Common use of Additional Rental Clause in Contracts

Additional Rental. In addition to the Base Rental payable pursuant to paragraph A above, Tenant shall pay as Additional Rental for the period from and after the Commencement Date (i) Tenant’s Percentage Share of (a) Operating Expenses and (b) Impositions as provided in paragraph B of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year of this Lease, the estimate of Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, within thirty (30) days after receipt of Delta’s statement, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement or, if audited, by the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (10) days of Tenant’s written request to Delta for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire amount of such underpayment within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of Delta’s statement of actual Operating Expenses for the previous calendar year, to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountant.

Additional Rental. In addition Lessee shall pay to Lessor as additional rental (“Additional Rental” sometimes referred to as “Cost Pass Through” (“CPT” in every day language) Lessee’s share (as hereinafter defined) of the increase each year in Operating Expense (as hereinafter defined) over the Base Operating Expense (as hereinafter defined). “Lessee’s share shall equal that portion of such increase that the square footage of the Premises bears to all space available for lease in the Building. The term “Operating Expense” shall include all Lessor’s costs of operation, replacement and maintenance of the Building for each year including, but not limited to, all ad valorem taxes, premiums for insurance, management costs, utility charges, Building and parking lot security expense, parking lot maintenance expenses, janitorial and maintenance expenses, but shall not include the cost of capital improvements (such definition shall in no way increase Lessor’s obligations hereunder). The term “Base Operating Expense” shall mean the sum of $3.00 per square foot per calendar year. As soon as practical after December 31 of each calendar year, the Lessor shall deliver to the Base Rental payable pursuant to paragraph A above, Tenant shall pay as Additional Rental for the period from and after the Commencement Date Lessee (i) Tenant’s Percentage Share a statement of (a) Operating Expenses and (b) Impositions as provided in paragraph B of Article 7for the fiscal year just ended, (ii) utility charges as provided in paragraph A a computation of Article 7 and Tenant Impositions as provided in paragraph B Lessee’s share of Article 7such Operating Expenses, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year of this Lease, the estimate of Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, within thirty (30) days after receipt of Delta’s statement, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement orAdditional Rentals, if auditedany, payable by Lessee, hereinafter called the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction “Notice of the next accruing installment Payment of Additional Rental payable by Tenant to Delta, and (ii) if Rentals”. Lessee shall pay such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment Additional Rentals within ten (10) days after receipt of TenantNotice of Payment of Additional Rentals. At Lessor’s written request option, Lessor may estimate the Additional Rentals and xxxx the Lessee monthly in advance for such Additional Rentals; and Lessee shall pay the same to Delta for payment of such amountLessor in advance, at the same time and together with the monthly Base Rentals. If such audit reflects an underpayment monthly billing is elected by Tenant with respect to Lessor, and Lessee’s share of the period auditedOperating Expenses for the applicable calendar year exceeds the Additional Rentals paid by Lessee for such calendar year, then Tenant Lessee shall pay to Delta the entire amount of such underpayment excess within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of DeltaNotice of Payment of Additional Rentals. If Lessee’s statement Share of actual the Operating Expenses for the previous applicable calendar year is less than the Additional Rentals paid by Lessee for such calendar year, to cause DeltaLessor shall immediately credit and reduce Lessee’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement current Additional Rental payments accordingly. All Additional Rentals for the previous calendar year exceeds in which the actual amount lease term terminates shall be due and payable upon receipt of Notice of Payment of Additional Rentals even if such Notice is received after the lease termination date. With respect to the Additional Rentals, within sixty (60) days from the end of each calendar year, Lessee upon reasonable notice to Lessor, may have access to Lessor’s records to verify, at Lessee’s expense, the Operating Expenses for such the applicable calendar year as disclosed year. The base operating expense for the 902 square foot vault (G-102 Extension) shall be $3.47 less ad valorem taxes per square foot per annum. Ad valorem taxes shall be paid directly by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountantLessee.

Additional Rental. In addition The first paragraph of Paragraph Five of the Office Lease Agreement as amended shall be amended effective June 1, 2007 to read as follows: Landlord shall absorb and be responsible for paying all Operating Expenses during the first calendar year of the Renewal Term (the “Expense Stop”); and, Landlord shall absorb and be responsible for all Operating Expenses for any other calendar year of the Renewal Term to the Base Rental payable pursuant extent such Operating Expenses in any other calendar year are less than or equal to paragraph A abovethe Expense Stop. Thereafter, Tenant “Additional Rental” for any calendar year shall pay as Additional Rental for the period from and after the Commencement Date (i) mean Tenant’s Percentage Share of (a) Operating Expenses and (b) Impositions as provided in paragraph B of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year of this Lease, the estimate of Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, within thirty (30) days after receipt of Delta’s statement, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement or, if audited, by the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (10) days of Tenant’s written request to Delta for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire amount of such underpayment within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of Delta’s statement of actual Operating Expenses for the previous calendar year, to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit by more than in excess of the Expense Stop, “Tenant’s Percentage Share” shall mean a fraction, the numerator of which is the total number of square feet of Net Rentable Area within the Premises (27,268 square feet from and after February 1, 2007) and the denominator of which is the greater of (i) ninety-five percent (595%) of the total square footage of all Net Rentable Area in the Building (42,073 as of February 1, 2007); or (ii) the total square footage of all Net Rentable Area in the Building actually leased to rent paying tenants. Paragraph c. of Paragraph Five of the Office Lease Agreement as amended shall be amended effective June 1, 2007 to read as follows: The Annual Operating Expense Statement shall be rendered by Landlord to Tenant within thirty (30) day after calculation of such Annual Operating Expenses by Landlord. The payment of any Additional Rental by Tenant shall not preclude it from questioning the truth, correctness, or completeness of any Annual Operating Expense Statement. Tenant and provided further its authorized representatives shall have the right to audit Landlord’s records with respect to the Annual Operating Expenses. In the event Tenant’s audit discloses discrepancies, the appropriate adjustment shall be made, and if such discrepancies result in an overcharge to Tenant that is in excess of 2% of the annual billing to Tenant for such auditor’s determination is confirmed by Delta or otherwise determined to be correctitem(s), in which event Delta Landlord shall pay the costs and also reimburse Tenant its actual out-of-pocket expenses of such audit, including the fees and but in no event shall Landlord be responsible for audit expenses of Tenant that exceed the amount(s) found to be an overcharge to Tenant’s accountant. In the event Tenant shall dispute any Annual Operating Expense Statement and the parties cannot resolve their differences within sixty (60) days thereafter, then the matter shall be referred to arbitration. The balance of subparagraphs 5 (a) and (b) shall remain unchanged.

Additional Rental. In addition (a) Subject to the Base terms of this Article 8, from and after the Rental payable pursuant to paragraph A aboveCommencement Date, Tenant shall pay to Landlord "Tenant's Forecast Additional Rental" (as defined in subparagraph (b) hereinbelow) and "Tenant's Additional Rental" (as defined in subparagraph (c) hereinbelow). Payments of Tenant's Forecast Additional Rental shall be made as set forth in Article 5(a). (b) For purposes of this Lease, "Tenant's Forecast Additional Rental" shall mean Landlord's reasonable estimate of Tenant's Additional Rental for the period from and after the Commencement Date (i) Tenant’s Percentage Share of (a) Operating Expenses and (b) Impositions as provided in paragraph B of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding coming calendar year of this Lease, the estimate of Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect or portion thereof. If at any time it appears to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Landlord that Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses 's Additional Rental for the current calendar year. Tenant agrees to pay Delta, within thirty (30) days after receipt of Delta’s statement, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement or, if audited, by the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (10) days of Tenant’s written request to Delta for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire amount of such underpayment within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of Delta’s statement of actual Operating Expenses for the previous calendar year, to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit will vary from Landlord's estimate by more than five percent (5%), Landlord shall have the right to revise, by notice to Tenant, its estimate for such year, and subsequent payments by Tenant for such year shall be based upon such revised estimate of Tenant's Additional Rental. Failure to make a revision contemplated by the immediately preceding sentence shall not prejudice Landlord's right to collect the full amount of Tenant's Additional Rental. Prior to the Rental Commencement Date and thereafter prior to the beginning of each calendar year during the Lease Term, including any extensions thereof, Landlord shall present to Tenant a statement of Tenant's Forecast Additional Rental for such calendar year; provided, however, that if such statement is not given prior to the beginning of any calendar year as aforesaid, Tenant shall continue to pay during the next ensuing calendar year on the basis of the amount of Tenant's Forecast Additional Rental payable during the calendar year just ended until the month after such statement is delivered to Tenant. (c) For purposes of this Lease, "Tenant's Additional Rental" shall mean for each calendar year (or portion thereof) the Operating Expense Amount (defined below), less the Expense Stop set forth in Article 1(s), multiplied by the number of square feet of Rentable Floor Area of the Demised Premises. As used herein, "Operating Expense Amount" shall mean an amount equal to (x) plus (y), where: (x) equals the amount of Operating Expenses (as defined below) for such calendar year divided by the greater of (i) 95% of the number of square feet of Rentable Floor "t..J'ea of t..~e Building, or (ii) L1.e total nllillber of square feet of Rentable Floor .Area occupied in the Building for such calendar year on an average annualized basis; provided, however, if the Operating Expenses actually incurred by Landlord are lower than, using reasonable projections would be expected to be incurred using generally accepted accounting principles consistently applied would be incurred if at least 95% of the Building were occupied or if Landlord shall not furnish any particular item(s) of work or services (the cost of which would otherwise be included within Operating Expenses) to portions of the Building because (A) such portions are not occupied, (B) such item of work or services is not required or desired by the tenant of such portion, (C) such tenant is itself obtaining such item of work or services, or (D) of any other reason, then. appropriate - 6 - adjustments shall be made to determine Operating Expenses for such calendar year as though the Building were actually occupied to the extent of the greater of (i) or (ii) above and as though Landlord had furnished such item of work or services to the greater of (i) or (ii) above; and (y) equals a management fee contribution equal to five percent (5%) of the difference between Tenant's Base Rental Rate and the Expense Stop, plus five percent (5%) of the per square foot amount described in (x) above. (d) Within one hundred fifty (150) days after the end of the calendar year in which the Rental Commencement Date occurs and of each calendar year thereafter during the Lease Term, or as soon thereafter as practicable, Landlord shall provide Tenant a statement showing the Operating Expenses for said calendar year, and a statement comparing Tenant's Forecast Additional Rental with Tenant's Additional Rental. In the event Tenant's Forecast Additional Rental exceeds Tenant's Additional Rental for said calendar year, Landlord shall credit such amount against Rent then owing or next due hereunder or, if the Lease Term has expired or is about to expire, refund such excess to Tenant if Tenant is not in material default under this Lease (in the instance of a default such excess shall be held as additional security for Tenant's performance, may be applied by Landlord to cure any such default, and shall not be refunded until any such default is cured). In the event that the Tenant's Additional Rental exceeds Tenant's Forecast Additional Rental for said calendar year, Tenant shall pay Landlord, within thirty (30) days of receipt of the statement, an amount equal to such difference. The provisions of this Lease concerning the payment of Tenant's Additional Rental (and the refund of any excess payment) shall survive the expiration or earlier termination of this Lease. In no event shall Landlord collect from the tenants in the Building more than 100% of the Operating Expenses actually incurred by Landlord for such year. (e) For so long as Tenant is not in default under this Lease, Landlord's books and records pertaining to the calculation of Operating Expenses for any calendar year within the Lease Term may be audited by an authorized representative of Tenant at'Tenant's expense, at any time within twelve (12) months after Tenant's receipt of the annual statement required by Section 7(d) above; provided further that Tenant shall give Landlord not less than thirty (30) days' prior written notice of any such auditor’s determination is confirmed audit. For purposes hereof, an authorized representative of Tenant shall mean a bona fide employee of Tenant, any of the "big six" accounting firms, or any other party reasonably approved in writing by Delta or otherwise determined to be correct), Landlord. In no event shall an authorized representative of Tenant include the owner of any office building in the metropolitan area in which event Delta shall pay the costs and expenses Demised Premises are located or any affiliate of such owner. Prior to the commencement of such audit, including Tenant shall cause its authorized representative to agree in writing for the fees benefit of Landlord that such representative Vvill keep the results of the audit confidential and expenses that such representative will not disclose or divulge t~e results of such audit except to Tenant and Landlord and except in connection with any dispute between Landlord and Tenant relating to Operating Expenses. Such audit shall be conducted during reasonable business hours at Landlord's office where Landlord's books and records are maintained. Tenant shall cause a Vv ti.tten audit report to be prepared by its authorized representative following any such audit and shall provide Landlord with a copy of such report promptly after receipt thereof by Tenant. If Landlord's calculation of Tenant’s accountant's Additional R~ntal for the - 7 - audited calendar year was incorrect, then Tenant shall be entitled to a prompt refund of any overpayment or Tenant shall promptly pay to Landlord the amount of any underpayment, as the case may be. If Landlord's calculation of Tenant's Additional Rental for the audit calendar year was overstated by an amount in excess of ten percent (10%) of the Additional Rental, Landlord shall, in addition to the refund of any overpayment, pay Tenant's reasonable audit fees, not to exceed $750.00. 9.

Additional Rental. In addition to Minimum Annual Rental, Tenant shall pay to Landlord when due each sum of money required to be paid pursuant to this Article 5, Article 16, Article 18, and any other portion of this Lease as additional rent, whether or not the same is designated as additional rent. In addition to the Base Rental Minimum Annual Rent payable pursuant to paragraph A abovehereunder, Tenant shall pay Landlord as “Additional Rental Rent” for each calendar year following the period from and after Base Year or each portion thereof during the Commencement Date (i) Term Tenant’s Percentage Share of the sum of (ax) the amount (if any) by which Operating Expenses and (b) Impositions as provided in paragraph B of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7Costs for such period exceed Base Operating Costs, and (iiiy) all other payments to be made the amount (if any) by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Leasewhich Premises Taxes for such period exceed Base Taxes. Operating Expenses prior Prior to the first January 1 to occur after end of the Commencement Date shall be estimated based upon a budget prepared by Delta Base Year and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year thereafter, Landlord shall notify Tenant of this Lease, the Landlord’s estimate of Operating Expenses shall be based upon actual Operating Expenses Costs, Premises Taxes and Tenant’s Additional Rent for the previous following calendar year. Commencing on the first day of January of each calendar year (with respect to following the Base Year and continuing on the first full calendar day of every month thereafter in such year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay to Landlord one-twelfth (1/12th) of the estimated Additional Rent. If Landlord thereafter estimates that Operating Costs or Premises Taxes for such year will vary from Landlord’s prior estimate, Landlord may, by notice to Tenant’s Percentage Share of , revise the estimate for such estimated Operating Expenses year (“Tenant’s Estimated Operating Expenses”) for the calendar year and Additional Rent shall thereafter be payable based on the first (1st) day revised estimate). As soon as reasonably practicable after the end of each calendar month. By April 1 of the Base Year and each calendar year following the Commencement Datethereafter, Delta Landlord shall furnish to Tenant a statement of Delta’s actual with respect to such year, showing Operating Expenses Costs, Premises Taxes and Additional Rent for the previous calendar year year, and the calculation of Tenanttotal payments made by Tenant with respect thereto (“Expense Statement”). Unless Tenant raises any objections to Landlord’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, Expense Statement within thirty ninety (3090) days after receipt of Delta’s statementthe same, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement or, if audited, by the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to Expense Statement shall conclusively be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply deemed correct and credit such overpayment in reduction of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (10) days of Tenant’s written request to Delta for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire amount of such underpayment within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have no right thereafter to dispute such Expense Statement or any item therein or the rightcomputation of Additional Rent based thereon. If Tenant does object to such Expense Statement, within one hundred eighty (180) days after receipt then Landlord shall provide Tenant with reasonable verification of Delta’s statement of actual Operating Expenses for the previous calendar year, figures shown on the Expense Statement and the Parties shall negotiate in good faith to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by resolve any 9 Landlord /s/ RS____ CA Lease Revision 8.0 – Torrey Hills Corporate Center Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountant./s/ KA____ Skye Bioscience Lease

Additional Rental. In addition Section 8 (Additional Rental) of the Lease is hereby amended to reflect that during the Extension Term and commencing in calendar year 2008, Tenant will pay its proportionate share of Tenant’s Additional Rental based on the excess of Landlord’s projected Operating Expenses in each calendar year over the Base Rental payable pursuant Year Operating Expenses. For purposes of this Second Amendment, the “Base Year” shall mean calendar year 2007. In the event the average occupancy level of the Building or the Project for any calendar year, including the Base Year, is not ninety-five percent (95%) or more of full occupancy, then the Operating Expenses for such year shall be apportioned among the tenants by the Landlord to paragraph A abovereflect those costs which would have occurred had the Building or the Project, Tenant shall pay as Additional Rental for the period from and applicable, been ninety-five percent (95%) occupied during such year. For each calendar year after the Commencement Date (i) Tenant’s Percentage Share Base Year, Landlord shall provide Tenant with a comparison of (a) the Base Year Operating Expenses and (b) Impositions as provided in paragraph B of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. the projected Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayedfor such current calendar year. For each succeeding calendar year of this Lease, the estimate of Such projected increase in Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date payable in advance on a date other than January 1). Tenant shall pay monthly basis by paying one-twelfth (1/12th) of Tenant’s Percentage Share such projected increase during each month of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the respective calendar year year. If Landlord has not furnished Tenant such comparison by January 1 of a calendar year, Tenant shall continue to pay on the first (1st) day basis of each calendar monththe prior year’s estimate until the month after such comparison is given. By April 1 of each calendar year following the Commencement Date, Delta shall furnish The statement provided by Landlord to Tenant a statement as set forth in Section 8(c) of Deltathe Lease shall set forth such year’s actual Operating Expenses for the previous compared to Base Year Operating Expenses and a statement comparing Tenant’s proportionate share of projected increases in Operating Expenses which Tenant paid throughout such calendar year and with Tenant’s proportionate share of actual Operating Expense increases (the calculation “Final Annual Statement of Operating Expenses”). If Tenant’s proportionate share of increases in actual Operating Expenses are greater than as shown in the statement delivered pursuant to Section 8(c) or greater than the amount of Tenant’s Estimated Operating Expenses for the current calendar year. Additional Rental actually paid by Tenant agrees to pursuant thereto, Tenant shall pay DeltaLandlord, within thirty (30) days after receipt of Deltasuch statement’s statementreceipt, any amount of such additional sum owed by Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses Additional Rental actually paid by Tenant during such calendar year pursuant to Landlord’s estimate of Tenant’s proportionate share of increases in Operating Expenses is greater than Tenant’s Percentage Share share of increases in actual Operating Expenses during such calendar year, as shown by Delta’s statement oron the Final Annual Statement of Operating Expenses, if auditedLandlord shall credit Tenant, by the audit thereof described below within thirty (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (1030) days of Tenant’s written request such statement issuance, such overpaid amount, or if the Lease has expired, will issue a check to Delta Tenant for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire overpaid amount of such underpayment within ten thirty (1030) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of Delta’s such statement of actual Operating Expenses for the previous calendar year, to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountantissuance.

Additional Rental. (a) In addition to the Base Rental payable pursuant to paragraph A abovefor each calendar year (or portion thereof) during the term of this Lease, Tenant shall pay as additional rent (the “Additional Rental for the period from and after the Commencement Date (iRental”) Tenant’s Percentage Proportionate Share (as hereinafter defined) of the Operating Expenses (as hereinafter defined) for that year in excess of the Operating Expenses for the Base Year (as hereinafter defined) and Tenant’s Proportionate Share of the Real Estate Taxes (aas hereinafter defined) Operating Expenses and in excess of the Base Real Estate Taxes (bas hereinafter defined) Impositions as provided in paragraph B for that year. On or about the beginning of Article 7, (ii) utility charges as provided in paragraph A of Article 7 and Tenant Impositions as provided in paragraph B of Article 7, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year during the term of this Lease, Landlord shall deliver to Tenant Landlord’s good faith estimate (the estimate “Estimated Additional Rental”) of Operating Expenses the Additional Rental for that year. The Estimated Additional Rental shall be paid in equal installments in advance on the first day of each month. If Landlord does not deliver an estimate to Tenant for any year by January 1 of that year, Tenant shall continue to pay Estimated Additional Rental based upon actual Operating Expenses for on the previous prior year’s estimate. From time to time during any calendar year (with respect to the first full but not more than twice during any calendar year), adjustedLandlord may, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, within upon thirty (30) days after receipt prior written notice, revise its estimate of Delta’s statementthe Additional Rental for that year based on either actual or reasonably anticipated increases in Operating Expenses or Real Estate Taxes, any and the monthly installments of Estimated Additional Rental shall be appropriately adjusted for the remainder of that year in accordance with the revised estimate so that by the end of the year, the total payments of Estimated Additional Rental paid by Tenant shall equal the amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as the revised estimate. The parties acknowledge and agree that during calendar year 2000, Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Additional Rental shall be only Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Proportionate Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement or, if audited, by the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment Real Estate Taxes in reduction excess of the next accruing installment of Additional Rental payable by Tenant to Delta, and (ii) if such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment within ten (10) days of Tenant’s written request to Delta for payment of such amount. If such audit reflects an underpayment by Tenant with respect to the period audited, then Tenant shall pay to Delta the entire amount of such underpayment within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of Delta’s statement of actual Operating Expenses for the previous calendar year, to cause Delta’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement for the previous calendar year exceeds the actual amount of such Operating Expenses for such calendar year as disclosed by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountantBase Real Estate Taxes.

Additional Rental. In addition Lessee shall pay to Lessor as additional rental (“Additional Rental” sometimes referred to as “Cost Pass Through” (“CPT” in every day language) Lessee’s share (as hereinafter defined) of the increase each year in Operating Expense (as hereinafter defined) over the Base Operating Expense (as hereinafter defined). “Lessee’s share shall equal that portion of such increase that the square footage of the Premises bears to all space available for lease in the Building. The term “Operating Expense” shall include all Lessor’s costs of operation, replacement and maintenance of the Building for each year including, but not limited to, all ad valorem taxes, premiums for insurance, management costs, utility charges. Building and parking lot security expense, parking lot maintenance expenses, janitorial and maintenance expenses, but shall not include the cost of capital improvements (such definition shall in no way increase Lessor’s obligations hereunder). The term “Base Operating Expense” shall mean the sum of $3.00 per square foot per calendar year. As soon as practical after December 31 of each calendar year, the Lessor shall deliver to the Base Rental payable pursuant to paragraph A above, Tenant shall pay as Additional Rental for the period from and after the Commencement Date Lessee (i) Tenant’s Percentage Share a statement of (a) Operating Expenses and (b) Impositions as provided in paragraph B of Article 7for the fiscal year just ended, (ii) utility charges as provided in paragraph A a computation of Article 7 and Tenant Impositions as provided in paragraph B Lessee’s share of Article 7such Operating Expenses, and (iii) all other payments to be made by Tenant to Delta pursuant to Articles 9, 10 and 16 of this Lease and all other payments to be made by Tenant to Delta with respect to capital improvements, capital replacements or other capital expenditures as provided in Article 1 of this Lease. Operating Expenses prior to the first January 1 to occur after the Commencement Date shall be estimated based upon a budget prepared by Delta and approved by Tenant, which approval shall not be unreasonably withheld or delayed. For each succeeding calendar year of this Lease, the estimate of Operating Expenses shall be based upon actual Operating Expenses for the previous calendar year (with respect to the first full calendar year, adjusted, if necessary, to reflect a Commencement Date on a date other than January 1). Tenant shall pay one-twelfth (1/12th) of Tenant’s Percentage Share of such estimated Operating Expenses (“Tenant’s Estimated Operating Expenses”) for the calendar year on the first (1st) day of each calendar month. By April 1 of each calendar year following the Commencement Date, Delta shall furnish to Tenant a statement of Delta’s actual Operating Expenses for the previous calendar year and the calculation of Tenant’s Estimated Operating Expenses for the current calendar year. Tenant agrees to pay Delta, within thirty (30) days after receipt of Delta’s statement, any amount of Tenant’s Percentage Share of actual Operating Expenses which was not previously paid as Tenant’s Estimated Operating Expenses for such previous calendar year. If for any calendar year the amount of Tenant’s Estimated Operating Expenses paid by Tenant during such calendar year is greater than Tenant’s Percentage Share of actual Operating Expenses during such calendar year, as shown by Delta’s statement orAdditional Rentals, if auditedany, payable by Lessee, hereinafter called the audit thereof described below (provided such auditor’s determination is confirmed by Delta or otherwise determined to be correct), then, (i) if such overpayment is less than $50,000.00, Delta shall apply and credit such overpayment in reduction “Notice of the next accruing installment Payment of Additional Rental payable by Tenant to Delta, and (ii) if Rentals”. Lessee shall pay such overpayment is greater than $50,000.00, Delta shall refund to Tenant the entire amount of any such overpayment Additional Rentals within ten (10) days after receipt of TenantNotice of Payment of Additional Rentals. At Lessor’s written request option, Lessor may estimate the Additional Rentals and xxxx the Lessee monthly in advance for such Additional Rentals; and Lessee shall pay the same to Delta for payment of such amountLessor in advance, at the same time and together with the monthly Base Rentals. If such audit reflects an underpayment monthly billing is elected by Tenant with respect to Lessor, and Lessee’s share of the period auditedOperating Expenses for the applicable calendar year exceeds the Additional Rentals paid by Lessee for such calendar year, then Tenant Lessee shall pay to Delta the entire amount of such underpayment excess within ten (10) days of receipt of Delta’s invoice therefor. Tenant shall have the right, within one hundred eighty (180) days after receipt of DeltaNotice of Payment of Additional Rentals. If Lessee’s statement Share of actual the Operating Expenses for the previous applicable calendar year is less than the Additional Rentals paid by Lessee for such calendar year, to cause DeltaLessor shall immediately credit and reduce Lessee’s books and records relating to Operating Expenses to be audited by a Big Eight accounting firm designated by Tenant and reasonably acceptable to Delta, and Delta shall cooperate with Tenant and such accountants in connection with any such audit; provided, however, that Tenant shall pay all costs and expenses of such audit unless such audit reveals that the amount of Operating Expenses set forth in Delta’s statement current Additional Rental payments accordingly. All Additional Rentals for the previous calendar year exceeds in which the actual amount lease term terminates shall be due and payable upon receipt of Notice of Payment of Additional Rentals even if such Notice is received after the lease termination date. With respect to the Additional Rentals, within sixty (60) days from the end of each calendar year, Lessee upon reasonable notice to Lessor, may have access to Lessor’s records to verify, at Lessee’s expense, the Operating Expenses for such the applicable calendar year as disclosed year. The base operating expense for the 902 square foot vault (G-102 Extension) shall be $ 3.47 less ad valorem taxes per square foot per annum. Ad valorem taxes shall be paid directly by such audit by more than five percent (5%) (and provided further that such auditor’s determination is confirmed by Delta or otherwise determined to be correct), in which event Delta shall pay the costs and expenses of such audit, including the fees and expenses of Tenant’s accountantLessee.