THIRD AMENDMENT TO LEASE
Exhibit 10.53
THIRD AMENDMENT TO LEASE
This
THIRD AMENDMENT TO LEASE (this "Third Amendment") is made and entered
into as of November 9, 2018, by and between 10900 WILSHIRE, L.L.C.,
a Delaware limited liability company ("Landlord"), and CHROMADEX, INC., a
California corporation ("Tenant").
R E
C I T A L S:
A. Landlord
and Tenant are parties to that certain Lease, dated July 6, 2017
(the "Office Lease"), as
amended by that certain First Amendment to Lease, dated February 7,
2018 (the "First
Amendment"), and that certain Second Amendment to Lease,
dated June 30, 2018 (the "Second
Amendment")], whereby
Landlord leases to Tenant and Tenant leases from Landlord (i) that
certain premises (the "Existing
Premises"), commonly known as Xxxxx 000 xxx Xxxxx 000, and
located on the sixth (6th) floor of that certain office building
located at 00000 Xxxxxxxx Xxxxxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx (the
"Building"), as more
particularly set forth in the Lease, and (ii) that certain storage
space, commonly known as PD-9. The Office Lease, First Amendment
and Second Amendment shall collectively be referred to herein as
the "Lease".
B. Landlord
and Tenant now desire (i) to expand the Existing Premises to
include that certain space comprised of approximately 3,175
rentable square feet of space, commonly known as Suite 600, as
depicted on Exhibit A
attached hereto (the "Expansion
Premises"), and (ii) to otherwise amend the Lease, all on
the terms and conditions contained herein.
A G
R E E M E N T:
NOW,
THEREFORE, in consideration of the foregoing recitals and the
mutual covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as
follows.
1. Capitalized
Terms. Each capitalized term when used herein shall have the
same respective meaning as is given such term in the Lease, unless
expressly provided otherwise in this Third Amendment.
2. "As-Is"
Condition. Tenant hereby agrees that Tenant is in occupancy
of the Existing Premises and shall continue accept the Existing
Premises in its currently existing, "as is" condition, and Landlord
shall not be obligated to provide or pay for any improvement work
or services related to the improvement of the Existing Premises.
Additionally, Tenant hereby acknowledges and agrees that, except as
set forth in this Section 2, below, Sections 6 and 7, below, Tenant shall accept
the Expansion Premises in its presently existing, "as-is"
condition, and Landlord shall not be obligated to provide or pay
for any improvement work or services related to the improvement of
the Expansion Premises. Tenant also acknowledges that neither
Landlord nor any agent of Landlord has made any representation or
warranty regarding the condition of the Existing Premises, the
Expansion Premises, or the Building or with respect to the
suitability of any of the foregoing for the conduct of Tenant's
business. Notwithstanding the foregoing, Landlord shall deliver
possession of the Expansion Premises to Tenant (i) in a broom-clean
condition, and free of debris and any personal property and affects
from any prior tenants previously occupying the Expansion Premises,
and (ii) with all Building Systems (defined below) serving the
Expansion Premises in good working order and condition (such
condition shall be referred to herein as the "Delivery Condition"). For the purposes
of this Third Amendment, "Building
Systems" shall mean the plumbing, sewer, drainage,
electrical, fire protection, elevator, life safety and security
systems and equipment, existing heating, ventilation and
air-conditioning systems, and all other mechanical, electrical and
communications systems and equipment which are located in the
internal core of the Building and which serve the Building
generally.
-1-
3. Expansion of
Existing Premises.
3.1 Condition
Precedent. Tenant hereby acknowledges that (i) the Expansion
Premises are currently occupied by an existing tenant (the
"Existing Tenant"), (ii) the
Existing Tenant's lease of the Expansion Premises is scheduled to
expire on November 30, 2018, and (iii) Landlord's ability to
deliver the Expansion Premises to Tenant shall be conditioned upon
the Existing Tenant's timely vacation of the Expansion Premises. In
connection with the foregoing, Tenant hereby agrees that Landlord
shall not be liable for any damage whatsoever, if Landlord does not
tender possession of the Expansion Premises to Tenant on or before
any particular date, the Lease shall not be void or voidable
thereby, and the Expansion Term (defined in Section 3.2, below) shall not
commence until the Expansion Commencement Date (defined in
Section 3.2,
below). Landlord shall use commercially reasonable efforts to cause
the Existing Tenant to vacate the Expansion Premises in a timely
manner. Such efforts shall require Landlord to commence legal
actions against the Existing Tenant in the event that the Existing
Tenant fails to vacate the Expansion Premises on or before November
30, 2018.
3.2 Expansion
Commencement Date. Commencing on the date (the "Expansion Commencement Date") that
Landlord delivers the Expansion Premises to Tenant in the Delivery
Condition, and continuing through the Expiration Date (i.e.,
October 31, 2021), Tenant shall lease from Landlord and Landlord
shall lease to Tenant the Expansion Premises pursuant to the terms
of the Lease, except as amended by this Third Amendment. The period
commencing on the Expansion Commencement Date and continuing
through, and including the Expiration Date, shall be referred to
herein as the "Expansion
Term". Effective upon the Expansion Commencement Date, the
Existing Premises shall be increased to include the Expansion
Premises, which Premises shall be deemed to consist of
10,116 rentable square
feet) and, except as otherwise specifically provided in this Third
Amendment, all references in the Lease and this Third Amendment to
the term "Premises" shall include the Existing Premises and the
Expansion Premises. Landlord and Tenant hereby acknowledge and
agree that the Expansion Premises shall be deemed to contain the
rentable square feet set forth in Recital B above (and shall not
be subject to re-measurement or modification during the Expansion
Term). Landlord shall use commercially reasonable efforts to
deliver the Expansion Premises to Tenant by December 1,
2018.
4. Fixed
Rent.
4.1 Existing
Premises. Tenant shall continue to pay Fixed Rent
attributable to the Existing Premises in accordance with the terms
of the Lease.
4.2 Expansion
Premises.
(a) In
General. Notwithstanding any provision to the contrary set
forth in the Lease, commencing as of the Expansion Commencement
Date and continuing throughout the Expansion Term, Tenant shall pay
to Landlord monthly installments of Fixed Rent for the Expansion
Premises in the amounts set forth in the schedule below, but
otherwise in accordance with the terms and conditions of the
Lease.
|
Months During Expansion Term
|
Fixed Rent Per Annum
|
Fixed Rent Per Month
|
Approximate Monthly Fixed Rent Per Rentable Square Foot*
|
|
1-12
|
$169,545.00
|
$14,128.75
|
$4.45
|
|
13-24
|
$175,479.07
|
$14,623.26
|
$4.61
|
|
25-Expiration Date
|
$181,620.83
|
$15,135.07
|
$4.77
|
*The
calculations of the Monthly Fixed Rent Per Rentable Square Foot set
forth above are approximate calculations based on a 3.5% increase
per annum, rounded to the nearest one-hundredth. These
approximations are provided for convenience only and the Fixed Rent
Per Month amounts control.
-2-
Concurrently with
its execution and delivery of this Third Amendment, Tenant shall
deliver an amount equal to $14,128.75, as payment of the Fixed Rent
payable for the Expansion Premises for the fifth (5th) full calendar
month of the Expansion Term.
(b) Abated
Fixed Rent. Notwithstanding the
terms of Section
4.2(a), above, Tenant shall be
entitled to a full abatement of Fixed Rent otherwise due for the
Expansion Premises during the initial four (4) calendar months of
the Expansion Term for a period of four and one half months (such
period shall be referred to herein as the "Fixed Rent Abatement
Period"). Landlord and Tenant
acknowledge that Tenant's right (the "Fixed Rent Abatement
Right") to receive Fixed Rent
abatement, as set forth above, during the Fixed Rent Abatement
Period has been granted to Tenant as additional consideration for
Tenant's agreement to enter into this Third Amendment and comply
with the terms and conditions otherwise required under the Lease,
as amended. Nothing contained in this Section 4.2(b) shall be
construed as relieving Tenant of its obligation to pay Tenant's
Operating Payment and Tenant's Tax Payment, and any and all parking
costs and taxes in connection with the Expansion Passes (defined in
Section 9, below)
payable under Section 9 below, during
the Expansion Premises Abatement Period. Landlord and Tenant
acknowledge that the terms and provisions of this Section 4.2(a) shall pertain to
Tenant's lease of the Expansion Premises under this Third Amendment
only, and shall not affect or in any way modify any Rent payable by
Tenant under the Lease, as amended, with respect to the Existing
Premises.
5.1 Existing
Premises. Tenant shall continue to pay to Landlord Tenant's
Proportionate Share of Operating Expenses and Taxes with respect to
the Existing Premises in accordance with the terms and conditions
set forth in the Lease.
5.2 Expansion
Premises.
Notwithstanding any provision to the contrary contained in the
Lease, with respect to the period of the Term occurring from and
after the Expansion Commencement Date, Tenant shall pay to Landlord
Tenant's Proportionate Share of Operating Expenses and Taxes with
respect to the Expansion Premises on the terms and conditions set
forth in the Lease, provided, however, that effective as of the
Expansion Commencement Date, with respect to the Expansion Premises
only, the following shall apply: (i) the Base Year shall be
the calendar year 2019, and (ii) Tenant's Proportionate Share
of Operating Expenses and Taxes with respect to the Expansion
Premises shall equal 1.338%.
6. Improvements;
Landlord Work.
6.1 Allowance.
Notwithstanding any provision to the contrary contained herein,
Tenant shall be entitled to a one-time tenant improvement allowance
(the "Allowance") in an
aggregate amount equal to $63,500.00 (i.e., $20.00 per rentable square foot
of the Premises), for the costs
relating to the initial design and construction of Tenant's
improvements that are permanently affixed to the Expansion Premises
(the "Improvements"). In no event shall Landlord be obligated
to make disbursements from the Allowance prior to the Expansion
Commencement Date, nor for costs which are unrelated to the
Improvements or in a total amount which exceeds the Allowance.
Except as otherwise provided in
this Section
6.1, Tenant shall perform the
Improvements at its sole cost and expense and in accordance with
the terms of Article 5
of the Office Lease. Any
portion of the Allowance not used by Tenant in accordance with the
terms of this Section 6.1 on or before
the first anniversary of the Expansion Commencement Date, shall
automatically revert to Landlord, and Tenant shall have no further
rights with respect thereto.
6.2 Disbursement of
Allowance. During the construction of the Improvements,
Tenant may request, and Landlord shall make monthly disbursements
of the Allowance for the benefit of Tenant and shall authorize the
release of monies for the benefit of Tenant as
follows:
(a) Monthly
Disbursements. On or before the twentieth (20th) day of each
calendar month during the construction of the Improvements (the
"Submittal Date") (or such
other date as Landlord may designate), Tenant shall deliver to
Landlord: (i) a request for payment of the contractor retained to
construct the Improvements, approved by Tenant, (ii) executed
mechanic's lien releases, which lien releases shall be conditional
with respect to the then-requested payment amounts and
unconditional with respect to payment amounts previously disbursed
by Landlord or Tenant, which shall comply with the applicable
provisions of California Civil Code Sections 8132, 8134, 8136 and
8138 and (iii) all applicable invoices related to the payment and
disbursement request from all general contractors, subcontractors,
laborers, materialmen, and suppliers used by Tenant for labor
rendered and materials delivered to the Expansion Premises in
connection with Improvements. Tenant's request for payment shall be
deemed Tenant's acceptance and approval (as between Tenant and
Landlord only) of the work furnished and/or the materials supplied
as set forth in Tenant's payment request. On or before the date
occurring not more than thirty (30) days after the Submittal Date,
and assuming Landlord receives all of the information described in
items (i) through (iii), above, Landlord shall deliver a check to
Tenant in payment of the lesser of: (A) the amounts so requested by
Tenant, as set forth in this Section 6.2(a), above, up to an
aggregate total of ninety percent (90%) of the Allowance (the
remaining ten percent (10%) of the Allowance shall be the
"Final Retention"), and (B)
the balance of any remaining available portion of the Allowance
(not including the Final Retention), provided that Landlord does
not unreasonably dispute any request for payment due to any
substandard work. Landlord's payment of such amounts shall not be
deemed Landlord's approval or acceptance of the work furnished or
materials supplied as set forth in Tenant's payment
request.
-3-
(b) Final
Retention. Subject to the provisions of this Section 6.2, a check for the
Final Retention payable to Tenant shall be delivered by Landlord to
Tenant following the completion of construction of the
Improvements, provided that (i) Tenant delivers to Landlord
properly executed unconditional mechanics lien releases in
compliance with both California Civil Code Section 8134 and either
Section 8136 or Section 8138 from Tenant's contractor or
subcontractors and any other party which has lien rights in
connection with the construction of the Improvements, (ii) Landlord
has determined that no substandard work exists that adversely
affects the mechanical, electrical, plumbing, heating, ventilating
and air conditioning, life-safety or other systems of the Building,
the curtain wall of the Building, the structure or exterior
appearance of the Building, or any other tenant's use of such other
tenant's leased premises in the Building, and (iii) Tenant delivers
to Landlord a certificate from Tenant's architect certifying that
the construction of the Improvements has been
completed.
7. Landlord
Work. Except as specifically set forth in Sections 2, and 6 above, along with this
Section 7, Landlord
shall not be obligated to provide or pay for any improvement work
or services related to the improvement of the Expansion Premises.
Notwithstanding the foregoing, Landlord shall, at Landlord sole
cost and expense, using Building standard methods, materials, and
finishes (i) repair or replace, as reasonably deemed necessary by
Landlord and Tenant, any cracked, chipped exterior film glazing on
all exterior windows of the Expansion Premises; (ii) repair or
replace, as reasonably deemed necessary by Landlord and Tenant, the
aluminum window mullions on the exterior windows of the Expansion
Premises, and (iii) install Building standard window coverings,
wherein such window covering specification is Mecho Shade
Black/Xxxxx 6000 series with a 3% perforation in the Expansion
Premises (the foregoing items (i), (ii) and (iii) shall be known
collectively as the “Landlord
Work”). Landlord shall perform the Landlord Work
concurrently with Tenant's performance of the Improvements, and in
connection therewith Landlord and Tenant shall cooperate with one
another. Landlord hereby acknowledges that Tenant shall have the
right, but not the obligation, to occupy the Expansion Premises
during the performance of the Landlord Work. Notwithstanding the
foregoing, Tenant agrees that it shall reasonably cooperate with
Landlord in connection with the scheduling and performance of the
Landlord Work, and that Landlord shall be permitted to perform the
Landlord Work during normal business hours (without the payment of
overtime or other premiums to complete such work), and Tenant shall
provide a clear working area for the Landlord Work (including, but
not limited to, the moving of furniture, fixtures and
Tenant’s property away from the area in which Landlord is
conducting the Landlord Work). Tenant hereby agrees that the
performance of the Landlord Work shall in no way constitute a
constructive eviction of Tenant nor entitle Tenant to any abatement
of Rent or damages of any kind. Furthermore, in no event shall
Tenant be entitled to any compensation or damages from Landlord for
loss of the use of the whole or any part of the Expansion Premises
or of Tenant’s personal property or improvements resulting
from the Landlord Work or Landlord’s actions in connection
with the Landlord Work, or for any inconvenience or annoyance
occasioned by the Landlord Work or Landlord’s actions in
connection with the Landlord Work, provided that the foregoing
shall not limit Landlord's liability, if any, pursuant to
applicable law for personal injury and property damage to the
extent caused by the gross negligence or willful misconduct of
Landlord, its agents, employees or contractors.
-4-
8. Letter of
Credit.
8.1 Form of Letter of
Credit; Letter of Credit Amount. On or before the date (the
"Letter of Credit Delivery
Date") that is fifteen (15) days following the execution and
delivery of this Third Amendment by Landlord and Tenant, Tenant
shall deliver to Landlord, as protection for the full and faithful
performance by Tenant of all of its obligations under the Lease, as
amended, and for all losses and damages Landlord may suffer as a
result of any breach or default by Tenant under the Lease, as
amended, an irrevocable and unconditional negotiable standby letter
of credit (the "Letter of
Credit"), in the form attached hereto as Exhibit B,
or another form, which shall be subject to Landlord's reasonable
approval, and containing the terms required herein, payable in the
City of Los Angeles, California, running in favor of Landlord and
issued by a solvent, nationally recognized bank with a long term
rating of A or higher (by Standard Poor's) or a long term rating of
A2 or higher (by Xxxxx'x), under the supervision of the
Superintendent of Banks of the State of California, or a national
banking association, in the amount of $152,077.19 (the
"Letter of Credit Amount").
The Letter of Credit shall (i) be "callable" at sight, irrevocable
and unconditional, (ii) be maintained in effect, whether through
renewal or extension, for the period from the Expansion
Commencement Date and continuing until the date (the "LC Expiration Date") that is sixty (60)
days after the Expiration Date (as the same may be extended), and
Tenant shall deliver a new Letter of Credit or certificate of
renewal or extension to Landlord at least ninety (90) days prior to
the expiration of the Letter of Credit then held by Landlord,
without any action whatsoever on the part of Landlord, (iii) be
fully assignable by Landlord, its successors and assigns, (iv)
permit partial draws and multiple presentations and drawings, and
(v) be otherwise subject to the International Standby Practices
1998, International Chamber of Commerce Publication No. 590. The
form and terms of the Letter of Credit and the bank issuing the
same (the "Bank") shall be
reasonably acceptable to Landlord, in Landlord's reasonable
discretion. Landlord, or its then managing agent, shall have the
right to draw down an amount up to the face amount of the Letter of
Credit if any of the following shall have occurred or be
applicable: (1) such amount is due to Landlord under the terms and
conditions of the Lease, as amended,, or (2) Tenant has filed a
voluntary petition under the U.S. Bankruptcy Code or any state
bankruptcy code (collectively, "Bankruptcy Code"), or (3) an involuntary
petition has been filed against Tenant under the Bankruptcy Code,
or (4) the Bank has notified Landlord that the Letter of Credit
will not be renewed or extended through the LC Expiration Date or
(5) the long term rating of the Bank has been downgraded to BBB or
lower (by Standard & Poor's) or Baa2 or lower (by Xxxxx'x) and
Tenant has failed to deliver a new Letter of Credit from a bank
with a long term rating of A or higher (by Standard & Poor's)
or A2 or higher (by Xxxxx'x) and otherwise meeting the requirements
set forth in this Section
8 within thirty (30) days following notice from Landlord.
The Letter of Credit will be honored by the Bank regardless of
whether Tenant disputes Landlord's right to draw upon the Letter of
Credit.
8.2 Transfer of Letter
of Credit by Landlord. The Letter of Credit shall also
provide that Landlord, its successors and assigns, may, at any time
and without notice to Tenant and without first obtaining Tenant's
consent thereto, transfer (one or more times) all or any portion of
its interest in and to the Letter of Credit to another party,
person or entity, regardless of whether or not such transfer is
separate from or as a part of the assignment by Landlord of its
rights and interests in and to the Lease, as amended. In the event
of a transfer of Landlord's interest in the Building, Landlord
shall transfer the Letter of Credit, in whole or in part, to the
transferee and thereupon Landlord, without any further agreement
between the parties, shall be released by Tenant from all liability
therefor, and it is agreed that the provisions hereof shall apply
to every transfer or assignment of the whole or any portion of said
Letter of Credit to a new landlord. In connection with any such
transfer of the Letter of Credit by Landlord, Tenant shall, at
Tenant's sole cost and expense, execute and submit to the Bank such
applications, documents and instruments as may be necessary to
effectuate such transfer, and Tenant shall be responsible for
paying the Bank's transfer and processing fees in connection
therewith.
-5-
8.3 Maintenance of
Letter of Credit by Tenant. If, as a result of any drawing
by Landlord on the Letter of Credit, the amount of the Letter of
Credit shall be less than the Letter of Credit Amount, Tenant
shall, within five (5) days thereafter, provide Landlord with
additional letter(s) of credit in an amount equal to the
deficiency, and any such additional letter(s) of credit shall
comply with all of the provisions of this Section 8, and if Tenant fails
to comply with the foregoing, notwithstanding anything to the
contrary contained in Section 15.1 of the Office
Lease, the same shall constitute an incurable Event of 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. Without limiting the generality of the
foregoing, if the Letter of Credit expires earlier than the LC
Expiration Date, Landlord will accept a renewal thereof (such
renewal letter of credit to be in effect and delivered to Landlord,
as applicable, not later than ninety (90) days prior to the
expiration of the Letter of Credit), which shall be irrevocable and
automatically renewable as above provided through the 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. However, if the Letter of Credit is not timely renewed,
or if Tenant fails to maintain the Letter of Credit in the amount
and in accordance with the terms set forth in this Section 8, Landlord shall have
the right to present the Letter of Credit to the Bank in accordance
with the terms of this Section 8, and the proceeds of
the Letter of Credit may be applied by Landlord against any Rent
payable by Tenant under the Lease, as amended, that is not paid
when due and/or to pay for all losses and damages that Landlord has
suffered or that Landlord reasonably estimates that it will suffer
as a result of any breach or default by Tenant under the Lease, as
amended. Any unused proceeds shall constitute the property of
Landlord and need not be segregated from Landlord's other assets.
Landlord agrees to pay to Tenant within thirty (30) days after the
LC Expiration Date the amount of any proceeds of the Letter of
Credit received by Landlord and not applied against any Rent
payable by Tenant under the Lease, as amended, that was not paid
when due or used to pay for any losses and/or damages suffered by
Landlord (or reasonably estimated by Landlord that it will suffer)
as a result of any breach or default by Tenant under the Lease, as
amended; provided, however, that if prior to the LC Expiration Date
a voluntary petition is filed by Tenant, or an involuntary petition
is filed against Tenant by any of Tenant's creditors, under the
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 the Lease,
as amended, have been resolved in such bankruptcy or reorganization
case or such bankruptcy or reorganization case has been
dismissed.
8.4 Landlord's Right to
Draw Upon Letter of Credit. Tenant hereby acknowledges and
agrees that Landlord is entering into this Third Amendment in
material reliance upon the ability of Landlord to draw upon the
Letter of Credit upon the occurrence of any breach or default on
the part of Tenant under the Lease, as amended. If Tenant shall
breach any provision of the Lease, as amended, or otherwise be in
default hereunder, Landlord may, but without obligation to do so,
and without notice to Tenant, draw upon the Letter of Credit, in
part or in whole, to cure any breach or default of Tenant and/or to
compensate Landlord for any and all damages of any kind or nature
sustained or which Landlord reasonably estimates that it will
sustain resulting from Tenant's breach or default. The use,
application or retention of the Letter of Credit, or any portion
thereof, by Landlord shall not prevent Landlord from exercising any
other right or remedy provided by the Lease, as amended, or by any
applicable law, it being intended that Landlord shall not first be
required to proceed against the Letter of Credit, and shall not
operate as a limitation on any recovery to which Landlord may
otherwise be entitled. Tenant agrees not to interfere in any way
with payment to Landlord of the proceeds of the Letter of Credit,
either prior to or following a "draw" by Landlord of any portion of
the Letter of Credit, regardless of whether any dispute exists
between Tenant and Landlord as to Landlord's right to draw upon the
Letter of Credit. No condition or term of the Lease, as amended,
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
agrees and acknowledges that (a) the Letter of Credit constitutes a
separate and independent contract between Landlord and the Bank,
(b) Tenant is not a third party beneficiary of such contract, (c)
Tenant has no property interest whatsoever in the Letter of Credit
or the proceeds thereof, and (d) in the event Tenant becomes a
debtor under any chapter of the Bankruptcy Code, neither Tenant,
any trustee, nor Tenant's bankruptcy estate shall have any right to
restrict or limit Landlord's claim and/or rights to the Letter of
Credit and/or the proceeds thereof by application of Section
502(b)(6) of the U. S. Bankruptcy Code or otherwise.
-6-
8.5 Letter of Credit
Not a Security Deposit. Landlord and Tenant acknowledge and
agree that in no event or circumstance shall the Letter of Credit
or any renewal thereof or any proceeds thereof be (i) deemed to be
or treated as a "security deposit" within the meaning of California
Civil Code Section 1950.7, (ii) subject to the terms of such
Section 1950.7, or (iii) intended to serve as a "security deposit"
within the meaning of such Section 1950.7. The parties hereto (A)
recite that the Letter of Credit is not intended to serve as a
security deposit and such Section 1950.7 and any and all other
laws, rules and regulations applicable to security deposits in the
commercial context ("Security
Deposit Laws") shall have no applicability or relevancy
thereto and (B) 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.
8.6 Reduction in Letter
of Credit Amount. To the extent that (i) Tenant is not in
material non-monetary or monetary default under the Lease, as
amended, as of the Reduction Date (defined below), (ii) has not
been in material non-monetary or monetary default, beyond all cure
periods, as provided for under the terms of the Lease, as amended,
during the twelve (12) month period prior to the Reduction Date,
and (iii) Tenant has achieved an EBITDA margin of 15% in any
consecutive twelve (12) month period during the Expansion Term,
then the Letter of Credit Amount shall be reduced by fifty percent
(50%) on the first day following the expiration of any such twelve
(12) month period (the "Reduction
Date"). To the extent that Tenant has satisfied the terms of
the foregoing items (i) through (iii), then Tenant shall have the
right to reduce the Letter of Credit Amount as set forth above via
the delivery to Landlord of either (x) an amendment to the existing
Letter of Credit (in form and content reasonably acceptable to
Landlord) modifying the Letter of Credit Amount to the amount then
required under this Section 8.6, or (y) an entirely
new Letter of Credit (in the form and content otherwise required in
this Section 8) in
the total Letter of Credit Amount then required under this
Section
8.6.
9. Parking.
Notwithstanding any provision to the contrary contained in the
Lease, in addition to the parking rights granted to Tenant in the
Lease, in connection with Tenant's lease of the Expansion Premises,
Tenant shall have the right, but not obligation, to rent from
Landlord up to ten (10) additional unreserved parking passes (the
"Expansion Passes") on a
monthly basis throughout the Expansion Term, which parking passes
shall pertain to the Building Parking Facility. Tenant shall have the right to convert up to two
(2) of the Expansion Passes allocated to Tenant to two (2) reserved
parking passes, which reserved parking passes shall be located on
the PA or PB level of the Building Parking Facility. The exact
location of the reserved parking passes on the PA or PB level of
the Building Parking Facility shall be mutually determined by
Landlord and Tenant. Tenant shall pay to Landlord, on a
monthly basis, the prevailing rate (the "Parking Charge") charged for such
Expansion Passes, provided, however,
that Tenant shall have no obligation to pay a Parking Charge for
the Expansion Passes allocated to Tenant during the initial two (2)
full calendar months of the Expansion Term. Notwithstanding the foregoing, during the initial
twelve (12) months of the Expansion Term only, the Parking Charges
for the Expansion Passes only shall be fixed, without increase, (A)
at $210.72 per unreserved parking pass per month, and (B) at
$316.16 per reserved parking space per month (the foregoing rates
are inclusive of taxes). Commencing on the first day of the
thirteenth (13th) month of the Expansion Term and continuing
annually thereafter, the Parking Charge for the Expansion Passes
shall not increase by more than three percent (3%) per twelve (12)
month period thereafter, on a cumulative, compounding basis, over
the Parking Charge for such parking passes in effect during the
prior twelve (12) month period. Except as otherwise provided
in this Section 9, Tenant's rights
and obligations with respect to the Expansion Passes shall be
subject to the terms of Article 28 of the Office
Lease.
10. Signage.
Tenant's identifying signage to the Expansion Premises shall be
provided by Landlord, at Landlord's cost, and such signage shall be
comparable to that used by Landlord for other similar floors in the
Building and shall comply with Landlord's then-current Building
standard signage program.
-7-
11. Required
Disclosures Related to Accessibility Standards. For purposes
of Section 1938(a) of the California Civil Code, Landlord hereby
discloses to Tenant, and Tenant hereby acknowledges, that the
Expansion Premises have not undergone inspection by a person
certified as a Certified Access Specialist (CASp). In addition, the
following notice is hereby provided pursuant to Section 1938(e) of
the California Civil Code: "A Certified Access Specialist (CASp)
can inspect the subject premises and determine whether the subject
premises comply with all of the applicable construction-related
accessibility standards under state law. Although state law does
not require a CASp inspection of the subject premises, the
commercial property owner or lessor may not prohibit the lessee or
tenant from obtaining a CASp inspection of the subject premises for
the occupancy or potential occupancy of the lessee or tenant, if
requested by the lessee or tenant. The parties shall mutually agree
on the arrangements for the time and manner of the CASp inspection,
the payment of the fee for the CASp inspection, and the cost of
making any repairs necessary to correct violations of
construction-related accessibility standards within the premises."
In furtherance of and in connection with such notice: (i) Tenant,
having read such notice and understanding Tenant's right to request
and obtain a CASp inspection and with advice of counsel, hereby
elects not to obtain such CASp inspection and forever waives its
rights to obtain a CASp inspection with respect to the Expansion
Premises, the Building and/or the Real Property to the extent
permitted by applicable Requirements now or hereafter in effect;
and (ii) if the waiver set forth in clause (i) hereinabove is not
enforceable pursuant to applicable Requirements now or hereafter in
effect, then Landlord and Tenant hereby agree as follows (which
constitute the mutual agreement of the parties as to the matters
described in the last sentence of the foregoing notice): (A) Tenant
shall have the one-time right to request for and obtain a CASp
inspection, which request must be made, if at all, in a written
notice delivered by Tenant to Landlord within thirty (30) days
after the Commencement Date; (B) any CASp inspection timely
requested by Tenant shall be conducted (1) between the hours of
9:00 a.m. and 5:00 p.m. on any Business Day, (2) only after ten
(10) days' prior written notice to Landlord of the date of such
CASp inspection, (3) in a professional manner by a CASp designated
by Landlord and without any testing that would damage the Expansion
Premises, the Building or the Real Property in any way, (4) in
accordance with all of the provisions of this Lease applicable to
Tenant contracts for construction, and (5) at Tenant's sole cost
and expense, including, without limitation, Tenant's payment of the
fee for such CASp inspection, the fee for any reports and/or
certificates prepared by the CASp in connection with such CASp
inspection (collectively, the "CASp
Reports") and all other costs and expenses in connection
therewith; (C) Landlord shall be an express third party beneficiary
of Tenant's contract with the CASp, and any CASp Reports shall be
addressed to both Landlord and Tenant; (D) Tenant shall deliver a
copy of any CASp Reports to Landlord within two (2) Business Days
after Tenant's receipt thereof; (E) any information generated by
the CASp inspection and/or contained in the CASp Reports shall not
be disclosed by Tenant to anyone other than (I) contractors,
subcontractors and/or consultants of Tenant, in each instance who
have a need to know such information and who agree in writing not
to further disclose such information, or (II) any governmental
entity, agency or other person, in each instance to whom disclosure
is required by applicable Requirements or by regulatory or judicial
process; (F) Tenant, at its sole cost and expense, shall be
responsible for making any improvements, alterations, modifications
and/or repairs to or within the Expansion Premises to correct
violations of construction-related accessibility standards,
including, without limitation, any violations disclosed by such
CASp inspection; and (G) if such CASp inspection identifies any
improvements, alterations, modifications and/or repairs necessary
to correct violations of construction-related accessibility
standards relating to those items of the Building and/or the Real
Property located outside the Expansion Premises, then Tenant shall
be responsible for performing any such improvements, alterations,
modifications and/or repairs as and to the extent required by
applicable Requirements to the extent provided Section 8.1(a) of the Office
Lease and Landlord shall be responsible for performing any such
improvements, alterations, modifications and/or repairs as and to
the extent required by applicable Requirements to the extent
provided in Section
8.1(c) of the Office Lease.
12. Limitation on
Liability. The liability of Landlord for Landlord’s
obligations under the Lease, as amended, and any other documents
executed by Landlord and Tenant in connection with the Lease, as
amended (collectively, the "Lease
Documents") shall be limited to Landlord’s interest in
the Real Property (including any rent, insurance, sales and
condemnation proceeds actually received by Landlord and not subject
to any superior rights of any third parties) and Tenant shall not
look to any other property or assets of Landlord or the property or
assets of any direct or indirect partner, member, manager,
shareholder, director, officer, principal, employee or agent of
Landlord (collectively, the “Parties”) in seeking either to
enforce Landlord’s obligations under the Lease Documents or
to satisfy a judgment for Landlord’s failure to perform such
obligations; and none of the Parties shall be personally liable for
the performance of Landlord’s obligations under the Lease
Documents. In no event shall Landlord be liable for, and Tenant, on
behalf of itself and all other subtenants or occupants of the
Premises and their respective agents, contractors, subcontractors,
employees, invitees or licensees hereby waives any claim for, any
indirect, consequential or punitive damages, including loss of
profits or business opportunity, arising under or in connection
with the Lease Documents.
-8-
13. Tax Status of
Beneficial Owner. Tenant recognizes and acknowledges that
Landlord and/or certain beneficial owners of Landlord may from time
to time qualify as real estate investment trusts pursuant to
Sections 856, et seq. of the Internal Revenue Code and that
avoiding (a) the loss of such status, (b) the receipt of any
income derived under any provision of the Lease, as amended, that
does not constitute “rents from real property” (in the
case of real estate investment trusts), and (c) the imposition of
income, penalty or similar taxes (each an “Adverse Event”) is of material
concern to Landlord and such beneficial owners. In the event that
the Lease, as amended, or any document contemplated hereby could,
in the opinion of counsel to Landlord, result in or cause an
Adverse Event, Tenant agrees to cooperate with Landlord in
negotiating an amendment or modification thereof for the limited
purpose of addressing such Adverse Event and shall at the request
of Landlord execute and deliver such documents reasonably required
to effect such amendment or modification, provided that Landlord
shall, after the receipt of an invoice therefor, reimburse Tenant
for its reasonable and actual out-of-pocket attorneys fees incurred
in connection with Tenant's review of such amendment or
modification. Any amendment or modification pursuant to this
Section 13 shall be
structured so that the economic results to Landlord and Tenant
shall be substantially similar to those set forth in the Lease, as
amended, without regard to such amendment or modification. Without
limiting any of Landlord's other rights under this Section 13, Landlord may
waive the receipt of any amount payable to Landlord hereunder and
such waiver shall constitute an amendment or modification of the
Lease, as amended, with respect to such payment. Tenant expressly
covenants and agrees not to enter into any sublease or assignment
which provides for rental or other payment for such use, occupancy,
or utilization based in whole or in part on the net income or
profits derived by any person from the property leased, used,
occupied, or utilized (other than an amount based on a fixed
percentage or percentages of receipts or sales), and that any such
purported sublease or assignment shall be absolutely void and
ineffective as a conveyance of any right or interest in the
possession, use, occupancy, or utilization of any part of the
Premises.
14. Authority.
If Tenant is a corporation, trust, limited liability company or
partnership, each individual executing this Third Amendment on
behalf of Tenant hereby represents and warrants that Tenant is a
duly formed and existing entity qualified to do business in
California and that Tenant has full right and authority to execute
and deliver this Third Amendment and that each person signing on
behalf of Tenant is authorized to do so.
15. Brokers.
Landlord and Tenant hereby warrant to each other that they have had
no dealings with any real estate broker or agent in connection with
the negotiation of this Third Amendment other than Tishman Speyer
Properties, L.P. and Xxxxxxx & Xxxxxxxxx U.S., Inc.,
(collectively, the "Brokers"), and that they know of no other real estate
broker or agent who is entitled to a commission in connection with
this Third Amendment. Each party agrees to indemnify and defend the
other party against and hold the other party harmless from any and
all claims, demands, losses, liabilities, lawsuits, judgments,
costs and expenses (including, without limitation, reasonable
attorneys' fees) with respect to any leasing commission or
equivalent compensation alleged to be owing on account of the
indemnifying party's dealings with any real estate broker or agent
other than the Brokers. The terms of this Section 15
shall survive the expiration or
earlier termination of the Lease, as amended.
16. Conflict;
No Further Modification.
In the event of any conflict between the terms and conditions of
the Lease and the terms and conditions of this Third Amendment, the
terms and conditions of this Third Amendment shall prevail. Except
as specifically set forth in this Third Amendment, all of the terms
and conditions of the Lease shall remain unmodified and in full
force and effect.
[signatures appear on following
page]
|
|
|
|
-9-
IN
WITNESS WHEREOF, this Third
Amendment has been executed as of the day and year first
above written.
LANDLORD:
10900
WILSHIRE, L.L.C.,
a
Delaware limited liability company
By:
/s/ Xxxx X.
Xxxxxxx
Its:
Senior Managing
Director
TENANT:
CHROMADEX,
INC.,
a
California corporation
By:
/s/ Xxxxxx
Xxxxx
Its:
President &
CEO
By:
/s/ Xxxxx
Xxxx
Its:
CFO
-10-
EXHIBIT A
OUTLINE OF EXPANSION PREMISES
The
floor plan which follows is intended solely to identify the general
location of the Expansion Premises, and should not be used for any
other purpose. All areas, dimensions and locations are approximate,
and any physical conditions indicated may not exist as
shown.
A-1
EXHIBIT B
FORM OF LETTER OF CREDIT
[LETTERHEAD OF ISSUER OF LETTER OF CREDIT]
(ISSUE
DATE)
=======================================
IRREVOCABLE
STANDBY LETTER OF CREDIT
=======================================
|
BENEFICIARY:
|
APPLICANT:
|
|
|
COMPLETE
NAME
STREET
ADDRESS
|
COMPLETE
NAME
STREET
ADDRESS
|
|
|
LETTER
OF CREDIT NO:
|
|
|
|
EXPIRY
DATE:
|
|
|
|
AT:
|
ISSUING
BANK’S GLOBAL DOCUMENTARY SERVICES COUNTERS LOCATED AT
ADDRESS INDICATED ABOVE, EXCEPT AS PROVIDED HEREIN.
|
|
|
AMOUNT:
|
NOT
EXCEEDING US$
|
|
|
|
( AND
NO/100 U.S. DOLLARS)
|
|
BY
ORDER OF OUR CLIENT, _________________ (THE
“APPLICANT”), WE HEREBY ESTABLISH THIS IRREVOCABLE
STANDBY LETTER OF CREDIT NO. ___________ IN YOUR FAVOR FOR AN
AMOUNT UP TO BUT NOT EXCEEDING THE AGGREGATE SUM OF
______________________ AND NO/100 U.S. DOLLARS ($____________) (THE
“LETTER OF CREDIT AMOUNT”), EFFECTIVE IMMEDIATELY, AND
EXPIRING ON THE CLOSE OF BUSINESS AT OUR OFFICE AT THE ADDRESS SET
FORTH ABOVE ON (INITIAL EXPIRY DATE) UNLESS RENEWED AS HEREINAFTER
PROVIDED.
FUNDS
UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU ON OR PRIOR TO THE
EXPIRY DATE AGAINST PRESENTATION BY YOU OF YOUR SIGHT DRAFT(S)
DRAWN ON __________________ IN THE FORM OF ANNEX 1 HERETO, AND
ACCOMPANIED BY THE FOLLOWING DOCUMENTS:
1) A
STATEMENT COMPLETED AND SIGNED BY ONE OF YOUR OFFICERS CERTIFYING
AS FOLLOWS:
“BENEFICIARY
IS ENTITLED TO DRAW UNDER THE LETTER OF CREDIT IN THE AMOUNT
DEMANDED PURSUANT TO THE TERMS OF THAT CERTAIN LEASE AGREEMENT
DATED ____________, BETWEEN ___________________________________, AS
THE LANDLORD, AND ______________________________________________,
AS THE TENANT.”
2) THE
ORIGINAL OF THIS LETTER OF CREDIT.
SUCH
PAYMENT DOCUMENTS, NOTICES AND COMMUNICATIONS MUST BE SENT EITHER
(BUT NOT BOTH) BY: (A) COURIER OR FIRST CLASS UNITED STATES MAIL TO
______________________________________, ATTN: STANDBY LETTERS OF
CREDIT, OR (B) FACSIMILE TO FACSIMILE NUMBER ____________, ATTN:
STANDBY LETTERS OF CREDIT PROVIDED, HOWEVER, THAT SUCH ADDRESS AND
FACSIMILE NUMBER MAY BE
B-1
AMENDED
BY US UPON THE PROVISION OF WRITTEN NOTICE OF SUCH AMENDMENT TO
YOU. THE BENEFICIARY SHALL USE COMMERCIALLY REASONABLE EFFORTS TO
GIVE TELEPHONIC NOTIFICATION OF A DEMAND FOR PAYMENT AT EITHER
____________ OR ________________.
YOU MAY
PRESENT TO US ONE OR MORE DRAWINGS FROM TIME TO TIME PRIOR TO THE
EXPIRY DATE IN AN AGGREGATE AMOUNT NOT TO EXCEED THE LETTER OF
CREDIT AMOUNT THEN IN EFFECT (IT BEING UNDERSTOOD THAT THE HONORING
BY US OF EACH DRAWING REQUEST SHALL REDUCE THE LETTER OF CREDIT
AMOUNT THEN IN EFFECT.)
THIS
LETTER OF CREDIT INITIALLY EXPIRES ON (INITIAL EXPIRY
DATE).
IT IS A
CONDITION OF THIS LETTER OF CREDIT THAT IT SHALL BE CONSIDERED
AUTOMATICALLY EXTENDED WITHOUT AMENDMENT FOR ONE YEAR FROM THE
PRESENT OR ANY FUTURE EXPIRATION DATE UNLESS WE NOTIFY YOU IN
WRITING BY COURIER AT LEAST SIXTY (60) DAYS PRIOR TO ANY SUCH
EXPIRATION DATE THAT THIS LETTER OF CREDIT WILL NOT BE EXTENDED. IN
THE EVENT THAT WE ELECT NOT TO EXTEND THE LETTER OF CREDIT, YOU MAY
IMMEDIATELY DRAW DOWN ON THE FULL AMOUNT OF THE LETTER OF CREDIT BY
PRESENTATION OF YOUR DRAWING REQUEST. NOTWITHSTANDING ANY OTHER
PROVISION HEREIN, THIS LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND
(FINAL EXPIRY).
THIS
LETTER OF CREDIT SETS FORTH IN FULL THE TERMS OF OUR UNDERTAKING
AND SUCH UNDERTAKING SHALL NOT IN ANY WAY BE MODIFIED, AMENDED OR
AMPLIFIED BY REFERENCE TO ANY DOCUMENT OR INSTRUMENT REFERRED TO
HEREIN OR IN WHICH THIS LETTER OF CREDIT IS REFERRED TO OR TO WHICH
THIS LETTER OF CREDIT RELATES, AND NO SUCH REFERENCE SHALL BE
DEEMED TO INCORPORATE HEREIN BY REFERENCE ANY DOCUMENT OR
INSTRUMENT.
THIS
LETTER OF CREDIT IS TRANSFERABLE IN ITS ENTIRETY (BUT NOT IN PART)
UPON THE TERMS SET FORTH HEREIN. WE HEREBY AGREE TO TRANSFER THIS
CREDIT UPON PRESENTATION TO US OF THE ORIGINAL CREDIT (AND ANY
AMENDMENTS HERETO) AND THE BENEFICIARY'S WRITTEN REQUEST FOR
TRANSFER IN THE FORM OF ANNEX II ATTACHED HERETO AND INCORPORATED
BY REFERENCE. ALL CHARGES IN CONNECTION WITH ANY TRANSFER OF THIS
LETTER OF CREDIT ARE FOR THE APPLICANT'S ACCOUNT. ANY SUCH TRANSFER
MAY BE MADE BY BENEFICIARY AT ANY TIME AND WITHOUT NOTICE TO
APPLICANT AND WITHOUT FIRST OBTAINING APPLICANT'S CONSENT
THERETO.
WE
HEREBY AGREE WITH BENEFICIARY OF DRAFTS DRAWN UNDER AND IN
COMPLIANCE WITH THE TERMS OF THIS CREDIT THAT SUCH DRAFTS WILL BE
DULY HONORED UPON PRESENTATION TO US. THE OBLIGATION OF
_____________________ UNDER THIS LETTER OF CREDIT IS THE INDIVIDUAL
OBLIGATION OF ____________________ AND IS IN NO WAY CONTINGENT UPON
REIMBURSEMENT WITH RESPECT THERETO.
DRAFTS
DRAWN UNDER THIS CREDIT MUST BEAR THE CLAUSE: “DRAWN UNDER
_____________________ IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER
//SAMPLE//.”
B-2
ISSUER
SHALL NOT BE LIABLE FOR ANY DELAY, NON-RETURN OF DOCUMENTS,
NON-PAYMENT, OR OTHER ACTION OR INACTION COMPELLED BY A JUDICIAL
ORDER OR BY ANY LAW OR REGULATION APPLICABLE TO
ISSUER.
TO THE
EXTENT NOT INCONSISTENT WITH THE EXPRESS TERMS HEREOF, THIS LETTER
OF CREDIT IS SUBJECT TO THE INTERNATIONAL STANDBY PRACTICES
(ISP98), THE INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO.
590.
OR
EXCEPT
AS OTHERWISE EXPRESSLY STATED HEREIN, THIS CREDIT IS SUBJECT TO
"THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS" (2007
REVISION) INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO.
600.
(DRAFT)
___________________________________________
STANDBY
LETTERS OF CREDIT
APPROVED:
|
X
|
|
AUTHORIZED
SIGNATURE, APPLICANT
AS
AUTHORIZATION TO ISSUE IN THIS FORM
|
B-3
ANNEX I
(SAMPLE
OF SIGHT DRAFT TO BE TYPED ON BENEFICIARY’S LETTERHEAD
PAPER)
SIGHT DRAFT
DATE:
__________
CITY, STATE:
_____________________
DRAWEE:
___________________________
AT
SIGHT OF THIS SOLE OF EXCHANGE PAY TO THE ORDER OF:
__________________________________________________________
(BENEFICIARY
NAME)
US$_________________
(AMOUNT IN NUMERALS)
(AMOUNT
IN WORDS)
“DRAWN
UNDER ______________________________, IRREVOCABLE STANDBY LETTER OF
CREDIT NO. _____________________ (ISSUE DATE).”.
(BENEFICIARY
NAME)
__________________________
AUTHORIZED
SIGNATURE
B-4
(THE
REVERSE SIDE OF THIS DRAFT MUST BE ENDORSED BY THE
BENEFICIARY)
TRANSFER OF LETTER OF CREDIT IN ITS ENTIRETY
ANNEX II TO STANDBY LETTER OF CREDIT NO. XXXXXXXXX
|
TO:
|
|
FROM:
|
|
|
Re:
|
Letter
of Credit No.
|
|
Issued
by:
|
|
We, the
undersigned beneficiary, hereby authorize and direct you to
transfer irrevocably the referenced letter of credit in its
entirety
|
To:
|
|
|
Whose
Address is:
|
|
|
|
|
|
|
|
|
|
|
|
|
(Herein
called the "transferee") with no changes in terms and conditions of
the Letter of Credit.
|
We are
returning the original instrument, including original amendments,
if any, to you herewith in order that you may deliver it to the
transferee together with your customary Letter of
Transfer.
Any
amendments to the Letter of Credit that you may issue or receive
are to be advised by you directly to the transferee, and the
documents (including drafts if required under the Credit) of the
transferee are to be processed by you (or any intermediary) without
our intervention and without any further responsibility on your
part to us.
Issuer shall not be liable for any delay, non-return of documents,
non-payment or other action or inaction compelled by a Judicial
order or by any law or regulation applicable to
issuer.
|
**The
signature of the beneficiary with title as stated conforms with
that on file with us and is authorized for the execution of such
instruction.
|
|
|
|
|
|
|
|
(Name
of Bank)
|
|
(Name
of Beneficiary)
|
|
|
|
By:
|
|
|
|
(Address
of Bank)
|
|
(Authorized
Signature)
|
|
By:
|
|
|
|
|
|
(Authorized
Signature)
|
|
(Title)
|
|
|
|
|
|
|
|
(Title)
|
|
(Telephone
Number)
|
|
|
|
Date:
|
|
|
|
(Telephone
Number)
|
|
|
|
Date:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
B-5
