LEASE

Exhibit 99.2

LEASE

[Phase 3 Properties / Icagen, Inc.]

[8,932 SF]

THIS LEASE (“ Lease ”) is dated for reference purposes only August 8, 2007, by and between 3908 PATRIOT DRIVE LLC, a Delaware limited liability company (“ Landlord ”), and ICAGEN, INC., a Delaware corporation (“ Tenant ”).

1. Lease Premises .

1.1 Landlord hereby leases to Tenant and Tenant hereby leases from Landlord during the term of this Lease, on the terms and conditions set forth herein, those certain premises (“ Premises ”) consisting of 8,932 square feet of Rentable Area in the existing building (“ Building ”) located at 3908 Patriot Drive, Durham, North Carolina, on real property legally described on Exhibit “A” attached hereto, together with all parking rights herein provided and all appurtenances and other rights with respect thereto (“ Property ”). The Building consists of 48,394 square feet of Rentable Area, and the Premises constitute 18.46% of the Building. The Building, the Property, and all landscaping, parking facilities, and other improvements and appurtenances related thereto are hereinafter collectively referred to as the “ Project .” The site plan for the Project is attached hereto as Exhibit “B”, and the Premises are outlined on Exhibit “C”. All portions of the Project which are for the non-exclusive use of tenants of the Project, including without limitation equipment rooms and exterior roadways, driveways, sidewalks, parking areas, and landscaped areas, are indicated on the Exhibit B and hereinafter referred to as “ Common Areas .”

2. Basic Lease Provisions .

2.1 For convenience of the parties, certain basic provisions of this Lease are set forth herein, which provisions are subject to the remaining terms and conditions of this Lease and are to be interpreted in light of such remaining terms and conditions.

1

2.2. The following exhibits are attached hereto and incorporated herein by this reference:

3. Term .

3.1 This Lease shall take effect and be binding upon and inure to the benefit of Landlord and Tenant from the date of execution hereof by each of the parties hereto. Landlord hereby tenders possession of the Premises to Tenant. Tenant, upon acceptance of possession of the Premises, shall comply with all terms of this Lease (other than the payment of Rent, which shall commence as set forth in Section 3.2).

2

3.2 Tenant’s obligation to pay Rent shall commence on the Commencement Date set forth above. The term of this Lease shall end (the “ Term Expiration Date ”) five (5) years from the Commencement Date, subject to earlier termination of this Lease or extension of the term as provided herein. Landlord and Tenant shall execute a written acknowledgment of the Commencement Date and the Term Expiration Date when such is established in substantially the form attached hereto as Exhibit “D” and attach it to this Lease as Exhibit “D-1”; provided, however, failure to execute and deliver such acknowledgment shall not affect Tenant’s liability hereunder.

3.3 The Commencement Date as defined in Section 3.2 above shall be delayed one (1) day for each one (1) day of delay in the event of a Landlord Delay. The term “ Landlord Delay ” as used in this Lease shall mean any delay in the completion of the Tenant Improvements which is due to any act or omission of Landlord or its agents or contractors, whether willful, negligent or otherwise. The term Landlord Delay shall include, but shall not be limited to, any (i) delay in Landlord tendering possession of the Premises to Tenant; (ii) delay in the giving of authorizations or approvals by Landlord; (iii) delay attributable to the acts or failures to act, whether willful, negligent or otherwise, of Landlord, or of its agents, employees, or contractors, where such acts or failures to act delay the completion of the Tenant Improvements; (iv) delay attributable to the interference of Landlord, or of its agents, employees, or contractors, with the completion of the Tenant Improvements or the failure or refusal of any such party to permit Tenant or its agents or contractors priority access to and priority use of the Premises or any Building facilities or services, which access and use are required for the orderly and continuous performance of the work necessary to complete the Tenant Improvements; and (v) delay by Landlord in administering and paying when due the Tenant Improvement Allowance.

4. Possession and Construction of Tenant Improvements .

4.1 Immediately upon execution of this Lease, Landlord shall tender possession of the Premises to Tenant in its existing “as is” condition (except as herein expressly provided to the contrary) for construction of the Tenant Improvements (as defined below; provided, however, Landlord shall remain responsible for repairs of latent structural defects in the Building.

4.2 Tenant shall construct such improvements in the Building as it desires for its use and occupancy (“ Tenant Improvements ”) in accordance with plans and specifications prepared by Tenant and approved by Landlord in its reasonable discretion (“ Tenant Improvement Plans ”). Preparation of the Tenant Improvement Plans and construction of the Tenant Improvements shall be at Tenant’s cost and expense, subject to Landlord providing the Tenant Improvement Allowance described in Section 4.3 below. Tenant shall retain its own architect, engineers and contractors for the design and construction of the Tenant Improvements, subject to Landlord’s approval, which shall not be unreasonably withheld, conditioned or delayed and shall be deemed given if not so reasonably withheld within five (5) days following delivery of the Tenant Improvement Plans to the Landlord. Landlord’s approval of the Tenant Improvement Plans, and any revisions and supplements thereto, shall be required only if the revisions and supplements to the Tenant Improvement Plans are not reasonably consistent as to scope of work and quality of finishes with the plans reviewed by Landlord prior to the execution of this Lease; and any such required approval shall not be unreasonably withheld, conditioned or delayed and shall be deemed given if not so reasonably withheld within five (5) days following delivery of the plans to Landlord. Tenant shall ensure that the Tenant Improvements, and in particular the walls devising the Premises from the balance of the Building, are sufficient to attenuate the sound of Tenant’s animals in the vivarium.

4.3 Landlord shall contribute for the cost of the Tenant Improvements the sum of $260,000, which is calculated at the rate of $29.11 per square foot for the 8,932 square feet of Rentable Area. All sums contributed by Landlord to the costs of the Tenant Improvements under this Section 4.3 shall be referred to herein as the “ Tenant Improvement Allowance .” The Tenant Improvement Allowance shall be disbursed by Landlord to Tenant as work progresses, and any cost of Tenant Improvements in excess of $29.11 per square foot of Rentable Area shall be paid by Tenant as the work progresses on a monthly basis in accordance with the provisions of Section 4.4.

4.4 Tenant shall prepare a budget for the design, permitting and construction of the Tenant Improvements (“ Tenant Improvement Budget ”), including (i) design and architectural fees, (ii) engineering fees, (iii) costs of processing and obtaining permits from any governmental entity, (iv) water and sewer connection

3

charges, utilities consumed for construction, and other expenses related or similar thereto, (v) payments to architects, designers, contractors, subcontractors and material suppliers and the other direct costs incurred in the design and construction of the Tenant Improvements, (vi) premiums for insurance carried by Tenant or its contractors, subcontractors, designers, or architects with respect to the construction, and (vii) costs of installing separate meters to measure utilities provided to the Premises. Landlord shall provide Tenant with an electronic copy of as-built plans for the Premises, within five (5) days of mutual execution of this Lease. As work progresses on the Tenant Improvements, Tenant shall submit an application for payment (“ Application for Payment ”) to Landlord no more often than monthly, for work completed by and through the twentieth (20 ^th ) day of the previous month, for disbursement of the Tenant Improvement Allowance. Applications for Payment may be made only for work actually completed or services actually provided and shall include a detailed description of such completed Tenant Improvement work or services. Applications for Payment shall include copies of the invoices to Tenant by Tenant’s contractor(s) or other vendors for the work completed. As a condition of payment of any Application for Payment, Landlord shall require the certification by both Tenant and Tenant’s architect that the described Tenant Improvement Work or services have been completed. Landlord shall disburse the requested funds directly to Tenant (or, at Tenant’s election, to a contractor or other vendor) on or before the tenth (10 ^th ) day of the calendar month immediately succeeding the last day covered by the Application for Payment. Notwithstanding the foregoing, if Tenant fails to promptly pay to any vendor or contractor any amount included in an Application for Payment submitted to Landlord, then at its election, Landlord may disburse any sums otherwise owing by Landlord to Tenant hereunder by joint check in the name of the Tenant and the applicable vendors or contractors, until Tenant demonstrates to Landlord’s reasonable satisfaction that all vendors and contractors have been paid current; provided, however, that the foregoing shall not apply to any vendor or contractor (i) with which Tenant has a good faith dispute, (ii) to whom Tenant has paid all sums that are not in dispute, and (iii) for whom Tenant has provided Landlord with a bond or other appropriate assurances that no lien will attach to Landlord’s right, title and interest in the Premises. Tenant agrees to reasonably cooperate with Landlord in compiling the Applications for Payment in form and content reasonably satisfactory to Landlord’s construction lender. If the Tenant Improvement Budget, as initially adopted or as revised from time to time because of changes in work, cost overruns, or otherwise, exceeds the amount of the Tenant Improvement Allowance, then Landlord shall disburse the Tenant Improvement Allowance and Tenant shall pay the overage on a monthly basis as the work progresses, so that the periodic disbursements of the Tenant Improvement Allowance and the payments by Tenant and Landlord shall at all times be proportional to the total cost of the Tenant Improvements to be paid by the Tenant Improvement Allowance and by Tenant.

5. Rent .

5.1 Tenant agrees to pay Landlord as Basic Annual Rent for the Premises as set forth below the sum set forth in Section 2.1.2, subject to adjustment as set forth in Article 6 and 8.3. Basic Annual Rent shall be paid in the equal monthly installments set forth in Section 2.1.3, subject to adjustment as set forth in Sections 6.1 and 8.3, each in advance on the first day of each and every calendar month during the term of this Lease.

5.2 In addition to Basic Annual Rent, Tenant agrees to pay to Landlord as additional rent (“ Additional Rent ”), at the times hereinafter specified in this Lease (i) Tenant’s Pro Rata Share (as defined in Section 7.3(a) and as set forth in Section 2.1.4, subject to adjustment pursuant to Section 8.1) of Operating Expenses as provided in Article 7 and (ii) all other amounts that Tenant assumes or agrees to pay under the provisions of this Lease, including but not limited to any and all other sums that may become due by reason of any default of Tenant under this Lease or failure on Tenant’s part to comply with the agreements, terms, covenants and conditions of this Lease to be performed by Tenant.

5.3 Basic Annual Rent and Additional Rent shall together be denominated “ Rent .” Except as expressly set forth in this Lease, Rent shall be paid to Landlord, without notice, demand, abatement, suspension, deduction, setoff, counterclaim, or defense, in lawful money of the United States of America, at the office of Landlord as set forth in Section 2.1.8 or to such other person or at such other place as Landlord may from time to time designate in writing.

5.4 In the event the term of this Lease commences or ends on a day other than the first day of a calendar month, then the Rent for such fraction of a month or year shall be prorated for such period on the basis of a thirty (30) day month and the monthly amount shall be paid at the then current rate for such fractional month prior on or before the commencement of the partial month.

4

6. Rental Adjustments .

6.1 The Basic Annual Rent set forth in Sections 2.1.2 and 2.1.3 shall be increased by three percent (3%) annually, compounded, commencing on the first anniversary of the Commencement Date, and on the same day of each year thereafter for so long as this Lease continues in effect.

7. Operating Expenses .

7.1 As used herein, the term “ Operating Expenses ” shall include:

(a) Government impositions including, without limitation, real and personal property taxes and assessments (but excluding personal property taxes and assessments of other tenants of the Project) levied upon the Project or any part thereof; amounts due under any improvement bond upon the Project and assessments levied in lieu thereof (except to the extent they represent costs related to the construction of the Project); any tax on or measured by gross rentals received from the rental of space in the Project or tax based on the square footage of the Building to the extent such tax is in lieu of or in the nature of a property tax (no such tax is imposed at this time; this is not intended to encompass an income tax, only a tax based on revenue in the nature of a property tax if imposed in the future); and any 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 Project, and any expenses, including the reasonable cost of attorneys or experts, reasonably incurred by Landlord in seeking reduction by the taxing authority of the applicable taxes not to exceed the amount of any such reduction, less tax refunds obtained as a result of an application for review thereof.

(b) Except as set forth in Section 7.2 below, all other net and actual costs paid or incurred by Landlord for the maintenance and operation of the Project in a first class condition, including, by way of examples and not as a limitation upon the generality of the foregoing, costs of (i) maintenance, repairs and replacements to improvements within the Project as appropriate to maintain the Project in first class condition; (ii) utilities furnished to the Common Areas of the Project (except those utilities which are consumed by individual tenants in their respective premises); (iii) sewer fees; (iv) trash collection; (v) cleaning (including windows); (vi) maintenance of landscape and grounds; (vii) maintenance of drives and parking areas, including periodic resurfacing; (viii) reasonable and customary security services; (ix) maintenance, repair, and replacement of reasonable and customary security devices; (x) building supplies; (xi) maintenance, repair, and replacement of equipment utilized for operation and maintenance of the Project; (xii) costs of maintenance, repairs and replacements of mechanical, plumbing, electrical and other systems which are part of the Building core and shell; (xiii) insurance premiums; (xiv) insurance deductibles and other portions of insured losses attributable to Tenant Improvements deductible by reason of insurance policy terms; (xv) service contracts for work of a nature before referenced; (xvi) costs of services of independent contractors retained to do work of nature before referenced at reasonable and customary rates; (xvii) costs of compensation (including employment taxes and fringe benefits) of all persons who perform regular and recurring duties connected with the day-to-day operation and maintenance of the Project at reasonable and customary rates; and (xviii) reasonable costs of management services up to a maximum of four percent (4%).

7.2 Notwithstanding the foregoing, Tenant shall not have any obligation to perform or to pay directly, or to reimburse Landlord for, and Operating Expenses shall not include, the Tenant Improvement Allowance shall not be reduced by, and Tenant shall not be responsible for, and shall have no obligations to pay, the following costs and expenses, repairs, maintenance, improvements, replacements, premiums, claims, losses, fees, charges, and liabilities (collectively, “ Costs ”):

(a) Costs incurred for the initial construction of the Project (although costs of Tenant Improvements in excess of the Tenant Improvement Allowance shall remain the obligation of Tenant as set forth in and pursuant to Article 4);

5

(b) Costs incurred for the repair, maintenance or replacement of the structural components of : (i) the footings, (ii) the foundation, (iii) the ground floor slab, (iv) the roof and (v) the load bearing walls of the Building (but excluding painting and ordinary maintenance and repair of exterior surfaces, which are Operating Expenses under Section 7.1(b));

(c) Costs incurred to correct any defects in design, materials or construction of the Project or to comply with any violation of any covenants, conditions and restrictions applicable to the Premises or the Project as of the date of this Lease (provided that costs incurred to correct any defects in design, materials or construction of the Tenant Improvements constructed by Tenant shall remain the obligation of Tenant pursuant to Article 4);

(d) Costs, expenses and penalties (including without limitation attorneys fees) incurred as a result of the use, storage, removal, investigation, or remediation of Hazardous Material (defined in Section 39.14) not introduced to the Premises by Tenant or its employees, contractors, agents, representatives, or invitees (provided that such costs for Hazardous Material introduced to the Premises by Tenant or its employees, contractors, agents, representative, or invitees shall be the responsibility of Tenant pursuant to the provisions of Article 39);

(e) Interest, principal, points and other fees on debt or amortization of any debt secured in whole or part by all or any portion of the Project (provided that interest upon a government assessment or improvement bond payable in installments may be an Operating Expense to the extent provided under Section 7.1(a));

(f) Costs incurred in connection with the financing, sale or acquisition of the Project or any portion thereof;

(g) Costs, expenses, and penalties (including without limitation attorneys’ fees) incurred due to the violation by Landlord of any underlying deed of trust, mortgage or ground lease affecting the Project or any portion thereof, and fees, commissions, attorneys’ fees, Costs or other disbursements incurred in connection with negotiations or disputes with any other occupant of the Project and Costs arising from the violation by Landlord or any other occupant of the Project of the terms and conditions of any lease or other agreement affecting the Project;

(h) Expense reserves, depreciation and amortization of any type (provided this exclusion is not intended to delete from Operating Expenses actual costs of maintenance, repairs and replacements which are otherwise included within Operating Expenses);

(i) Costs incurred as a result of the negligence, willful misconduct, breach of this Lease, violation of any statute, ordinance or other source of applicable law, or breach of contract by any party other than Tenant and its employees, contractors, agents, invitees, successors, assigns or representatives, or tort liability of any party other than Tenant;

(j) Costs incurred in leasing or procuring tenants (including, without limitation, lease commissions, advertising expenses, attorneys’ fees and expenses of renovating space for tenants);

(k) Advertising, marketing, media and promotional expenditures regarding the Project and Costs of signs identifying the owner, lender, any other occupants of the Project, or any contractor thereof;

(l) any wages, fees, salaries or other compensation of the executive employees or principals of Landlord, Costs incurred to investigate, remove, remediate or otherwise respond to any Hazardous Material present on or about the Project other than as set forth in Article 39;

(m) any rentals and related expenses incurred in leasing equipment which may be classified as capital expenditures under generally accepted accounting principles;

6

(n) any net income, franchise, capital stock, estate or inheritance taxes or taxes which are the personal obligation of Landlord or of another tenant of the Project;

(o) Costs which relate to any renovation, improvement, painting or redecorating of any rental space in the Project other than the Premises, including without limitation, building permit, license and inspection costs, incurred with respect to the installation of improvements made for other occupants of the Project or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant tenant space in the Project for other occupants in the Project or which arise in connection with any breach of obligation or other dispute concerning such preparation;

(p) legal expenses arising out of the initial construction of the Project or for the enforcement of the provisions of any tenant leases (other than the legal expenses related to this Lease, which shall be governed by Article 26);

(q) Cost of any work or service performed for or facilities furnished to a tenant at such tenant’s cost, or arising with respect to a service of a type not provided to Tenant;

(r) any interest or penalties imposed upon Landlord by any taxing authority for late payment or otherwise;

(s) any other expense otherwise chargeable as part of the cost of operation and maintenance but which is not of general benefit to all occupants of the Project but is primarily for the benefit of one or more specific tenants;

(t) Landlord’s charitable or political contributions;

(u) the amount of any payments to subsidiaries and affiliates of Landlord for services to the Project or for supplies or other materials to the extent that the cost of such services, supplies or materials exceeds the cost which would have been paid had the services, supplies or materials been provided by unaffiliated parties on a competitive basis (provided, however, any fee for management services paid to an affiliate of Landlord shall be in the amount set forth in Section 7.1(b)); and

(v) Costs of electric power or other utility costs for which Tenant directly contracts with a public service company or which arise from the disproportionate use of any utility or service supplied by Landlord to any other occupant of the Project;

(w) Except to the extent of Tenant’s responsibility under Article 22, Costs occasioned by fire, acts of God, or other casualties and condemnations and Costs for which Landlord is reimbursed from others;

(x) Costs for repairs, alterations, improvements, equipment and tools which could properly be capitalized under generally accepted accounting principles, except to the extent the Cost is amortized over the useful life of the capital item in question;

(y) Costs for insurance coverage not customarily carried by landlords or paid by tenants of similar projects in the vicinity of the Premises (except to the extent required by Landlord’s mortgage lender), and increases in insurance costs caused by the activities of another occupant of the Project;

(z) Wages, salaries, compensation, and labor burden for any employee not stationed on the Project on a full time basis or any fee, profit or compensation retained by Landlord or its affiliates for management and administration of the Project in excess of the management fee described in Section 7.1(b); and

(aa) Costs and expenses for which Tenant reimburses Landlord directly or which Tenant pays directly to a third person

7

7.3 Tenant shall pay to Landlord on the first day of each calendar month of the term of this lease, as Additional Rent, Landlord’s good faith estimate of Tenant’s Pro Rata Share (as set forth in 2.1.6) of Operating Expenses with respect to the Project for such month.

(a) “ Tenant’s Pro Rata Share ” under this Lease shall mean the percentage set forth in Section 2.1.4 (subject to adjustment pursuant to Section 8.1), determined by dividing the Rentable Area of the Premises by the total Rentable Area of the Project.

(b) Within sixty (60) days after the conclusion of each calendar year, Landlord shall furnish to Tenant in writing a statement (the “ Annual Operating Expense Statement ”) showing in reasonable detail the actual Operating Expenses and Tenant’s Pro Rata Share of Operating Expenses for the previous calendar year. Any additional sum due from Tenant to Landlord shall be due and payable within thirty (30) days of Tenant’s receipt of such statement. If the amounts paid by Tenant pursuant to this Section 7.3 exceed Tenant’s Pro Rata Share of 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. Landlord’s obligation to return any excess Operating Expenses shall survive termination of the Lease.

(c) Any amount due under this Section 7.3 for any period which is less than a full year or a full month shall be prorated for such fractional year and month.

(d) Operating Expenses which are fairly allocated to one or more tenants of the Project shall be so allocated, and shall be separately scheduled on the Annual Operating Expense Statement.

7.4 Tenant shall have the right, at Tenant’s expense, upon reasonable notice during reasonable business hours, to have certified public accountants or other persons authorized by Tenant inspect that portion of Landlord’s books, records, invoices, and other data which are relevant to preparation of the Annual Operating Expense Statement provided any request for such review shall be furnished within one hundred eighty (180) days after Tenant’s receipt of such statement as to a prior year’s Operating Expenses. If, as a result of Tenant’s inspection of Landlord’s books, the amount of Operating Expenses relating to the Premises identified on such annual statement is found to exceed the actual Operating Expenses of the Premises, Landlord shall, within ten (10) days after Tenant’s request therefor, refund to Tenant the amount of overpayment by Tenant. In addition, if such audit reveals that the Operating Expenses paid by Tenant in any year exceed one hundred five percent (105%) of the actual Operating Expenses which should have been paid by Tenant in such year, Landlord shall reimburse Tenant for the reasonable cost of such audit. In all other cases, Tenant shall pay for the reasonable cost of the audit.

7.5 Operating Expenses for the calendar year in which Tenant’s obligation to pay them commences and in the calendar year in which such obligation ceases shall be prorated. 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 pay Operating Expenses. The responsibility of Tenant for Operating Expenses pursuant to Section 7.3 shall continue to the latest of (i) the date of termination of this Lease or (ii) the date Tenant has fully vacated the Premises.

8. Rentable Area .

8.1 Landlord and Tenant agree that the Rentable Area of the Project is 48,394 square feet, that the Rentable Area of the Premises is 8,932 square feet, and that Tenant’s Pro Rata Share is 18.46%. The Rentable Area, Common Area and Tenant’s Pro Rata Share shall not be adjusted on account of re-measurement of the Building or the Premises; provided, however, if the Expansion Space is added to the Premises pursuant to Section 41, Tenant’s Pro Rata Share shall be proportionately increased.

9. Security Deposit .

9.1 Within seven (7) days following execution of this Lease by both parties, Tenant shall deposit with Landlord cash (“ Cash Deposit ”) or an irrevocable stand-by letter of credit ( “Letter of Credit ”) in the

8

amount of $100,000, to be held by Landlord as security for the faithful performance by Tenant of all of the terms, covenants, and conditions of this Lease to be kept and performed by Tenant during the term and any extension term hereof. If Tenant defaults with respect to any provision of this Lease, including but not limited to any provision relating to the payment of Rent, and subject to any notice requirements and cure periods for Tenant’s benefit set forth in Article 24, Landlord may (but shall not be required to) draw from any Letter of Credit and apply from such proceeds of the Letter of Credit or the Cash Deposit, as the case may be, the amount required to cure the default, and to use, apply or retain the proceeds thereof for the payment of any Rent or any other sum in default, or to compensate Landlord for any other reasonable loss or damage which Landlord may suffer by reason of Tenant’s default. Any amount not used to cure a default or to compensate Landlord for its reasonable loss or damage shall be deposited and held by Landlord in a segregated interest-bearing account, labeled as a security deposit for this Lease, with interest added to principal and held and disbursed as part of the security deposit pursuant to this Article 9.

9.2 Tenant shall be responsible for any expenses in obtaining and maintaining any Letter of Credit.

9.3 The Letter of Credit, and any replacement Letter of Credit, shall be issued by a financial institution reasonably acceptable to Landlord and Landlord’s lender. Should the institution be placed in conservatorship or receivership by the Federal Deposit Insurance Corporation or any other state of federal regulatory agency, Tenant shall, within thirty (30) days after written request by Landlord, provide a replacement Letter of Credit from a financial institution reasonably acceptable to Landlord, and in the event Tenant fails to do so, Landlord may draw on the Letter of Credit and use the proceeds thereof as a security deposit in accordance with the provisions of Section 9.1.

9.4 The Letter of Credit shall be substantially in the form attached hereto as Exhibit “E” or in such other form as the Landlord shall approve in its reasonable discretion.

9.5 The initial Letter of Credit shall be for a period of not less than one (1) year, and any replacement Letter of Credit shall be for a period of not less than one (1) year. The initial Letter of Credit (or any later replacement Letter of Credit) shall be replaced by Tenant by delivering to Landlord a replacement Letter of Credit at least thirty (30) days prior to the expiration of the then current Letter of Credit. If Tenant fails to deliver a replacement Letter of Credit at least thirty (30) days prior to the expiration of the then current Letter of Credit, Landlord shall have the right to draw the total amount of the then current Letter of Credit and hold the proceeds thereof as a security deposit pursuant to the provisions of Section 9.1. The Letter of Credit shall be successively renewed or replaced until that date which is thirty (30) days after the expiration of the initial or any extended term of this Lease.

9.6 In the event of the use of any portion of the Cash Deposit or proceeds of the Letter of Credit, Tenant shall within ten (10) days after another request therefor replenish the Cash Deposit or replenish the proceeds of the Letter of Credit or substitute a new Letter of Credit to the full amount set forth above.

9.7 Any Cash Deposit or Letter of Credit shall be transferable by Landlord to a successor Landlord or mortgagee or beneficiary of a deed of trust encumbering the Premises which agrees to hold and disburse the Cash Deposit or Letter of Credit in accordance with the provisions of this Article 9 (and Landlord shall notify Tenant concurrently of any such transfer), or, in the case of a Letter of Credit, a substitute Letter of Credit shall be issued to any such entity at the request of Landlord; provided, however, that Landlord shall pay any expenses incurred by Tenant on account of any such transfer or issuance.

9.8 In the event of bankruptcy or other debtor/creditor proceedings against Tenant, the proceeds of the Cash Deposit or the Letter of Credit shall be deemed to be applied first to the payment of Rent and other charges due Landlord for all periods prior to the filing of such proceedings.

9.9 Landlord shall deliver the Cash Deposit or Letter of Credit, and any proceeds thereof, to any purchaser of Landlord’s interest in the Premises (and Landlord shall notify Tenant concurrently of any such transfer), and thereupon Landlord shall be discharged from any further liability with respect thereto provided that such purchaser has agreed to assume in writing the obligations of Landlord hereunder. This provision shall also apply to any subsequent transfers.

9

9.10 The Cash Deposit or Letter of Credit, and any proceeds thereof, shall be returned to Tenant within thirty (30) days following the expiration of this Lease, except for amounts which are needed by Landlord to cure any default by Tenant. This obligation shall survive termination of this Lease.

9.11 In the event that Tenant’s unencumbered cash and cash equivalents (collectively “Liquid Assets”) on any day following the date of this Lease drop below Six Million Dollars ($6,000,000.00) in aggregate value (“Cash Deficiency Event”), then Tenant shall be required immediately to give Landlord written notice of such Cash Deficiency Event and, within five (5) business days following such Cash Deficiency Event, Tenant shall cause an additional standby irrevocable letter of credit substantially in the form of Exhibit “E” attached hereto and made a part hereof by this reference (“Supplemental Letter of Credit”) to be issued in compliance with all provisions of this Article 9 related to letters of credit and to deliver the Supplemental Letter of Credit to Landlord within such five (5) business day period. Such Supplemental Letter of Credit shall be held pursuant to the terms of Article 9 above. Tenant shall cause the Supplemental Letter of Credit to be issued in the following amount (the “Supplemental LOC Amount”): the amount of unamortized Tenant Improvement Allowance as of the date of the Cash Deficiency Event; provided, however, the Supplemental LOC Amount shall be reduced on a dollar-for-dollar basis for any unamortized Tenant Improvements for which Tenant pays to Landlord within five (5) business days following a Cash Deficiency Event. After issuance of the Supplemental Letter of Credit, Tenant may substitute a revised letter of credit in an amount equal to the then-current Supplemental LOC Amount, provided that such substituted letter of credit meets all the requirements of Article 9 and this Section 9.11, and, provided further, that the replacement Supplemental Letter of Credit is issued and delivered to Landlord prior to Landlord being obligated to return the existing Supplemental Letter of Credit.

9.12 In the event that Tenant’s unencumbered Liquid Assets on any day following the date of this Lease drop below Three Million Dollars ($3,000,000.00) in aggregate value (“Letter of Credit Liquidation Event”), then Tenant shall be required immediately to give Landlord written notice of such Letter of Credit Liquidation Event, and Landlord, without notice to Tenant and without prejudice to any other remedy available to Landlord under the Lease, at law or in equity, shall be entitled to present the Supplemental Letter of Credit for payment in whole or in part and to receive and retain all amounts paid on the Supplemental Letter of Credit, to hold such amount as an additional security deposit under this Lease.

In the event that Tenant’s unencumbered Liquid Assets on any day following the Letter of Credit Liquidation Event rise above Six Million Dollars ($6,000,000.00) in aggregate value and remain above such level for one hundred twenty (120) consecutive days, then Tenant shall have the right to give Landlord written notice of such increase, and Landlord shall return to Tenant the Supplemental Letter of Credit and any unapplied LOC Amount within thirty (30) days after receipt of Tenant’s notice.

9.13 If the Supplemental Letter of Credit is issued and provided to Landlord, and so long as Landlord is entitled to present the Supplemental Letter of Credit for payment as provided in Section 9.12 above, Tenant shall provide to Landlord on a monthly basis by email (to the email addresses for Landlord provided in the Notices section of this Lease), copies of financial reports certified by Tenant’s chief financial officer as being true and correct in all material respects to the best knowledge of such individual providing a summary of the status of unencumbered Liquid Assets at the end of each immediately preceding month.

10. Use .

10.1 Tenant may use the Premises for any use permitted by (i) the applicable zoning governing the Property and (ii) any other laws, regulations, ordinances, and permits applicable to the Premises, and shall not use the Premises, or permit or suffer the Premises to be used for any other purpose without the prior written consent of Landlord.

10.2 Tenant shall conduct its business operations and use the Premises in compliance with all federal, state, and local laws, regulations, ordinances, requirements, permits and approvals applicable to the Premises. Subject to Section 10.1, Tenant shall not use or occupy the Premises in violation of any law or regulation or the certificate of occupancy issued for the Building, and shall, upon five (5) days’ written notice from Landlord, discontinue any use of the Premises which is declared by any governmental authority having jurisdiction to be a

10

violation of law or the certificate of occupancy. Subject to Section 10.1, 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. Tenant shall not be deemed to be in default of the foregoing obligation (a) until any notice and cure period provided under this Lease has expired or (b) if Tenant has the right to appeal such directive, and Tenant prosecutes such appeal in a timely fashion and in a manner that does not impose any lien, charge or other obligation on Landlord or any portion of the Project, during any such appeal period.

10.3 Tenant shall not do or permit to be done anything which will invalidate or increase the cost (unless Tenant agrees to pay such increased cost) of any fire, extended coverage or any other insurance policy covering the Premises, or which will make such insurance coverage unavailable on commercially reasonable terms and conditions, and shall comply with all rules, orders, regulations and requirements of the insurers of the Premises.

10.4 Tenant shall comply with the Americans with Disabilities Act of 1990 (“ ADA ”), and the regulations promulgated thereunder, as amended from time to time. All responsibility for compliance with the ADA relating to the Premises and the activities conducted by Tenant within the Premises shall be exclusively that of Tenant and not of Landlord, including any duty to make structural or capital improvements, alterations, repairs and replacements to the Premises. Any alterations to the Premises made by Tenant for the purpose of complying with the ADA or which otherwise require compliance with the ADA shall be done in accordance with Article 17; provided, that Landlord’s consent to such alterations shall not constitute either Landlord’s assumption, in whole or in part, of Tenant’s responsibility for compliance with the ADA, or representation or confirmation by Landlord that such alterations comply with the provisions of the ADA. However, nothing in this Lease shall be construed to require Tenant to make structural or capital improvements, alterations, repairs or replacements to comply with ADA unless and until required to do so by order of any government entity or court of law exercising proper jurisdiction with regard thereto, subject to any right to appeal or otherwise contest any such order.

10.5 Tenant may install signage on and about the Premises, including any existing monument sign or new monument sign installed by Tenant, to the extent permitted by, and in conformity with, the applicable sign ordinance and other laws, regulations, ordinances, and permits applicable to the Premises, and to the extent approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed. Tenant acknowledges that it understands that other tenants will occupy space in the Project, and that the maximum allowable signage is to be shared among all of the tenants on a fair and reasonable basis. Tenant further acknowledges that it is not relying on any representations or warranty of Landlord regarding the number, size or location of any signage. Notwithstanding the foregoing, subject to any applicable sign ordinance and other laws, regulations, ordinances, and permits applicable to the Premises, and Landlord’s reasonable approval, which shall not be unreasonably withheld, conditioned or delayed, Tenant shall be entitled but shall not be required to display at least one exterior sign identifying Tenant on the existing monument sign on the Project. The expense of design, permits, purchase and installation of any signs shall be the responsibility of Tenant and the cost thereof shall be borne by Tenant. At the termination of the Lease, all signs shall be the property of Tenant and shall be removed from the Premises by Tenant, subject to the provisions of Article 30.

10.6 No equipment shall be placed at a location within the Building other than a location designed to carry the load of the equipment. Equipment weighing in excess of floor loading capacity shall not be placed in the Building.

10.7 Subject to Section 10.1, Tenant shall not use or allow the Premises to be used for any unlawful purpose, nor shall Tenant cause, maintain or permit any nuisance or waste in, on, or about the Premises.

11. Brokers .

11.1 Tenant represents and warrants to Landlord that it has had no dealings with any real estate broker or agent in connection with the negotiation of this Lease other than Grubb & Ellis as Landlord’s broker. Tenant shall indemnify, defend, protect, and hold harmless Landlord from any claim of any other broker as a result of any act or agreement of Tenant, and Landlord shall indemnify, defend, protect, and hold harmless Tenant from any claim of any other broker as a result of any act or agreement of Landlord.

11

11.2 To the best of Tenant’s knowledge, without investigation or inquiry, Tenant represents and warrants that no broker or agent has made any representation or warranty relied upon by Tenant in Tenant’s decision to enter into this Lease other than as contained in this Lease.

12. Holding Over .

12.1 If, with Landlord’s consent, Tenant holds possession of all or any part of the Premises after the expiration or earlier termination of this Lease, Tenant shall be deemed a tenant from month to month upon the date of such expiration or earlier termination, and in such case Tenant shall continue to pay in accordance with Article 5 the Basic Annual Rent as adjusted in accordance with Article 6, together with Operating Expenses in accordance with Article 7 and other Additional Rent as may be payable by Tenant, and such month-to-month tenancy shall be subject to every other term, covenant and condition contained herein.

12.2 If Tenant remains in possession of all or any portion of the Premises after the expiration or earlier termination of the term hereof without the express written consent of Landlord, Tenant shall become a tenant at sufferance upon the terms of this Lease except that monthly rental shall be equal to one hundred fifty percent (150%) of the Monthly Installment of Basic Annual Rent payable during the last month of the initial term.

12.3 Acceptance by Landlord of Rent after such expiration or earlier termination shall not result in a renewal or reinstatement of this Lease.

12.4 The foregoing provisions of this Article 12 are in addition to and do not affect Landlord’s right to re-entry or any other rights of Landlord under Article 24 or elsewhere in this Lease or as otherwise provided by law.

13. Taxes on Tenant’s Property

13.1 Tenant shall pay not less than ten (10) days before delinquency taxes levied against any personal property or trade fixtures placed by Tenant in or about the Premises. Tenant shall not be responsible for taxes levied against any tenant improvements, alterations, personal property or trade fixtures of other tenants.

13.2 If any such taxes on Tenant’s personal property or trade fixtures are levied against Landlord or Landlord’s property or, if the assessed valuation of the Project is increased by the inclusion therein of a value attributable to Tenant’s personal property or trade fixtures, and if Landlord after written notice to Tenant pays the taxes based upon such increase in the assessed value, then Tenant shall, upon receipt of satisfactory evidence of such tax increase and assignment to Tenant of any claim for a refund, repay to Landlord the taxes so levied against Landlord.

13.3 If any improvements in or alterations to the Premises, whether owned by Landlord or Tenant and whether or not affixed to the Property so as to become a part thereof, are assessed for real property tax purposes at a valuation higher than the valuation at which improvements in other spaces in the Project are assessed, then the disproportionate amount of the real property taxes and assessments levied against Landlord or the Project by reason of such excess assessed valuation shall be deemed to be taxes levied against personal property to Tenant and shall be governed by the provisions of Section 13.2 above. Any such excess assessed valuation due to improvements in or alterations to space in the Project leased by other tenants of Landlord shall not be included in the Operating Expenses defined in Section 7, but shall be treated, as to such other tenants, as provided in this Section 13.3, and shall be allocated to such other tenants and any payments thereof by Tenant shall be reimbursed by Landlord to Tenant upon demand. If the records of the County assessor are available and sufficiently detailed to serve as a basis for determining whether said Tenant improvements or alterations are assessed at a higher valuation than improvements in other spaces in the Project, such records shall be binding on both Landlord and Tenant.

13.4 To the extent Tenant fails to make any payment required of Tenant by this Article 13 and Landlord does so on Tenant’s behalf, Tenant shall reimburse Landlord for the cost thereof pursuant to the provisions of Sections 7.1 and 24.3.

12

14. Condition of Premises .

14.1 Except as expressly provided herein to the contrary, Tenant accepts the Premises in their “as is” condition, except for latent structural defects in the Building, the repair of which shall remain the responsibility of Landlord; provided, however, that Landlord represents and warrants for a period of one (1) year commencing on the Commencement Date that the Building, Premises and all electrical, plumbing, mechanical and HVAC systems are in good order and repair.

14.2 Except as expressly provided herein, Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty, express or implied, with respect to the condition of the Premises, or to the Project or with respect to their suitability for the conduct of Tenant’s business.

15. Common Areas and Parking Facilities .

15.1 Tenant shall have the nonexclusive right, in common with others, to use the Common Areas, subject to the rules and regulations adopted by Landlord and attached hereto as Exhibit “F” together with such other reasonable and nondiscriminatory rules and regulations as are hereafter promulgated by Landlord (the “ Rules and Regulations ”) and delivered to Tenant in writing; provided, however, that such rules and regulations are applicable to all occupants of the Project, and, if changed, do not increase the cost of Tenant’s conduct of business in the Premises, and do not unreasonably interfere with Tenant’s use and enjoyment of the Premises and Common Areas.

15.2 Tenant shall not place any equipment, storage containers or any other property on the surface parking area or otherwise outside of the Premises without the consent of Landlord, which consent shall be in the sole discretion of Landlord. Tenant may use the existing exterior trash facilities in common with other tenants of the Building, or, if reasonably necessary, may locate its own trash receptacle outside of the Premises at a location approved by Landlord. In the event Tenant elects to locate Hazardous Material storage facilities, water systems, mechanical equipment, emergency generators, or other Tenant Improvements in the parking area, the space used for such facilities shall be deducted from Tenant’s Pro Rata Share of parking described below.

15.3 As an appurtenance to the Premises, Tenant, and its employees and invitees, shall be entitled to use, free of charge, the parking spaces on the Project in common other tenants of the Project on a non-reserved basis. The Project shall have approximately 3.3 parking spaces for each 1,000 square feet of Rentable Area of the Project and shall not be oversubscribed by Landlord.

16. Utilities and Services .

16.1 Tenant shall pay for all water, gas, electricity, telephone, cable television, and other utilities which may be furnished to the Premises during the term of this Lease, together with any taxes thereon. If any such utility is not separately metered to Tenant, Tenant shall pay Tenant’s Pro Rata Share of the costs thereof as an Operating Expense unless Landlord has installed separate meters or measuring devices for the determination of Tenant’s actual use of such utility service. In such case, Tenant shall pay as an Operating Expense the actual cost of that portion of the utility or service actually used by Tenant. Utilities and services provided to the Premises which are separately metered shall be paid by Tenant directly to the supplier of such utility or service, and Tenant shall pay for such utilities and services prior to delinquency during the term of this Lease.

16.2 Landlord shall not be liable for, nor shall any eviction of Tenant result from, any failure of any such utility or service, and in the event of such failure Tenant shall not be entitled to any abatement or reduction of Rent, nor be relieved from the operation of any covenant or agreement of this Lease, and Tenant waives any right to terminate this Lease on account thereof. Notwithstanding the foregoing:

(i) in the event that Landlord is unable to supply any of the Building’s sanitary, electrical, heating, air conditioning, water, elevator, life safety or other essential systems serving the Premises (collectively, the “ Essential Services ”) from a cause within Landlord’s reasonable control, and such inability of Landlord materially impairs Tenant’s ability to carry on its business in the Premises for a period of fifteen (15)

13

consecutive calendar days, Basic Annual Rent and Additional Rent shall be abated commencing with the sixteenth (16 ^th ) day of such material interference with Tenant’s business,. Such abatement shall continue until the Essential Services have been restored to such extent that the lack of any remaining services no longer materially impairs Tenant’s ability to carry on its business in the Premises. Tenant shall not be entitled to such an abatement to the extent that Landlord’s inability to supply Essential Services to Tenant is caused by Tenant or its employees, contractors, agents, licensees or invitees; and

(ii) in the event of any stoppage or interruption of Essential Services to the Premises, Landlord shall use commercially reasonable efforts to restore Essential Services to the Premises as soon as possible. Landlord shall promptly notify Tenant of any planned or actual interruption of Essential Services, and shall keep Tenant advised of the status of such restoration efforts.

16.3 Except as expressly provided in this Lease Landlord shall have no obligation to provide or pay for janitors, maintenance personnel, and other persons who perform duties connected with the operation and maintenance of the interior of the Premises.

17. Alterations .

17.1 After completion of the Tenant Improvements (which shall be performed in accordance with Section 4) Tenant shall make no alterations, additions or improvements (“Alterations”) in or to the Premises, except for non-structural Alterations costing less than $50,000, without Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed. Tenant shall deliver to Landlord final plans and specifications and working drawings for Alterations to Landlord, and Landlord shall have ten (10) days thereafter to grant or withhold its consent. If Landlord does not notify Tenant of its decision within the ten (10) days, Landlord shall be deemed to have given its approval.

17.2 If a permit is required to construct the Alterations, Tenant shall deliver a completed, signed-off inspection card to Landlord within ten (10) days of completion of the Alterations and the completion of the final inspection, and shall promptly thereafter obtain and record a notice of completion and deliver a copy thereof to Landlord.

17.3 The Alterations shall be constructed only by licensed contractors or mechanics. All contractors, except those constructing non-structural Alterations costing less than $50,000, shall be approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed. Any such contractor must have in force a general liability insurance policy of not less than $2,000,000 or such other limits as Landlord may reasonably require or approve, which policy of insurance of the general contractor shall name Landlord as an additional insured. Tenant shall provide Landlord with a copy of the contract with the contractor or mechanic prior to the commencement of any construction of Alterations requiring Landlord’s consent.

17.4 Tenant agrees that any Alterations by Tenant shall be accomplished in such a manner as to permit any fire sprinkler system and fire water supply lines to remain fully operable except when minimally necessary for building reconfiguration work.

17.5 Tenant covenants and agrees that all Alterations done by Tenant shall be performed in full compliance with all laws, rules, orders, ordinances, directions, regulations, permits, approvals, and requirements of all governmental agencies, offices, departments, bureaus and boards having jurisdiction, and in full compliance with the rules, orders, directions, regulations, and requirements of any applicable fire rating bureau. Tenant shall provide Landlord with “as-built” plans showing any material Alterations in the Premises within thirty (30) days after completion.

17.6 Before commencing any Alterations requiring Landlord’s consent (other than the initial Tenant Improvements), Tenant shall give Landlord at least five (5) days’ prior written notice of the proposed commencement of such work and, for any such work which exceeds $50,000 in cost, if required by Landlord’s mortgage lender, secure at Tenant’s own cost and expenses a completion and lien indemnity bond approved by Landlord, which approval will not be unreasonably withheld, conditioned or delayed. Upon request, Landlord shall advise Tenant in writing whether it reserves the right to require Tenant to remove any Alterations from the Premises upon termination of the Lease.

14

17.7 Tenant shall have the right to install (in accordance with the terms and conditions of this Lease), operate and maintain an emergency back-up generator (the “Generator“) and, if necessary based upon the specifications for such Generator, an above ground fuel tank (the “Tank“) to be located in the existing equipment yard behind the Building (the “Equipment Yard”).

(i) Upon receipt of a request from Tenant, Landlord shall advise Tenant as to the location of space at the Project for the installation of Tenant’s Generator and Tank (if applicable) in the Equipment Yard. Any space in the Equipment Yard utilized by Tenant in connection with the Generator and Tank shall not be included in the Premises and no Basic Annual Rent shall be payable therefor but all of the other provisions hereof shall apply thereto as if such space were part of the Premises hereunder. Notwithstanding anything herein to the contrary, Tenant’s right to install the Generator shall be subject to Landlord’s reasonable approval of the manner in which the Generator and Tank are installed, the manner in which any cables and wires are run to and from the Generator to the Premises, the manner in which any lines are run to and from the Generator to the Tank and the measures that will be taken to eliminate any vibrations or sound disturbances from the operation of the Generator. Landlord shall have the right to require an acceptable enclosure (e.g., penthouse enclosures in keeping with others thereon) to hide or disguise the existence of the Generator and/or Tank and to minimize any adverse effect that the installation of the Generator and/or Tank may have on the appearance of the Project. Tenant shall be solely responsible for obtaining all necessary governmental and regulatory approvals and for the cost of installing, operating, maintaining and removing of the Generator. Tenant shall also be responsible for the cost of all utilities consumed in the operation of the Generator.

(ii) Tenant shall be responsible for assuring that the installation, maintenance, operation and removal of the Generator and Tank will not damage the Project other than minor damage in the portion of the Equipment Yard where such Generator and Tank were located caused by the installation and removal thereof (subject to (iii) below). Tenant agrees to be responsible for any damage caused to the Project in connection with the installation, maintenance, operation or removal of the Generator and Tank and, in accordance with the terms of this Lease, to indemnify, defend and hold Landlord harmless from all liabilities, obligations, damages, penalties, claims, costs, charges and expenses, including, without limitation, reasonable architects’ and attorneys’ fees (if and to the extent permitted by law), which may be imposed upon, incurred by, or asserted against Landlord in connection with the installation, maintenance, operation or removal of the Generator and Tank, including, without limitation, any environmental and hazardous materials claims in connection with the installation, maintenance, operation or removal of the Generator and Tank by Tenant or any of Tenant’s agents, servants, contractors or employees, other than any of the foregoing caused by Landlord’s negligence or willful misconduct.

(iii) Tenant shall be responsible for the installation, operation, cleanliness, maintenance and removal of the Generator, Tank and appurtenances, all of which shall remain the personal property of Tenant, and, subject to the provisions of Section 30 hereof, shall be removed by Tenant at its own expense at the termination of the Lease. Tenant shall repair any damage caused by such removal, including the patching of any holes to match, as closely as possible, the color surrounding the area where the Generator, Tank and appurtenances were attached. Such maintenance and operation shall be performed in a manner to avoid any unreasonable interference with any other tenants or Landlord. Tenant agrees to maintain the Generator and Tank, including without limitation, any enclosure installed around the Generator and Tank, in good condition and repair. Tenant shall be responsible for performing any maintenance and improvements to any enclosure surrounding the Generator and Tank so as to keep such enclosure in good condition.

(iv) Tenant shall only test the Generator before or after normal business hours and upon prior notice to Landlord.

17.8 Ownership and removal of Alterations is governed by Article 30.

15

18. Repairs and Maintenance .

18.1 Subject to reimbursement by Tenant as its Pro Rata Share of Operating Expenses to the extent provided by Article 7, and subject to the provisions of Article 22 (Damage and Destruction) and 23 (Eminent Domain), Landlord shall repair, replace and maintain the structural and exterior portions of the Building, Project and Common Areas, including foundations, exterior walls, load bearing walls, windows, plate glass, roofing, and roofing covering materials, and plumbing, fire sprinkler system, heating, ventilating, air conditioning and electrical systems installed or furnished by Landlord (and not part of the Tenant Improvements).

18.2 Subject to the provisions of Article 7 (Operating Expenses), Article 22 (Damage and Destruction) and Article 23 (Eminent Domain), and except as otherwise set forth in Section 18.1, Tenant shall, throughout the term of this Lease, at Tenant’s sole cost and expense, keep the Tenant Improvements Tenant is required to surrender to the Landlord in accordance with this Lease, and every part thereof, in good condition and repair, and the Premises tendered by Landlord to Tenant, and every part thereof, in the same condition as received on the date hereof, except for damage to the Premises or such Tenant Improvements from causes beyond the reasonable control of Tenant, damages from casualties, condemnation, Hazardous Materials not placed on or about the Premises by Tenant, its assignees or subtenants or their respective agents, employees, contractors, and ordinary wear and tear. Tenant shall upon the expiration or earlier termination of the term hereof surrender the Premises and the Required Surrender Improvements to Landlord in the same condition as required by the prior sentence.

18.3 If Landlord fails to commence any repair, replacement or maintenance work required of Landlord under Section 18.1 within two (2) business days after Landlord receives Tenant’s written notice of the need for such repairs or maintenance (or such period of time in excess of two (2) business days as is commercially reasonably necessary based upon the nature of such work or the need for permits or other governmental approvals), and such failure materially adversely impairs Tenant’s use of the Premises as provided in this Lease, then Tenant shall be permitted to make such repairs, replacement or maintenance, provided that (i) the cost of such repairs, replacement or maintenance does not exceed Ten Thousand Dollars ($10,000.00); (ii) does not materially adversely impact the (a) base Building systems, (b) structural integrity of the Building, or (c) foundation, roof, structure, or exterior appearance of the Building, (iii) Tenant first gives Landlord an additional two (2) business days’ prior written notice indicating that Tenant intends to undertake such repairs, replacement or maintenance, and (iv) Landlord fails to commence such repairs or maintenance within such two (2) business day period. If Tenant performs any repairs or maintenance as permitted under this Section 18.3, Tenant shall use only vendors and/or contractors approved by Landlord in its reasonable discretion and Landlord agrees to promptly reimburse Tenant for the reasonable, actual and documented costs of such repairs, replacement or maintenance performed by Tenant, but without any offset rights against Rent or any other amounts payable by Tenant under this Lease, within thirty (30) days after receipt of paid invoices therefore (including appropriate back-up documentation). Any repairs, replacement or maintenance performed by Tenant pursuant to this Section 18.3 shall be done in accordance with the provisions of this Lease.

18.4 Notwithstanding Section 18.3 above, in the event of an interruption of Essential Services to the Premises, Tenant shall be permitted to make such repairs, replacement or maintenance work which would otherwise be required of Landlord under Section 18.1 provided that (i) Tenant immediately notifies both Landlord and Landlord’s Local Representative [as identified in Section 2.1.8] by both formal notice, as set forth in Section 42.11, and informal (emergency) notice by phone, voice mail or electronic mail, as the case may be, that an interruption to Essential Services has occurred and that Tenant intends to undertake such repairs, replacement or maintenance as permitted in this Section 18.4; (ii) the cost of such repairs, replacement or maintenance does n