Exhibit 10.4

LEASE
by and between
KENDALL SQUARE, LLC
LANDLORD,
and
GENZYME CORPORATION,
TENANT

ARTICLE I

REFERENCE DATA

1.1    SUBJECTS REFERRED TO

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        The following capitalized terms shall have the respective meanings set forth below or as referenced in this Lease:

ADA Requirements: The Americans with Disabilities Act (42 U.S.C. § 12101 et seq.) and the regulations and Accessibility Guidelines for Buildings and Facilities issued pursuant thereto.

Additional Rent Adjustment Date: As defined in Section 4.2.4

Additional Rent: All rent, charges and other sums, other than Fixed Rent, due Landlord pursuant to this Lease.

Affiliate of Landlord: A person or entity controlled by, controlling or under common control with Landlord.

Affiliate of Tenant: Any entity controlled by, controlling or under common control with Tenant.

Annual Building Maintenance and Operation Charge: As defined in Section 4.2.4

Annual Complex Maintenance and Operation Charge: As defined in Section 4.2.4.

Annual Maintenance Charge: The sum of the Annual Building Maintenance and Operation Charge, the Annual Complex Maintenance and Operation Charge and the Nonstandard Charge.

Annual Tax, Insurance and Utility Charge: The sum of the Initial Tax Charge, the Initial Insurance Charge and the Initial Utility Charge.

Appraiser: A commercial real estate broker having at least ten (10) years experience in the commercial leasing market in the City of Cambridge, Massachusetts.

Approved Contractor: As defined in Section 3.2.1.

Arbitrator: As defined in Section 10.13.

Architect's Contract: As defined in Section 3.1.1.

Availability Notice: As defined in Section 10.18

Base Building Improvements: As defined in Section 3.1.1.

Brokers: Trammel Crow Company and Insignia/ESG.

Building Common Areas: Interior and exterior common areas and facilities of the Building and the Lot.

Casualty Restoration Completion Date: As defined in Section 6.1.

CDD: Community Development Department of the City of Cambridge, Massachusetts.

Change Orders: As defined in Section 3.1.2.

Chapter 91 Determination: As defined in Section 3.1.4.

Commencement Date: As defined and determined pursuant to Section 2.2.

Complex Common Areas: Interior and exterior common areas and facilities of the Complex.

Confidential Information: Any and all knowledge, information, data, materials, trade secrets, and other work product of a confidential nature gained, obtained, derived, produced, generated or otherwise acquired by Landlord with respect to Tenant's business.

Construction Contract: As defined in Section 3.1.1.

Construction Documents: As defined in Section 3.2.1.

Design Development Documents: As defined in Section 3.1.1.

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Design Process Letter: Letter dated January 17, 2000 from David Clem of Lyme Properties, LLC to Henri Termeer, President and CEO of Tenant.

Developer's Fee: As defined in Section 3.1.1.

Development Approvals: As defined in Section 3.1.4.

Early Occupancy Space: As defined in Section 10.11.

Environmental Agreement: The Environmental Agreement between Landlord and Tenant in the form of Exhibit E hereto.

Environmental Remediation: As defined in Section 3.1.3.

Estimated Annual Additional Rent: Landlord's estimate of the total amount of Additional Rent which may be due from Tenant for any particular Lease Year with respect to the Building, Lot and Complex.

Estimated Annual Maintenance Charge: Landlord's reasonable estimate of the Annual Maintenance Charge.

Estimated Annual Tax, Insurance and Utility Charge: Landlord's reasonable estimate of the Annual Tax, Insurance and Utility Charge.

Event of Default: As defined in Section 7.1.

Excluded Taxes: Any income taxes, excess profits taxes, excise taxes, franchise taxes, or any taxes or assessments with respect to the Garage and other buildings leased or available for lease (and the parcels of land upon which such buildings are situated), other than the Building, the Lot and any building or portion of a building in the Complex which is not available for lease (and the parcel(s) of land on which the same may be located), in the Complex.

Exercise Notice: As defined in Section 10.12.

Expansion Spaces: As defined in Section 10.11.

Extension Periods: As defined in Section 10.12.

Extension Rent: As defined in Section 10.12.

Fair Market Rent: As defined in Section 10.12.

Final Design Documents: As defined in Section 3.1.1.

Final Project Budget: All hard costs and soft costs incurred by Landlord in connection with the construction of the Base Building Improvements as reflected in a final project budget to be mutually approved by Landlord and Tenant, as provided in Section 3.1.1.

First Expansion Space: As defined in Section 10.11.

Fixed Rent: As defined in Section 4.1.

Garage Owner: The owner of the Garage.

Garage Parking Spaces: Tenant's Parking Spaces and the Valet Parking Spaces.

Garage: The underground parking structure to be constructed and/or owned by Landlord or an Affiliate of Landlord south of Kendall Street, as shown on Exhibit A hereto.

Holder: As defined in Section 8.1.

Impositions: As defined in Section 4.2.4(1)(a).

Indemnified Parties: As defined in Section 5.1.6.

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Initial Estimated Annual Additional Rent for Building: As defined in Section 4.2.

Inquiry Notice: As defined in Section 10.12.

Labor Unrest: As defined in Section 3.2.1.

Landlord Milestone Date: As defined in Section 3.2.

Landlord's Statement: As defined in Section 4.2.4.

Landlord's Work: The construction of the Base Building Improvements in accordance with the Final Design Documents as affected by Change Orders.

MCP: Massachusetts Contingency Plan, 310 CMR 40.0000 et seq., as amended.

MEPA Certificate: Certificate of the Secretary of Environmental Affairs on the Final Environmental Impact Report dated April 15, 1999.

Minor Alteration: As defined in Section 3.2.1.

Mitigation Expenses: As defined in Section 3.1.1.

Mortgage: Mortgages, deeds of trust or other similar instruments evidencing other voluntary liens or encumbrances, and modifications, consolidations, extensions, renewals, replacements and substitutes thereof.

Nonstandard Charge: As defined in Section 4.2.4.

Nonstandard Costs: As defined in Section 4.2.4.

Option to Lease: The option to lease with respect to Building B executed by Landlord and Tenant simultaneously with the execution hereof.

Options to Extend: As defined in Section 10.12.

Order of Conditions: Order of Conditions issued July 12, 1999 by the City of Cambridge Conservation Commission.

Outside Completion Date: As defined in Section 3.2.

Parking Fee: As defined in Section 10.14.

Preliminary Design Concept: As defined in Section 3.1.1.

Progress Schedule: As set forth in Exhibit B hereto.

PTDM Approval: The PTDM Decision, the PTDM Letter and PTDM Plan.

PTDM Decision: PTDM Ordinance Final Decision issued April 20, 1999 by the CDD.

PTDM Letter: The Letter dated April 20, 1999 to Robert L. Green of Lyme Properties from Susanne Rasmussen of the CDD attached to the PTDM Decision.

PTDM Plan: Landlord's Parking Transportation Demand Management Plan dated April 9, 1999.

PUD Approval: The PUD Permit and the Settlement Agreement.

PUD Permit: A Special Permit issued by the City of Cambridge Planning Board, Case No. PB #141 filed April 7, 1999 (the "PUD Permit"), recorded with the Middlesex South District Registry of Deeds (the "Registry") in Book 31137, Page 89.

Punch List Items: Minor items which can be fully completed by Landlord within thirty (30) days without material interference with Tenant and other items which because of the season or weather or the

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nature of the item are not practicable to do at the time, provided that none of said items is necessary to perform Tenant's Work.

Relevant Market: As defined in Section 10.12(b).

Remediation Documents: The documents set forth on Exhibit E-1 hereto.

Rentable Square Feet, Rentable Square Footage or r.s.f.: The rentable square footage of the space in question as measured in accordance with the standard set forth in Section 2.3.

Response Action Outcome: As such term is defined in the MCP.

ROFR Notice: As defined in Section 10.18.

ROFR Space: As defined in Section 10.18.

ROFR: As defined in Section 10.18.

Schematic Design Documents: As defined in Section 3.1.1.

Settlement Agreement: A Settlement Agreement dated May 24, 1999 among Barbara Broussard, Mary DeFreitas, the East Cambridge Planning Team and Landlord.

SNDA: Subordination, Non-disturbance and Attornment Agreement.

Subdivision: As defined in Section 9.1.6.

Sublease Costs: As defined in Section 5.2.1.

Sublease Profits: As defined in Section 5.2.1.

Subsequent Approvals: As defined in Section 3.1.4.

Substantial Completion Date: As defined in Section 3.2.

Substitute Taxes: As defined in Section 4.2.1.

Tenant Delay: As defined in Section 3.1.1.

Tenant's Property: All of the furnishings, fixtures, equipment, effects and property of every kind, nature and description owned or leased by Tenant or by any person claiming by, through or under Tenant which, during the continuance of this Lease or any occupancy of the Premises by Tenant or anyone claiming under Tenant, may be on the Premises.

Tenant's Proportionate Fraction for Building: As defined in Section 2.3

Tenant's Proportionate Fraction for Complex: As defined in Section 2.3.

Tenant's Work: As defined in Section 3.2.1.

TI Factor: As defined in Section 10.11.

Title Exceptions: Item Nos. 2 through 12, inclusive set forth in Schedule B, Part 1 of the Title Policy.

Title Policy: Owner's Policy No. 136-00-336684 dated August 19, 1998, issued by Lawyer's Title Insurance Corporation.

TMA: The Charles River Transportation Management Association or any other transportation management association of which Landlord is a member.

Transfer: As defined in Section 9.1.6.

Utilities: As defined in Section 4.2.3.

Utility Service Provider or Utility Service Providers: As defined in Section 4.2.3.

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Utility Services: As defined in Section 4.2.3.

Valet Parking Fee: As defined in Section 10.14.

Valet Parking Spaces: As defined in Section 10.14.

1.2    EXHIBITS.

        The Exhibits listed below in this section are incorporated in this Lease by reference and are to be construed as a part of this Lease:

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1.3    TABLE OF CONTENTS

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ARTICLE II

PREMISES AND TERM

2.1    PREMISES.

        Landlord hereby leases and demises to Tenant and Tenant hereby leases from Landlord, subject to and with the benefit of the terms, covenants, conditions and provisions of this Lease, the Premises. Tenant shall have, as appurtenant to the Premises, the right to use in common with others, if any, entitled thereto (i) the common areas and common facilities, if any, included in the Building, on the Lot or in the Complex, (ii) the building service fixtures and equipment serving the Premises, and (iii) subject to Section 10.14 hereof, (a) the right to use that number of nonreserved parking spaces determined by dividing the Rentable Square Footage (as the same shall be determined pursuant to Section 2.3 hereof and as the same may be increased pursuant to Section 10.11 hereof) by 500 ("Tenant's Parking Spaces") in the underground parking garage located south of Kendall Street as shown on Exhibit A hereto (the "Garage") and (b) the right to use that number of nonreserved Valet Parking Spaces, as such term is defined and such number is determined pursuant to Section 10.14 hereof. To the extent that the Premises includes all of the rentable square footage on a particular floor of the Building, Tenant shall have exclusive use of the common areas on such floors, but Landlord shall have the rights set forth in the next paragraph hereof.

        Landlord reserves the right from time to time, without unreasonable interference with Tenant's use, (a) to install, repair, replace, use, maintain and relocate for service to the Premises and to other parts of the Building, or either, building service fixtures and equipment wherever located in the Building, including the perimeter walls of the Premises, on the roof of the Building, in mechanical penthouses and in any space in or adjacent to the Premises used for shafts, stacks, pipes, conduits, wires and appurtenant fixtures, ducts, electric or other utilities, telecommunications equipment or other Building facilities, as well as the right of access (which right of access shall be at reasonable times and upon reasonable notice, except in the case of emergency) through the Premises for the purpose of operation, maintenance and repair, provided, however, that the Annual Fixed Rent, Additional Rent (as defined in Section 4.2 hereof) and other charges payable hereunder by Tenant shall be proportionally reduced in the event that any such installation or relocation of service materially reduces the usable floor area of the Premises (other than a temporary reduction to accommodate installation, repair, replacement, maintenance and relocation of such service); notwithstanding the foregoing provisions of this clause (a), to the extent that the Premises include all of the rentable square footage on a particular floor of the Building, Landlord's right to install, repair, replace, use, maintain and relocate such building service fixtures and equipment on such floor of the Building shall be limited to placing or installing such building service fixtures and equipment in shafts, pipes, stacks, conduits, chases and risers located within the central core common area of such floor or in such other locations on such floor as may be set forth in the Final Design Documents; (b) to construct, alter or relocate any Building Common Areas and/or Complex Common Areas (provided that, except for any construction, alteration or relocation of Complex Common Areas required or permitted by the Development Approvals or Subsequent Approvals, no such construction, alteration or relocation of any such Complex Common Areas shall substantially or materially increase any payments due from Tenant under this Lease and any such construction, alteration or relocation shall be substantially similar in quality and utility to Complex Common Areas being altered or relocated or substantially similar to common areas of first-class, mixed use projects in the Relevant Market); and (c) after construction of the Building to construct, alter or relocate any Building Common Areas, subject to approval by Tenant, such approval not to be unreasonably withheld, delayed or conditioned.

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2.2    TERM.

        To have and to hold for a period (the "Term") commencing on the Term Commencement Date (as such term is defined in Section 1.1 hereof) (the "Commencement Date") and continuing until the Term Expiration Date, unless sooner terminated as provided herein, including Section 3.2 and Article VII hereof, and subject to extension in accordance with the terms of Section 10.12 hereof.

2.3    MODIFICATION OF CERTAIN DEFINITIONS; CERTIFICATE REGARDING COMMENCEMENT DATE.

        Landlord and Tenant acknowledge that the actual rentable square footage of the Premises, the Expansion Spaces (as such term is defined in Section 10.11 hereof) and the Building may, upon completion of construction of the Base Building Improvements (as hereinafter defined), be different than the estimates as set forth in Article I hereof. Accordingly, after completion of construction of the Base Building Improvements, Landlord will notify Tenant of the Rentable Square Footage of the Premises, the Expansion Spaces and the Building, all of which shall be measured by Landlord's Architect in accordance with the ANSI/BOMA Z65.1-1996 Standard Method for Measuring Building Rentable Area, approved June 7, 1996 for a single tenant building. Landlord's Architect's measurement shall be subject to review and approval by Tenant's Architect for conformity to the foregoing standard. If necessary, Landlord and Tenant will execute an amendment to this Lease modifying the definitions of Rentable Square Footage of Premises, Rentable Square Footage of Building, the location in the Building of the Premises and the Expansion Spaces, Tenant's Proportionate Fraction for Building, Tenant's Proportionate Fraction for Complex, Initial Estimated Annual Additional Rent for Building, Initial Estimated Annual Additional Rent for Complex, and such other terms and provisions, if any, of this Lease as may be necessary to reflect such actual measurements. Landlord and Tenant will also execute, upon request of either, a certificate, substantially in the form of Exhibit A-3 hereto, acknowledging, inter alia, the Commencement Date of this Lease as provided for in Section 2.2 hereof, after such Commencement Date has occurred (as described in Section 3.2 hereof), and the Rentable Square Footage of the Building, the Premises and the Expansion Spaces. After such measurement by Landlord's Architect, the Premises, the Expansion Spaces and the Building shall not be subject to remeasurement without the consent of Landlord and Tenant. Anything in this Lease to the contrary notwithstanding, the Premises, as initially demised, shall include all of the Rentable Square Footage in the Building other than the Expansion Spaces and the Retail Space. "Tenant's Proportionate Fraction for Building" shall be the ratio, expressed as a percentage, of the Rentable Square Footage of Premises, including the Expansion Spaces and any ROFR Space (from and after the dates on which each of the Expansion Spaces or any ROFR Space is demised to Tenant), to the Rentable Square Footage of Building. "Tenant's Proportionate Fraction for Complex" shall be the ratio, expressed as a percentage, of the Rentable Square Footage of the Premises, including the Expansion Spaces and any ROFR Space, when applicable, to the Rentable Square Footage of all buildings (other than any garages in the Complex and any building or portion thereof which is not available for lease such as an information kiosk), including the Building, which Landlord is permitted to develop in the Complex pursuant to the PUD Approval. Landlord shall have the right to estimate on a good faith basis, from time to time, the Rentable Square Footage of all such buildings prior to the construction thereof. From time to time after construction of each building in the Complex, Landlord shall notify Tenant of the Rentable Square Footage of such buildings and shall provide to Tenant, upon Tenant's request, such information as Tenant may reasonably request with respect to the calculation thereof. Within thirty (30) days after notice of such Rentable Square Footage, Tenant shall pay to Landlord or Landlord shall credit to Additional Rent next due from Tenant, as applicable, any underpayment owed or overpayment made, as applicable, by Tenant based upon the estimated Rentable Square Footage of such buildings, on account of Tenant's Proportionate Fraction for Complex of taxes and assessments and Tenant's Proportionate Fraction for Complex of the Annual Complex Maintenance and Operation Charge and the actual Rentable Square Footage of such buildings.

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ARTICLE III

BASE BUILDING IMPROVEMENTS

3.1    INITIAL DESIGN AND CONSTRUCTION.

3.1.1    Architect Selection Process, Development of Design Documents, Landlord's Contractor and Project Cost.

        Landlord has initiated a design competition for the Building as more fully set forth in a letter dated January 17, 2000 from David Clem of Lyme Properties, LLC to Henri Termeer, President and CEO of Tenant (the "Design Process Letter"), which is incorporated herein by reference thereto. Landlord and Tenant agree to cooperate in connection with the design competition as set forth in the Design Process Letter. Upon completion of such design competition, Landlord and Tenant shall mutually select Landlord's Architect (for purposes of this Lease the term "Landlord's Design Team" shall be deemed to refer not only to Landlord's Architect but also to the principal engineers, architects and other design consultants employed by Landlord or Landlord's Architect for the design and construction of the Building) and Landlord's Design Team (to the extent then identified). Landlord and Tenant shall also mutually establish and agree upon (i) a preliminary design concept for the Building (the "Preliminary Design Concept"), which shall be based upon Tenant's program, outline building specifications, schedule requirements, and (ii) a preliminary hard and soft cost budget for the Base Building Improvements (the "preliminary Project Cost budget"). Such selection of Tenant's Architect and Landlord's Design Team (to the extent then identified), the establishment and agreement upon the Preliminary Design Concept and the establishment and agreement upon such preliminary Project Cost budget shall be made by the respective dates for each set forth in the progress schedule attached as Exhibit B hereto (the "Progress Schedule"). Landlord and Tenant acknowledge and agree that the Progress Schedule represents a good faith estimate of the respective dates upon which the items set forth in the Progress Schedule are to occur but that the Progress Schedule is subject to finalization by Landlord and Tenant upon selection of Landlord's Architect and Landlord's Contractor. Accordingly, references in this Lease to the Progress Schedule shall mean the Progress Schedule attached hereto as Exhibit B as the same may be finalized. The Preliminary Design Concept shall describe the general scope and quality of the Building and shall identify those portions of the Building which will constitute the Premises initially leased to Tenant and the Expansion Spaces. If despite the diligent and good faith efforts of Landlord and Tenant the parties are unable to mutually select Landlord's Architect, to establish a mutually acceptable Preliminary Design Concept and/or a mutually acceptable preliminary Project Cost budget by the applicable dates set forth in the Progress Schedule, either Landlord or Tenant may terminate this Lease upon thirty (30) days' prior written notice to the other party. During such thirty (30) day period Landlord and Tenant shall use diligent and good faith efforts to select such Architect, establish such Preliminary Design Concept and/or preliminary Project Cost budget, as applicable, failing which this Lease shall terminate on the date set forth in such notice. In the event of such termination, all third party, out-of-pocket costs incurred by Landlord in connection with the design competition and design process solely for the Building shall be shared equally by Landlord and Tenant.

        Landlord and Tenant also agree to cooperate in good faith in connection with the design of the Building and the Base Building Improvements and the development of a mutually acceptable Final Project Budget (as defined below). Neither Landlord nor Tenant shall be required to approve any Design Documents unless the Building includes at least 285,000 r.s.f. of office space and at least 15,000 r.s.f. of ground floor retail space and each Expansion Space includes approximately 25,000 r.s.f. of contiguous space on a single floor of the Building. The size, layout, design and base building fit-up of the Building and Base Building Improvements and the Final Project Budget shall be mutually agreed

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upon by Landlord and Tenant. Landlord and Tenant acknowledge and agree that during design development process contemplated hereby, Tenant, with Landlord's approval, which approval shall not be unreasonably withheld, conditioned or delayed, shall have the right to approve and/or design base building electrical, mechanical, HVAC and other systems and design specifications (such as, by way of example, entranceway and lobby design, internal stair location, elevator size and finish, location of electrical and telecom rooms and equipment, location of mechanical shaftways and equipment, structural bay spaces, window mullions spacing and sill depth and height, floor to floor heights and the like), provided that the specifications for such base building elements are equal or better than the quality of the specifications therefor in a newly constructed, first-class office tower in Cambridge.

        Each party acknowledges and agrees that it is in its best interest for the Substantial Completion Date to occur on or before the Scheduled Substantial Completion Date and that the Final Project Budget be substantially consistent with the preliminary Project Cost budget and the updates thereto. Accordingly, each party hereby agrees that it shall keep the other party informed of the progress and status of its efforts to achieve the various milestones and other scheduled completion dates set forth on the Progress Schedule; and that if either party concludes that a milestone or other scheduled completion date will not be met, such party shall use reasonable efforts to notify the other party of the occurrence of any act, event, condition, omission or circumstance which could have a substantial or material impact on: (i) the ability to achieve the various milestone and other scheduled completion dates set forth on the Progress Schedule; (ii) the cost or financial viability of the construction of the Building or Complex; or (iii) Tenant's use and occupancy of the Premises.

        After Landlord's Architect and the Landlord's Design Team have been selected and Landlord and Tenant have mutually established the Preliminary Design Concept, Landlord shall enter into a contract (the "Architect's Contract") with Landlord's Architect. The Architect's Contract shall be subject to Tenant's prior approval, which approval shall not be unreasonably withheld, conditioned or delayed. The Architect's Contract shall include provisions requiring Landlord's Architect to submit all Design Documents (as hereinafter defined) for each stage in the design process simultaneously to both Landlord and Tenant sufficiently prior to the applicable Design Document completion date for such design stage set forth in the Progress Schedule, in order to provide Landlord and Tenant with reasonably sufficient time (in any event not less than ten (10) business days for initial review of the applicable Design Document) following receipt of such submission to review, comment on and approve such submission prior to such completion date, to be responsible for the adequacy, accuracy and completeness of the Final Design Documents approved by Landlord and Tenant, and to cause the Final Design Documents to comply with all applicable laws, regulations, building codes, building design standards, the Development Approvals, Subsequent Approvals, agreed upon floor loading limits, and with respect to all materials, equipment and special designs, processes or products, that the same do not infringe any patent or other proprietary rights of others. Contemporaneously with the selection of Landlord's Architect, Landlord shall retain a construction manager or similar consultant (the "Construction Cost Estimator"), reasonably satisfactory to the Tenant, to work with and provide pre-construction services for Landlord, Tenant and Landlord's Architect to develop, and provide value engineering services to control, a preliminary Project Cost budget and updates thereto during the Schematic Design Documents phase and the Design Development Documents phase. The parties acknowledge that Landlord may, subject to Tenant's reasonable approval, elect, at any time, to hire such Construction Cost Estimator as Construction Manager/General Contractor for the Building. Subject to the limitations hereafter set forth with respect to Tenant's right to disapprove bids with respect to the Construction Contract, each of Landlord and Tenant shall have the right to approve such preliminary Project Cost budget and updates thereto, which approvals shall not be unreasonably withheld, conditioned or delayed.

        Landlord shall cause Landlord's Architect to prepare schematic architectural plans, structural and engineering plans, elevations and building sections, and site plans for the Building based upon the

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Preliminary Design Concept ("Schematic Design Documents"), which shall mean a conceptual design of the Base Building Improvements illustrating the scale and relationship of the components of the Base Building Improvements and calculating the gross floor area and Rentable Square Footage of the Building. Additionally, the Construction Cost Estimator shall prepare an updated budget for the Base Building Improvements for approval by Landlord and Tenant. The Schematic Design Documents shall show walkways and plazas for the Building and Lot, major landscape features, hardscaping, scale and relationship of other major components of the Building and Lot, pedestrian and vehicular (including service) access and flow through the Lot, lighting, survey information such as existing elevations, benchmarks and utilities, and any known construction limits. The Schematic Design Documents shall also include models, color renderings and outline specifications indicating all basic materials and systems of the proposed Base Building Improvements. The Schematic Design Documents and all subsequent Design Documents shall be prepared and distributed by Landlord's Architect in both hard copy and electronic format.

        During the development of the Schematic Design Documents, Landlord and Tenant shall meet with representatives of the CDD (as defined in Section 3.1.4 hereof) and their respective consultants to review and refine the design of the Building and the Lot. Thereafter, Landlord shall seek approval of the Schematic Design Documents by the Planning Board (as defined in Section 3.1.4 hereof), and Tenant shall cooperate with Landlord in connection therewith. If despite the good faith efforts of Landlord and Tenant the Planning Board rejects the design reflected in the Schematic Design Documents or insists upon major changes to the Schematic Design Documents which are unacceptable to either Landlord or Tenant and if as a result thereof Landlord is unable to obtain approval of the Schematic Design Documents by the Planning Board by the date set forth in the Progress Schedule, as the same may be changed by any Tenant Delay, either Landlord or Tenant may terminate this Lease upon thirty (30) days prior written notice. If Planning Board approval of the Schematic Design Documents is not obtained by the end of such thirty-day period, this Lease shall thereupon terminate. In the event of such termination, all third party, out-of-pocket costs incurred by Landlord in connection with the design competition and design process solely for the Building and Lot shall be shared equally by Landlord and Tenant. Planning Board approval of the Schematic Design Documents shall be a Subsequent Approval (as defined in Section 3.1.4 hereof). Landlord and Tenant agree to cooperate in connection with any conditions imposed by the Planning Board in connection with the Planning Board's approval of the Schematic Design Documents, such as further review of the Design Documents by the CDD.

        At such time as the Schematic Design Documents have been approved by Landlord and Tenant (and by the Planning Board, if Landlord elects to have the Schematic Design Documents approved by the Planning Board), Landlord shall cause (i) Landlord's Architect to prepare further details and development of the Schematic Design Documents (the "Design Development Documents") for the Building and the Base Building Improvements, which shall mean plans, sections and elevations, typical construction details, and equipment layouts showing the scope, relationships, forms, size and appearance of the Base Building Improvements and calculating the gross floor area and the Rentable Square Footage of the Building and (ii) the Construction Cost Estimator, based upon such Design Development Documents, to prepare an updated budget for the Base Building Improvements, each for approval by Landlord and Tenant. Design Development Documents shall include architectural, mechanical and electrical drawings and details of the Building, exterior materials to be incorporated in the Building, walkways and other plaza areas on the Lot, a site and landscape plan for the Lot showing all site development and landscape detail for lighting, paving, landscaping, utilities, grading, drainage, access and service areas. The Design Development Documents shall also include outline specifications indicating all basic materials and mechanical and electrical systems of the proposed Base Building Improvements. As with the Schematic Development Documents, the Design Development Documents shall be prepared and distributed in both hard copy and electronic format.

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        At such time as the Design Development Documents have been approved by Landlord and Tenant, Landlord shall cause (i) Landlord's Architect to prepare detailed construction drawings and specifications ("Final Design Documents") which shall set forth in detail the requirements for construction of Landlord's Work (including all architectural, mechanical, electrical and structural drawings and detailed specifications), shall be fully coordinated with one another and with field conditions as they exist on the Lot, shall show all work necessary to complete Landlord's Work, including all cutting, fitting, and patching and all connections to the mechanical and electrical systems and components of the Base Building Improvements, and shall include calculations of the gross floor area and the Rentable Square Footage of the Base Building Improvements and (ii) the Construction Cost Estimator, based upon such Final Design Documents, to prepare an updated budget for the Base Building Improvements, each for approval by Landlord and Tenant. The Final Design Documents shall be used for the construction of the Base Building Improvements and shall be based upon the Design Development Documents and other information which is relevant to the design and construction of the Base Building Improvements. The Final Design Documents shall be prepared and stamped by Landlord's Architect. The Preliminary Design Concept, the Schematic Design Documents and the Final Design Documents (collectively, the "Design Documents") shall not include any of Tenant's Work (as hereinafter defined). As used herein, the term "Base Building Improvements" shall mean the items of work and materials to be performed and supplied by Landlord in accordance with the Final Design Documents as affected by Change Orders (as such term is hereafter defined) and the term "Landlord's Work" shall mean the construction of the Base Building Improvements in accordance with the Final Design Documents as affected by Change Orders.

        The preliminary and final Schematic Design Documents, the preliminary and final Design Development Documents, and the Final Design Documents shall be submitted to both Landlord and Tenant for review and comment in accordance with the dates and requirements included in the Progress Schedule, which shall be incorporated, to the extent applicable, in the Architect's Contract. In each instance both parties shall have until the respective completion dates set forth in the Progress Schedule to review each submission and to notify the other party of approval or disapproval. Tenant may disapprove any new items shown on a submission which are not in compliance with (i) the Preliminary Design Concept with regard to the Schematic Design Documents, (ii) the Schematic Design Documents with regard to the Design Development Documents, or (iii) the Design Development Documents with regard to the Final Design Documents, specifying and detailing in each case such objections. To the extent that any such submission is consistent with prior submissions approved by Tenant, such submission shall be approved by Tenant, provided however, that Tenant shall have the right, with Landlord's approval, to make modifications as set forth in the next sentence hereof. Tenant, with the approval of Landlord, which approval shall not be unreasonably withheld, conditioned or delayed, shall have the right to modify the design of the Base Building Improvements at any time during the design process contemplated hereby, provided that if as a result of any such design change (a) any particular Design Document submission is not approved by the applicable completion date set forth on the Progress Schedule, or (b) any such design change delays the Substantial Completion Date, such lack of approval or design change shall constitute a Tenant Delay for purposes of Section 3.2. In the event Tenant shall fail to object to any Design Documents submissions by the applicable completion date for such submission set forth in the Progress Schedule, provided that Tenant had received such submission not less than five (5) business days prior to the applicable completion date, such failure shall constitute a Tenant Delay for purposes of Section 3.2. If Tenant objects to any such submission because such submission is inconsistent with the prior submission approved by Tenant, Landlord shall cause Landlord's Architect to modify such submission to respond to Tenant's objection and submit such modified submission to Tenant within five (5) business days after receipt of Tenant's objections for approval by Tenant in the same manner as with regard to the prior submission. Rejection of new items included in any submission that are inconsistent with the approvals given for prior design phases shall not give rise to a Tenant Delay so long as the initial rejection was delivered within the dates established

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in the Progress Schedule, as modified. Landlord and Tenant agree to cooperate with one another diligently and in good faith so as to complete the review and approval of all Design Document submission by the applicable completion dates set forth in the Progress Schedule.

        Upon approval of the Final Design Documents, Landlord shall solicit bids from general contractors or construction managers mutually identified by Landlord and Tenant by the date set forth in the Progress Schedule. Landlord and Tenant shall mutually determine whether such bids shall be submitted on the basis of a guaranteed maximum or fixed price contract basis. Upon receipt of bids from such general contractors or construction managers, Landlord and Tenant shall mutually select Landlord's Contractor from among such bidders and thereupon Landlord shall enter into a contract (the "Construction Contract") with Landlord's Contractor for construction of the Base Building Improvements. The parties acknowledge that if Landlord and Tenant have agreed to hire the Construction Cost Estimator to serve as Construction Manager/General Contractor for the Building, instead of soliciting bids from general contractors or construction managers as described above, such Construction Manager shall instead be required to solicit bids from all subcontractors, and in such case Landlord and Tenant shall be entitled to approve the subcontractors selected by the Construction Manager and require Landlord's Contractor to enter into such subcontracts. The Construction Contract shall be subject to Tenant's prior approval, which approval shall not be unreasonably withheld, conditioned or delayed. If, after such bids are received, none of such bids is acceptable to Tenant and/or Tenant seeks any change in previously approved Design Documents, and as a result thereof Tenant fails or refuses to approve the Final Project Budget (as hereinafter defined) by the date set forth in the Project Schedule, such failure or refusal shall constitute a Tenant Delay. Additionally, Tenant shall have no right to withhold approval of any general contractor bid or any subcontractor bid if the total amount of all such bids does not exceed by more than fifteen percent (15%) the estimated amount thereof set forth in the preliminary budget for Project Cost or the updated budget for Project Cost, as the case may be, then most recently approved by Landlord and Tenant.

        As used in this Lease, the term "Project Cost" shall mean (i) all hard costs and soft costs incurred by Landlord in connection with the construction of the Base Building Improvements as reflected in a final project budget (the "Final Project Budget") to be mutually approved by Landlord and Tenant based upon, inter alia, all amounts payable by Landlord pursuant to the Architect's Contract and the Construction Contract, and including all liabilities and expenses of all architectural and engineering services relating to Landlord's Work, appropriate amounts for the other line item categories set forth on the Project Budget form attached hereto as Exhibit B-1 (the "Project Budget Form"), (ii) the net amount of all Change Orders (as hereinafter defined), (iii) a pro-rata portion of all "Mitigation Expenses" (as such term is hereafter defined) incurred by Landlord or any Affiliate of Landlord pursuant to the Development Approvals and the Subsequent Approvals (as such terms are defined in Section 3.1.4 hereof), which pro-rata portion shall be equal to the ratio of the gross floor area of the Building (as such gross floor area is determined pursuant to the Cambridge Zoning Ordinance) to 1,313,000 square feet (being the maximum amount of gross floor area, determined pursuant to the Cambridge Zoning Ordinance, permitted to be developed in the Complex pursuant to the PUD Approval (as such term is defined in Section 3.1.4 hereof) except as hereinafter set forth and (iv) taxes and assessments for the Building and Lot, utility and insurance costs for the Building and Lot and all other operating and maintenance costs for the Building and Lot, in each case incurred by Landlord for the period from the Substantial Completion Date through the Term Commencement Date. The term "Mitigation Expenses" shall mean all capital expenses for housing linkage payments and public open space linkage payments required pursuant to the PUD Approval with respect to the Building, costs of traffic mitigation required by the Development Approvals and Subsequent Approvals and infrastructure improvements for the Complex required by the Development Approvals and Subsequent Approvals. Tenant's pro-rata share of capital expenses for housing linkage payments and public open space linkage payments required pursuant to the PUD Approval with respect to the Building shall be equal to the ratio of the Rentable Square Footage of Premises to the Rentable Square Footage of Building. For

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purposes of determining Project Cost, the line item amount for Land and Environmental Remediation shall be fixed at $60.00 per r.s.f. regardless of the actual cost of such line item; Project Cost shall not include any amount for construction of the Garage (as hereinafter defined) or for the leasing of (or the making of any tenant improvements to) the Expansion Spaces to tenants; the developer's fee shall be fixed at five percent (5%) of Project Cost (exclusive, however, of the line item amounts for Land and Environmental Remediation, Development Fee/Supervision (the "Developer's Fee") and Interest on Landlord's Equity (as such term is hereinafter defined)); the broker's fee shall not exceed $7.50 per r.s.f. and no amount shall be included in Project Cost for general or administrative expenses of Landlord or for improvements to the Retail Space in excess of the cost of Base Building Improvements related thereto, and no amount shall be included in Project Cost for any interest, charges or fees paid or payable by Landlord with respect to any construction loan financing for the Project. Project Cost shall include an amount determined by multiplying all components of the Project Cost (exclusive, however, of the line item for the Developer's Fee) by twelve percent (12%) per annum for the period commencing as of the date the cost of each such component is incurred through and including the Term Commencement Date (as so determined, "Interest on Landlord's Equity"), it being understood and agreed by Landlord and Tenant that Interest on Landlord's Equity with respect to any component of Project Cost that Landlord has acquired, purchased or incurred prior to the date of execution of this Lease, such as the cost of the Land & Environmental component of the Project Cost, shall be deemed to begin to accrue, not as of the date that the cost was actually incurred, but rather as of the execution date of this Lease. Landlord shall account for all Project Costs on a so-called "open book" basis. Within ninety (90) days after the Substantial Completion Date, Landlord shall deliver to Tenant a full accounting of the Project Cost incurred as of the Substantial Completion Date; Tenant, from the date hereof through the date which is twelve (12) months after receipt of such full accounting of Project Cost, may review all of Landlord's books and records relating to the incurrence and payment of the Project Cost in order to verify and confirm the accuracy thereof. If Landlord incurs any cost or expense properly includable in Project Cost after the Substantial Completion Date (including, without limitation, any Mitigation Expenses) which is not included in the full accounting, Landlord shall notify Tenant thereof and Landlord shall provide Tenant with such documentation with respect thereto as Tenant reasonably may request. Landlord and Tenant acknowledge and agree that the incurrence of additional costs and expenses by Landlord after the Substantial Completion Date which are properly includable in Project Cost will result in an increase in the Annual Fixed Rent Rate, which increase shall be effective as of the date of incurrence thereof.

        Tenant shall have the right (but not the obligation) to offer to finance up to twenty percent (20%) of the Project Cost as hereinafter provided ("Tenant Financing"). If Tenant shall desire to offer Tenant Financing, Tenant shall give Landlord written notice ("Financing Notice") of such offer not later than thirty (30) days after Landlord and Tenant have agreed upon the first preliminary Project Budget; such Financing Notice shall specify the amount (the "Tenant Financing Amount") and other financial terms of such Tenant Financing described below. Delivery by Tenant of a Financing Notice shall constitute a representation by Tenant that it has the capacity to provide such Tenant Financing.

        If Tenant offers to provide Tenant Financing and all of the terms and conditions thereof, including without limitation, all documents evidencing and securing Tenant Financing, are acceptable to Landlord and its construction and/or permanent lenders, in their respective sole discretion, Tenant shall make a loan to Landlord for an amount equal to the Tenant Financing Amount. The Financing Notice shall specify the interest rate per annum payable on such Tenant Financing loan and the repayment schedule (interest only until maturity; or payments of principal and interest based upon the amortization period specified by Tenant in the Financing Notice), which interest rate and repayment schedule shall be subject to Landlord acceptance or rejection. Such Tenant Financing loan shall be due and payable not later than the scheduled expiration date of the initial Term of the Lease, and shall be secured by a mortgage on the Lot and Building, which mortgage shall be subject and subordinate to the lien of any mortgage granted to any lender now or hereafter providing Landlord with construction and/or

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permanent financing ("Landlord's Project Financing"). The amount by which the Project Cost exceeds the Tenant Financing Amount is herein referred to as the "Landlord Project Cost Portion". Tenant agrees that upon any uncured Event of Default hereunder, Landlord shall be entitled to offset against any payments due under the Tenant Financing loan any amount owed by Tenant to Landlord pursuant to this Lease. In addition, Tenant agrees that it will enter into any intercreditor agreement (which may include typical subordinate lender standstill agreements) requested by any lender providing Landlord's Project Financing. Tenant shall disburse the proceeds of such Tenant Financing loan to Landlord on the Commencement Date, and Landlord shall apply such proceeds to pay down Landlord's Project Financing by the Tenant Financing Amount.

        If Tenant provides Tenant Financing as aforesaid, the definition of Annual Fixed Rent Rate set forth in Section 1.1 shall be deemed to be revised to read as follows:

        Subject to Sections 4.1(b), 10.11 and 10.12 thereof, an amount equal to (a) the sum of (i) the product of (x) the Landlord Project Cost Portion multiplied by (y) twelve percent (12%) plus (ii) the product of (x) the Tenant Financing Amount multiplied by (y) the Tenant Financing interest rate per annum payable on the Tenant Financing (or debt service constant if Tenant elects to have the Tenant Financing amortized), divided by (b) the Rentable Square Footage of the Building.

3.1.2    Change Orders.

        Tenant and Landlord recognize that it may be necessary or advisable to make certain changes to the Final Design Documents or the Base Building Improvements from time to time. Any changes shall be made in accordance with this Lease.

        (a)   In the event that Tenant shall request or authorize any Change Order (as hereinafter defined) or additional services from Landlord with respect to the Base Building Improvements for the purpose of upgrading or changing the scope, manner of performance, or quality of the Base Building Improvements, including any change of design, subcontractor, supplier or materials made at the request of Tenant, such Change Order when implemented by Landlord may result in a change in the Progress Schedule and/or the Project Cost. As used herein, the term "Change Order" shall mean (A) a written order from Landlord which Landlord determines is necessary to carry out the approved design and construction of the Base Building Improvements, whether due to any mistake or omission in, or clarification of, the Design Documents, or (B) a written order to Landlord from Tenant requesting or authorizing a Change in Landlord's Work or an adjustment of the Project Cost or the Progress Schedule. Landlord shall provide Tenant with copies of all proposed and final Change Orders. In addition: subject to the last sentence of this Subparagraph (a), (i) with respect to additive Change Orders, the Project Cost shall be increased by an amount equal to the change in the cost of Landlord's Work (as determined pursuant to the Construction Contract and/or the Architect's Contract) attributable to such Change Order, and (ii) with respect to deductive Change Orders, the Project Cost shall be reduced by the change in the cost of Landlord's Work (as determined pursuant to the Construction Contract and/or the Architect's Contract) attributable to such Change Order. Additive or deductive Change Orders shall result in an increase or decrease, respectively, in the Developer's Fee (but not in any change of the percentage thereof), and Landlord shall be reimbursed by Tenant, either directly or through an increase or decrease, as applicable, in the Project Cost, for the actual cost of overhead and profit, if any, which Landlord is required to pay to Landlord's Contractor on account of any additive Change Order as set forth in the Construction Contract approved by Tenant and Landlord. Anything herein to the contrary notwithstanding, Tenant's approval of a Change Order shall be

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required for each of the following, which approval shall not be unreasonably withheld, conditioned or delayed:

        (1)   A change in the rentable square footage of the Premises by more than four percent (4%) in the aggregate;

        (2)   A change in the rentable square footage of any floor included within the Premises by more than five percent (5%) in the aggregate;

        (3)   Any material change in the elevator systems or mechanical or electrical systems serving the Premises with the result that such systems would be significantly different than those shown on the Final Design Documents;

        (4)   Any material change in standard structural floor load capacities from those shown on the Final Design Documents;

        (5)   Any material change in the quality of materials and fixtures used in the lobby of the Building, passenger elevator cabs serving the Premises, or washrooms serving the Premises with the result that the same would be significantly different from to those shown on the Final Design Documents;

        (6)   Any change in the exterior design or appearance of the Building; or

        (7)   Any individual Change Order which increases the Project Cost by more than $500,000.00.

        (b)   If Tenant requests or requires any Change Order for the Base Building Improvements, Landlord shall submit all such Change Orders with plans, specifications, pricing and a schedule of values if appropriate to Tenant for its review and approval, which approval shall not be unreasonably withheld, delayed or conditioned. No Change Order for the Base Building Improvements requested by Tenant shall be effective unless approved by Landlord's Representative and Tenant's Construction Representative in writing, such approval not to be unreasonably withheld, delayed or conditioned. Tenant may withdraw any Change Order requested by Tenant at any time prior to Tenant's Construction Representative having given its approval to such Change Order. Promptly, but not later than ninety (90) days after the Term Commencement Date, Landlord shall deliver a set of as built plans and operating and maintenance manuals for the Base Building Improvements to Tenant.

3.1.3    Environmental Remediation.

        Landlord shall be responsible for undertaking and completing environmental remediation of the Lot ("Environmental Remediation") pursuant to an Environmental Agreement (the "Environmental Agreement") between Landlord and Tenant in the form of Exhibit E hereto. Landlord has delivered to Tenant the documents set forth on Exhibit E-1 hereto (the "Remediation Documents") and Landlord will provide Tenant with such additional information pertaining to Environmental Remediation and hazardous substances present on other portions of the Lot as Tenant reasonably may request, including correspondence with regulatory authorities and other governmental bodies with respect to the Environmental Remediation. Landlord will provide Tenant with notice of any circumstances relating to the Environmental Remediation which could delay the Substantial Completion Date, as