FIRST AMENDMENT TO LEASE AGREEMENT

THIS FIRST AMENDMENT TO LEASE AGREEMENT (the “Amendment”) is made this 11th day of March, 2009, by and between MOR BEN, LLC , a Maryland limited liability company (“Landlord”), successor-in-interest to MOR Bennington LLLP and GENVEC, INC. , a Delaware corporation (“Tenant”).

THE PARTIES ENTER INTO THIS AMENDMENT on the basis of the following facts, understandings and intentions.

A.           Landlord’s predecessor-in-interest, MOR Bennington LLLP, and Tenant entered into a Lease Agreement (the “Lease”) dated May 4, 1999 for the premises (the “Premises” or “Leased Premises”) consisting of approximately 42,900 square feet of space, being the entire single story building located at 65 West Watkins Mill Road, Gaithersburg, Maryland  20879.

B.           At Tenant’s request, Tenant and Landlord have agreed to extend the term of the Lease and amend certain terms of the Lease in accordance with the terms hereof.

NOW THEREFORE, IN CONSIDERATION of the mutual covenants and promises of the parties, the parties hereto agree as follows:

1.            Defined Terms .   All capitalized terms used but not defined herein shall have that meaning given to them in the Lease.

2.            Extension of Lease Term .   (a)  The Lease Term is hereby extended through and until October 31, 2014.  The Tenant shall have one further right to extend the Lease Term for a period of five (5) years, pursuant to the second renewal option set forth in Rider No. 3 of the Lease.  For this purpose, the first paragraph of subparagraph (ii) of Rider No. 3 of the Lease is hereby amended to read as follows:

(ii) the Basic Annual Rent payable with respect to the Leased Premises shall be adjusted to reflect the then prevailing rental rate (but in no event less than the current Basic Annual Rent) for comparable space within Bennington Corporate Center and comparable buildings in the vicinity of the Bennington Corporate Center as of the commencement of the renewal term (as determined below).

(b)           Except as provided for in Section 2(a) above, Tenant shall have no other or further options to extend or renew the Lease Term.  The extension option provided for Paragraph II A.2 of the Lease is null and void.

3.            Basic Annual Rent .   From the date hereof through and until October 31, 2009, the Tenant shall pay the Landlord all Basic Annual Rent set forth in Paragraph III B of the Lease.  Commencing on November 1, 2009, and on the first day of each calendar month thereafter during the Lease Term, Tenant will pay to Landlord the Basic Annual Rent set forth below for the Leased Premises in equal monthly installments, in lawful money of the United States, in advance and without offset, deduction prior notice or demand, in accordance with the Lease:

4.            Additional Rent .  Tenant shall continue to pay all additional rent due under the Lease for the Leased Premises.

5.            Security Deposit .

5.1           In the event that Tenant determines to use the Landlord’s Allowance (as defined in Section 3 of Exhibit A attached hereto), then as a condition to Landlord’s obligation to disburse all or any portion of Landlord’s Allowance in accordance with Section 3 of Exhibit A attached hereto, and prior to Landlord’s disbursement of any of the Landlord’s Allowance, Tenant shall deposit the sum of $143,000 (the “Security Deposit”) with Landlord in accordance with the terms of this Section 5.  The Security Deposit shall be held by Landlord as security for the faithful performance by Tenant of all the terms, covenants and conditions of the Lease to be kept and performed by Tenant and not as an advance rental deposit or as a measure of Landlord’s damage in case of Tenant’s default.  If an Event of Default occurs and is continuing under the Lease, Landlord may use any part of the Security Deposit for the payment of any 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, or to compensate Landlord for any other loss or damage which Landlord may suffer by reason of Tenant’s default.  If any portion of the Security Deposit is so used, Tenant shall within ten (10) days after written demand therefore, deposit with Landlord an amount sufficient to restore the Security Deposit to its original amount and Tenant’s failure to do so shall constitute an Event of Default under the Lease.  Except to such extent, if any, as shall be required by law, Landlord shall not be required to keep the Security Deposit separate from its general funds, and Tenant shall not be entitled to interest on such deposit.  In the event that the Security Deposit has not been fully released prior to the termination of the Lease, then following the termination of the Lease, the Security Deposit or any balance thereof shall be returned to Tenant at such time when Landlord shall have determined that all of Tenant’s obligations under the Lease have been fulfilled, but not later than sixty (60) days following the termination of the Lease.

5.2           The required Security Deposit shall be in the form of an irrevocable standby letter of credit in favor of Landlord (the “letter of credit”) in the amount of $143,000.  Under any circumstance under which Landlord is entitled the use of all or a part of the Security Deposit, then, Landlord, in addition to all other rights and remedies provided under the Lease, shall have the right to draw down upon the letter of credit for the amount then claimed by Landlord and retain the proceeds.  The following terms and conditions shall govern the letter of credit:

5.2.1           The letter of credit shall be returned to Tenant at the expiration of the Lease Term or such earlier date when Tenant is entitled to return of its Security Deposit under Section 5.3 below.

5.2.2           The letter of credit shall be in favor of Landlord, shall be issued by a commercial bank reasonably acceptable to Landlord having a Standard & Poors rating of “A” or better, and branches in either Northern Virginia, Washington, D.C. or Baltimore, Maryland, shall comply with all of the terms and conditions of this Section 5.2 and shall otherwise be in form reasonably acceptable to Landlord.  The initial letter of credit shall have an expiration date not earlier than fifteen (15) months after the date of its issuance.  A draft of the form of letter of credit must be submitted to Landlord for its approval prior to issuance.

5.2.3           The letter of credit or any replacement letter of credit shall be irrevocable for the term thereof and shall automatically renew on a year to year basis until a period ending not earlier than three (3) months after the expiration date of the Lease (“End Date”) without any action whatsoever on the part of Landlord; provided that the issuing bank shall have the right not to renew the letter of credit by giving written notice to Landlord not less than sixty (60) days prior to the expiration of the then current term of the letter of credit that it does not intend to renew the letter of credit.   Tenant understands that the election by the issuing bank not to renew the letter of credit shall not, in any event, diminish the obligation of Tenant to maintain such an irrevocable letter of credit in favor of Landlord through such date.

5.2.4           Landlord, or its then managing agent, shall have the right from time to time to make one or more draws on the letter of credit at any time that an Event of Default has occurred.  The letter of credit must state that it can be presented for payment at the office of the issuer or an approved correspondent in the Northern Virginia, Washington D.C. or Baltimore, Maryland.  Funds may be drawn down on the letter of credit upon presentation to the issuing or corresponding bank of Landlord’s (or Landlord’s then managing agent’s) certificate stating as follows:

“Beneficiary is entitled to draw on this credit pursuant to that certain Lease dated for reference _______________ between [INSERT CURRENT NAME OF LANDLORD] , as Landlord and [INSERT CURRENT NAME OF TENANT], as Tenant, as amended from time to time.”

It is understood that if Landlord or its managing agent be a corporation, partnership or other entity, then such statement shall be signed by an officer (if a corporation), a general partner (if a partnership), or any authorized party (if another entity).

5.2.5           Tenant acknowledges and agrees (and the letter of credit shall so state) that the letter of credit shall be honored by the issuing bank without inquiry as to the truth of the statements set forth in such draw request and regardless of whether the Tenant disputes the content of such statement.

5.2.6           In the event of a transfer of Landlord’s interest in the Leased Premises, Landlord shall have the right to transfer the letter of credit to the transferee and thereupon the Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefore, and it is agreed that the provisions hereof shall apply to every transfer or assignment of said letter of credit to a new landlord; and Tenant shall pay all fees to the issuer necessary to effect and evidence such transfer.

5.2.7           Without limiting the generality of the foregoing, if the letter of credit expires earlier than the End Date, or the issuing bank notifies Landlord that it will not renew the letter of credit, Landlord shall accept a renewal thereof or substitute letter credit (such renewal or substitute letter of credit to be in effect not later than thirty (30) days prior to the expiration of the expiring letter of credit), irrevocable and automatically renewable as above provided to the End Date upon the same terms as the expiring letter of credit or upon such other terms as may be reasonably acceptable to Landlord.  However, if (i) the letter of credit is not timely renewed, or (ii) a substitute letter of credit, complying with all of the terms and conditions of this Section is not timely received, then Landlord may present the expiring letter of credit to the issuing bank, and the entire sum so obtained shall be paid to Landlord, to be held by Landlord until Tenant would otherwise be entitled to the return of the letter of credit, and to be retained by Landlord if a default occurs, provided that if Tenant provides Landlord with a new letter of credit for the full amount of the Security Deposit in accordance with the requirements for a letter of credit set forth above, then Landlord shall refund Tenant the cash Security Deposit that it is holding.

5.3           Provided that no Event of Default has occurred and is continuing under this Lease, then on the first day of the 25 ^th month following the date of Landlord’s receipt of the letter of credit, the Security Deposit shall be reduced by $47,666, and on the first day of the 37 ^th month following the date of Landlord’s receipt of the letter of credit, the Security Deposit shall be reduced by another $47,666, and on the first day of the 49 ^th month following the date of Landlord’s receipt of the letter of credit, the Security Deposit shall be reduced to zero dollars and released.

Each reduction to the letter of credit as set forth below shall be processed by an amendment to the letter of credit or a replacement letter of credit, as reasonably approved by Landlord.

6.            As Is Condition .  The Leased Premises shall be leased to Tenant for the Lease Term in “As Is” condition, provided that, to the extent that Tenant provides Landlord with the Security Deposit of $143,000 as set forth in Section 5 above, then Landlord shall provide Tenant with the improvement allowance described on Exhibit A hereto, subject to the terms and conditions set forth on Exhibit A hereto.

7.            Use .  The following new paragraph is hereby added to the end of Article IV A of the Lease (Use Restrictions and Rules) to read as follows:

The Leased Premises are to be used solely for purposes set forth in this Lease.  Tenant shall not do or permit anything to be done in or about the Leased Premises which will in any way unreasonably obstruct or interfere with the rights of other tenants or occupants of the Building, if any, or injure, annoy, or disturb them, or allow the Leased Premises to be used for any improper, immoral, unlawful, or objectionable purpose, or commit any waste.  Tenant shall not do, permit or suffer in, on, or about the Leased Premises the sale of any alcoholic liquor without the written consent of Landlord first obtained.  Tenant shall comply in all material respects with all governmental laws, ordinances and regulations applicable to the use of the Leased Premises and its occupancy and shall promptly comply with (or properly contest, if applicable), all governmental orders and directions for the correction, prevention and abatement of any violations in the Building or appurtenant land, caused or permitted by, or resulting from the specific use by, Tenant, or in or upon, or in connection with, the Leased Premises, all at Tenant’s sole expense.  Except as otherwise expressly permitted in this Lease, Tenant shall not do or permit anything to be done on or about the Leased Premises or bring or keep anything into the Leased Premises which will in any way increase the rate of, invalidate or prevent the procuring of any insurance protecting against loss or damage to the Building or any of its contents by fire or other casualty or against liability for damage to property or injury to persons in or about the Building or any part thereof.  To the extent the terms of the above conflict with any provisions of Article IV A, the above terms shall govern.

8.            Tenant’s Insurance .   (a)  The first paragraph of Paragraph IV E of the Lease is hereby deleted in its entirety and the following replacement paragraph is hereby inserted in lieu thereof:

Tenant shall keep in force throughout the Term: (a) a Commercial General Liability insurance policy or policies to protect Landlord and its managing agent at the Property against liability to the public or to any invitee of Tenant or a Landlord Entity incidental to the use of or resulting from any accident occurring in or upon the Leased Premises with a limit of not less than $1,000,000 per occurrence and not less than $2,000,000 in the annual aggregate, or such larger amount as Landlord may prudently require from time to time, covering bodily injury and property damage liability and $1,000,000 products/completed operations aggregate; (b) Business Auto Liability covering owned, non-owned and hired vehicles with a limit of not less than $1,000,000 per accident; (c) Worker’s Compensation Insurance with limits at least as required by statute and Employers Liability with limits of $500,000 each accident, $500,000 disease policy limit, $500,000 disease--each employee; (d) All Risk or Special Form coverage protecting Tenant against loss of or damage to Tenant’s alterations, additions, improvements, carpeting, floor coverings, panelings, decorations, fixtures, inventory and other business personal property situated in or about the Leased Premises to the full replacement value of the property so insured; an