EXHIBIT 10.2
THIRD AMENDMENT
THIS THIRD AMENDMENT (the "Amendment") is made and entered into as of the
14th day of November, 2003, by and between CA-MARINA BUSINESS CENTER LIMITED
PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP ("Landlord"), and CANCERVAX
CORPORATION, A DELAWARE CORPORATION ("Tenant").
RECITALS
A. Landlord (as successor in interest pursuant to conversion from EOP-Marina
Business Center, L.L.C., a Delaware limited liability company, as
successor in interest pursuant to merger with Spieker Properties, L.P., a
California limited partnership) and Tenant, as Assignee, (as successor in
interest to John Wayne Cancer Institute, a non-profit corporation, as
Assignor) are parties to that certain lease dated July 22,1999, which
lease has been previously amended by letter agreement dated October 8,
1999 (re: commencement letter), First Amendment to Lease dated October 1,
2001 (the "First Amendment") and Second Amendment To Lease dated September
4, 2002 (the "Second Amendment") (collectively, the "Lease"). Pursuant to
the Lease, Landlord has leased to Tenant space currently containing
approximately 50,750 rentable square feet (the "Premises") described as
Suite Nos. 100 and 150 on the 1st and mezzanine floors of the building
commonly known as Marina Business Center located at 4503 Glencoe Avenue,
Marina del Rey, California (the "Building").
B. Assignor and Assignee have entered into that certain assignment agreement
dated August 4, 2000 ("Assignment Agreement") whereby Assignor assigned
all of its right, title and interest in and to the Lease to Assignee.
Assignee has requested Landlord's acknowledgment and approval that the
Assignor is released from all liability under the Lease.
C. The Lease by its terms shall expire on AUGUST 14, 2009 ("Prior Scheduled
Term Expiration Date"), and the parties desire to extend the Term of the
Lease, all on the following terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
I. RELEASE OF LIABILITY. Landlord hereby releases and relieves Assignor and
its members, directors, officers and employees (collectively the "Assignor
Parties"), and covenants not to sue the Assignor Parties with respect to,
any past, present or future claims, causes of actions, suits, damages,
demands, costs, expenses, liabilities, obligations, losses or liabilities
of the Assignor Parties of any kind whatsoever owed to the Landlord,
arising out of or relating to the Lease, the Premises or the Building,
whether known or unknown, whether fixed or contingent, whether direct or
indirect, whether foreseen or unforeseen, and whether arising in law or in
equity. It is expressly understood that Assignor shall not remain liable
for such obligations notwithstanding the subsequent assignment(s),
sublease(s) or transfer(s) of the interest of the tenant under the Lease.
It is specifically understood that Assignor is not a party to this
Amendment and, notwithstanding anything to the contrary contained in this
Amendment, is not bound by any terms, provisions, representations or
warranties contained in this Amendment, but Assignor and each Assignor
Party shall be entitled to the benefit of this Paragraph I, and to enforce
this Paragraph I against Landlord and its successors and assigns. Landlord
waives the provisions of any applicable laws (including without limitation
California Civil Code Section 1542) restricting the release of claims
which a releasing party does not know or suspect to exist at the time of
provision of a release (even if awareness of such claims might have
affected the releasing party's willingness to provide the release).
II. EXTENSION. The Term of the Lease is hereby extended for a period of
twenty-four (24) months and shall expire on AUGUST 14, 2011 ("Extended
Expiration Date"), unless sooner terminated in accordance with the terms
of the Lease. That portion of the Term commencing the day immediately
following the Prior Scheduled Term Expiration Date ("Extension Date") and
ending on the Extended Expiration Date shall be referred to herein as the
"Extended Term".
III. BASE RENT. As of October 1, 2003, the schedule of Base Rent as set forth
in the section entitled "Basic Lease Information" of the Lease and Section
II., "Base Rent" of the First Amendment shall be deleted in their entirety
and Base Rent for the Premises shall be payable as follows:
ANNUAL RATE ANNUAL MONTHLY
PERIOD PER SQUARE FOOT BASE RENT BASE RENT
- ----------------------- --------------- ----------- ----------
October 1, 2003 through $ 16.00 $812,000.04 $67,666.67
September 30, 2004
October 1, 2004 through $ 16.52 $838,389.96 $69,865.83
September 30, 2005
October 1, 2005 through $ 17.06 $865,794.96 $72,149.58
September 30, 2006
October 1, 2006 through $ 17.61 $893,707.56 $74,475.63
September 30, 2007
October 1, 2007 through $ 18.18 $922,635.00 $76,886.25
September 30, 2008
October 1, 2008 through $ 18.77 $952,577.52 $79,381.46
September 30, 2009
October 1, 2009 through $ 19.38 $983,535.00 $81,961.25
September 30, 2010
October 1, 2010 through $ 20.01 $930,881.93 $84,625.63
August 14, 2011 (11 months)
All such Base Rent shall be payable by Tenant in accordance with the terms
of the Lease.
IV. ADDITIONAL SECURITY DEPOSIT. No additional security deposit shall be
required in connection with this Amendment.
V. LETTER OF CREDIT. SECTION I.A., "LETTER OF CREDIT" OF THE SECOND
AMENDMENT, SECTION III., "ADDITIONAL SECURITY DEPOSIT" OF THE FIRST
AMENDMENT, PARAGRAPH 39.G., "LETTER OF CREDIT" OF THE LEASE AND EXHIBIT E,
"IRREVOCABLE STANDBY LETTER OF CREDIT" OF THE LEASE shall be deleted in
their entirety and of no further force and effect and the following shall
be substituted therefor:
"Letter of Credit.
(a) GENERAL PROVISIONS. Concurrently with Tenant's execution
of this Amendment, Tenant shall deliver to Landlord, as collateral
for the full performance by Tenant of all of its obligations under
this Lease and for all losses and damages Landlord may suffer as a
result of any default by Tenant under this Lease, including, but not
limited to, any post lease termination damages under section 1951.2
of the California Civil Code, a standby, unconditional, irrevocable,
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transferable letter of credit (the "LETTER OF CREDIT") substantially
in the form of EXHIBIT "A" hereto (with such technical and
logistical modifications as may be approved by Lender in its
reasonable discretion) and containing the terms required herein, in
the face amount of $650,000.00 (such amount as adjusted in
accordance with Section V(f) the "LETTER OF CREDIT AMOUNT"), naming
Landlord as beneficiary, issued (or confirmed) by Bank of America or
a financial institution acceptable to Landlord in Landlord's sole
discretion, and permitting multiple and partial draws thereon.
Tenant shall cause the Letter of Credit to be continuously
maintained in effect (whether through replacement, renewal or
extension) in the Letter of Credit Amount through the date (the
"FINAL LC EXPIRATION DATE") that is 120 days after the scheduled
expiration date of the Term or any renewal Term. If the Letter of
Credit held by Landlord expires earlier than the Final LC Expiration
Date (whether by reason of a stated expiration date or a notice of
termination or non-renewal given by the issuing bank), Tenant shall
deliver a new Letter of Credit or certificate of renewal or
extension to Landlord not later than 30 days prior to the expiration
date of the Letter of Credit then held by Landlord. Any renewal or
replacement Letter of Credit shall comply with all of the provisions
of this Section V, shall be irrevocable, transferable and shall
remain in effect (or be automatically renewable) through the Final
LC Expiration Date upon the same terms as the expiring Letter of
Credit or such other terms as may be acceptable to Landlord in its
sole discretion.
(b) DRAWINGS UNDER LETTER OF CREDIT. Landlord shall have the
immediate right to draw upon the Letter of Credit, in whole or in
part, at any time and from time to time: (i) If a default occurs and
continues beyond the expiration of all applicable sure periods; or
(ii) If the Letter of Credit held by Landlord expires earlier than
the Final LC Expiration Date (whether by reason of a stated
expiration date or a notice of termination or non-renewal given by
the issuing bank), and Tenant fails to deliver to Landlord, at least
30 days prior to the expiration date of the Letter of Credit then
held by Landlord, a renewal or substitute Letter of Credit that is
in effect and that complies with the provisions of this Section V.
No condition or term of this Lease shall be deemed to render the
Letter of Credit conditional to justify the issuer of the Letter of
Credit in failing to honor a drawing upon such Letter of Credit in a
timely manner. Tenant hereby acknowledges and agrees that Landlord
is entering into this Lease in material reliance upon the ability of
Landlord to draw upon the Letter of Credit upon the occurrence of
any default by Tenant under this Lease that continues beyond the
expiration of all applicable sure periods or upon the occurrence of
any of the other events described above in this Section V(b).
(c) USE OF PROCEEDS BY LANDLORD. The proceeds of the Letter of
Credit shall constitute Landlord's sole and separate property (and
not Tenant's property or the property of Tenant's bankruptcy estate)
and Landlord may immediately upon any draw (and without notice to
Tenant) apply or offset the proceeds of the Letter of Credit: (i)
against any Rent payable by Tenant under this Lease that is not paid
when due; (ii) against all losses and damages that Landlord has
suffered or that Landlord reasonably estimates that it may suffer as
a result of any default by Tenant under this Lease that continues
beyond the expiration of all applicable sure periods, including any
damages arising under section 1951.2 of the California Civil Code
following termination of the Lease; (iii) against any costs incurred
by Landlord in connection with the Lease (including attorneys'
fees); and (iv) against any other amount that Landlord may spend or
become obligated to spend by reason of Tenant's default that
continues beyond the expiration of all applicable sure periods.
Landlord agrees to pay to Tenant within 30 days after the Final LC
Expiration Date the amount of any proceeds of the Letter of Credit
received by Landlord and not applied as allowed above; provided,
that if prior to the Final LC Expiration Date a voluntary petition
is filed by Tenant or any Guarantor, or an involuntary petition is
filed against Tenant or any Guarantor by any of Tenant's or
Guarantor's creditors, under the Federal Bankruptcy Code, then
Landlord shall not be obligated to make such payment in the amount
of the unused Letter of Credit proceeds until either all preference
issues relating to payments under this Lease have been resolved in
such bankruptcy or reorganization case or such bankruptcy or
reorganization case has been dismissed, in each case pursuant to a
final court order not subject to appeal or any stay pending appeal.
Notwithstanding the foregoing, if Landlord draws upon the Letter of
Credit under Section V(b)(ii) and Tenant delivers a replacement
Letter of Credit that satisfies all of the
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requirements of this Lease, then Landlord shall pay to Tenant any
proceeds of any Letter of Credit that Landlord has not then applied
in accordance with this Section V(c).
(d) ADDITIONAL COVENANTS OF TENANT. If, as result of any
application or use by Landlord of all or any part of the Letter of
Credit, the amount of the Letter of Credit shall be less than the
Letter of Credit Amount, Tenant shall, within 5 days after Tenant
received written notice thereof from Landlord, provide Landlord with
additional letter(s) of credit in an amount equal to the deficiency
(or a replacement letter of credit in the total Letter of Credit
Amount), and any such additional (or replacement) letter of credit
shall comply with all of the provisions of this Section V(d), and if
Tenant fails to comply with the foregoing, notwithstanding anything
to the contrary contained in this Lease, the same shall constitute
an uncurable default by Tenant. Tenant further covenants and
warrants that it will neither assign nor encumber the Letter of
Credit or any part thereof and that neither Landlord nor its
successors or assigns will be bound by any such assignment,
encumbrance, attempted assignment or attempted encumbrance.
(e) TRANSFER OF LETTER OF CREDIT. Landlord may, at any time
and without notice to Tenant and without first obtaining Tenant's
consent thereto, transfer all or any portion of its interest in and
to the Letter of Credit to another party, person or entity,
including Landlord's mortgagee and/or to have the Letter of Credit
reissued in the name of Landlord's mortgagee. If Landlord transfers
its interest in the Building and transfers the Letter of Credit (or
any proceeds thereof then held by Landlord) in whole or in part to
the transferee and the transferee assumes all of Landlord's
obligations under the Lease, then Landlord shall, without any
further agreement between the parties hereto, thereupon be released
by Tenant from all liability therefor. The provisions hereof shall
apply to every such transfer or assignment of all or any part of the
Letter of Credit to a new landlord. In connection with any such
transfer of the Letter of Credit by Landlord, Tenant shall, at
Landlord's sole cost and expense, execute and submit to the issuer
of the Letter of Credit such applications, documents and instruments
as may be necessary to effectuate such transfer. Landlord shall be
responsible for paying the issuer's transfer and processing fees in
connection with any transfer of the Letter of Credit and, if Tenant
advances any such fees (without having any obligation to do so),
Landlord shall reimburse Tenant for any such transfer or processing
fees within 10 days after Tenant's written request therefor.
(f) REDUCTION IN LETTER OF CREDIT AMOUNT. Provided no default
has occurred hereunder in the 12 month period prior to the reduction
and has continued beyond the expiration of all applicable cure
periods, and no less than 30 days prior to each requested letter of
credit reduction date, the Letter of Credit Amount shall be reduced
as follows: (i) $600,000.00 effective as of August 15, 2006; (ii)
$550,000.00 effective as of August 15, 2007; (iii) $500,000.00
effective as of August 15, 2008; and (iv) $200,000.00 effective as
of August 14, 2009. If Tenant is not entitled to reduce the Letter
of Credit Amount as of a particular reduction effective date due to
Tenant's failure to timely pay all Rent during the 12 months prior
to that particular reduction effective date, then any subsequent
reduction(s) Tenant is entitled to hereunder shall be reduced by the
amount of the reduction Tenant would have been entitled to had
Tenant timely paid all Rent during the 12 months prior to that
particular earlier reduction effective date. Notwithstanding
anything to the contrary contained herein, if Tenant has been in
default under this Lease (beyond the expiration of all applicable
cure periods) at any time prior to the effective date of any
reduction of the Letter of Credit Amount and Tenant has failed to
cure such default within any applicable cure period, then Tenant
shall have no further right to reduce the Letter of Credit Amount as
described herein. Any reduction in the Letter of Credit Amount shall
be accomplished by Tenant providing Landlord with a substitute
letter of credit in the reduced amount. Tenant shall have the right
to deliver to Landlord a substitute letter of credit that satisfies
the requirements of this Section V at any time, and, upon receipt of
the substitute letter of credit, Landlord shall return the Letter of
Credit to Tenant and take all steps reasonably requested by Tenant
to cause the Letter of Credit to be terminated and cancelled.
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(g) NATURE OF LETTER OF CREDIT. Landlord and Tenant (1)
acknowledge and agree that in no event or circumstance shall the
Letter of Credit or any renewal thereof or substitute therefor or
any proceeds thereof (including the LC Proceeds Account) be deemed
to be or treated as a "security deposit" under any Law applicable to
security deposits in the commercial context including Section 1950.7
of the California Civil Code, as such section now exist or as may be
hereafter amended or succeeded" ("SECURITY DEPOSIT LAWS"), (2)
acknowledge and agree that the Letter of Credit (including any
renewal thereof or substitute therefor or any proceeds thereof) is
not intended to serve as a security deposit, and the Security
Deposit Laws shall have no applicability or relevancy thereto, and
(3) waive any and all rights, duties and obligations either party
may now or, in the future, will have relating to or arising from the
Security Deposit Laws.
Tenant hereby waives the provisions of Section 1950.7 of the
California Civil Code and all other provisions of Law, now or
hereafter in effect, which (i) establish the time frame by which
Landlord must refund a security deposit under a lease, and/or (ii)
provide that Landlord may claim from the Security Deposit only those
sums reasonably necessary to remedy defaults in the payment of rent,
to repair damage caused by Tenant or to clean the Premises, it being
agreed that Landlord may, in addition, claim those sums specified in
this Section V above and/or those sums reasonably necessary to
compensate Landlord for any loss or damage caused by Tenant's breach
of this Lease or the acts or omission of Tenant or any other Tenant
related parties, including any damages Landlord suffers following
termination of the Lease."
VI. OPERATING EXPENSES. For the period commencing on October 1, 2003 and
ending on the Extended Expiration Date, Tenant shall pay for Tenant's
Proportionate Share of the Building in accordance with the terms of the
Lease.
VII. IMPROVEMENTS TO PREMISES.
A. CONDITION OF PREMISES. Tenant is in possession of the Premises and
accepts the same "as is" without any agreements, representations,
understandings or obligations on the part of Landlord to perform any
alterations, repairs or improvements, except as may be expressly
provided otherwise in this Amendment.
B. RESPONSIBILITY FOR IMPROVEMENTS TO PREMISES. Any construction,
alterations or improvements to the Premises shall be performed by
Tenant at its sole cost and expense using contractors selected by
Tenant and approved by Landlord and shall be governed in all
respects by the provisions of the Lease.
VIII. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
of the date of this Amendment (unless different effective date(s) is/are
specifically referenced in this Section), the Lease shall be amended in
the following additional respects:
A. SECTION VIII.A., "OPTION TO TERMINATE" OF THE FIRST AMENDMENT,
SECTION 39.D., "OPTION TO TERMINATE" OF THE LEASE shall be deleted
in their entirety and of no further force and effect.
IX. MISCELLANEOUS.
A. This Amendment sets forth the entire agreement between the parties
with respect to the matters set forth herein. There have been no
additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement,
improvement allowance, leasehold improvements, or other work to the
Premises, or any similar economic incentives that may have been
provided Tenant in connection with entering into the Lease, unless
specifically set forth in this Amendment.
B. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
C. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
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D. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
E. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "Landlord Related Parties") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "Tenant Related Parties") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
G. INTENTIONALLY OMITTED.
H. CALIFORNIA WAIVERS. Notwithstanding anything to the contrary
contained in the Lease, Tenant hereby waives any and all rights
under and benefits of subsection 1 of Section 1932, Sections 1941
and 1942 (Tenant's Repairs and Alterations), 1932(2) (Casualty
Damage), and Section 1265.130 (Condemnation) of the California Code
of Civil Procedure, or any similar or successor laws now or
hereinafter in effect.
I. Equity Office Properties Management Corp. ("EOPMC") is an affiliate
of Landlord and represents only the Landlord in this transaction.
Any assistance rendered by any agent or employee of EOPMC in
connection with this Lease or any subsequent amendment or
modification hereto has been or will be made as an accommodation to
Tenant solely in furtherance of consummating the transaction on
behalf of Landlord, and not as agent for Tenant.
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IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
CA-MARINA BUSINESS CENTER LIMITED PARTNERSHIP,
A DELAWARE LIMITED PARTNERSHIP
By: EOM GP, L.L.C., a Delaware limited
liability company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company,
its non-member manager
By: /s/ Robert E. Dezzutti
-------------------------------
Name: Robert E. Dezzutti
Title: Senior Vice President
TENANT:
CANCERVAX CORPORATION, A DELAWARE CORPORATION
By: /s/ David F. Hale
-------------------------------
Name: David F. Hale
Title: President and CEO
TENANT'S FEIN: 52 224 3564
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