Exhibit 10.2
AGREEMENT
THIS AGREEMENT (the "Agreement") is entered into this 31st day of
March, 2001, between XXXXX RESEARCH PARK ASSOCIATES VI, L.C., BY ITS GENERAL
PARTNER THE XXXXX COMPANY, L.C., a Utah limited liability company ("Owner"), and
MYRIAD GENETICS, INC. ("Myriad").
RECITALS:
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A. Contemporaneously with the execution of this Agreement, Owner, as
Landlord, and Myriad, as Tenant, executed a Lease Agreement dated March 31, 2001
(the "Lease") pertaining to space in a building (Phase III) to be constructed at
000 Xxxxxx Xxx, Xxxx Xxxx Xxxx, Xxxx.
B. As part of the negotiations leading to the amendment of the Lease
Agreement, Owner has agreed to pay to Myriad participation in Owner's net
operating cash flow from the Building upon the terms and subject to the
conditions set forth in this Agreement.
AGREEMENT:
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NOW, THEREFORE, for good a valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Owner and Myriad agree as follows:
1. Definitions. Certain terms are defined in this Agreement prior
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to this Section 1. As used in this Agreement, the following additional terms
shall have the meanings set forth:
(a) "Basic Annual Rent" is defined in the Lease.
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(b) "Building" means the Phase III building to be constructed by
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Owner at 000 Xxxxxx Xxx, Xxxx Xxxx Xxxx, Xxxx, in which the premises
covered by the Lease are located.
(c) "Myriad's Share of Operating Cash Flow" means, for any
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specified period, the lesser of:
(i) The Setoff Percentage multiplied by the Basic Annual
Rent for the period; or
(ii) The Operating Cash Flow for the period.
(d) "Myriad's Termination Share" means an amount determined as
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follows:
(i) First, project Myriad's Share of Operating Cash Flow
in each Lease Year following the Termination Date (but not
including any renewal or extension terms subsequent to the then
term of the Lease, unless and then only to the extent that Myriad
has validly exercised its right to renew or extend the then term
of the Lease) as being equal to Myriad's Share of Operating Cash
Flow for the twelve (12) months prior to the Termination Date
increased by the lesser of CPI or three percent (3%) per annum on
the regular adjustment dates specified in Section 3.1 for
adjustment of Basic Annual Rent.
(ii) Second, based on the assumption that Myriad's Share
of Operating Cash Flow for each Lease Year following the
Termination Date, as projected in subsection (i) above, is
received by Myriad on the last day of the seventh (7th) month of
such Lease Year (or in the case of a Lease Year which is less
than seven (7) months long, on the last day of such Lease Year),
calculate the present value of such projected amounts as of the
Termination Date. The discount rate to be used in such present
value calculation shall be ten and one-half percent (10 1/2%) per
annum.
(e) "Expenditures" means all reasonable costs, expenses and
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fees incurred by Xxxxx in connection with the ownership, financing,
improvement, operation leasing, management, maintenance and repair of
the Building but only to the extent paid directly or indirectly out or
Rent.
(f) "Lease Year" is defined in the Lease.
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(g) "Operating Cash Flow" means for a specified period all Rent
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less all Expenditures.
(h) "Rent" means all rents and charges received by Owner from
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the tenants of the Building, but excluding receipts from loans,
contributions to capital of Owner, insurance proceeds, recoveries in
connection with eminent domain proceedings or recoveries in connection
with other actions (but including as part of Rent recoveries of any
unpaid Rent).
(i) "Setoff Percentage" means 3.85%.
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(j) "Termination Date" means, if but only if Owner exercises
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the option set forth in Section 3, the date of the closing of the sale
or other transfer of title to the Building by Owner.
2. Payment of Myriad's Share of Operating Cash Flow. During the term
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of the Lease, Owner shall pay Myriad's Share of Operating Cash Flow to Myriad,
as follows:
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(a) Prior to then end of each calendar quarter during the
term of the Lease, Owner shall pay Myriad Myriad's Share of
Operating Cash Flow for the quarter, less any amounts Myriad has
deducted from Basic Annual Rent pursuant to Section 2(b).
(b) Until a lender having a lien recorded or security
interest filed in respect of the Building first exercises a remedy
of any kind with respect to a default on the part of Owner to such
lender, Myriad may deduct from each monthly installment of Basic
Annual Rent pursuant to the Lease an amount equal to Myriad's Share
of Operating Cash Flow. Owner shall notify Myriad in writing of the
amount of the projected Operating Cash Flow if such cash flow is
projected to be less than the Setoff Percentage multiplied by Basic
Annual Rent.
(c) Notwithstanding any other provision of this Agreement,
Owner shall have no obligation to pay any amount to Owner while
Owner is in default under the terms of the Lease.
3. Termination of Myriad's Participation Upon Sale of Building.
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Upon a sale of the Building, Owner may, at its sole option upon written notice
to Myriad, terminate all of Myriad's right, title and interest under this
Agreement and in and to Operating Cash Flow as of the Termination Date except as
prescribed by this Section 3. If Owner exercises such option and the sale
closes, Owner shall pay to Myriad, promptly following the Termination Date,
Myriad's Termination Share. If, but only if, Owner does not exercise the option
set forth in this Section 3 and the Building is conveyed to a third party, such
third party shall succeed to all of the rights and obligations of Owner under
this Agreement including, without limitation, the provisions of this Section 3
with respect to a subsequent sale.
4. Refinancing of Building. Owner may finance or refinance the
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construction and operation of the Building at such time or times and upon such
terms and conditions, including, but not limited to interest rate and payment
terms, as it determines; provided, without the consent of Myriad, no refinancing
of the Building shall result in projected annual Operating Cash Flow which is
less than the Setoff Percentage multiplied by the Basic Annual Rent.
5. No Representation, Warranty or Guaranty. The amount of
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Operating Cash Flow will depend on economic and other factors beyond Owner's
control, including, without limitation, the amount and terms of financing, lease
rates, real estate values, insurance, taxes and other operating costs and the
timing of Building lease-up. Accordingly, neither Owner, its members nor any
affiliates of Owner or its members have made any representation, warranty or
guaranty with respect to the amount or timing of any Operating Cash Flow to be
paid to Myriad.
6. Nature of Myriad's Rights Pursuant To This Agreement. Owner
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and Myriad do not by this agreement intend to create a partnership, joint
venture or similar relationship. All obligations of Owner to Myriad created
pursuant to this Agreement are unsecured. Myriad shall have no ownership or
security interest of any type in the Building or in the rents, profits or
revenue thereof. All right, title and interest of Myriad under this Agreement
and in and to Operating Cash Flow shall be, and are hereby made, subject,
subordinate, inferior and junior to
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the lien of any mortgage, deed of trust, assignment of leases and rents,
security agreement, financing statement or similar security instrument
encumbering the Building, and all renewals, modifications, amendments,
consolidations, replacements and extensions of any such instrument. Such
subordination shall be effective without the execution, delivery or recordation
of any other agreement or instrument. Notwithstanding the foregoing, Myriad
shall execute such agreements or instruments as may be necessary or appropriate
or as may otherwise be requested by any mortgage lender to evidence, confirm or
accomplish such subordination. The rights and obligations set forth in the Lease
are severable from and independent of any rights and obligations pursuant to
this Agreement and, except for the limited right of setoff granted Myriad
pursuant to Section 2(b) which may be terminated under certain conditions in
said Section, Myriad shall not, and shall not have the right to, offset against
or deduct from any amount owed or claimed to be owed to it pursuant to this
Agreement any rent, charge or other obligation due pursuant to the Lease.
7. Miscellaneous. This Agreement may be executed in any number of
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counterparts, each of which when executed and delivered shall be deemed to be an
original, and all of which counterparts, taken together, shall constitute one
and the same instrument. The captions that precede the Section of this
Agreement are for convenience only and shall in no way affect the manner in
which any provision hereof is construed. There are no representations,
warranties or covenants between the parties other than as set forth in this
Agreement. None of the provisions of this Agreement may be altered or modified
except by an instrument in writing signed by the parties. All of the terms,
provisions, agreements and undertakings in this Agreement shall be binding upon
and shall inure to the benefit of the respective heirs, personal
representatives, successors and assigns of the parties to this Agreement. The
parties shall do such further acts and things and execute and deliver such
additional agreements and instruments as either of them may reasonably require
to consummate, evidence or confirm the agreements contained in this Agreement in
the manner contemplated by this agreement. This Agreement shall be governed by
and construed in accordance with the laws of the State of Utah. Neither party
may assign or transfer its rights under this Agreement to any other entity or
person without first obtaining the consent of the other party. References in
this Agreement to a Section by number shall be deemed to be a reference to the
corresponding Section in this Agreement unless the context clearly requires a
reference to another agreement.
IN WITNESS WHEREOF, Owner and Myriad have executed this Agreement on
the respective dates set forth below, to be effective as of the date first set
forth above.
[SIGNATURES ON THE FOLLOWING PAGE]
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"OWNER":
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XXXXX RESEARCH PARK ASSOCIATES VI,
L.C., BY ITS GENERAL PARTNER THE XXXXX
COMPANY, L.C., a Utah limited liability
company, by is Manager:
By: /s/ H. Xxxxx Xxxxx
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H. Xxxxx Xxxxx
Chairman and Manager
"Myriad":
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MYRIAD GENETICS, INC., a Utah corporation
By: /s/ Xxx X. Xxxxx
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Name: Xxx X. Xxxxx
Title: C.F.O.
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