be irrevocably committed to issue to Purchaser the UCC Commitments provided in Section 3.2 hereof, free and clear of all liens, Permitted Exceptions, encumbrances, claims, rights or liabilities in favor of any other party of any kind or nature whatsoever (“UCC Title Policy”);

(h) Bankruptcy. No proceeding shall have been commenced against Seller or the Property Entities under the federal Bankruptcy Code or any state law for relief of debtors;

(i) Moratorium. No moratorium, statute or regulation of any governmental agency or order or ruling of any court shall have been enacted, adopted, or issued which would adversely affect Purchaser’s use or development of either Property;

(j) Property Entities. Except as provided in this Agreement, there shall not have occurred since the Effective Date, any material change (including without limitation the initiation of any material litigation or other adversarial proceeding) in or relating to the business or operation of the Property Entities, and Seller shall not have taken, and Seller shall have not permitted the Property Entities to have taken, any action which would constitute a breach of this Agreement. No claim shall have been filed or threatened against Seller or the Property Entities seeking to prevent or set aside the Closing or seeking damages or compensation if the Closing occurs. The financial condition of Seller and the Property Entities shall be substantially the same on the Closing Date as on the date of execution of this Agreement;

(k) Concurrent Closing. The Closing hereunder shall not occur unless and until the closing under the Purchase Agreement Re: Crown Royal occurs.

(l) The Closing hereunder and the closing under the Purchase Agreement Re: Crown Royal shall occur concurrently.

(m) Other Condition. Any other condition set forth in this Agreement to Purchaser’s obligation to close shall have been satisfied by the applicable date.

5.3. Failure of Condition Precedent. So long as a party is not in default hereunder, if any condition to such party’s obligation to proceed with the Closing hereunder has not been satisfied as of the Closing Date or other applicable date, such party may, in its sole discretion, either:

(a) terminate this Agreement by delivering written notice to the other party on or before the Closing Date or other applicable date, whereupon: (i) if such termination occurs prior to the expiration of the Due Diligence Period, then the Earnest Money shall be returned to Purchaser, (ii) if such termination occurs subsequent to the termination of the Due Diligence Period and Purchaser is in breach of its obligations under this Agreement, then the provisions of Section 5.4 shall apply, or (iii) if Seller is in breach of its obligations under this Agreement, then the provisions of Section 5.5 shall apply; or

(b) elect to close, notwithstanding the non-satisfaction of such condition, in which event such party shall be deemed to have waived any such condition.

The foregoing shall not be construed as diminishing the respective rights of the parties under Sections 5.4(b) and 5.5(b).

(a) In the event of a breach by Purchaser of its obligations under this Agreement after the expiration of the Due Diligence Period, which breach is not cured within five (5) days after Purchaser’s receipt of notice of default from Seller (provided that no such cure period shall extend the Closing Date or apply for a breach of the obligation to close by the Closing Date) and Seller is willing, ready and able to perform its obligations hereunder, and shall have performed all of the obligations required of Seller as of the date Purchaser receives the notice of default from Seller, Seller’s sole remedy shall be to terminate this Agreement and retain all Earnest Money and any earnings thereon as liquidated damages, not as a penalty. PURCHASER AND SELLER AGREE THAT IT WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO QUANTIFY THE ACTUAL DAMAGES TO SELLER IN THE EVENT OF A BREACH BY PURCHASER AFTER THE EXPIRATION OF THE DUE DILIGENCE PERIOD, THAT THE AMOUNT OF ALL EARNEST MONEY IS A REASONABLE ESTIMATE OF SUCH ACTUAL DAMAGES, AND THAT SELLER’S EXCLUSIVE REMEDY IN THE EVENT OF A BREACH BY PURCHASER AFTER THE EXPIRATION OF THE DUE DILIGENCE PERIOD SHALL BE TO RETAIN ALL EARNEST MONEY AND ANY EARNINGS THEREON AS LIQUIDATED DAMAGES.

(b) After Closing, in the event of a breach by Purchaser of its obligations under this Agreement that survive Closing, Seller may exercise any rights and remedies available at law or in equity.

(a) In the event of a breach by Seller of its obligations under this Agreement, which breach is not cured within five (5) days after Seller’s receipt of notice of default from Purchaser (provided that no such cure period shall extend the Closing Date or apply for a breach of the obligation to close by the Closing Date), Purchaser may elect only one of the following two remedies: (i) terminate this Agreement and receive: (1) a refund of the Earnest Money and any earnings thereon, plus (2) reimbursement from Seller for Purchaser’s reasonable out of pocket costs incurred in connection with the negotiation of this Agreement, Purchaser’s diligence with respect to the Properties, and Purchaser’s actions in furtherance of the transactions contemplated by this Agreement (provided that said sum recoverable as reimbursement shall not exceed one hundred thousand dollars ($100,000)); or (ii) enforce specific performance of this Agreement against Seller, including the right to recover reasonable attorneys’ fees and to seek recovery pursuant to Section 9.1 of this Agreement. PURCHASER AND SELLER AGREE THAT IT WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO QUANTIFY THE ACTUAL DAMAGES TO PURCHASER IN THE EVENT OF A BREACH BY SELLER, THAT THE AMOUNT OF ALL EARNEST MONEY IS A REASONABLE ESTIMATE OF SUCH ACTUAL DAMAGES, AND THAT IN THE EVENT PURCHASER SELECTS TO ENFORCE ITS REMEDIES UNDER (I) ABOVE, PURCHASER SHALL RECEIVE A REFUND OF ALL EARNEST MONEY AND ANY EARNINGS THEREON, AND PURCHASER’S OUT OF POCKET COSTS NOT TO EXCEED $100,000.

(b) After Closing, in the event of a breach by Seller of its obligations under this Agreement that survive Closing, Purchaser may exercise any rights and remedies available at law or in equity.

6.1. Closing and Escrow. The consummation of the transactions contemplated herein (“Closing”) shall occur on the Closing Date at the offices of the Escrow Agent. Closing shall occur through the money escrow with the Escrow Agent. Funds shall be deposited into and held by Escrow Agent in a closing escrow account with a bank satisfactory to Purchaser and Seller. Upon satisfaction or completion of all closing conditions and deliveries, the parties shall direct the Escrow Agent to immediately record and deliver the closing documents to the appropriate parties and make disbursements according to the Closing Statement executed by Seller and Purchaser no later than 11:00 A.M. PST on the Closing Date, including, without limitation, Escrow Agent wiring the purchase price under the Purchase Agreement Re: Crown Royal Interests to the Tributary Sellers and the remainder of the Purchase Price to Seller, subject to adjustments and prorations in accordance with the Closing Statements. The parties understand that the Closing shall occur in San Diego, California requiring that all necessary deliveries to escrow must be completed by 1:00 P.M. PST on the second Business Day prior to the Closing Date.

6.2. Seller’s Deliveries in Escrow. Prior to 1:00 P.M. PST on the second Business Day prior to the Closing Date, Seller shall deliver in escrow to the Escrow Agent the following:

(a) Amendment to Amended and Restated Guilford Real Estate Trust Agreement. The Amended and Restated Trust Agreement naming Purchaser as “Owner Trustee” and the holder of the 100% of the beneficial interests in the Guilford Real Estate Trust, provided, however, if Purchaser determines, in its sole and absolute discretion, that the “Owner Trustee” and the holder of the “beneficial interest” should be separate entities, Purchaser shall have the right to designate a substitute entity to become the “Owner Trustee” or the holder of the beneficial interests of the Guilford Real Estate Trust;

(b) Assignment of Beckley Trust Interests. The Assignment of Beckley Trust Interests, in form and substance approved pursuant to Section 4.1(a) hereof;

(c) Assignment of Agreement of Sale of Membership Interests. An Assignment of the Purchase Agreement Re: Crown Royal Interests, executed by Seller and the Tributary Sellers, substantially in the form of Exhibit F attached hereto transferring to Purchaser Seller’s rights as “Purchaser” under the Purchase Agreement Re: Crown Royal Interests, free and clear of all claims;

(d) Beckley Lease. The Beckley Lease, substantially in the form of Exhibit G attached hereto, executed by Seller;

(e) Tributary Lease. The Tributary Lease, substantially in the form of Exhibit G attached hereto, executed by Seller;

(f) Seller’s Closing Certificate. A certificate, substantially in the form of Exhibit H attached hereto (the “Seller’s Closing Certificate”), executed by Seller;

(g) Terminations. Terminations, effective no later than Closing, of those Service Contracts which Purchaser has elected not to assume, including any management and leasing agreements affecting the Properties;

(h) Authority. Evidence of the existence, organization and authority of Seller and of the authority of the persons executing documents on behalf of Seller reasonably satisfactory to the Escrow Agent and the Title Company; and

(i) Other Deliveries. Any other Closing deliveries required to be made by or on behalf of Seller hereunder or reasonably required to effect the Closing of this transaction consistent with this Agreement.

6.3. Purchaser’s Deliveries in Escrow. Prior to 1:00 P.M. PST on the second Business Day prior to the Closing Date, Purchaser shall deliver in escrow to the Escrow Agent the following:

(a) Purchase Price. The Purchase Price, less the Earnest Money that is applied to the Purchase Price, plus or minus applicable prorations, deposited by Purchaser with the Escrow Agent in immediate, same-day federal funds wired for credit into the Escrow Agent’s escrow account;

(b) Beckley Lease. The Beckley Lease, substantially in the form of Exhibit G attached hereto, executed by Purchaser on behalf of the Guilford Real Estate Trust;

(c) Tributary Lease. The Tributary Lease, substantially in the form of Exhibit G attached hereto, executed by Purchaser on behalf of BMR-Tributary LLC; and

(d) Other Deliveries. Any other Closing deliveries required to be made by or on behalf of Purchaser hereunder or reasonably required to effect the Closing of this transaction consistent with this Agreement.

(a) Seller and Purchaser shall deposit with the Escrow Agent executed Closing Statements consistent with this Agreement in the form required by the Escrow Agent.

(b) Seller and Purchaser shall execute such returns, questionnaires and other documents as shall be required with regard to all applicable real property transaction taxes imposed by applicable federal, state or local law or ordinance.

(c) Seller shall pay the fees of any counsel representing Seller in connection with this transaction. Seller shall also pay the following costs and expenses:

(i) one-half of the escrow fee, if any, which may be charged by the Escrow Agent or the Title Company;

(d) Purchaser shall pay the fees of any counsel representing Purchaser in connection with this transaction. Purchaser shall also pay the following costs and expenses:

(i) one-half of the escrow fee, if any, which may be charged by the Escrow Agent or the Title Company; and

(iii) An amount equal to the sum of (A) $25,530,80 (representing the security deposit paid by Seller under the Existing Tributary Lease) plus (B) the rent paid by Seller under the Tributary Lease relating to the period on or after the Closing, shall be paid by Purchaser to Seller to, and only to, the extent that Purchaser receives a credit for such sums under the Purchase Agreement Re: Crown Royal Interests.

6.5. Possession. At the time of Closing, Purchaser shall obtain possession of the Beckley Property and the Tributary Property, subject only to the Permitted Exceptions.

6.6. Delivery of Books and Records. Immediately after the Closing, Seller shall deliver to the offices of Purchaser’s property manager: if in Seller’s or its property manager’s possession or control, the original Service Contracts; all permits and warranties; keys and other items, if any, used in the operation of the Properties; the original “as-built” plans and specification; all other available plans and specifications; and all operation manuals. Seller shall cooperate with Purchaser after Closing to transfer to Purchaser any such information stored electronically.

7.1. Prorations. At least five (5) days prior to the Closing Date, Seller shall provide to Purchaser such information and verification reasonably necessary to support the prorations and adjustments under this Article 7. Subject to the items in Subsections (a) through (d) of this Section 7.1, any taxes, assessments, charges under Service Contracts and utility charges applicable to Properties shall be prorated between Seller and Purchaser, based on the actual number of days in the applicable period, as of the close of the day immediately preceding the Closing Date, with Seller bearing all such items to the extent attributable to the period prior to the Closing Date and Purchaser bearing all such items to the extent attributable the period commencing on the Closing Date. Notwithstanding the foregoing, if as of the Closing Date there are any outstanding (a) taxes, (b) assessments, (c) charges under Service Contracts that (pursuant to the terms of this Agreement) are to continue to bind the Property following the Closing Date, or (d) utility charges, and the same apply to the period prior to the Closing Date but are payable by the tenant under the terms of the Subject Leases, then Purchaser shall not receive a credit for such items except to the extent that such items are delinquent (pursuant to the terms of the applicable law or documentation creating such payment obligation) as of the Closing Date, and provided further that if Purchaser receives a credit at Closing for such an item on account of such a delinquency, then upon proper payment of such item by the tenant under the Subject Leases subsequent to the Closing and the provision of evidence of the same reasonably satisfactory to Purchaser, Purchaser promptly shall make a payment of an equal amount to such tenant.

7.2. Closing Statement. At least five (5) days prior to the Closing Date, Seller shall deliver to Purchaser a closing statement setting forth the prorations and adjustments to the Purchase Price pursuant to Section 7.1 (the “Closing Statement”). Purchaser shall have two (2) Business Days after receipt of the Closing Statement to notify Seller in writing of any changes to the Closing Statement. If Purchaser fails to notify Seller within such two (2) Business Day period, then Purchaser shall have been deemed to have approved the Closing Statement. If Purchaser notifies Seller within such two (2) Business Day period, then Seller shall endeavor in good faith to cause the changes to be implemented in the Closing Statement. In the event Seller objects to any of the proposed changes, Seller shall negotiate in good faith with Purchaser to come to a resolution.

7.3. Sales Commissions. Seller shall be responsible for paying Colliers Pinkard’s fee in connection with this transaction and Purchaser shall be responsible for paying CBRE’s fee in connection with this transaction. Except as provided above, Seller and Purchaser represent and warrant each to the other that they have not dealt with any other real estate broker, sales person or finder in connection with this transaction. In the event of any claim for broker’s or finder’s fees or commissions in connection with the negotiation, execution or consummation of this Agreement or the transactions contemplated hereby, each party shall indemnify and hold harmless the other party from and against any such claim based upon any statement, representation or agreement of such party.

7.4. Pre-Closing Expenses. Except as otherwise specifically provided in this Agreement or in any other written agreement that may be entered into between Seller and Purchaser, Seller has paid or will pay in full, prior to Closing, all bills and invoices for labor, goods, material and services of any kind relating to either Property and utility charges, relating to the period prior to Closing. Any alterations, installations, decorations and other work required to be performed under any and all agreements affecting the Properties (including, but not limited to, Subject Leases) have been or will, by the Closing, be completed and paid for in full by Seller.

7.5. Transfer Taxes. In the event that the state or local transfer or recordation taxes are required to be paid under Maryland law as a result of the sale of the Beckley Membership Interests, Crown Royal Interests or Seller’s rights under the Purchase Agreement Re: Crown Royal Interests, Seller and Purchaser shall each be liable to pay one-half of any transfer or recordation taxes and interest payable pursuant to this transaction, should any be required. This indemnity shall survive the Closing.

8.1. Seller’s Representations and Warranties. As a material inducement to Purchaser to execute this Agreement and consummate this transaction, Seller represents and warrants to Purchaser that:

(a) Organization and Authority. Seller has been duly organized, is validly existing, and is in good standing as a Delaware corporation. Seller is in good standing and is qualified to do business in the state in which the Properties are located. Seller has the full right and authority and has obtained any and all consents required to enter into this Agreement and to consummate or cause to be consummated the transactions contemplated hereby. This Agreement has been, and all of the documents to be delivered by Seller at the Closing will be, authorized and properly executed and constitute, or will constitute, as appropriate, the valid and binding obligations of Seller, enforceable in accordance with their terms.

(b) Recitals. All matters set forth in the Recitals are true and correct as of the date hereof.

(c) Guilford Real Estate Trust and Beckley Trust Interests. For federal and applicable state and income tax purposes, the Guilford Real Estate Trust has been treated as a “grantor trust” since its formation. The Beckley Trust Interests constitute 100% of the issued and outstanding beneficial interests of the Guilford Real Estate Trust, free and clear of all liens, encumbrances, claims or liabilities of any kind or nature. There are no beneficial interests in the Guilford Real Estate Trust other than the Beckley Trust Interests, and other than as required in Section 4.1(a), there is no amendment to the trust agreement of the Guilford Real Estate Trust in effect as of the Effective Date.

(d) Conflicts and Pending Actions or Proceedings. There is no agreement to which Seller or the Guilford Real Estate Trust are a party or, to Seller’s knowledge, binding on Seller or the Guilford Real Estate Trust which is in conflict with this Agreement, or which challenges or impairs Seller’s ability to execute or perform its obligations under this Agreement. There is not now pending or, to the best of Seller’s knowledge, threatened, any action, suit or proceeding before any court or governmental agency or body against Seller or the Guilford Real Estate Trust that would prevent Seller or the Guilford Real Estate Trust from performing its obligations hereunder or against or with respect to either Property. To Seller’s knowledge, no condemnation, eminent domain or similar proceedings are pending or threatened with regard to either Property. Seller or, to Seller’s knowledge, the Tributary Sellers or the Property Entities, have not received any notice and Seller has no knowledge of any pending or threatened liens, special assessments, impositions or increases in assessed valuations to be made against either Property.

(e) Beckley Lease. Seller is the only tenant at the Beckley Property under the Existing Beckley Lease. Seller has not assigned the Existing Beckley Lease or sublet any part of the Beckley Property and does not hold the Beckley Property under an assignment or sublease. All work to be performed for Seller under the Existing Beckley Lease or any other agreement has been performed as required and has been accepted by Seller, and all allowances to be paid to Seller, including allowances for tenant improvements, moving expenses or other items, have been paid. The Existing Beckley Lease is in full force and effect, free from default and free from any event which could become a default under the Existing Beckley Lease and Seller has no claims against the landlord or offsets or defenses against rent, and there are no disputes with the landlord. Seller is not currently entitled to any rent abatement. All information set forth in the Rent Roll for the Beckley Property is or will be true, correct, and complete in all material respects as of its date. There are no leasing or other fees or commissions due, nor will any become due, in connection with the Existing Beckley Lease or any renewal or extension or expansion of the Existing Beckley Lease, nor under any understanding or agreement with any party as to payment of any leasing commissions or fees regarding future leases or as to the procuring of tenants. Seller shall amend and restate the Existing Beckley Lease prior to the Closing Date.

(f) Tributary Lease. Seller is the only tenant to the Tributary Property under the Existing Tributary Lease. Seller has not assigned the Existing Tributary Lease or sublet any part of the Tributary Property and does not hold the Tributary Property under an assignment or sublease. All work to be performed for Seller under the Tributary Lease or any other agreement has been performed as required and has been accepted by Seller, and all allowances to be paid to Seller, including allowances for tenant improvements, moving expenses or other items, have been paid. The Existing Tributary Lease is in full force and effect, free from default and free from any event which could become a default under the Existing Tributary Lease and Seller has no claims against the landlord or offsets or defenses against rent, and there are no disputes with the landlord. Seller is not currently entitled to any rent abatement. All information set forth in the Rent Roll for the Tributary Property is or will be true, correct, and complete in all material respects as of its date. There are no leasing or other fees or commissions due, nor will any become due, in connection with the Existing Tributary Lease or any renewal or extension or expansion of the Existing Tributary Lease, nor under any understanding or agreement with any party as to payment of any leasing commissions or fees regarding future leases or as to the procuring of tenants. Seller shall amend and restate the Existing Tributary Lease prior to the Closing Date, pursuant to which Seller shall terminate Seller’s option to purchase the Tributary Property.

(g) REIT Compliance. Neither the Crown Royal Partnership nor the Guilford Real Estate Trust hold any assets other than “real estate assets” as defined in Section 856(c)(5)(B) of the Internal Revenue Code of 1986 (the “Code”) or which generate income which would not qualify under Sections 856(c)(3) and 856(d) of the Code.

(h) Service Contracts; Operating Statements. The list of Service Contracts to be delivered to Purchaser pursuant to this Agreement is or will be true, correct, and complete as of the date of its delivery. The documents constituting the Service Contracts that are delivered to Purchaser are true, correct and complete copies of all of the Service Contracts affecting either Property. Neither Seller nor, to Seller’s knowledge, any Property Entity or any other party thereto is in default under any Service Contract.

(i) Legal Compliance. Seller and to Seller’s knowledge, the Property Entities have all material licenses, permits and certificates necessary for the use and operation of the Properties, including, without limitation, all certificates of occupancy necessary for the lawful occupancy of the Properties. Neither Seller nor the Property Entities have received written notice that either Property or the use thereof violates any governmental law or regulation or any covenants or restrictions encumbering either Property. Neither Seller nor the Property Entities have received any written notices of violations or alleged violations of any laws, rules, regulations or codes, including building codes, with respect to the Properties which have not been corrected to the satisfaction of the issuer of the notice.

(j) Environmental. Neither Seller nor the Guilford Real Estate Trust have knowledge of any violation of Environmental Laws related to the Properties or the presence or release of Hazardous Materials on or from the Properties except as disclosed in the Property Information. To Seller’s knowledge, neither Seller nor any tenant or other occupant, has used the Properties or any part thereof for the release, generation, treatment, storage, handling or disposal of any Hazardous Materials, in violation of any Environmental Laws. To Seller’s knowledge, there are no underground storage tanks located on the Properties, except as disclosed in environmental reports furnished to Purchaser pursuant to this Agreement. The term “Environmental Laws” includes without limitation the Resource Conservation and Recovery Act and the Comprehensive Environmental Response Compensation and Liability Act and other federal laws governing the environment as in effect on the Date of this Agreement, together with their implementing regulations, guidelines, rules or orders as of the Date of this Agreement, and all state, regional, county, municipal and other local laws, regulations, ordinances, rules or orders that are equivalent or similar to the federal laws recited above or that purport to regulate Hazardous Materials. The term “Hazardous Materials” includes petroleum, including crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel (or mixtures of natural gas or such synthetic gas), and any substance, material, waste, pollutant or contaminant listed or defined as hazardous or toxic under any Environmental Law.

(k) ERISA. Seller is not and is not acting on behalf of an “employee benefit plan” within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended, a “plan” within the meaning of Section 4975 of the Internal Revenue Code of 1986, as amended or an entity deemed to hold “plan assets” within the meaning of 29 C.F.R. § 2510.3-101 of any such employee benefit plan or plans.

For purposes of this Agreement, “Seller’s knowledge” means the knowledge of Edwin James III, the Senior Director of Facilities of Seller, and Bob Evans, the Facilities Manager of Seller (the “Seller Representatives”). Each of the Seller Representatives have worked for Seller for the past ten years, have current, actual knowledge of the agreements to which Seller and the Property Entities are a party and the conditions of the Beckley Property and the Tributary Property, and are the most capable of speaking on behalf of Seller.

8.2. Purchaser’s Representations and Warranties. As a material inducement to Seller to execute this Agreement and consummate this transaction, Purchaser represents and warrants to Seller that:

(a) Organization and Authority. Purchaser has been duly organized and is validly existing as a Maryland limited partnership, in good standing and will be qualified to do business in the state in which the Properties are located on the Closing Date. Subject only to obtaining certain internal approvals on or before the expiration of the Due Diligence Period, Purchaser has the full right and authority and has obtained any and all consents required to enter into this Agreement and to consummate or cause to be consummated the transactions contemplated hereby. This Agreement has been, and all of the documents to be delivered by Purchaser at the Closing will be, authorized and properly executed and constitutes, or will constitute, as appropriate, the valid and binding obligation of Purchaser, enforceable in accordance with their terms.

(b) Conflicts and Pending Action. There is no agreement to which Purchaser is a party or to Purchaser’s knowledge binding on Purchaser which is in conflict with this Agreement. There is no action or proceeding pending or, to Purchaser’s knowledge, threatened against Purchaser which challenges or impairs Purchaser’s ability to execute or perform its obligations under this Agreement.

8.3. Survival of Representations and Warranties. The representations and warranties set forth in this Article 8 are made as of the Effective Date and are remade as of the Closing Date and shall not be deemed to be merged into or waived by the instruments of Closing, but shall survive the Closing for a period of two (2) years following the Closing Date. Similarly, the representations and warranties of Seller in Seller’s Closing Certificate shall survive the Closing for a period of two (2) years following the Closing Date. Notwithstanding the foregoing, Section 7.5, the representations and warranties contained in Section 8.1(c) and the indemnification contained in Section 9.1(a) shall survive the Closing for three (3) years following the Closing Date.

8.4 “As-Is” Purchase. Purchaser is an experienced commercial real estate owner and, except as set forth in this Agreement or in any document executed at Closing pursuant to or in connection with this Agreement, shall rely solely upon its own evaluation and investigation of the condition and all aspects of the Beckley Property. Purchaser acknowledges that this Agreement grants to Purchaser the opportunity to fully evaluate the condition and all aspects of the Beckley Property. Purchaser has asked for, and has obtained in this Agreement, disclosure of information and documents regarding the Beckley Property which is in Seller’s possession or control. Accordingly, except to the extent that Seller fraudulently or intentionally conceals or makes misrepresentations as to the condition or suitability of the Beckley Property and except for Seller’s representations and warranties set forth in this Agreement and the warranties set forth in any closing documents delivered to Purchaser from Seller, Purchaser acknowledges that it is not relying upon any representations of Seller as to the condition of the Beckley Property or its suitability for Purchaser’s intended use. Purchaser shall be deemed to accept the Beckley Property “as is” in all respects.

9.1. Indemnification. Seller shall defend, indemnify and hold harmless Purchaser from and against: (a) all debts, obligations, torts and liabilities of the Guilford Real Estate Trust or the Beckley Property arising or incurred prior to the Closing, or (b) against any liability, damages, claims or causes of action as a result of a breach of Seller’s representations and warranties in this Agreement or any instrument delivered pursuant to this Agreement, including, without limitation, Seller’s Closing Certificate. This indemnity shall not apply to the condition of the Beckley Real Property or the Tributary Real Property, except to the extent that Seller has breached any of Seller’s warranties provided under this Agreement. The indemnity contained in Section 9.1(b) relating to a breach of a representation under Section 8.1 (other than Section 8.1(c)) shall survive for two (2) years following the Closing Date, with a maximum liability of $2,000,000. The indemnification contained in Section 9.1(b) relating to a breach of a representation under Section 8.1(c) and the indemnification contained in Section 9.1(a) shall survive for three (3) years following the Closing Date, and Seller’s monetary liability thereunder shall be unlimited.

9.2. Parties Bound. Neither party may assign this Agreement without the prior written consent of the other, and any such prohibited assignment shall be void; provided, however, that Purchaser may assign this Agreement without Seller’s consent to an Affiliate (including without limitation BioMed Realty Trust, Inc). Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the respective legal representatives, successors, assigns, heirs, and devisees of the parties. For the purposes of this paragraph, the term “Affiliate” means (a) an entity that directly or indirectly controls, is controlled by or is under common control with Purchaser or (b) a partnership or other entity in which Purchaser or an entity described in (a) is a partner or other owner; and the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations.

9.3. Headings. The article and paragraph headings of this Agreement are for convenience only and in no way limit or enlarge the scope or meaning of the language hereof.

9.4. Expenses. Except as otherwise expressly provided herein, each party hereto shall pay its own expenses incident to this Agreement and the transactions contemplated hereunder, including all legal and accounting fees and disbursements.

9.5. Invalidity and Waiver. If any portion of this Agreement is held invalid or inoperative, then so far as is reasonable and possible the remainder of this Agreement shall be deemed valid and operative, and, to the greatest extent legally possible, effect shall be given to the intent manifested by the portion held invalid or inoperative. The failure by either party to enforce against the other any term or provision of this Agreement shall not be deemed to be a waiver of such party’s right to enforce against the other party the same or any other such term or provision in the future.

9.6. Governing Law. This Agreement shall, in all respects, be governed, construed, applied, and enforced in accordance with the law of the state of Maryland.

9.7. Survival. Subject to Section 8.3, the provisions of this Agreement and the obligations of the parties not fully performed at the Closing shall survive the Closing and shall not be deemed to be merged into or waived by the instruments of Closing.

9.8. No Third Party Beneficiary. This Agreement is not intended to give or confer any benefits, rights, privileges, claims, actions, or remedies to any person or entity as a third party beneficiary, decree, or otherwise.

9.9. Entirety and Amendments. This Agreement embodies the entire agreement between the parties and supersedes all prior agreements and understandings relating to the Properties. This Agreement may be amended or supplemented only in writing by a non-electronic instrument executed by the party against whom enforcement is sought. For the avoidance of doubt, copies of signed instruments that are electronically transmitted constitute a writing for this purpose.

9.10. Time of the Essence. Time is of the essence in the performance of this Agreement.

9.11. Time. All times, whenever specified herein, shall be local time in San Diego, California.

9.12. Press Release. Until the Closing, neither Seller nor Purchaser will release or cause or permit to be released any press notices, or publicity (oral or written) or advertising promotion relating to, or otherwise announce or disclose or cause or permit to be announced or disclosed, in any manner whatsoever, the terms, conditions or substance of this Agreement without first obtaining the written consent of the other party except those disclosures that are required by securities law(s), including the Securities Act of 1933, or contractual obligation (in which case notice shall be timely provided to the other party of such requirement and disclosure). The foregoing shall not preclude either party from discussing the substance or any relevant details of such transactions with any of its attorneys, accountants, professional consultants, lenders, partners, investors, or any prospective lender, partner or investor, as the case may be, or prevent either party hereto, from complying with laws, rules, regulations and court orders, including without limitation, governmental regulatory, disclosure, tax and reporting requirements, or from Seller making disclosures in the ordinary course of its due diligence inspections and contacts with third parties related thereto. Notwithstanding the foregoing, any party to this transaction (and each employee, agent or representative of the foregoing) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transaction and all materials of any kind (including opinions or other tax analyses) that are provided to them relating to such tax treatment and tax structure except to the extent maintaining such confidentiality is necessary to comply with any applicable federal or state securities laws. Except as required by law or SEC requirements, the authorization in the preceding sentence is not intended to permit disclosure of any other information unrelated to the tax treatment and tax structure of the transaction including (without limitation) (a) any portion of the transaction documents or related materials to the extent not related to the tax treatment or tax structure of the transaction, (b) the existence or status of any negotiations unrelated to the tax issues, or (c) any other term or detail not relevant to the tax treatment or the tax structure of the transaction.

9.13. Attorneys’ Fees. Should either party employ attorneys to enforce any of the provisions hereof, the non-prevailing party agrees to pay the prevailing party all reasonable costs, charges, and expenses, including reasonable attorneys’ fees, expended or incurred by the prevailing party in connection therewith.

9.14. Notices. All notices required or permitted hereunder shall be in writing and shall be served on the parties at the addresses set forth in Exhibit I. Any such notices shall be either (a) sent by overnight delivery using a nationally recognized overnight courier, in which case notice shall be deemed delivered one Business Day after deposit with such courier, (b) sent by facsimile, in which case notice shall be deemed delivered upon transmission of such notice with confirmed receipt by the sender’s machine, or (c) sent by personal delivery, in which case notice shall be deemed delivered upon receipt or refusal of delivery. A party’s address may be changed by written notice to the other party; provided, however, that no notice of a change of address shall be effective until actual receipt of such notice. Copies of notices are for informational purposes only, and a failure to give or receive copies of any notice shall not be deemed a failure to give notice. The attorney for a party has the authority to send notices on behalf of such party.

9.15. Construction. The parties acknowledge that the parties and their counsel have reviewed and revised this Agreement and that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or any exhibits or amendments hereto.

9.16. Remedies Cumulative. Except as expressly provided to the contrary in this Agreement, the remedies provided in this Agreement shall be cumulative and shall not preclude the assertion or exercise of any other rights or remedies available by law, in equity or otherwise.

9.17. Calculation of Time Periods. Unless otherwise specified, in computing any period of time described herein, the day of the act or event after which the designated period of time begins to run is not to be included and the last day of the period so computed is to be included, unless such last day is a Saturday, Sunday or legal holiday for national banks in the location where the Properties are located, in which event the period shall run until the end of the next day which is neither a Saturday, Sunday, or legal holiday. The last day of any period of time described herein and the time during any day by which an event must occur shall be deemed to end at 5 p.m.

9.18. Public Company Requirements. Upon Purchaser’s request, during the Due Diligence Period and for a period of two years after Closing, Seller shall make the books and records of the Properties and the Guilford Real Estate Trust available to Purchaser for inspection, copying and audit by Purchaser’s designated accountants, and at Purchaser’s expense. Seller shall provide Purchaser, but without third-party expense to Seller, with copies of, or access to, such factual information as may be reasonably requested by Purchaser, and in the possession or control of Seller, to enable Purchaser to comply with applicable filing requirements of the Securities and Exchange Commission (“SEC”). Purchaser or its designated independent or other accountants may audit the operating statements of the Properties and the Guilford Real Estate Trust, and Seller shall supply such documentation in its possession or control as Purchaser or its accountants may reasonably request in order to complete such audit and shall provide to Purchaser’s auditors a customary representation letter from Seller or its representative reasonably satisfactory to Purchaser’s auditors in connection with such audit.

9.19. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of such counterparts shall constitute one Agreement. To facilitate execution of this Agreement, the parties may execute and exchange by telephone facsimile counterparts of the signature pages.

9.20. Further Assurances. In addition to the acts and deeds recited herein and contemplated to be performed, executed or delivered by either party at Closing, each party agrees to perform, execute and deliver, for a period of two (2) years following the Closing Date, any further actions, documents, and will obtain such consents, as may be reasonably necessary or as may be reasonably requested to fully effectuate the purposes, terms and conditions of this Agreement or to further perfect the conveyance, transfer and assignment of the Subject Rights to Purchaser.

9.21. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY.

9.22. Submission to Jurisdiction. Each party hereby submits to the nonexclusive jurisdiction of the Maryland State Courts and the federal courts sitting in the State of Maryland for the purposes of all legal proceedings arising out of or relating to this Agreement or the transactions contemplated hereby. Each party hereby irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such proceeding brought in such court has been brought in an inconvenient forum.

1 IN WITNESS WHEREOF, the parties hereto have executed this Agreement, as of the Effective Date.


SELLER:	PURCHASER:
GUILFORD PHARMACEUTICALS INC., a Delaware corporation By /s/ Asher M. Rubin —	BIOMED REALTY, L.P.,
Name: Asher M. Rubin	a Maryland limited partnership
Title: Senior Vice	By /s/ Gary A. Kreitzer
President, General		—
Counsel and	Name: Gary A. Kreitzer
Secretary	Title: Executive Vice President

Escrow Agent has executed this Agreement in order to confirm that Escrow Agent shall act as escrowee with respect to and hold in escrow the Earnest Money and the interest earned thereon, and shall disburse the Earnest Money and the interest earned thereon, pursuant to the provisions of Exhibit C hereof.

Pursuant to Item 601(b)(2) of Regulation S-K promulgated by the Securities and Exchange Commission (the “Commission”) the schedule and exhibits to this Agreement of Purchase and Sale identified below have been omitted. The schedule and exhibits will be furnished supplementally to the Commission upon request.


Exhibit A-1 Exhibit A-2 Exhibit B Exhibit C Exhibit D-1 Exhibit D-2 Exhibit E Exhibit F Exhibit G Exhibit H Exhibit I Schedule 1		Legal Description of Beckley Property Legal Description of Tributary Property Earnest Money Escrow Provisions Earnest Money Escrow Provisions Property Information Entity Information Owner’s Affidavit Form of Assignment of Agreement of Sale of Membership Interests Form of Lease Form of Seller’s Certificate Notice Addresses Tangible and Intangible Personal Property

This AMENDED AND RESTATED SINGLE TENANT ABSOLUTE NET LEASE (“Lease”) is made as of December 17, 2004 (“Effective Date”), BETWEEN BMR-6611 Tributary Street LLC, a Maryland limited liability company formerly known as Crown Royal Limited Partnership (“Landlord”), and Guilford Pharmaceuticals Inc., a Delaware corporation (“Tenant”), who agree as follows:

This Lease is executed by Landlord and Tenant in contemplation of the following facts and circumstances:

A. Landlord is the owner of certain real property located in the City of Baltimore, State of Maryland, commonly known as 6611 Tributary Street and more particularly described on Exhibits “A” and “B” which are attached and made a part of this Lease. The land consists of approximately 7.48 acres (together with any easements and appurtenances thereto, the “Land”) with an existing building containing approximately 91,592 square feet of space (the “Building”). The Land and the Building are collectively referred to as the “Premises.”

B. Landlord and Tenant entered into that certain Standard Net Lease Agreement dated August 30, 1994 (as amended, the “Original Lease”), pursuant to which Tenant leased the Premises from Landlord. Landlord and Tenant now desire to amend and restate the Original Lease upon the terms and conditions contained in this Lease in complete replacement of the Original Lease.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS. The terms defined in this paragraph, for all purposes of this Lease, shall have the meanings herein specified. Terms defined elsewhere in this Lease shall have the meanings as defined thereunder.

1.1 “Applicable Law” shall mean all federal, state, county, municipal and other governmental statutes, laws, rules, orders, permits, licenses, regulations, ordinances, judgments, decrees, directions and injunctions affecting the Premises or any portion thereof or the use or occupancy thereof, whether now or hereafter enacted or in force, whether ordinary or extraordinary, foreseen or unforeseen.

1.2 “Claims” shall mean any and all liabilities (statutory or otherwise), obligations, claims, demands, damages, penalties, causes of action, costs, expenses (including attorneys’ fees and expenses), losses and injuries arising from the subject matter of an indemnity granted herein.

1.3 “Default Rate” shall mean the greater of (i) ten percent (10%) per annum, or (ii) five percent (5%) per annum plus the discount rate of the Federal Reserve Bank situated nearest the Premises; provided, however, in no event shall the Default Rate exceed the maximum interest rate permitted under applicable law.

1.4 “HVAC” shall mean all heating, ventilation and air conditioning equipment and all equipment and fixtures related thereto.

1.5 “Lease Commencement Date” shall be the date BioMed Realty, L.P. acquires direct or indirect ownership of Landlord.

1.6 “Lease Term” shall mean the period commencing with the Lease Commencement Date and ending after the term described in Paragraph 4.1.

1.7 “Lender” shall mean any lender whose loan is secured by a deed of trust on any part of the Premises or this leasehold interest.

1.8 “Rent” shall include all Monthly Rent, Additional Rent and all other sums of any and every sort payable hereunder to Landlord by Tenant.

1.9 “Security Deposit” shall be $525,000.00 or as may be adjusted pursuant to Paragraph 5.

1.10 “Subtenant” shall mean any tenant, assignee, subtenant, licensee, concessionaire or other occupant of the Premises (other than Tenant); and the term “sublease” shall mean any lease, assignment, sublease, license or other agreement for the use or occupancy of any such space (other than this Lease).

1.11 “Taking” shall mean a taking or voluntary conveyance of title to or any interest in all or any part of the Premises, or the right to use all or any part thereof, pursuant to, as a result of, or in lieu or in anticipation of, the exercise of the right of condemnation, expropriation or eminent domain; and upon such a Taking the Premises, or such part thereof, shall be deemed to have been “taken.”

1.12 “Taxes” shall mean all government impositions including, without limitation, property tax costs consisting of real and personal property taxes and assessments (including amounts due under any improvement bond upon the Premises or the Building, including the parcel or parcels of real property upon which the Building is located or assessments levied in lieu thereof) imposed by any governmental authority or agency on the Premises or improvements thereon, any tax on or measured by gross rentals received from the rental of space in the Building, or tax based on the square footage of the Premises or the Building as well as any parking charges, utilities surcharges, or any other costs levied, assessed or imposed by, or at the direction of, or resulting from statutes or regulations, or interpretations thereof, promulgated by any federal, state, regional, municipal or local government authority in connection with the use or occupancy of the Building or the parking facilities serving the Building; any tax on this transaction or this Lease; provided, however, that “Taxes” shall in no event include any franchise or income tax or any tax based on net rentals received from the rental of space in the Building.


Initial Lease Term:		15 years

Rentable Area:		91,592 square feet

Initial Annual Rent:		$1,050,000.00, subject to annual adjustments pursuant to Paragraph 5

Initial Monthly Rent:		$87,500.00, subject to annual adjustments pursuant to Paragraph 5

Security Deposit:		$525,000.00, subject to adjustments pursuant to Paragraph 5

Lease Commencement Date:		The date BioMed Realty, L.P. acquires direct or indirect ownership of Landlord.



Address for Notices:

To Landlord:		c/o BioMed Realty, L.P. 17140 Bernardo Center Drive,Suite 222 San Diego, California 92128 Attention: Gary A. Kreitzer, Esq.

To Tenant:		Guilford Pharmaceuticals Inc. 6611 Tributary Street Baltimore, Maryland 21224 Attention: Asher Rubin, Esq.

Exhibits:		A (Legal Description) B (Site Plan) C (Acknowledgement of Lease Commencement Date) D (Estoppel Certificate)

In the event of any conflict between any Fundamental Lease Provision and the balance of this Lease, the latter shall control.

3. AGREEMENT TO LEASE. Landlord hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises, under the terms and conditions of this Lease.

4.1 Lease Term. The initial Lease Term shall begin as of the Lease Commencement Date and shall continue until fifteen (15) years after the Lease Commencement Date unless sooner terminated or renewed as provided in this Lease. Landlord and Tenant shall execute a written acknowledgment of the Lease Commencement Date and the termination date in substantially the form attached hereto as Exhibit “C”; however, failure to execute and deliver such acknowledgment shall not affect Tenant’s liability hereunder. Provided that no Default has occurred and is continuing at the time Tenant elects to extend the Lease Term, Tenant, at its sole option, may extend the Lease Term for two (2) additional periods of ten (10) years each (individually, an “Extension Period”), subject to all the provisions of this Lease, except, however the Rent (as defined in Paragraph 5 below) shall be adjusted at the commencement of each Extension Period to an amount equal to the then current fair market rental rate as agreed to by Landlord and Tenant, but in no event shall the Rent be less than the Rent payable on the date immediately preceding the commencement of such Extension Period, plus an escalation of three percent (3%) as provided in Paragraph 5.1.4 below. If after thirty (30) days following delivery of the written extension notice described in Paragraph 4.2 below, Landlord and Tenant are unable to agree upon the fair market rental value of the Premises, Tenant shall obtain at its expense and deliver to Landlord an independent appraisal of the fair market rental value of the Premises as of the commencement of the Extension Period. Within thirty (30) days of its receipt of Tenant’s appraisal, Landlord may elect to obtain at its expense and deliver to Tenant a second independent appraisal of the fair market rental value of the Premises as of the commencement of the Extension Period. If Landlord elects not to obtain and deliver to Tenant a second appraisal within the required time period, or if Landlord’s appraisal is no more than five percent (5%) greater than Tenant’s appraisal, Tenant’s appraisal shall be conclusive. If Landlord’s appraisal is more than five percent (5%) greater than Tenant’s appraisal, the two appraisers shall appoint a third appraiser to appraise the fair market rental value of the Premises as of the commencement of the Extension Period, and the fair market rental value of the Premises shall be the arithmetical average of the two appraisals closest in their determination of fair market rental value. Landlord and Tenant shall bear equally the expense of the third appraiser. The Monthly Rent as so determined for each Extension Period shall be increased annually by three percent (3%) as provided in Paragraph 5.1.4 below. All references in this Lease to “Lease Term” shall be considered to include both the initial term of this Lease and any properly executed Extension Period, and all references to termination or to the end of the Lease Term shall be considered to mean the termination or end of the initial term of this Lease or any exercised Extension Period, as the case may be.

4.2 Procedure to Extend Term. Tenant may exercise its option with respect to each Extension Period by complying with the following procedure: At least eighteen (18) months before the last day of the then applicable Lease Term (the “Exercise Period”), Tenant shall deliver written notice to Landlord setting forth Tenant’s irrevocable election to exercise the option to extend. Extension Periods are not assignable separate and apart from this Lease, but they may be assigned as part of an assignment of this Lease.

4.3 Tenant’s Default. Notwithstanding the foregoing, if a Default has occurred and is continuing at the time Tenant elects to extend the Lease Term, Tenant shall have no right to extend the Lease Term as herein provided unless and until Tenant cures such Default, and Landlord shall be free to lease the Premises to any other party or parties prior thereto. Furthermore, nothing in this Paragraph 4.3 shall increase or extend the Exercise Period.

4.4 Possession. Tenant hereby acknowledges that it is presently in possession of the Premises as prior owner of the Premises.

5.1.1 Tenant shall pay the Rent to Landlord during the Lease Term, commencing as of the Lease Commencement Date, without deduction, setoff, prior notice or demand. Tenant shall pay the Rent in advance on the first day of each calendar month during the Lease Term. Rent for any partial months will be prorated based upon the number of days in the month, and will be paid in advance on the first day of each month.

5.1.2 Upon the Lease Commencement Date, Tenant shall pay to Landlord the Rent due and payable for the first full calendar month of the Lease Term. If the Lease Commencement Date is not on the first day of a calendar month, Tenant shall pay to Landlord the prorated Rent for the first partial month of the Lease Term.

5.1.3 All Rent payable hereunder shall be paid to Landlord in lawful money of the United States of America which shall be legal tender at the time of payment at Landlord’s office or to such other person or at such other place as Landlord from time to time may designate in writing.

5.1.4 The Initial Annual Rent shall be the amount set forth in Paragraph 2. The Annual Rent will be payable in twelve (12) equal installments (“Monthly Rent”). Effective upon the first (1^st) anniversary date of the Lease Commencement Date and each year thereafter during the Lease Term (including any Extension Period), on the anniversary of the Lease Commencement Date, the Monthly Rent during such year shall be increased by three percent (3%) of its then current amount.

5.2 Additional Rent. Commencing upon the Lease Commencement Date Tenant shall pay to Landlord (unless otherwise expressly required hereunder to pay directly to a third party), as additional rent (“Additional Rent”), all sums of money of any and every sort required to be paid by Tenant under this Lease, whether or not the same are designated as Additional Rent. If such amounts or charges are not paid at the time provided in this Lease, they shall nevertheless be collectible as Additional Rent with the next installment of Monthly Rent thereafter falling due, but nothing herein contained shall be deemed to suspend or delay the payment of any amount of money or charge at the time the same becomes due and payable hereunder, or limit any other remedy of Landlord. Tenant acknowledges that this is an absolute net lease to Landlord. As such, Tenant shall pay, as Additional Rent, all costs and expenses relating to the Premises.

5.3 Late Payment. If Tenant shall fail to pay, when the same is due and payable (after giving effect to any applicable notice and cure period), any Rent, such unpaid amounts shall bear interest at the Default Rate from the date due to the date of payment. Tenant further acknowledges that late payment of Monthly Rent will cause Landlord to incur certain costs not contemplated by this Lease, the exact amount of such costs being extremely difficult and impractical to determine with certainty. For this reason, in addition to interest, if Tenant shall fail to pay (which for purposes of this paragraph, “pay” shall mean actual receipt of the payment by Landlord) any installment of Monthly Rent by the tenth (10^th) day of the calendar month for which such installment is due, a late charge equal to five percent (5%) of the overdue installment of Monthly Rent automatically shall be due without further notice, and shall be in addition to all other sums due. The Parties agree that this additional late charge represents a fair and reasonable estimate of the costs Landlord will incur by reason of late payment by Tenant.

5.4 No Right to Setoff. Tenant shall pay to Landlord, throughout the Lease Term, the Rent and other sums payable hereunder, free of any charges, assessments, deductions or reductions of any kind, and without abatement, deduction or setoff except as otherwise expressly provided for herein.

5.5 Payment of Security Deposit. Upon the Lease Commencement Date, Tenant shall deposit the Security Deposit with Landlord. The Security Deposit shall be deposited by Landlord into a nonsegregated, interest-bearing bank account (with interest accruing for the benefit of Landlord) in a federally insured bank or savings institution, and shall be held for the faithful performance of all of the provisions and conditions of this Lease to be kept and performed by Tenant hereunder. If at any time Tenant shall have reported in its periodic filings with the Securities and Exchange Commission three (3) consecutive calendar quarters of positive net income, the Security Deposit shall be reduced by fifty percent (50%).

5.6 Use of Security Deposit. If a Default occurs with respect to the payment of Rent or any other covenant contained herein, Landlord may use or retain all or any part of the Security Deposit for the payment of any Monthly Rent, Additional Rent or any other sum in default, or for the payment of any amount which Landlord may spend or become obligated to spend by reason of Tenant’s Default. Landlord also may apply the Security Deposit toward costs incurred to repair damages to the Premises or to clean the Premises upon termination of this Lease. If any portion of the Security Deposit is so applied or used prior to the termination of this Lease, Tenant shall, within fourteen (14) days after written notice thereof, deposit an additional amount with Landlord sufficient to restore the Security Deposit to the amount set forth above, and Tenant’s failure to do so shall constitute a material breach of this Lease. If Tenant shall fully and faithfully perform every provision of this Lease to be performed by Tenant, the Security Deposit (including interest thereon), or the balance thereof, shall be returned to Tenant (or, at Landlord’s option to the last assignee of Tenant’s interest hereunder) at the expiration of the Lease, subject to the provisions of Paragraph 27.

5.7 Pledge of Security Deposit. The Security Deposit may be pledged by Landlord as additional collateral to the Lender.

5.8 Letter of Credit. The Security Deposit may be delivered either in cash or in the form of letter of credit reasonably acceptable to Landlord.

5.8.1 In lieu of depositing cash as the Security Deposit, Tenant shall have the right to deliver to Landlord an unconditional, irrevocable standby letter of credit in the amount of the cash Security Deposit otherwise required hereunder, which letter of credit shall (i) be in a form reasonably acceptable to Landlord, (ii) be issued by a financial institution selected by Tenant and reasonably acceptable to Landlord, (iii) be for the benefit of Landlord, but shall be assignable by Landlord to any subsequent purchaser or encumbrancer of the Building or the Premises, (iv) be automatically renewable from year to year throughout the Lease Term, (v) be payable by draft sight in a location reasonably acceptable to Landlord upon presentation of a certification signed by an officer of Landlord which states that a Default under the Lease has occurred and has not been cured within any applicable cure period and the cure of the Default is not being diligently pursued, and (vi) be payable in the event such letter of credit is not renewed on or before the date which is thirty (30) days prior to its expiration. Any amounts of cash drawn on a letter of credit Security Deposit will thereafter be treated as a cash Security Deposit hereunder.

5.8.2 Tenant shall have the right at any time during the Lease Term upon five (5) days’ prior written notice to Landlord (i) to replace a cash Security Deposit with a letter of credit which complies with all the terms of Section 5.8.1, or (ii) to replace a letter of credit Security Deposit with an applicable amount of cash.

6.1 Permitted Use. Tenant shall use the Premises for the purposes of laboratory use, administration, pharmaceutical and related health care uses (and only such purposes) (the “Permitted Use”). During the Lease Term, the Premises and every part thereof shall be kept by the Tenant in a clean condition, free of any noises or activities, which constitute any nuisance. Tenant shall comply with all Applicable Law in all material respects and at all times during the Lease Term.

6.2 No Violations. Tenant shall not knowingly use or occupy the Premises in violation of any federal, state and local laws and regulations, zoning ordinances, or the certificate of occupancy issued for the Building, and shall discontinue any use of the Premises upon final, non-appealable resolution of demand of any governmental authority having jurisdiction which declares or claims a violation of law, regulation or zoning ordinance or of such certificate of occupancy. Tenant shall comply with any direction of any governmental authority having jurisdiction which shall, by reason of the nature of Tenant’s use or occupancy of the Premises, impose any duty upon Tenant or Landlord with respect to the Premises or with respect to the use or occupation thereof.

6.3 Exterior Appearance. Except as may be in existence on the Effective Date or as may be needed in the conduct of Tenant’s business, (i) no awnings or other projection shall be attached to any outside wall of the building; (ii) no curtains, blinds, shades or screens shall be attached to or hung in, or used in connection with, any window or door of the Premises other than Landlord’s standard window coverings; (iii) neither the interior nor exterior of any windows shall be coated or otherwise sunscreened without the express written consent of Landlord, nor shall any bottles, parcels, or other articles be placed on the windowsills; and (iv) no equipment, furniture or other items of personal property shall be placed on any exterior balcony without the express written consent of Landlord.

6.4 Signs. Tenant may at its expense install signage in conformity with the City of Baltimore sign ordinance on the Building and the monument serving the Building. Interior signs on doors and the directory tablet shall be inscribed, painted or affixed by Tenant at its expense.

6.5 Structural Integrity. Tenant shall cause any office equipment or machinery to be installed in the Premises so as to reasonably prevent sounds or vibrations therefrom from extending outside the Building. Further, except as may already exist as of the Effective Date, no equipment or machinery weighing five hundred (500) pounds, or greater, shall be placed above the first floor of the Premises without advance notice to and approval by Landlord. Such equipment or machinery, if approved by Landlord, shall be placed only at a location designed to carry the weight of such equipment.

6.6 ADA. Notwithstanding any other provision herein to the contrary, Tenant shall be responsible for all liabilities, costs and expenses arising out of or in connection with the compliance of the Premises with the Americans With Disabilities Act, 42 U.S.C. § 12101, et seq. (together with regulations promulgated pursuant thereto, “ADA”), and Tenant shall indemnify, defend and hold Landlord harmless from and against any loss, cost, liability or expense (including reasonable attorneys’ fees and disbursements) arising out of any failure of the Premises to comply with the ADA.

7.1 Payment of Real Property Taxes. Commencing with the Lease Commencement Date and continuing for each calendar year, or tax year at Landlord’s option (such “tax year” being a period of twelve (12) consecutive calendar months for which the applicable taxing authority levies or assesses Taxes), for the balance of the Lease Term, Tenant shall pay to Landlord the amount of all Taxes levied and assessed for any such year upon the Premises. Such sum for any partial year of the Lease Term shall be prorated on the basis of the number of days of such partial year. Payment shall be made in the following manner: Tenant shall pay to Landlord the amount of all Taxes levied and assessed upon the Premises, including improvements and the underlying realty for any calendar year, or at Landlord’s option any tax year, within thirty (30) days after Landlord gives notice to Tenant of the amount of such Taxes payable by Tenant (or not less than thirty (30) days prior to delinquency, whichever is later). Landlord also shall provide Tenant with a copy of the applicable Tax bill or Tax statement from the taxing authority. Notwithstanding the foregoing, if applicable law allows such Taxes to be paid in installments, then Tenant may make such payments to Landlord in installments, provided that each such installment shall be payable to Landlord not less than thirty (30) days prior to the date upon which payment of the applicable installment to the taxing authority becomes delinquent. In addition to any other amounts due from Tenant to Landlord, if Tenant fails to pay the Taxes to Landlord as herein required, Tenant shall pay to Landlord the amount of any interest, penalties or late charges imposed for late payment. Landlord, at its option, may require Tenant to pay all Taxes directly to the appropriate taxing authority under the same manner and subject to the provisions set forth in this Paragraph 7.1 (as if the governmental authority were “Landlord”). Tenant shall provide to Landlord verification (reasonably acceptable to Landlord) of said payment within five (5) days of payment.

7.1.1 If the Premises are separately assessed, Tenant shall have the right, by appropriate proceedings, to protest or contest in good faith any assessment or reassessment of Taxes, any special assessment, or the validity of any Taxes or of any change in assessment or tax rate; provided, however, that prior to any such challenge Tenant must either (a) pay the taxes alleged to be due in their entirety and seek a refund from the appropriate authority, or (b) post bond in an amount sufficient to insure full payment of the Taxes. In any event, upon a final determination with respect to such contest or protest, Tenant shall promptly pay all sums found to be due with respect thereto. In any such protest or contest, Tenant may act in its own name, and at the request of Tenant, Landlord shall cooperate with Tenant in any way Tenant may reasonably require in connection with such contest or protest, including signing such documents as Tenant reasonably shall request, provided that such cooperation shall be at no expense to Landlord and shall not require Landlord to attend any appeal or other hearing. Any such contest or protest shall be at Tenant’s sole expense, and if any penalties, interest or late charges become payable with respect to the Taxes as a result of such contest or protest, Tenant shall pay the same.

7.1.2 If Tenant obtains a refund as the result of Tenant’s protest or contest and subject to Tenant’s obligation to pay Landlord’s costs (if any) associated therewith, Tenant shall be entitled to such refund to the extent it relates to the Premises during the Lease Term.

7.2 Personal Property Taxes. Tenant shall be solely responsible for the payment of any and all taxes levied upon personal property and trade fixtures located upon the Premises.

7.3 Other Taxes. If at any time during the Lease Term under the laws of the United States Government, state, county or city, or any political subdivision thereof in which the Premises are situated, a tax or excise on rent or any other tax, however described, is levied or assessed by any such political body against Landlord on account of rentals payable to Landlord hereunder, such tax or excise shall be considered “Taxes” for the purposes of this Paragraph 7, excluding, however, from such tax or excise any amount assessed against Landlord as state or federal income tax.

7.4 Tax and Insurance Escrows. To the extent Landlord is required by Lender, Tenant shall timely pay all tax and insurance impound payments due on the Premises.

(b) All other costs of any kind paid or incurred by Landlord in connection with the operation and maintenance of the Building and the Premises including, by way of examples and not as a limitation upon the generality of the foregoing, costs of repairs and replacements to improvements within the Premises as appropriate to maintain the Premises as required hereunder, including cost of funding such reasonable reserves as Landlord, consistent with industry standards, may establish to provide for future repairs and replacements; costs of utilities furnished to the Premises; sewer fees; cable TV, when applicable; trash collection; cleaning, including windows; costs of maintaining HVAC; maintenance of landscape and grounds, drives and parking areas; security services and devices; building supplies; maintenance and replacement to equipment utilized for operation and maintenance of the Premises; license, permit and inspection fees; sales, use and excise taxes on goods and services purchased by Landlord in connection with the operation, maintenance or repair of the Premises and Building systems and equipment; telephone, postage, stationary supplies and other expenses incurred in connection with the operation, maintenance, or repair of the Premises; accounting, legal and other professional fees and expenses incurred in connection with the operation and maintenance of the Premises; the cost of furniture, draperies, carpeting, landscaping and other customary and ordinary items of personal property provided by Landlord for use in the Premises; capital expenditures; costs of complying with any applicable laws; hazard waste remediation, rules or regulations; insurance premiums including premiums for public liability, property casualty, earthquake and environmental coverages; portions of insured losses paid by Landlord as part of deductible portion of loss by reason of insurance policy terms; service contracts; costs of services of independent contractors retained to do work of nature before referenced, and costs of compensation (including employment taxes and fringe benefits) of all persons who perform regular and recurring duties connected with the day-to-day operation and maintenance of the Premises, its equipment, the adjacent walks, landscaped areas, drives and parking areas, including without limitation, janitors, floor waxers, window-washers, watchmen, gardeners, sweepers and handymen; and costs of management services, which costs of management services shall not exceed three percent (3%) of the Rent due from Tenant, whether or not Landlord incurs fees payable to any third party to provide such services and without regard to the actual costs incurred by Landlord for such services.

(c) Notwithstanding the foregoing, Operating Expenses shall not include any leasing commissions; expenses which relate to preparation of rental space for a tenant; expenses of initial development and construction, including but not limited to, grading, paving, landscaping and decorating (as distinguished from maintenance repair and replacement of the foregoing); legal expenses relating to other tenants; costs of repair to the extent reimbursed by payment received by Landlord of insurance or other proceeds; interest upon loans to Landlord or secured by mortgage or deed of trust covering the Premises or a portion thereof (provided interest upon a government assessment or improvement bond payable in installments is an Operating Expense under subparagraph (a) above); salaries of executive officers of Landlord or other employees of Landlord who are not involved in the operation, maintenance or repair of the Premises; depreciation claimed by Landlord for tax purposes (provided this exclusion of “depreciation” is not intended to delete from Operating Expenses actual costs of necessary repairs and replacements and reasonable reserves in regard thereto which are provided for in subparagraph (b) above); and taxes of the types set forth within the last proviso of Paragraph 1.12 above.

7.5.2 Tenant shall pay to Landlord on the first day of each calendar month of the Term, as Additional Rent, Landlord’s reasonable estimate of Operating Expenses with respect to the Premises for such month. Notwithstanding the foregoing, at the election of Landlord, Tenant shall pay all or certain Operating Expenses (as designated in writing by Landlord) directly to the appropriate vendor, service provider or governmental authority.

(a) Within ninety (90) days after the conclusion of each calendar year (or such longer period as may be reasonably required), Landlord shall furnish to Tenant a statement showing in reasonable detail the actual Operating Expenses for the previous calendar year. Any additional sum due from Tenant to Landlord shall be immediately due and payable. If the amounts paid by Tenant pursuant to Paragraph 7.5.2 exceed Operating Expenses for the previous calendar year, the difference shall be credited by Landlord against the Rent next due and owing from Tenant; provided that, if the Lease Term has expired, Landlord shall accompany said statement with payment for the amount of such difference.

(b) Any amount due under this Paragraph 7.5.2 for any period which is less than a full month shall be prorated (based on a 30-day month) for such fractional month.

7.5.3 Landlord’s annual statement shall be final and binding upon Tenant unless Tenant, within thirty (30) days after Tenant’s receipt thereof, shall contest any item therein by giving written notice to Landlord, specifying each item contested and the reason therefor. If, during such thirty (30) day period, Tenant reasonably and in good faith questions or contests the correctness of Landlord’s statement of Operating Expenses, Landlord will provide Tenant with access to Landlord’s books and records and such information as Landlord reasonably determines to be responsive to Tenant’s questions and shall allow Tenant a reasonable amount of time to review such records and information. In the event that after Tenant’s review of such information, Landlord and Tenant cannot agree upon the amount of Operating Expenses, then Tenant shall have the right to have an independent public accounting firm hired by Tenant (at Tenant’s sole cost and expense unless the audit discloses a discrepancy of five percent (5%) or greater of the amount of Operating Expenses set forth in Landlord’s statement of Operating Expenses, in which case Landlord shall pay for the reasonable costs of such audit) and approved by Landlord (which approval shall not be unreasonably withheld or delayed) audit and/or review such information and books and records for the year in question (the “Independent Review”). The results of any such Independent Review shall be binding on Landlord and Tenant. If the Independent Review shows that Operating Expenses actually paid for the calendar year in question exceeded Tenant’s obligations for such calendar year, Landlord shall, at Tenant’s option, either (1) credit the excess to the next succeeding installments of estimated Additional Rent or (2) pay the excess to Tenant within thirty (30) days after delivery of such statement. If the Independent Review shows that Tenant’s payments of Operating Expenses for such calendar year were less than Tenant’s obligation for the calendar year, Tenant shall pay the deficiency to the Landlord within thirty (30) days after delivery of such statement.

7.5.4 Tenant acknowledges and agrees that Tenant, as owner and/or lessee of the Premises immediately prior to the execution of this Lease, is solely responsible for the payment of all Taxes, utility charges, insurance premiums, maintenance costs and any other Operating Expense due and payable and pertaining to the Premises prior to the Lease Commencement Date (the “Prior Expenses”). Tenant shall indemnify and hold harmless Landlord from and against all Claims arising out of or related to the Prior Expenses. The responsibility of Tenant for Operating Expenses shall continue to the latest of (i) the date of termination of the Lease, (ii) the date Tenant has fully vacated the Premises, or (iii) if termination of the Lease is due to the Default of Tenant, the earlier of the date of rental commencement of a replacement tenant or the date a replacement tenant takes possession of the Premises.

7.5.5 Operating Expenses for the calendar year in which Tenant’s obligation to share therein commences and in the calendar year in which such obligation ceases, shall be prorated on a basis reasonably determined by Landlord. Expenses such as taxes, assessments and insurance premiums which are incurred for an extended time period shall be prorated based upon time periods to which applicable so that the amounts attributed to the Premises relate in a reasonable manner to the time period wherein Tenant has an obligation to share in Operating Expenses.

8.1 Condition of Premises. Tenant has determined to lease the Premises after a full and complete investigation and examination thereof. Tenant accepts the Premises and all other rights under this Lease “as is.” Except as is expressly provided herein, Landlord shall not be required to furnish any services or facilities or to make any repairs or alterations in or to the Premises throughout the Lease Term. Tenant acknowledges that Tenant is the prior owner of the Premises and as such is fully aware of the current condition of the Premises.

8.2 No Warranties. Landlord has not made and makes no representations or warranties to Tenant of any kind regarding the Premises or the Building, including, without limitation, any representation or warranty regarding the physical condition of the Premises, its suitability for Tenant’s intended use, or the availability or capacity of utilities or sewer to the Premises.

9.1 Construction Requirements. Any alterations or improvements to the Premises of any kind by Tenant the cost of which exceeds One Hundred Thousand Dollars ($100,000) or which materially alters, affects, or modifies Building systems (including, without limitation, mechanical, electrical, plumbing, or HVAC systems), structural components, or the exterior of the Building shall be subject to satisfaction of each of the following conditions:

9.1.1 Architectural Review. Prior to commencement of any work, Tenant shall submit its proposed final plans and specifications to Landlord for Landlord’s consent, which consent shall not be unreasonably withheld, delayed or conditioned. Landlord agrees to respond to Tenant’s proposed final plans and specifications within fifteen (15) days after its receipt of such final plans and specifications. Landlord’s failure to approve or disapprove within said fifteen (15) days shall be deemed approval.

9.1.2 Code Compliance. Tenant shall comply with all Applicable Law, and Tenant shall obtain all required permits and approvals, including, but not limited to, any grading permits, building permits, zoning and planning requirements and approvals from any and all necessary governmental agencies and bodies.

9.1.3 Insurance. Tenant shall deliver to Landlord certificates of insurance evidencing that Tenant or the general contractor has obtained builder’s all-risk risk insurance in an amount not less than Five Million Dollars ($5,000,000). Tenant also shall deliver to Landlord evidence of worker’s compensation insurance coverage for all persons employed in connection with the construction and with respect to whom death or personal injury claims could be asserted against Landlord or the Premises. Tenant also shall deliver to Landlord evidence that Tenant has paid or caused to be paid all premiums for the insurance described in this paragraph. Tenant shall maintain or cause to be paid all premiums required to maintain and keep in force all insurance described in this paragraph at all times during which the construction is in progress.

9.1.4 Construction Requirements. Once any work of construction has begun, Tenant shall prosecute with reasonable diligence the same to conclusion. All construction shall be performed in a good and workmanlike manner, shall comply with all Applicable Law and shall be completed in conformance with the plans and specifications approved by Landlord.

9.1.5 Notice of Construction; Mechanics’ Liens. Landlord and its representatives shall have the right to go upon and inspect the Premises at all reasonable times upon reasonable prior notice and when accompanied by a representative of Tenant, and shall have the right to post and keep posted thereon notices of non-responsibility, or such other notices that Landlord may deem to be proper for the protection of Landlord’s interest in the Premises; provided, however, that such rights shall not unreasonably interfere with Tenant’s use or possession of the Premises, Landlord and Landlord’s invitees shall abide by Tenant’s safety practices and, except for true emergencies in which the health or safety of persons are in immediate danger, when necessary to save the destruction of significant property or when Landlord has provided reasonable prior notice (including the timing and scope) of an inspection by a prospective purchaser, investor, lender or insurer of the Premises, Landlord and Landlord’s invitees shall not under any circumstances have access to areas with confidential or proprietary information related to Tenant’s business. Before the commencement of any work, which might result in any lien, Tenant shall give to Landlord written notice of its intention to do so in sufficient time to enable the posting of such notices. Subject to Tenant’s right to contest any Claim or lien, Tenant shall keep the Premises and the Building free and clear of any and all liens and encumbrances which may arise at any time in connection with the improvement of the Premises by Tenant or its agents and contractors. Subject to Tenant’s right to contest any Claim or lien, Tenant shall pay and discharge all expenses incurred by Tenant for the services of mechanics and for the cost of goods and materials supplied by materialmen, and Tenant shall defend, indemnify and hold harmless Landlord and the Premises from and against any Claims by such mechanics or materialmen for labor or services performed or goods supplied at the request of Tenant. Furthermore, subject to Tenant’s right to contest any Claim or lien, Tenant shall, at its cost and expense, remove all such mechanics’ liens by bond or otherwise within ten (10) working days after the filing thereof. If Tenant desires to contest any Claim or lien, it shall be entitled to do so on the condition that Tenant first shall either (1) furnish Landlord a bond of a responsible corporate surety approved by Landlord in such amount as is sufficient to cause discharge of the lien of record, and conditioned on the discharge of the lien, or (2) furnish Landlord with other assurances satisfactory to Landlord that Landlord will be protected from the effect of such Claim or lien. If a final judgment establishing the validity or existence of a lien for any amount is entered, Tenant shall pay and satisfy the same at once. If Tenant shall not have paid, as and when required by this Paragraph 9.1.5, any charge for which a mechanics’ lien claim and suit to foreclose the lien have been filed, or if Tenant shall not have given Landlord security to protect the Premises and Landlord against such Claim or lien as required by this Paragraph 9.1.5, Landlord, upon five (5) days notice to Tenant, may (but shall not be required to) pay said lien or Claim including any costs, in which event the amount so paid, together with reasonable attorneys’ fees incurred in connection therewith, shall be immediately due and owing from Tenant to Landlord. Tenant shall pay the same to Landlord together with interest on the full amount thereof at the Default Rate from the date of Landlord’s payment until paid. If any Claims or liens are filed against the Premises or, if any action affecting title to the Premises is commenced, the party receiving notice of such lien or action shall forthwith give the other party written notice thereof.

9.1.7 As-Built Plans. On completion of any construction, Tenant shall give Landlord notice of all changes in plans or specifications made during the course of the work and, at the same time and in the same manner, shall supply Landlord with “as built” drawings accurately reflecting all such changes.

9.1.8 Ownership of Improvements. All improvements and fixtures existing on the Premises and the Building including (without limiting the generality of the foregoing) all wallcoverings, carpeting, flooring, built-in cabinet work, paneling and the like, all electrical, mechanical, and plumbing equipment and related ducts, shafts, and conduits, all exterior venting fume hoods, walk-in freezers and refrigerators, clean-rooms, climatized rooms, electrical panels and power back-up distribution systems, other than those items of personal property that are leased by Tenant, shall be the property of Landlord and shall remain upon, and be surrendered with the Premises, as a part thereof, at the end of the Lease Term. In the event that Tenant desires to make any alterations, additions or improvements governed by this Paragraph 9.1 upon the Premises during the Lease Term, Tenant shall submit to Landlord proposed final plans therefor, together with a request (the “Identification Notice”) that Landlord identify to Tenant in writing which of the proposed alterations, additions or improvements Landlord elects to remain property of Tenant to be removed by Tenant at the end of the Lease Term (each a “Tenant-Owned Alteration”). If Landlord fails to respond in writing to the Identification Notice (or fails to designate in writing a proposed alteration, addition or improvement as a Tenant-Owned Alteration) within fifteen (15) days after Landlord’s receipt of the Identification Notice, then Landlord shall be deemed to have elected to have any proposed alteration, addition or improvement not expressly designated as a Tenant-Owned Alteration within such fifteen (15) day period become property of Landlord (each a “Landlord-Owned Alteration”). If Tenant thereafter elects to make such proposed alterations, additions or improvements, then (a) all Landlord-Owned Alterations shall become property of Landlord and shall remain upon, and be surrendered with, the Premises, as a part thereof, at the end of the Lease Term, and (b) all Tenant-Owned Alterations shall remain the property of Tenant and shall be removed by Tenant at or prior to the end of the Lease Term. Tenant shall repair all damage resulting from its removal of Tenant-Owned Alterations, and restore the affected area to the condition existing prior to installation of Tenant-Owned Alterations. Nothing in the foregoing shall be construed to imply that Tenant’s Equipment (as defined in Paragraph 13.2 below) or other property of Tenant may become the property of Landlord. All articles of personal property, business and trade fixtures, machinery and equipment, furniture and movable partitions owned by Tenant or installed by Tenant at its expense in the Premises shall be and remain the property of Tenant and may be removed by Tenant at any time during the term of this Lease, provided that removal of the same shall not materially affect or damage the Building’s electrical, mechanical, or plumbing systems. Any items of Tenant’s improvements, which are paid for by Landlord, shall belong to Landlord and shall not be regarded as owned by Tenant. If Tenant shall fail to remove all of its effects from the Premises upon termination of this Lease for any cause whatsoever, Landlord, at its option, upon written notification to Tenant, may remove the same in any manner that Landlord shall choose and store said effects without liability to Tenant for loss thereof. In such event, Tenant agrees to pay Landlord upon demand any and all expenses incurred in such removal, including court costs and reasonable attorneys’ fees and storage charges on such effects, for any length of time that the same shall be in Landlord’s possession. If Tenant shall fail to remove all of its effects from the Premises upon termination of this Lease, Landlord, at its option, without notice, may sell said effects, or any of the same, at private sale and without legal process, for such price as Landlord may obtain and apply the proceeds of such sale upon the amounts due under this Lease from Tenant to Landlord and upon the expense incident to the removal and sale of said effects.

9.2 Landlord Not Responsible. Landlord’s approvals as required by this Lease shall not make Landlord responsible for the improvement with respect to which an approval is given or the construction thereof, and Tenant shall indemnify, defend (by counsel reasonably acceptable to Landlord), and hold Landlord and the Premises harmless from and against any Claims arising out of or in connection with any construction in, on or about the Premises or any labor dispute arising in connection therewith.

10.1 Tenant’s Responsibility. Tenant shall be responsible for all utility and other services to the Premises, at Tenant’s sole cost and expense. All such utility services shall be separately metered, and Tenant shall pay all costs therefor, including, without limitation, connection charges and billing deposits. Tenant shall pay (directly to the provider and prior to delinquency) for all water, gas, electricity, sewer, telephone, cable television and other utilities which may be furnished to the Premises during the term of this Lease. Tenant shall be responsible to all third parties for any damages to such third parties as may result from any failure or interruption of utility service to such third parties arising out of or attributable to the installation, maintenance or operation of Tenant’s utilities. Tenant shall indemnify and hold harmless Landlord against any such third party Claim.

10.2 Landlord Not Responsible. Landlord shall not be liable in damages or otherwise for any failure or interruption of any utility service or other services being furnished the Premises, and no such failure or interruption shall entitle Tenant to terminate this Lease, abate Rent, or be relieved from any obligation or the operation of any covenant or agreement under this Lease.

11.1.1 Tenant, at its sole cost and expense, shall maintain and keep the Premises, all improvements thereon, and all appurtenances thereto, including but not limited to sidewalks, parking areas, curbs, roads, driveways, lighting standards, landscaping, sewers, water, gas and electrical distribution systems and facilities, drainage facilities, and all signs, both illuminated and non-illuminated that are now or hereafter on the Premises, clean and in good and working condition and in a manner consistent with the Permitted Use (as defined in Paragraph 6.1 above). Tenant shall make all such repairs, replacements and improvements including, without limitation, all structural, roof, HVAC, plumbing, and electrical repairs, replacements and improvements required and shall keep the same free and clear from all rubbish and debris. All repairs made by Tenant shall be at least equal in quality to the original work, shall be made only by a licensed, bonded contractor approved in advance by Landlord; provided, however, that such contractor need not be bonded or approved by Landlord if the non-structural alterations, repairs, additions or improvements to be performed do not exceed Twenty-Five Thousand Dollars ($25,000) in value. Landlord may impose reasonable restrictions and requirements with respect to such repairs. Tenant shall not take or omit to take any action, the taking or omission of which shall cause material waste, damage or injury to the Premises. Tenant shall indemnify, defend (by legal counsel acceptable to Landlord) and hold harmless Landlord from and against any and all Claims arising out of the failure of Tenant or Tenant’s Agents to perform the covenants contained in this paragraph. “Tenant’s Agents” shall be defined to include Tenant’s officers, employees, agents, contractors, invitees, customers and subcontractors.

11.1.2 Tenant shall maintain the lines designating the parking spaces in good condition and paint the same as often as may be necessary, so that they are easily discernable at all times; resurface the parking areas as necessary to maintain it in good condition; paint any exterior portions of the Building as necessary to maintain them in good condition; maintain the roof in good condition; and to take all reasonable precautions to insure that the drainage facilities of the roof are not clogged and are in good operable condition at all times.

11.1.3 Tenant shall at all times during the term of this Lease, and at Tenant’s expense, maintain the exterior of the Building, the parking areas, landscaping, drainage systems, sprinklers and all other portions of the Premises visible from the surrounding streets in a commercially reasonable condition, and shall maintain attractive screens, barricades or enclosures around any waste or storage areas.

11.1.4 Tenant hereby waives any applicable law, statute, or ordinance relating to a Landlord’s duty to maintain the Premises in a tenantable condition, and all other rights of Tenant under any law, statute or ordinance now or hereafter in effect authorizing Tenant to make repairs at Landlord’s expense.

11.1.5 There shall be no abatement of Rent and no liability of Landlord by reason of any injury to or interference with Tenant’s business arising from the making of any repairs, alterations or improvements in or to any portion of the Premises, or in or to improvements, fixtures, equipment and personal property therein.

11.2 Landlord’s Right to Maintain. During the Lease Term, except as expressly provided in the Lease, Landlord shall not be required to maintain or make any repairs or replacements of any nature or description whatsoever to the Premises. Tenant hereby expressly waives the right to make repairs at the expense of Landlord as provided for in any statute or law in effect at the time of execution of this Lease, or in any other statute or law which hereafter may be enacted. Notwithstanding the foregoing, if Tenant shall fail, after reasonable notice (being at least thirty (30) days), to maintain or to commence and thereafter to proceed with diligence to make any repair or replacement required of it pursuant to the terms of this Lease, Landlord, without being under any obligation to do so and without thereby waiving such Default, may so maintain or make such repair or replacement and may charge Tenant for the cost thereof. Any expense reasonably incurred by Landlord in connection with the making of such repairs may be billed by Landlord to Tenant monthly, or immediately, at Landlord’s option, and shall be due and payable within ten (10) days after such billing, or at Landlord’s option, may be deducted from the Security Deposit.

11.3 Landlord’s Right of Entry for Repairs. Landlord and Landlord’s agents shall have the right to enter upon the Premises, or any part thereof, for the purpose of performing any repairs or maintenance Landlord is permitted or required to make pursuant to this Lease, and of ascertaining the condition of the Premises or whether Tenant is observing and performing Tenant’s obligations hereunder, all without unreasonable interference from Tenant or Tenant’s Agents. Except for emergency maintenance or repairs, the right of entry contained in this paragraph shall be exercisable at reasonable times, at reasonable hours and on reasonable notice.

13.1 Removal of Fixtures. Except as provided in Paragraphs 9.1.8 or 13.2 herein, Tenant shall not remove any fixtures belonging to Landlord from the Premises without Landlord’s prior written consent (not to be unreasonably withheld, conditioned or delayed); provided, however, Tenant shall have the right to sell or dispose of any existing building machinery, equipment or fixtures subject to this Lease which may have become obsolete or unfit for use or which are no longer useful, necessary or profitable in the conduct of Tenant’s business, so long as (i) the Premises retain its primary use consistent with the Permitted Use, and (ii) Tenant shall have substituted or promptly shall substitute for the property so removed from the Premises other building machinery, equipment or fixtures not necessarily of the same character but at least of equal quality in the performance of the particular function in question as that of the property so removed unless, in Tenant’s reasonable opinion, the property so removed was performing an obsolete function and replacement thereof is not necessary or appropriate to maintain the operation or character of the Premises or its overall value without impairment. Tenant shall give Landlord written notice of each material fixture removed by Tenant. All built-ins and fixtures installed in or attached to the Premises by Tenant must be new or like new when so installed or attached.

13.2 Trade Fixtures and Personal Property. Any trade fixtures, equipment, stock, inventory, machines (other than HVAC or other built-in machines or machinery, as provided in Paragraph 9.1.8), signs and other personal property of Tenant not permanently affixed to the Premises (“Tenant’s Equipment”) shall remain the property of Tenant. Landlord agrees that Tenant shall have the right, at any time, and from time to time, to remove any and all of Tenant’s Equipment which it may have stored or installed in the Premises. Tenant, at its sole cost and expense, immediately shall repair any damage occasioned to the Premises by reason of the removal of Tenant’s Equipment and, upon the last day of the Lease Term or upon earlier termination of this Lease, shall leave the Premises in a neat and clean condition, free of debris, and in as good a condition as that existing on the Lease Commencement Date, reasonable wear and tear excepted, with all HVAC and other Building systems in good and operable condition.

13.3 Taxes on Trade Fixtures and Personal Property. Tenant shall pay before delinquency all taxes, assessments, license fees and public charges levied, assessed or imposed upon its business operation, as well as upon its trade fixtures, leasehold improvements (including, but not limited to, those Tenant is allowed or required to make in accordance with the provisions of this Lease), merchandise and other personal property in, on or upon the Premises. If any such items of property are assessed together with property owned by Landlord, then, and in such event, such assessment shall be equitably divided between Landlord and Tenant.

13.4 Ownership of Tenant’s Equipment. All Tenant’s Equipment shall be and remain the property of Tenant during the Lease Term. Tenant shall bear all costs and expenses incurred in installing, removing, storing or disposing of Tenant’s Equipment pursuant to this paragraph and Paragraph 27 and shall repair at its expense all damage to the Premises caused by the installation and removal thereof, whether effectuated by Tenant or Landlord (as provided in Paragraph 27).

14. TENANT’S COVENANT. Tenant covenants and agrees that as to its leasehold estate and use and occupancy of the Premises, Tenant and all persons in possession or holding under Tenant shall conform to and shall not violate any Applicable Law.

15.1 Indemnification. Tenant shall indemnify, defend, and hold Landlord and its agents, employees, directors, officers, managers, members, partners, affiliates, independent contractors, and property managers (collectively, “Landlord’s Agents” or “Agents”) harmless from and against any and all claims, demands, liability, loss or damage, whether for injury to or death of persons or damage to real or personal property, arising out of or in connection with the Premises, Tenant’s use of the Premises, any activity, work, or other thing done, permitted, or suffered by Tenant in or about the Building, or arising from any reason or cause whatsoever in connection with the use or occupancy of the Premises by any party during the term of this Lease. This indemnification by Tenant shall include indemnity for the acts or omissions of Landlord and Landlord’s Agents, unless caused solely by the willful act or gross negligence of the Landlord or its Agents. Tenant shall further indemnify, defend, and hold Landlord and Landlord’s Agents harmless against and from any and all claims arising from any breach or default in the performance of any obligation on Tenant’s part to be performed under the terms of this Lease, or arising from any act or negligence of Tenant or any officer, agent, employee, guest, or invitee of Tenant, and from and against all costs, attorneys’ fees, expenses, and liabilities incurred as a result of any such claim or any action or proceeding brought thereon. In any case, action, or proceeding brought against Landlord or Landlord’s Agents by reason of any such claim, Tenant, upon notice from Landlord, shall defend the same at Tenant’s expense by counsel satisfactory to Landlord. Tenant, as a material part of the consideration to Landlord, hereby assumes all risk of damage to property or injury to persons in, upon, or about the Premises from any cause arising prior to the later of the termination of this Lease or the date Tenant is no longer in possession of the Premises (except for such damage or injury caused by Landlord’s or its Agents’ willful misconduct or gross negligence), and Tenant hereby waives all claims in respect thereof against Landlord and Landlord’s Agents. Tenant’s obligation to indemnify under this paragraph shall include reasonable attorneys’ fees, investigation costs, and other reasonable costs, expenses, and liabilities incurred by Landlord and Landlord’s Agents. If the ability of Tenant to use the Premises or the Building is interrupted for any reason, Landlord and Landlord’s Agents shall not be liable to Tenant for any loss or damages occasioned by such loss of use, except to the extent such loss or damages is caused solely by Landlord’s or its Agents’ willful misconduct or gross negligence.

15.2 Limitation on Landlord Liability. Neither Landlord nor Landlord’s Agents shall be liable for loss or damage to any property by theft or otherwise, or for any injury to or damage to persons or property resulting from fire, explosion, falling plaster, steam, gas, electricity, water, or rain which may leak from any part of the Building or from the pipes, appliances, or plumbing works therein or from the roof, street, or subsurface or from any other place resulting from dampness or any other cause whatsoever, unless caused by or due solely to the gross negligence or intentional acts of Landlord or Landlord’s Agents. Except as otherwise provided herein or unless caused by or due solely to the gross negligence or intentional acts of Landlord or Landlord’s Agents, neither Landlord nor Landlord’s Agents, shall be liable for interference with the light or other rights or loss of business by Tenant, nor shall Landlord or Landlord’s Agents be liable for any latent defect in the Premises or in the Building. Tenant shall give prompt notice to Landlord in case of fire or accidents in the Premises or in the Building or of defects therein or in the fixtures or equipment belonging to Landlord.

15.3 Waiver of Subrogation. Landlord and Tenant hereby waive any rights each may have against the other on account of any loss or damage occasioned to Landlord or Tenant, as the case may be, their respective property or the Premises, caused by or resulting from risks insured against under any policies carried by the parties; provided, however, that this paragraph shall be inapplicable if it would have the effect, but only to the extent that it would have the effect, of invalidating any insurance coverage of Landlord or Tenant. To the extent available, the parties shall cause each insurance policy obtained by it hereunder to provide a waiver of subrogation. Tenant’s insurer shall either waive subrogation rights against Landlord or, if Tenant’s insurance company does not waive the right of subrogation against Landlord and its insurance company, Tenant shall (a) maintain during the Lease Term fire and commercial liability coverage with respect to the Premises, and (b) pay to Landlord upon demand Landlord’s cost incurred in securing fire and commercial liability insurance protecting Landlord upon the destruction of Tenant’s property.

16.1 Property Insurance. During the Lease Term, Tenant shall keep and maintain, or cause to be kept and maintained, at Tenant’s sole cost and expense, a policy or policies of insurance on the Premises insuring the same against loss or damage by the following risks: fire and extended coverage, vandalism, malicious mischief, plate glass and sprinkler leakage (if sprinklers are required in the Building under applicable building code provisions, or are installed by Tenant whether or not there is such a requirement) in amounts at all times sufficient to prevent Landlord or Tenant from becoming a co-insurer under the terms of the applicable policies, but in any event in an amount payable there-under not less than Full Replacement Value of the Premises. The term “Full Replacement Value” shall mean actual replacement cost, including changes required by new building codes or ordinances (exclusive of the cost of excavation, foundations and footings). Such insurance shall show, as a loss payee in respect of the Premises, Landlord, Tenant and any Lender required to be named pursuant to its mortgage documents, as their interests may appear.

16.2 Commercial Liability Insurance. During the Lease Term, Tenant shall keep and maintain, or cause to be kept and maintained, at Tenant’s sole cost and expense, a policy or policies of commercial general public liability insurance, showing, as an additional insured in respect of the Premises, Landlord, Tenant, any management company retained by Landlord to manage the Premises, any ground lessor and any mortgagee of Landlord required to be named pursuant to its mortgage documents. Such policy shall insure against any and all Claims for injuries to persons, loss of life and damage to property occurring upon, in or about the Premises (including coverage for liability caused by independent contractors of Tenant or Subtenant working in or about the Premises), with minimum coverage in an amount not less than Five Million Dollars ($5,000,000) (inclusive of general liability, commercial liability, and umbrella/excess liability coverage) combined single limit with respect to all bodily injury, death or property damage in any one accident or occurrence. In the event of a Claim relating to the Premises, the amount of any deductible or self-insured retention and/or any award in excess of the policy limits shall be the sole responsibility of Tenant. The insurance shall include (i) personal injury insurance with endorsement deleting the employee liability exclusions, and employee liability insurance, (ii) a broad form contractual liability endorsement insuring Tenant’s indemnity obligation under Paragraph 15.1, (iii) a products liability coverage endorsement, (iv) a boiler and machinery liability endorsement, and (v) a products completed operations coverage endorsement.

16.3.1 In addition to all other insurance required to be carried by Tenant, Tenant, throughout the Lease Term, shall provide and keep in force at Tenant’s sole cost and expense:

(a) Such further insurance against such other hazards and risks and in such amounts as the ground lessor or the holder of any mortgage or deed of trust lien may require under to the terms of such liens;

(b) Rental value insurance with respect to the Premises, covering risk of loss of rental due to the occurrence of any of the hazards described above in Paragraph 16.1, in an amount not less than the aggregate requirements for the period of eighteen (18) months following the occurrence of the casualty for Rent and premiums on the insurance required to be carried pursuant to this Paragraph 16;

(d) Insurance on Tenant’s Equipment, personal property and other contents in, on or about the Premises insuring against loss or damage by all risks referred to in Paragraph 16.1 in amounts equal to ninety percent (90%) of their full replacement value;

(e) During any period of construction in the Premises and any other construction, Builder’s All Risk Insurance with Completed Operations Coverage; and

(f) Other insurance required by Landlord, including, without limitation, terrorism, flood, earthquake and environmental remediation, in types and amounts consistent with commercially reasonable practice.

16.4 Insurers; Primary Insurance. All policies of insurance provided for herein shall be on an occurrence basis (except for product coverage, which is on a claims-made basis) and shall be issued by insurance companies with a general policy holder’s rating of not less than A- and a financial rating of not less than Class XII as rated in the most current available “Best’s” Insurance Reports. Such insurance companies shall be qualified to do business in the State of Maryland. All such policies shall be issued in the name of Tenant, with Landlord, any ground lessor and Lender (or its successors and assigns) listed as additional insureds (or, in the case of property damage policies, as loss payees), and shall be for the mutual and joint benefit and protection of Landlord, Tenant, any ground lessor and Landlord’s mortgagee or beneficiary. All commercial liability and property damage policies shall contain a provision that Landlord, although named as an insured or loss payee, as the case may be, nevertheless shall be entitled to recovery under said policies for any loss occasioned to it, its servants, agents and employees by reason of the negligence of Tenant. As often as any such policy shall expire or terminate, renewal or additional policies shall be procured and maintained by Tenant in like manner and to like extent. All policies of insurance must contain a provision that the company writing said policy will give to Landlord ten (10) days notice in writing in advance of any cancellation or lapse or the effective date of any reduction in the amounts of insurance. All commercial liability, property damage and other casualty policies shall be written as primary policies, not contributing with and not in excess of coverage that Landlord may carry.

16.5 Blanket Policy. Notwithstanding anything to the contrary contained within this Paragraph 16, Tenant’s obligations to carry the insurance provided for herein may be brought within the coverage of a so-called blanket policy or policies of insurance carried and maintained by Tenant; provided, however, that Landlord, any ground lessor and Lender shall be named as an additional insured thereunder as their interests appear, the coverage afforded Landlord will not be reduced or diminished by reason of the use of such blanket policy of insurance, and the requirements set forth herein are otherwise satisfied.

16.6 Deductibles. The deductible amounts, if any, with respect to all insurance, which Tenant is required to maintain hereunder, shall not exceed Twenty-five Thousand Dollars ($25,000) per claim or occurrence or, in the case of product liability insurance, shall not exceed One Hundred Thousand Dollars ($100,000) per claim or occurrence. The amount of the deductibles, if any, within this limitation shall be a business decision by Tenant; under no circumstances shall Landlord be required to reimburse Tenant for the amount of any deductible incurred by Tenant in connection with any insured event, even if the event resulting in the claim was caused or contributed to by Landlord’s or Landlord’s Agents’ gross negligence or willful misconduct.

16.7 Certificates. Upon the execution and delivery of this Lease and thereafter not less than thirty (30) days prior to the expiration dates of the expiring policies theretofore maintained, Tenant shall deliver to Landlord certificates of insurance with respect to the policies of insurance required by this Lease.

16.8 No Separate Insurance. Tenant shall not take out separate insurance with respect to the Premises, concurrent in form or contributing in the event of loss with that required to be furnished by Tenant under this Lease, unless Landlord, and such other persons required to be named as insureds as provided in this Lease, are also included therein as named insureds, respectively, with loss payable as provided in this Lease. Tenant immediately shall notify Landlord of the taking out of any such separate insurance and shall deliver a certificate or certificates therefor to Landlord.

16.9 Adjustment in the Event of Loss. Except as otherwise provided herein, and subject to the rights of Lender, all insurance proceeds payable with respect to any damage or destruction to the Premises (but not with respect to Tenant’s personal property, it being understood that insurance proceeds allocable to Tenant’s personal property shall be payable directly to Tenant) shall be payable to Landlord. If Tenant undertakes to repair said damage in accordance with Paragraph 17 below, the proceeds shall be made available to Tenant and used to fund the reconstruction. In all other events, the proceeds shall be the sole property of Landlord except otherwise expressly provided herein. Tenant shall be entitled to compromise, adjust or settle, with Landlord’s approval, any and all claims with respect to the Premises. Each party agrees to execute and deliver to the other party such releases, endorsements and other instruments as the other party reasonably may require in order to compromise, adjust or settle any insurance claim which such other party shall be entitled to compromise, adjust or settle pursuant to this paragraph and to enable the other party or its designee to collect such insurance proceeds as are payable in respect of such claim.

16.10 Proration Upon Termination. If any of the insurance required to be carried by Tenant hereunder is still in effect at the termination of this Lease, Landlord may elect to terminate such insurance, or Landlord shall reimburse Tenant for the pro rata portion of the premium paid by Tenant for such insurance based upon the number of days remaining unexpired in such insurance.

16.11 Landlord’s Option to Maintain Coverage. Notwithstanding anything to the contrary in this Paragraph 16, Landlord may, at its election and upon ten (10) days’ notice to Tenant, keep and maintain any of the insurance policies required hereunder, the cost of which shall be paid by Tenant as Additional Rent.

17.1.1 If the Premises are damaged or destroyed during the Lease Term, within a period of ninety (90) days thereafter, Tenant shall commence repair, reconstruction and restoration of the Premises and prosecute the same diligently to completion at Tenant’s sole cost and expense whether or not the insurance proceeds shall be sufficient for the purpose, and Landlord shall make available to Tenant any insurance proceeds for such repair, reconstruction or restoration paid out to Landlord by the insurer. This Lease shall continue in full force and effect, and Tenant’s duty to rebuild shall exist without regard to whether the damage or destruction is covered by insurance.

17.1.2 Notwithstanding Paragraph 17.1.1 hereof, in the event of a total destruction of the Premises during the last two (2) years of the Lease Term, or the last year with respect to any Extension Period, as the case may be, Landlord and Tenant each shall have the option to terminate this Lease upon giving written notice to the other of exercise thereof within thirty (30) days after such destruction, in which case this Lease shall cease and terminate as of the date of destruction, and provided that, in the event of such termination by either Landlord or Tenant, Tenant shall pay to Landlord the fair market value of the Premises less the fair market value of the Land (to the extent such amount exceeds Landlord’s insurance proceeds received from the destruction). For purposes of this Paragraph 17.1.2, “total destruction” shall be deemed a damage or destruction to an extent that the cost of repair is at least fifty percent (50%) of the then full replacement cost of the Premises as of the date of destruction.

17.2 Reconstruction. In the event of any reconstruction of the Premises pursuant to this Paragraph 17, the construction by Tenant shall be subject to, and conducted in accordance with, the provisions of Paragraph 9 above.

17.3 Termination. In the event of termination pursuant to this Paragraph 17, all right to compromise, adjust or settle any insurance claim shall be in Landlord, and all proceeds from Tenant’s insurance shall be disbursed and paid to, and be the property of, Landlord, except to the extent such proceeds are allocable to the equipment, fixtures or other personal property of Tenant.

17.4 No Abatement. In the event of repair, reconstruction or restoration as herein provided, the Monthly Rent, which Tenant is required to pay to Landlord under this Lease, shall not be abated. Tenant shall continue the operation of its business on the Premises during any such period to the extent reasonably practicable from the standpoint of prudent business management, and the obligation hereunder to pay Additional Rent shall remain in full force and effect. Tenant shall not be entitled to any compensation or damages from Landlord for loss of the use of the whole or any part of the Premises, Tenant’s personal property or any inconvenience or annoyance occasioned by such damage, repair, reconstruction or restoration. Tenant hereby waives any statutory or common law rights of termination or abatement of rent, which may arise by reason of any partial or total destruction of the Premises.

18.1 No Assignment. Tenant shall neither voluntarily nor by operation of law assign, sell, encumber, pledge or otherwise transfer all or any part of Tenant’s leasehold estate hereunder, or permit any other person (excepting Tenant’s agents and employees) to occupy the Premises or any portion thereof, without Landlord’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. Consent by Landlord to one or more assignments of this Lease or to one or more sublettings of the Premises shall not constitute a waiver of Landlord’s right to require consent to any subsequent assignment, subletting or other transfer. If Tenant is a corporation, unincorporated association or partnership, the transfer, assignment or hypothecation of any stock or interest in such corporation, association or partnership in the aggregate in excess of twenty-five percent (25%) of all outstanding stock or interests, or liquidation thereof, shall be deemed an assignment within the meaning and provisions of this paragraph; provided, however, the transfer, assignment or hypothecation of any stock in a corporation or partnership which is a reporting company under the Securities Exchange Act of 1934, as amended, shall not be deemed an assignment within the meaning and provisions of this paragraph. The sale of all or substantially all of the assets of Tenant, or the assignment of the Lease to an entity into which Tenant is merged or with which Tenant is consolidated, shall be deemed an assignment within the meanings and provisions of this paragraph, unless the successor entity has a net worth equal to or greater than Tenant’s net worth immediately prior to the transfer. Tenant shall reimburse Landlord for all of Landlord’s reasonable costs and attorneys’ fees incurred in conjunction with the processing and documentation of any required consent to assignment, subletting, transfer, change of ownership or hypothecation of this Lease or Tenant’s interest in and to the Premises. Notwithstanding the foregoing, Tenant shall have the right, without the consent of Landlord, to assign its rights and obligations pursuant to this Lease to a parent, subsidiary or affiliate, provided that Tenant remains obligated under the Lease. For purposes of this Paragraph, the term “subsidiary” shall mean and refer to any subsidiary of Tenant in which Tenant owns fifty percent (50%) or more of the voting stock of such subsidiary. For purposes of this Paragraph, the term “affiliate” shall mean and refer to any entity in which Tenant or parent of Tenant owns fifty percent (50%) or more of the voting stock or ownership interest of such entity.

18.2 Consent Required. Landlord’s consent to any assignment, sale, encumbrance, pledge or other transfer shall not be unreasonably withheld, conditioned or delayed. It shall not be unreasonable for Landlord to base its determination as to whether consent will be granted in any specific instance on, without limitation, the following factors: (a) whether the transferee’s use of the Premises will be compatible with the provisions of this Lease; (b) the financial capacity of the transferee; (c) the business reputation of the transferee; (d) the quality and type of the business operations of the transferee; and (e) the business experience of the proposed transferee. This list of factors is not intended to be exclusive, and Landlord may rely on such other reasonable basis for judgment as may apply from time to time.

18.3 Procedure to Obtain Consent. If Tenant desires at any time to assign this Lease or to sublet the Premises or any portions thereof, it first shall notify Landlord of its desire to do so and shall submit in writing to Landlord (i) the name and legal composition of the proposed subtenant or assignee; (ii) the nature of the proposed subtenant’s or assignee’s business to be carried on in the Premises; (iii) the terms and provisions of the proposed sublease or assignment and all transfer documents relating to the proposed transfer; and (iv) such reasonable business and financial information as Landlord may request concerning the proposed subtenant or assignee. Any request for Landlord’s approval of a sublease or assignment shall be accompanied with a check in the amount of $2,000.00 for the cost of review and preparation, including reasonable attorneys’ fees, of any documents relating to such proposed transfer. Landlord shall notify Tenant of its approval or disapproval of any such request within ten (10) business days of receipt of the foregoing information and payment. Landlord’s failure to respond within such ten (10) business day period shall be deemed approval by Landlord. The provisions and conditions of any proposed sublease or assignment must not be inconsistent with any provision of this Lease, and must address all matters contained in this Lease. In addition, the transferee must expressly assume all of the obligations of Tenant under this Lease. Notwithstanding the assumption of the obligations of this Lease by the transferee, no subletting or assignment, even with the consent of Landlord, shall relieve Tenant of its continuing obligation to pay the rent and perform all the other obligations to be performed by Tenant hereunder. The obligations and liability of Tenant hereunder shall continue notwithstanding the fact that Landlord may accept rent and other performance from the transferee. The acceptance of rent by Landlord from any other person shall not be deemed to be a waiver by Landlord of any provision of this Lease or to be a consent to any assignment or subletting.

18.4 Advertising. In no event shall Tenant display on or about the Premises any signs for the purpose of advertising the Premises for assignment, subletting or other transfer of rights, without Landlord’s prior written consent.

18.5 Writing Required. Each permitted assignment or sublease shall be consummated by an instrument in writing executed by the transferor and transferee in form satisfactory to Landlord. Each assignee and subtenant shall agree in writing for the benefit of the Landlord herein to assume all obligations of Tenant hereunder, including the payment of all amounts due or to become due under this Lease directly to the Landlord. One executed copy of such written instrument shall be delivered to the Landlord.

18.6 Transfer Premiums. If Tenant assigns or sublets its rights under this Lease, Tenant shall pay to Landlord as Additional Rent, after Tenant has recovered any relevant leasing commissions, costs of tenant improvements and other expenses of the assignment or sublease, fifty percent (50%) of such excess consideration due and payable to Tenant from said assignment or sublease to the extent said consideration exceeds the Rent or a pro rata portion of the Rent, in the event only a portion of the Premises is sublet.

19. NO ENCUMBRANCE. Without Landlord’s prior written consent, Tenant shall not mortgage, encumber or hypothecate its interest in this Lease, the Premises or the Building, and any attempt by Tenant to do so shall be a default hereunder, and at Landlord’s option, shall terminate this Lease.

20.1 Hazardous Materials. Tenant shall not use, store, dispose of or permit to remain on the Premises, the Building, the Land, or any adjacent property other than in the normal course of its business and in compliance with all applicable laws, any solid, liquid or gaseous matter or any combination thereof, which is or may become, hazardous, toxic or radioactive including, but not limited to, any substance, gas, or waste, which is included in the definition of “hazardous substance,” “toxic substance,” “hazardous waste,” or “toxic waste” under any federal, state, or local law, ordinance, or regulation, including any material which, if discharged, leaked or emitted or permitted to be discharged, leaked or emitted into the atmosphere, the ground or any body of water, does or may (i) pollute or contaminate the same, or (ii) adversely affect (A) the health or safety of persons, whether on the Premises or anywhere else, (B) the condition, use or enjoyment of the Premises or anywhere else, or (C) the Premises, the Building or any of the improvements thereon (all of the foregoing collectively referred to herein as “Hazardous Materials”).

20.2 Testing. At reasonable times and upon reasonable prior notice, prior to the expiration or earlier termination of the Lease Term, Landlord shall have the right to conduct (a) hazardous material and waste investigation(s) of the Premises and (b) if Landlord has reasonable cause to believe that any contamination exists on, in, under, or around the Building or the Premises, such other tests of the Premises and the Building as Landlord may deem necessary or desirable to demonstrate whether contamination has occurred as a result of Tenant’s use of the Premises. Tenant shall be solely responsible for and shall defend, indemnify and hold the Landlord, its Agents and contractors harmless from and against any and all Claims, arising out of or in connection with any removal, clean up, restoration and materials required hereunder to return the Premises and any other property of whatever nature to their condition existing prior to the time of any such contamination, except for Claims caused by Landlord’s or its Agents’ gross negligence or willful misconduct. Tenant shall pay for the reasonable cost of the investigations and other tests of the Premises.

20.3 Duty to Dispose. Tenant shall not keep any trash, garbage, waste or other refuse on the Premises except in sanitary containers and shall regularly and frequently remove the same from the Premises. Tenant shall keep all incinerators, containers or other equipment used for the storage or disposal of such matter in a clean and sanitary condition. Tenant shall properly dispose of all sanitary sewage and shall not use the sewage disposal system of the Building (i) for the disposal of anything except sanitary sewage, or (ii) for disposal of sewage in excess of the lesser of the amount (A) reasonably contemplated by the uses permitted under this Lease, or (B) permitted by any governmental entity.

20.4 Hazardous Materials Laws. Tenant, at Tenant’s own cost and expense, shall comply with all existing and any hereinafter enacted federal, state or local laws pertaining to or governing Hazardous Materials laws. Tenant, at Tenant’s own cost and expense, shall make all submissions to, provide all information to and comply with all applicable requirements of any appropriate governmental authority (“Authority”) under all federal, state or local laws pertaining to or governing Hazardous Materials. In particular, Tenant shall comply with all laws relating to the storage, use and disposal of Hazardous Materials. Should any Authority require that a clean up or remediation plan be prepared or that a clean up or any other remediation action be undertaken because of any spills or discharges of Hazardous Materials at the Premises or on the Premises or any adjacent property that occur during the Lease Term or after expiration of the Lease Term as a result of Tenant’s use of the Premises, then Tenant, at Tenant’s own expense, shall prepare and submit the required plans and financial assurances and carry out the approved plans. At no expense to Landlord, Tenant promptly shall provide all information requested by Landlord for preparation of affidavits required by Landlord or for Landlord’s own information, to determine the applicability of the Hazardous Materials laws to the Premises and shall execute affidavits promptly when requested to so by Landlord.

20.5 Tenant Indemnification. Tenant shall indemnify, defend and hold harmless Landlord and Landlord’s Agents from and against (i) Claims in connection with or arising out of any release, spill or discharge of Hazardous Materials due to, contributed to or caused by the activities of Tenant, Tenant’s Agents, third parties who have trespassed on the Premises during the Lease Term or parties in contractual relationship with Tenant or any of them; and (ii) all Claims arising out of Tenant’s failure to provide all information, make all submissions and take all steps required by any Authority, under any federal, state or local laws pertaining to or governing Hazardous Materials laws or any other environmental law. Tenant’s obligations and liabilities under this paragraph shall survive the expiration or earlier termination of this Lease. Without limiting the foregoing, if the release, spill, leakage, or discharge of any Hazardous Materials on or in the Premises or the Building or any adjacent property, caused or permitted by Tenant results in any contamination of the Premises or the Building or any adjacent property, Tenant shall promptly take all actions at its sole expense as are necessary to return the Premises or the Building or any adjacent property, to the condition existing prior to the time of such contamination, provided that Landlord’s approval of such action shall first be obtained, which approval shall not unreasonably be withheld, delayed or conditioned so long as such actions would not potentially have any material adverse long-term or short-term effect on the Premises or the Building. Notwithstanding the foregoing, the indemnification herein shall not apply to the initial introduction of Hazardous Materials on or to the Premises by anyone other than the Tenant from and after the date that Tenant is neither the “Tenant” hereunder nor in possession of the Premises (“Tenant Relinquishment Date”).

20.6 Obligation to Remediate Upon Expiration of Lease. Tenant shall surrender the Premises at the expiration or earlier termination of this Lease free of any Hazardous Materials or contamination and free and clear of all judgments, liens, licenses, restrictions or encumbrances relating thereto and, at its own cost and expense, shall repair all damage and clean up or perform any remedial action necessary relating to any Hazardous Materials or contamination caused by Tenant’s operation. Tenant, at its sole cost and expense, shall, following Landlord’s request, remove any alterations or improvements that are contaminated or contain Hazardous Materials.

21.1 Termination of Lease. If the Premises or any portion thereof are Taken under the power of eminent domain, or sold by Landlord under the threat of the exercise of such power, this Lease shall terminate as to the part so Taken as of the date that the condemning authority takes possession. This Lease shall remain in full force and effect with respect to the remaining portion of the Premises. If more than fifty percent (50%) of the square footage of the Building is taken or sold under such threat, Tenant may terminate this Lease as of the date that the condemning authority takes possession by delivery of written notice of such election within twenty (20) days after such party has been notified of the Taking or, in the absence thereof, within twenty (20) days after the condemning authority shall have taken possession. Notwithstanding the foregoing, Tenant’s right to terminate this Lease under the preceding sentence is contingent upon all leasehold mortgages (if any) of Tenant being paid in full.

21.2 Rent Reduction; Tenant’s Obligation To Repair. If this Lease is not terminated by Landlord or Tenant, it shall remain in full force and effect as to the portion of the Premises remaining; provided, however, that the Monthly Rent shall be reduced by the proportion that the floor area of the Building taken bears to the original floor area of the Building. In such event Tenant, at Tenant’s sole cost and expense, but subject to the availability of condemnation proceeds therefor, shall restore the Premises to a complete unit of like quality and character, except as to size, as existed prior to the date on which the condemning authority took possession.

21.3 Award. All awards for the Taking of any part of the Premises or proceeds from the sale made under the threat of the exercise of the power of eminent domain (other than the portions of such award expressly attributed by the governmental authority to the diminution in value of the leasehold estate which portion, subject to the rights of any ground lessor, shall be the property of Tenant) shall be the property of Landlord, whether made for the Taking of the fee, or as severance damages; provided, however, that Tenant shall be entitled to any award that is made for damage to Tenant’s trade fixtures and removable personal property, to a portion of the award necessary to restore the Premises as provided in Paragraph 21.2 above, and to compensation for its moving and relocation expenses.

22.1 Events of Default. The occurrence of any of the following shall constitute a default hereunder (“Default”):

22.1.1 The failure of Tenant to pay or cause to be paid when past due, within five (5) days after written notice, any Rent, monies or other charge required by this Lease to be paid by Tenant;

22.1.2 The failure of Tenant, within thirty (30) days after notice, to do or cause to be done any act required by this Lease, or the failure to observe and perform any other provision of this Lease to be observed or performed by Tenant, other than payment of Rent, monies or charges required by this Lease. If a cure cannot be made within thirty (30) days, Tenant shall have an additional reasonable amount of time necessary to complete the cure using its diligent and best efforts. Notwithstanding the foregoing, if any such failure on the part of Tenant affects the health or safety of others, or would result in the destruction of property, Tenant shall immediately begin to cure and shall use its diligent and best efforts in pursuing said cure to completion;

22.1.3 Tenant’s causing or permitting, without the prior written consent of Landlord, any act for which this Lease requires Landlord’s prior consent, or if this Lease prohibits such act;

22.1.4 Any act of bankruptcy caused, suffered or permitted by Tenant or, if Tenant is a partnership, any general partner of Tenant. For purposes of this Lease, an “act of bankruptcy” shall include the following: (i) any general assignment or general arrangement for the benefit of creditors; (ii) the filing of any petition by or against Tenant to have Tenant adjudged a bankrupt, or a petition for reorganization or arrangement under any law relating to bankruptcy, unless such petition is filed against Tenant and the same is dismissed within ninety (90) days; (iii) the appointment of a trustee or receiver to take possession of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease; or (iv) the attachment, execution or other judicial seizure of substantially all of Tenant’s assets located at the Premises or of Tenant’s interest in this Lease.

22.1.5 The occurrence of a Default (as such term is or may hereafter be specifically defined therein and after giving effect to any applicable notice and cure period) under that certain Amended and Restated Single Tenant Absolute Net Lease (“Lease”) dated as of December 17, 2004, between Guilford Real Estate Trust 1998-1, a common law trust, and Tenant.

22.2 Rights of Landlord. Upon the occurrence, and during the continuance, of any Default, and in addition to any or all other rights or remedies of the Landlord hereunder or by law, Landlord, without further notice or demand of any kind to Tenant or any other person, shall have the following rights and remedies:

22.2.1 Landlord may continue this Lease in full force and effect and enforce all Landlord’s rights and remedies under this Lease, including the right to recover the Rent as it becomes due and any other amount necessary to compensate Landlord for all detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom. Landlord may sue monthly, annually or after such equal or unequal periods as Landlord desires for such amounts due.

22.2.2 Landlord shall use commercially reasonable efforts to mitigate its damages. Landlord (whether Landlord elects to continue this Lease in effect or terminate this Lease and Tenant’s right to possession hereunder) may reenter the Premises or take possession pursuant to legal proceedings or pursuant to any notice provided by law, and thereafter collect rent from existing sub-tenants of the Premises, if any, and(or) relet the Premises, in whole or in part, to third parties for Tenant’s account at such rent and upon such reasonable conditions and for such term as Landlord sees fit. Tenant shall pay to Landlord all costs actually and reasonably incurred in reletting the Premises or improvements thereon, including, without limitation, broker’s commissions, repairs, expenses of remodeling required by the reletting and like costs. Landlord may do all other acts necessary to maintain or preserve the Premises as Landlord deems reasonable and necessary, including removal of all persons and property, which property may be removed and stored in a public warehouse or elsewhere at the cost of and for the account of Tenant. If Landlord is able to so relet, rentals received by Landlord from such reletting shall be applied in the following order: (i) to the payment of any indebtedness other than Rent due hereunder from Tenant to Landlord; (ii) to the payment of any cost of such reletting; (iii) to the payment of the cost of any alterations and repairs; (iv) to the payment of Rent due and unpaid hereunder; (v) to the payment of any obligations of Tenant under any leasehold mortgage; and (vi) the residue, if any, shall be held by Landlord and applied in payment of future Rent as the same may become due and payable hereunder. If reletting results in the actual payment of rentals at less than the Rent payable during that month by Tenant as required hereunder, Tenant shall pay such deficiency to Landlord from time to time immediately upon demand therefor by Landlord.

22.2.3 Landlord, by written notice to Tenant, may terminate this Lease and Tenant’s right to possession of the Premises. No act by Landlord other than giving written notice to Tenant shall terminate this Lease. Acts of maintenance, reletting, or the appointment of a receiver on Landlord’s initiative shall not terminate this Lease. If Landlord elects to terminate this Lease, Landlord may recover all of the following:

(a) The worth at the time of award of the unpaid Rent which had been earned at the time of termination. “Worth at the time of award” shall be computed by allowing interest to accrue at the Default Rate from the first day a breach occurs.

(b) The worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Tenant proves could have been reasonably avoided. “Worth at the time of award” shall be determined by allowing interest at the Default Rate from the first day a breach occurs.

(c) The worth at the time of award of the amount by which the unpaid Rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Tenant proves could be reasonably avoided. “Worth at the time of award” shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank situated nearest the Premises at the time of award plus six percent (6%).

(d) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant’s failure to perform its obligations under this Lease or which in the ordinary course of events would be likely to result therefrom including, but not limited to, expenses of reletting, reasonable attorneys’ fees, costs of alterations and repairs, filing fees and any other expenses customarily resulting from obtaining possession of Premises and releasing.

(e) At Landlord’s election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable Maryland law.

22.2.4 If Tenant shall be in Default in the observance or performance of any term or covenant on Tenant’s part to be observed or performed under this Lease, Landlord may perform (but is not obligated to do so) the same for the account of Tenant, and if Landlord makes expenditures or incurs any obligation for the payment of money thereby, including, but not limited to, attorneys’ fees in instituting, prosecuting or defending any action or proceeding, such sums paid or obligations incurred, with interest thereon at the Default Rate, shall be deemed to be Additional Rent hereunder and shall be paid by Tenant to Landlord (without offset) immediately upon demand therefor.

22.2.5 Landlord, where permitted by applicable law, may seek to restrain any breach or threatened breach of any of Tenant’s obligations hereunder and/or may exercise any and all rights and remedies of a secured party under applicable law with respect to any property in which Landlord is granted a security interest under this Lease or otherwise.

22.3 Cumulative Remedies. Any right or remedy of Landlord under this Lease and any other right or remedy that Landlord may have at law, in equity or otherwise upon any Default or breach of any of the Tenant’s obligations hereunder shall be distinct, separate and cumulative rights or remedies and no right or remedy, whether exercised or not, shall be deemed to be in exclusion of any other.

22.4.2 The waiver by Landlord of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of such term, covenant or condition on any subsequent breach by Tenant. The acceptance of Rent hereunder by Landlord after any such breach shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular rental so accepted, regardless of Landlord’s knowledge of such preceding breach at the time of acceptance of such Rent. No covenant, term or condition of this Lease or breach thereof by Tenant shall be deemed to have been waived by Landlord unless such waiver is in a writing executed by Landlord.

22.4.3 Tenant hereby grants and assigns to Landlord a security interest in all accounts, inventory, fixtures, equipment and personal property of Tenant originating from or hereafter placed in, on or about the Premises to secure each and every obligation of Tenant under this Lease. Upon demand from Landlord, Tenant shall execute, acknowledge and deliver such documents or instruments as reasonably may be required by Landlord to perfect its security interest in the above described property.

22.5 Curing of Default. Notwithstanding any other provision of this Paragraph 22, if an event of Default, other than for the payment of Rent or other monies owing from Tenant to Landlord hereunder, is of such a nature that the same cannot be cured upon demand by Landlord as specified in any written notice relating thereto, then such event of Default shall be deemed to be cured if Tenant upon such notice shall have commenced to cure such Default and shall continue thereafter with all due diligence to so cure and does so complete the same within a reasonable period of time.

22.6 Landlord’s Default. If Landlord shall neglect or fail to perform or observe any of the covenants, provisions or conditions contained in this Lease on its part to be performed or observed within thirty (30) days after written notice of default (or if more than thirty (30) days shall be required because of the nature of the default, if Landlord shall fail to proceed diligently to cure such default after written notice thereof), Landlord shall be responsible to Tenant for any foreseeable and unavoidable damages sustained by Tenant as a result of Landlord’s breach.

22.7 Tenant’s Right to Perform. If, after such notice to Landlord and Assignee (as defined in Paragraph 22.9 below), if any, Landlord and Assignee shall fail to cure such default as provided herein, Tenant shall have the right, but not the obligation, to cure any such default at Landlord’s sole cost and expense including in such expenditure all costs and attorneys’ fees incurred to cure such default or breach of Lease. Tenant shall have no right to terminate this Lease for any such default by Landlord unless otherwise specifically provided in this Lease.

22.8 Abatement. Except as expressly otherwise provided herein, Landlord and Tenant hereby waive the provisions of any statutes, regulations, ordinances, or court decisions which relate to the abatement of rent or termination of leases when leased property is damaged or destroyed and agree that such event shall be exclusively governed by the terms of this Lease.

22.9 Tenant to Notify Mortgagees. If Landlord’s estate in the Premises or any part thereof is at any time subject to a mortgage or a deed of trust, and if this Lease or the rentals due from Tenant hereunder are assigned to such mortgagee, trustee or beneficiary (called an “Assignee” for purposes of this paragraph 22 only) and if Tenant is given written notice thereof, including the post office address of such Assignee, Tenant shall give written notice to such Assignee, specifying the default of Landlord in reasonable detail and affording such Assignee a reasonable opportunity to render performance for and on behalf of Landlord. If and when the Assignee has rendered performance on behalf of Landlord, such default shall be deemed cured.

23. LIMITATION OF LANDLORD’S LIABILITY. If Landlord is in default of this Lease, and as a consequence, Tenant recovers a money judgment against Landlord, the judgment shall be satisfied only out of the proceeds of sale received on execution of the judgment and levy against the right, title, and interest of Landlord in the Premises, and out of rent or other income from the Premises receivable by Landlord or out of the consideration received by Landlord from the sale or other disposition of all or any part of Landlord’s right, title, and interest in the Premises. Neither Landlord nor Landlord’s Agents shall be personally liable for any deficiency except to the extent liability is based upon willful and intentional misconduct. If Landlord is a partnership, joint venture, or limited liability company, the partners or members of such partnership or limited liability company, as the case may be, shall not be personally liable, and no partner or member of Landlord (or of any affiliated entity) shall be sued or named as a party in any suit or action, or service of process be made against any partner or member of Landlord (or of any affiliated entity), except as may be necessary to secure jurisdiction of the partnership, joint venture, or limited liability company or to the extent liability is caused by willful and intentional misconduct. If Landlord is a corporation, the shareholders, directors, officers, employees, and/or agents of such corporation shall not be personally liable, and no shareholder, director, officer, employee, or agent of Landlord shall be sued or named as a party in any suit or action, or service of process be made against any shareholder, director, officer, employee or agent of Landlord, except as may be necessary to secure jurisdiction of the corporation. No partner, member, shareholder, director, employee, or agent of Landlord (or of any affiliated entity) shall be required to answer or otherwise plead to any service of process and no judgment will be taken or writ of execution levied against any partner, member shareholder, director, employee, or agent of Landlord.

24.1 Tenant to Give Evidence of Subordination. Upon written request of Landlord, or any mortgagee or deed of trust beneficiary, or lessor of Landlord, Tenant in writing shall subordinate its rights hereunder to the lien of any mortgage or deed of trust now or hereafter in force against the land and buildings comprised of the Premises of which the Premises are a part, and upon any building hereafter placed upon the Premises, and to all advances made or hereafter to be made upon the security thereof; provided that Tenant obtains a non-disturbance agreement reasonably acceptable to Tenant from any such mortgagee or deed of trust beneficiary.

24.2 Attornment. If any proceedings are brought for foreclosure, or in the event of the exercise of the power of sale under any mortgage or deed of trust made by or to which the Landlord is subject covering the Premises, Tenant shall attorn to the purchaser or lessor under said lease upon any such foreclosure, sale or lease termination and recognize such purchaser or lessor as the Landlord under this Lease; provided, however, that the purchaser or lessor shall acquire and accept the Premises subject to this Lease.

24.3 Execution of Documents by Tenant. Tenant, upon request of any party in interest, shall duly execute in recordable form such instruments and certificates as are necessary to carry out the intent of this Paragraph 24.

25. QUIET POSSESSION. Subject to the provisions and matters referred to in Paragraph 14 of this Lease, Tenant, upon paying the Rent and performing the covenants and conditions of this Lease, may quietly have, hold and enjoy the Premises during the Lease Term.

26.1 Captions and Terms. The captions to all paragraphs of this Lease are for convenience only, are not a part of this Lease, and do not in any way limit or amplify the terms and provisions of this Lease. The masculine pronoun used herein shall include the feminine or the neuter as the case may be, and the use of the singular shall include the plural when appropriate.

26.2 Obligations of Successors. Each of the provisions hereof are to be construed as covenants and agreements as though the words importing such covenants and agreements were used in each separate paragraph hereof, and all of the provisions hereof shall bind and inure to the benefit of the parties hereto, and their respective heirs, legal representatives, successors and assigns (subject to any restrictions on assignment).

26.3 No Joint Venture. Nothing contained in this Lease shall be deemed or construed as creating a partnership, joint venture or any other relationship between the parties hereto other than Landlord and Tenant according to the provisions contained herein, or cause Landlord to be responsible in any way for the debts or obligations of Tenant or any other party.

26.4 Authority of Tenant. If Tenant is a corporation, the persons executing this Lease on behalf of Tenant hereby covenant and warrant that they have the authority to enter into this Lease, that Tenant is a corporation in good standing in the state of its origination, all steps have been taken prior to the date hereof to qualify Tenant to do business in the State of Maryland, all franchise and corporate taxes have been paid to date, and that all future forms, reports, fees and other documents necessary to comply with applicable laws will be filed when due.

26.5 No Right of Redemption. Tenant hereby expressly waives any and all rights of redemption granted by or under any present or future laws in the event of Tenant being lawfully evicted or dispossessed for any cause, or in the event of Landlord obtaining possession of the premises by reason of a Default by Tenant hereunder.

26.6 Holding Over. If Tenant remains in possession of the Premises (a) after the expiration of the Lease Term without executing a new lease, or (b) after Landlord has declared a forfeiture by reason of a Default by Tenant, then such holding over shall be construed as a tenancy at sufferance from month-to-month, subject to all the conditions, provisions and obligations of this Lease insofar as they are applicable to a month-to-month tenancy, except that the Monthly Rent shall be one hundred twenty-five percent (125%) of the Monthly Rent last due, payable monthly in advance. Notwithstanding the foregoing, if Tenant fails to vacate the Premises and fulfill all of its obligations hereunder at the end of the Lease Term, Tenant also shall be liable for all damages incurred by Landlord by reason of the latter’s inability to deliver possession of the Premises or any portion thereof to any other person.

26.7 Brokers. Tenant and Landlord each warrants and represents that it has had no dealings with any real estate brokers or agents in connection with the negotiation of this Lease other than Colliers Pinkard and CB Richard Ellis, and it knows of no other real estate broker or agent who is entitled to a commission in connection with this Lease. Tenant and Landlord each shall defend, indemnify and hold the other harmless from and against any and all Claims by any person for any finder’s fees or brokerage fees incurred as a result of any action by such indemnifying party.

26.8 Non-Merger. There shall be no merger of this Lease, or of the leasehold estate created hereby, with the fee estate in and to the Premises by reason of the fact that this Lease, or the leasehold estate created hereby, or any interest in either thereof, may be held directly or indirectly by or for the account of any person who shall own the fee estate in and to the Premises, or any portion thereof, and no such merger shall occur unless and until all persons at the time having any interest in the fee estate and all persons having any interest in this Lease or the leasehold estate, shall join in a written instrument effecting such merger.

26.9 Recordation of Lease. Neither Landlord nor Tenant shall record this Lease or any other document relating to this Lease without the prior written consent of the other party.

26.10 Notices. No notice, request, demand, instruction or other document to be given hereunder to any party shall be effective for any purpose unless personally delivered to the person or delivered by reputable overnight courier, to the addresses set forth in Paragraph 2 above. Notice shall be deemed to have been given when received, if by personal delivery, or the next business day after the date of the courier’s receipt of mailing, if by reputable overnight courier. Notice shall not be deemed given unless and until, under the preceding sentence, notice shall be deemed given to all addressees to whom notice must be sent. The addresses and addressees for the purpose of this paragraph may be changed by giving written notice of such change in the manner herein provided for giving notice. Unless and until such written notice is received, the last address and addressee as stated by written notice, or provided herein if no written notice of change has been sent or received, shall be deemed to continue in effect for all purposes hereunder.

26.11 Attorneys’ Fees. If any action or proceeding (judicial or nonjudicial) is commenced to enforce or interpret this Lease, the prevailing party shall be entitled to recover reasonable attorneys’ fees and costs, together with all other costs and fees incurred by it in attempting to enforce the other party’s obligations and/or to protect its rights under this Lease, whether or not such action or proceeding proceeds to judgment.

26.12 No Other Agreements. This Lease represents the entire agreement between the parties hereto and supersedes any and all previous written or oral agreements or discussions between said parties and any other person or legal entity concerning the transactions contemplated herein. There are no representations, warranties or agreements except as specifically set forth in this Lease or to be set forth in the instruments or other documents delivered or to be delivered hereunder.

26.13 Amendments. No change in or addition to, or waiver or termination of this Lease, or any part hereof, shall be valid unless in writing and signed by or on behalf of the parties hereto.

26.14 No Third Party Benefit. The parties acknowledge and agree that the provisions of this Lease are for the sole benefit of Landlord and Tenant, and not for the benefit, directly or indirectly, of any other person or entity, except as otherwise expressly provided herein.

26.15 Exhibits. Each of the Exhibits attached hereto is hereby incorporated herein by this reference.

26.16 Severability. If any one or more of the provisions of this Lease are held to be invalid, illegal or unenforceable in any respect or for any reason, the validity, legality and enforceability of such provision or provisions in every other respect and of the remaining provisions of this Lease shall not in any way be impaired.

26.17 Governing Law/Jurisdiction. This Lease shall, in all respects, be interpreted, enforced and governed by and under the laws of the State of Maryland.

26.18 Venue. The parties hereby expressly acknowledge and agree that if an action is brought with respect to this Lease, sole and proper venue for such action shall be in the City of Baltimore, State of Maryland.

26.19 Time Time is hereby expressly made of the essence with respect to each and every term and condition of this Lease.

26.20.1 Inspection. Tenant shall permit Landlord and Landlord’s agents to enter the Premises at all reasonable times after reasonable notice for the purpose of inspecting the same and for the purpose of exercising any of its other rights or performing any of its obligations under this Lease.

26.20.2 Sale or Lease of Premises. Landlord may at any time place on or about the Premises any ordinary “For Sale” signs, and at any time within eighteen (18) months prior to the expiration of this Lease, place on or about the Premises any usual or ordinary “For Lease” signs. Landlord may enter the Premises at reasonable times upon reasonable prior notice and when accompanied by a representative of Tenant during the Lease Term to show the Premises to prospective tenants, lenders, investors, or purchasers. In exercising its rights under this Paragraph 26.20.2, Landlord and Landlord’s invitees shall not unreasonably interfere with Tenant’s use or occupancy of the Premises, shall abide by Tenant’s safety practices and, except for true emergencies in which the health or safety of persons are in immediate danger, when necessary to save the destruction of significant property or when Landlord has provided reasonable prior notice (including the timing and scope) of an inspection by a prospective purchaser, investor, lender or insurer of the Premises, shall not under any circumstances have access to areas with confidential or proprietary information related to Tenant’s business.

26.20.3 Waiver. Landlord shall be permitted to enter upon the Premises in accordance with the terms hereof for any of the purposes stated herein without any liability to Tenant for any loss of occupation or quiet enjoyment resulting therefrom, except resulting from Landlord’s or its Agents’ gross negligence or willful misconduct, and Tenant hereby waives any claim for abatement of rent or for damages for any injury or inconvenience to or interference with Tenant’s business, any loss of occupancy or quiet enjoyment, or any other loss occasioned thereby.

26.21 Estoppel Certificates. Tenant shall at any time during the Lease Term, but not more frequently than four times per year, within ten (10) days after written request from Landlord, execute and deliver to Landlord a statement in writing in the form of the document attached hereto as Exhibit ”D”, or any reasonable equivalent requested by Landlord, certifying that this Lease is unmodified and in full force and effect or, if modified, stating the nature of such modification. Tenant’s statement shall include such other details as may be reasonably requested by Landlord. Any such statement may be relied upon conclusively by any existing or prospective purchaser or lender. Tenant’s failure to deliver such statements within such time shall be conclusive upon Tenant that this Lease is in full force and effect, except to the extent any modification has been represented in writing by Landlord to such prospective purchaser or lender, that there are no uncured defaults in Landlord’s performance, and that not more than one month’s rent has been paid in advance.

26.22 No Surrender. Except to the extent expressly provided for herein, no event or occurrence during the Lease Term, whether foreseen or unforeseen, however extraordinary, shall permit Tenant to surrender or terminate this Lease or shall relieve Tenant from any of its obligations hereunder, and Tenant waives any rights now or hereafter conferred upon it by statute or otherwise, except any rights set forth herein, to surrender or terminate this Lease or to claim any abatement or suspension of Rent or other sums payable hereunder on account of any such event or occurrence.

26.23 Consent of Landlord and Tenant. Whenever Landlord or Tenant is required to give its consent or approval to any action on the part of the other, such consent or approval shall not be unreasonably withheld, conditioned or delayed, unless otherwise expressly provided. In the event of failure to give any such consent, the other party hereto shall be entitled to specific performance at law and shall have such other remedies as are reserved to it under this Lease; provided, however that in no event shall Landlord or Tenant be responsible in monetary damages for such failure to give consent unless said consent is withheld maliciously or in bad faith.

26.24 Binding Effect. This Lease shall not be effective until fully executed by both Landlord and Tenant.

26.26 Furnishing of Financial Statements and Tenant’s Representations. To induce Landlord to enter into this Lease, Tenant agrees, at any time that Tenant is not required to publicly file such financial statements pursuant to the Securities Exchange Act of 1934, as amended, or any successor statute, it shall promptly furnish to Landlord, from time to time, upon Landlord’s written request, the most recent audited year-end financial statements reflecting Tenant’s current financial condition. Tenant represents and warrants that all financial statements, records and information furnished by Tenant to Landlord in connection with this Lease are true, correct and complete in all respects.

26.27 Absolute Net Lease. This Lease shall be deemed and construed to be an “absolute net lease” and, except as herein expressly provided, the Landlord shall receive all payment required to be made by Tenant, free from all charges, assessments, impositions, expenses, deductions of any and every kind or nature whatsoever. Landlord shall not be required to furnish any services or facilities or to make any repairs, replacements, or alterations of any kind in or on the Premises. Tenant shall receive all invoices and bills relative to the Premises and, except as otherwise provided herein, shall pay for all expenses directly to the person or company submitting a bill without first having to forward payment for the expenses to Landlord. Tenant shall at Tenant’s sole cost and expense be responsible for the management of the Premises, shall maintain the landscaping, parking lot and shall make all additional repairs and alterations as required to maintain the property in first class condition.

26.28 Interpretation. This Lease has been negotiated at arm’s length and between persons sophisticated and knowledgeable in the matters dealt with in this Lease. In addition, each party has been represented by experienced and knowledgeable legal counsel. Accordingly, any rule of law or legal decision that would require interpretation of any ambiguities in this Lease against the party that has drafted it is not applicable and is waived. The provisions of this Lease shall be interpreted in a reasonable manner to effect the purpose and intent of the parties to this Lease.

26.29 Waiver of Jury Trial and Counterclaims. THE PARTIES HERETO SHALL AND THEY HEREBY DO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT’S USE OR OCCUPANCY OF THE PREMISES, AND OR ANY CLAIM OF INJURY OR DAMAGE.

27.1.1 Upon the expiration of the Lease Term or earlier termination hereof through the exercise of any option to terminate this Lease granted herein (collectively referred to as the “Surrender Date”), title to the Building and the Premises shall be vested in Landlord. Thereupon, Tenant shall peaceably and quietly vacate the entire Premises, including the Building (a) in good order, condition and repair, except for normal wear and tear; and (b) free and clear of all lettings, occupancies, agreements, easements, encumbrances or other liens other than those to which this Lease was subject on the Lease Commencement Date and those caused, created by or consented to in writing by Landlord or otherwise permitted by the terms hereof.

27.1.2 Notwithstanding the exercise by either party of any option contained herein to terminate this Lease, any unsatisfied obligations of Tenant accruing on or prior to the Surrender Date and the indemnification provisions of Tenant contained in Paragraphs 15.1 and 20.5 shall survive the Surrender Date unless excused as of the Surrender Date by the provisions elsewhere contained in this Lease.

27.2 Re-Entry by Landlord. Upon the Surrender Date, Landlord, without further notice, may enter upon, re-enter, possess and repossess itself of the Premises, by summary proceedings, ejectment or otherwise, may dispossess and remove Tenant and all other persons and property from the Premises, and may have, hold and enjoy the Premises and the right to receive all Rent and other income of and from the same. As used in this Lease, the words “enter” and “re-enter” are not restricted to their technical legal meanings.

27.3 Tenant’s Equipment. Any of Tenant’s Equipment (as defined in Paragraph 13.2 above) or other personal property which shall remain on the Premises after the Surrender Date and the removal of Tenant from the Premises, at the option of Landlord, may be deemed to have been abandoned by Tenant or any Subtenant and either may be retained by Landlord as its property or be disposed of, without accountability, in such manner as Landlord may see fit. However, Landlord also shall have the right to require Tenant to remove any such equipment or other personal property at any time after the Surrender Date and the removal of Tenant from the Premises at Tenant’s own cost and expense and to repair any damage to the Premises resulting from such removal. From and after the Surrender Date, Landlord shall not be responsible for any loss or damage occurring to any property owned by Tenant or any Subtenant.

27.4 Survival. The provisions of this Paragraph 27 shall survive the Surrender Date.

WHEREFORE, the parties hereto have executed this Lease effective on the Effective Date first set forth above.


GUILFORD PHARMACEUTICALS INC.	BMR-6611 TRIBUTARY STREET LLC,
a Delaware corporation	a Maryland limited liability company
By: /s/ Asher M. Rubin

Name: Asher M. Rubin	By: BioMed Realty, L.P.,
—	its Member
Title: Senior Vice	By: /s/ Gary A. Kreitzer
President, General Counsel		—
and Secretary	Name: Gary A. Kreitzer
—	Title: Executive Vice President

BEING KNOWN AND DESIGNATED as Lot 5, Section 5 as shown on amended subdivision of Holabird Industrial Park and recorded among the Land Records of Baltimore City in
Plat Book SEB No. 2959 and 2960.

TOGETHER with the non-exclusive easement contained in Easement Agreement dated
January 16, 1990 between P. Fred K. Obrecht Management Co. and Crown Royal Limited
Partnership and recorded among the Land Records of Baltimore City in Liber SEB No.

Pursuant to Item 601(b)(2) of Regulation S-K promulgated by the Securities and Exchange Commission (the “Commission”) the exhibit to this Lease identified below has been omitted. This exhibit will be furnished supplementally to the Commission upon request.

THIS ACKNOWLEDGEMENT OF LEASE COMMENCEMENT DATE is made as of December 17, 2004, with reference to that certain that certain Amended and Restated Single Tenant Absolute Net Lease (“Lease”) dated December 17, 2004, between BMR-6611 Tributary Street LLC, a Maryland limited liability company (“Landlord”), and Guilford Pharmaceuticals Inc., a Delaware corporation (“Tenant”), for the Premises described in the Lease in the Building at 6611 Tributary Street, Baltimore, Maryland (“Premises”). All capitalized terms used herein without definition shall have the meaning ascribed to them in the Lease.

1. That the Tenant accepted possession of the Premises on December 17, 2004, and acknowledges that the Premises are in good order, condition and repair.

2. That all conditions of the Lease to be performed by Landlord prerequisite to the full effectiveness of the Lease have been satisfied; and that Landlord has fulfilled all of its duties of an inducement nature.

3. That in accordance with the provisions of Paragraph 4.1 of the Lease, the Lease Commencement Date is December 17, 2004, and that, unless extended or sooner terminated, the Lease Term expires on December 16, 2019.

4. That the Lease is in full force and effect, and that the same (including all exhibits thereto) represents the entire agreement between Landlord and Tenant concerning the Premises.

5. That there are no existing defenses which Tenant has against the enforcement of the Lease by Landlord, and there exist no offsets or credits against rent.

6. That the undersigned Tenant has not made any prior assignment, hypothecation or pledge of the Lease or of the rents thereunder.

IN WITNESS WHEREOF, the parties hereto have executed this Acknowledgment of Rent Commencement Date as of December 17, 2004.


TENANT:		LANDLORD:
GUILFORD PHARMACEUTICALS INC.,		BMR-6611 TRIBUTARY STREET LLC,
a Delaware corporation		a Maryland limited liability company
By:	—	By: BioMed Realty, L.P.,
Name:	—	its Member
Title:	—
		By: ________________________
		Name: Gary A. Kreitzer
		Title: Executive Vice President


To:		BMR-6611 Tributary Street LLC 17140 Bernardo Center Drive, Suite 222 San Diego, CA 92128 Attention: Mr. Alan D. Gold

		BioMed Realty, L.P. c/o BioMed Realty Trust, Inc. 17140 Bernardo Center Drive, Suite 222 San Diego, CA 92128

Re:		6611 Tributary Street Baltimore, Maryland (the “Property”)

		Premises at Property: 6611 Tributary Street (the “Premises”)

Tenant is a tenant at the Property under a lease (the “Lease”) dated for the Premises; the Lease has not been cancelled, modified, assigned, extended or amended except as follows: , and there are no other agreements, written or oral, affecting or relating to Tenant’s lease of the Premises or any other space at the Property. The lease term expires on .

Tenant took possession of the Premises, currently consisting of square feet, on and commenced to pay rent on . The Tenant has full possession of the Premises, has not assigned the Lease or sublet any part of the Premises and does not hold the Premises under an assignment or sublease, except: .

All base rent, rent escalations and additional rent under the Lease has been paid through . There is no prepaid rent, except $ , and the amount of security deposit is $ [in cash] [in the form of a letter of credit]. Tenant currently has no right to any future rent abatement under the Lease.

Tenant is currently paying estimated payments of additional rent of $ per month on account of real estate taxes, insurance, management fees and common area maintenance expenses.

6. The Tenant has full possession of the Premises, has not assigned the Lease or sublet any part of the Premises and does not hold the Premises under an assignment or sublease, except .

7. All work to be performed for Tenant under the Lease has been performed as required under the Lease and has been accepted by Tenant, except , and all allowances to be paid to Tenant, including allowances for tenant improvements, moving expenses or other items, have been paid.

8. The Lease is in full force and effect, free from default and free from any event which could become a default under the Lease and Tenant has no claims against the landlord or offsets or defenses against rent, and there are no disputes with the landlord. Tenant is not currently entitled to any rent abatement.

9. The Tenant has received no notice of prior sale, transfer or assignment, hypothecation or pledge of the Lease or of the rents payable thereunder, except .

12. To Tenant’s knowledge, no hazardous wastes have been generated, treated, stored, or disposed of by or on behalf of the Tenant on the Premises in violation of any environmental laws.

The undersigned has executed this Estoppel Certificate with the knowledge and understanding that is relying on this Estoppel Certificate and that the undersigned will be bound by this Estoppel Certificate. The statements contained herein may be relied upon by , and any mortgagee of the Property and their respective successors and assigns.

This AMENDED AND RESTATED SINGLE TENANT ABSOLUTE NET LEASE (“Lease”) is made as of December 17, 2004 (“Effective Date”), BETWEEN Guilford Real Estate Trust 1998-1, a common law trust (“Landlord”), and Guilford Pharmaceuticals Inc., a Delaware corporation (“Tenant”), who agree as follows:

This Lease is executed by Landlord and Tenant in contemplation of the following facts and circumstances:

A. Landlord is the owner of certain real property located in the City of Baltimore, State of Maryland, commonly known as 6411 Beckley Street and more particularly described on Exhibits “A” and “B” which are attached and made a part of this Lease. The land consists of approximately 4.56 acres (together with any easements and appurtenances thereto, the “Land”) with an existing building containing approximately 77,225 square feet of space (the “Building”). The Land and the Building are collectively referred to as the “Premises.”

B. Landlord and Tenant entered into that certain Lease Agreement dated as of February 5, 1998 (as amended, the “Original Lease”), pursuant to which Tenant leased the Premises from Landlord. Landlord and Tenant now desire to amend and restate the Original Lease upon the terms and conditions contained in this Lease in complete replacement of the Original Lease.

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1.4 “HVAC” shall mean all heating, ventilation and air conditioning equipment and all equipment and fixtures related thereto.

1.5 “Lease Commencement Date” shall be the date BioMed Realty, L.P. acquires direct or indirect ownership of Landlord.

1.6 “Lease Term” shall mean the period commencing with the Lease Commencement Date and ending after the term described in Paragraph 4.1.

1.7 “Lender” shall mean any lender whose loan is secured by a deed of trust on any part of the Premises or this leasehold interest.

1.8 “Rent” shall include all Monthly Rent, Additional Rent and all other sums of any and every sort payable hereunder to Landlord by Tenant.

1.9 “Security Deposit” shall be $787,500.00 or as may be adjusted pursuant to Paragraph 5.


Initial Lease Term:		15 years

Rentable Area:		77,225 square feet

Initial Annual Rent:		$1,575,000.00, subject to annual adjustments pursuant to Paragraph 5

Initial Monthly Rent:		$131,250.00, subject to annual adjustments pursuant to Paragraph 5

Security Deposit:		$787,500.00, subject to adjustments pursuant to Paragraph 5

Lease Commencement Date:		The date BioMed Realty, L.P. acquires direct or indirect ownership of Landlord.



Address for Notices:

To Landlord:		c/o BioMed Realty, L.P. 17140 Bernardo Center Drive,Suite 222 San Diego, California 92128 Attention: Gary A. Kreitzer, Esq.

To Tenant:		Guilford Pharmaceuticals Inc. 6611 Tributary Street Baltimore, Maryland 21224 Attention: Asher Rubin, Esq.

Exhibits:		A (Legal Description) B (Site Plan) C (Acknowledgement of Lease Commencement Date) D (Estoppel Certificate)