EXHIBIT 10.10
SUBLEASE AGREEMENT
ARRIS PHARMACEUTICAL CORPORATION, Sublessor
EXELIXIS PHARMACEUTICALS, INC., Sublessee
000 Xxxxxxxxxxx Xxxxxx, Xxxxx X
Xxxxx Xxx Xxxxxxxxx, Xxxxxxxxxx
SUBLEASE AGREEMENT
This Sublease Agreement ("Sublease") dated as of June 1, 1997 (the
"Commencement Date"), is entered into by and between Arris Pharmaceutical
Corporation, a Delaware corporation (hereinafter "Sublessor"), and Exelixis
Pharmaceuticals, Inc., a Delaware corporation (hereinafter "Sublessee"), and is
subject to the terms and conditions of that certain Lease (the "Master Lease")
dated June 22, 1993 (as amended by that certain First Amendment to Lease dated
October 25, 1993) entered into by Utah Partners, Ltd., a California limited
partnership ("Master Lessor"), and Khepri Pharmaceuticals, Inc., a Delaware
corporation, as Lessee. A copy of the Master Lease has been delivered to
Sublessee. Sublessor is the successor by merger to Khepri Pharmaceuticals, Inc.
1. Premises.
(a) Phase I Premises. As of the Commencement Date, Sublessor hereby
leases to Sublessee, and Sublessee hereby hires from Sublessor, on and subject
to the terms and conditions hereinafter set forth, those certain premises
(hereinafter referred to as the "Phase I Premises"), situated in the City of
South San Francisco, County of San Mateo, State of California, commonly known as
000 Xxxxxxxxxxx Xxxxxx, and consisting of approximately 9,497 rentable square
feet, as more particularly described on Exhibit "A" hereto.
(b) Phase II Premises. As of April 1, 1998, or such earlier or later
date upon which actual delivery to Sublessee occurs pursuant to Section 2(c)
below (the "Phase II Delivery Date"), Sublessor hereby leases to Sublessee, and
Sublessee hereby hires from Sublessor, on and subject to the conditions
hereinafter set forth, those certain premises adjacent to the Phase I Premises
(hereinafter referred to as the "Phase II Premises"), as more particularly
described on Exhibit "A" hereto. For all purposes hereof, until the Phase II
Delivery Date, the term "Premises" shall refer to the Phase I Premises.
Thereafter the term "Premises" shall refer to both the Phase I Premises and the
Phase II Premises.
(c) Common Areas. Sublessee shall have the right, in common with other
tenants of Master Lessor, to use the Common Areas of the property (as defined in
the Master Lease).
2. Sublease Term; Delivery of Possession.
(a) Term. The term of this Sublease shall begin on the Commencement
Date and end on July 15, 2005 (the "Expiration Date"), unless sooner terminated
pursuant to any provision of this Sublease or of the Master Lease.
(b) Delivery of Possession.
(1) If for any reason Sublessor cannot deliver possession of the
Phase I Premises by the Commencement Date, or possession of the Phase II
Premises by the Phase II Delivery Date, Sublessor shall not be subject to any
liability therefore, nor shall such failure
1.
affect the validity of this Sublease or the obligations of Sublessee hereunder
or extend the term hereof, but in such case Sublessee shall not be obligated to
pay rent until possession of the applicable portion of the Premises is tendered
to Sublessee; provided, however, that if Sublessor shall not have delivered
possession of the Premises within ninety (90) days after either the Commencement
Date or the Phase II Delivery Date, as applicable, Sublessee may, at Sublessee's
option, by notice in writing to Sublessor within ten (10) days thereafter,
cancel this Sublease, in which event the parties shall be discharged from all
obligations hereunder. Notwithstanding the foregoing, Sublessee's cancellation
of this Sublease as to the Phase II Premises shall not terminate this Sublease
as to the Phase I Premises.
(2) The Premises shall be delivered by Sublessor subject to all
applicable zoning, municipal, county and state laws, ordinances and regulations
governing and regulating the use of the Premises, and Sublessee accepts the
Premises subject thereto. Sublessee shall accept the Premises in "as-is"
condition. Sublessor has made no representation or warranty as to the condition
of the Premises, their compliance with existing federal, state or local laws,
ordinances or regulations (including without limitation the Americans with
Disabilities Act), or the suitability of the Premises for the conduct of
Sublessee's business. Sublessor shall have no obligation to improve, restore,
repair, paint or clean the Premises. At the request of Sublessee, Sublessor
shall deliver to Sublessee a copy of the closure report from the City of South
San Francisco if such report has been received by Sublessor.
(c) Early Possession.
(1) In the event Sublessee, with Sublessor's consent, takes
possession prior to the Commencement Date, such occupancy shall be subject to
all the provisions of this Sublease except for the payment of rent due
hereunder. Sublessee's early possession shall not advance the termination date
of this Sublease.
(2) In the event the Phase II Premises become available prior to
April 1, 1998, Sublessor may offer the Phase II Premises to Sublessee, and if
such earlier date is on or after February 1, 1998, and Sublessee has received
not less than three weeks prior written notice of the date such possession will
be delivered, Sublessee shall accept possession of the Phase II Premises on such
earlier date. If such date is earlier than February l, 1998, Sublessee shall
have the right but not the obligation to accept possession of the Premises on
such earlier date. The Phase II Delivery Date shall be the date the Premises are
delivered to Sublessee in accordance with this Subsection 2c(2).
(3) Without limitation of any other provision of this Sublease,
failure of Sublessee to occupy the Phase II Premises on the Phase II Delivery
Date shall constitute a default under this Sublease.
3. Rent.
(a) Base Rent. Sublessee shall pay to Sublessor without deduction, set
off, prior notice or demand, as rent for the Premises, monthly rent ("Base
Rent") as set forth in the rent schedule below. Sublessee shall pay Sublessor
upon the execution hereof the sum of Sixty
2.
Thousand Two Hundred Forty Dollars ($60,240.00) as rent for the first full
calendar month after the Phase II Delivery Date.
(1) From the Commencement Date until the Phase II Delivery Date,
Sublessee shall pay to Sublessor the sum of $16,144.90 per month, prorated for
any partial month.
(2) From and after the Phase II Delivery Date, Sublessee shall pay
to Sublessor Base Rent as follows:
Rent Schedule
Time Period Base Rent Per Month
----------------------------------------- ------------------------
Phase II Delivery Date to 9/30/98 * $60,240
10/01/98 to 7/31/00 $61,660
8/01/00 to 7/31/01 $63,200
8/01/01 to 7/31/02 $65,000
8/01/02 to 12/31/02 $72,238
1/01/03 to 7/31/03 $75,210
8/01/03 to 7/31/04 $76,845
8/01/04 to 7/15/05 ** $78,480
*prorated if Phase II Delivery Date is not the 1st day of the month
**prorated during last month
(b) Operating Expenses. Sublessee shall pay as additional rent the
amounts for which Sublessor is liable to Master Lessor pursuant to Section 6
(Operating Expenses) of the Master Lease, together with other expenses of the
Premises for which Sublessor is responsible (excluding any late charges or
penalties not caused by Sublessee), including without limitation utilities,
trash removal, phone, water, sewer, security, access and fire control systems
(maintenance and lease payments). When incorporated into this Sublease,
references to "Landlord" in Sections 6.b. and 6.c. of the Master Lease shall be
deemed to include Master Lessor and/or Sublessor. With respect to Section 6.e.
as incorporated into this Sublease, Sublessor shall have fifteen (15) days
following receipt of Master Lessor's annual reconciliation within which to
provide Sublessor's reconciliation to Sublessee. Notwithstanding the foregoing,
until the Phase II Delivery Date, Sublessee shall only be liable for 29% of the
Operating Expenses and other expenses, that being the percentage allocable to
the Initial Premises. Following the Phase II Delivery Date, Sublessee shall be
liable for all Operating Expenses and
3.
other expenses allocable to the Premises. Sublessee's obligation to pay its
share of Operating Expenses shall be prorated annually based on actual days.
4. Security Deposit. Sublessee shall deposit with Sublessor upon execution
hereof the sum of Seventy Five Thousand Dollars ($75,000.00) as security for
Sublessee's faithful performance of Sublessee's obligations hereunder. Sublessee
hereby grants Sublessor a security interest in the Security Deposit to secure
performance of Sublessee's obligations hereunder. If Sublessee defaults with
respect to any provision of this Sublease, Sublessor may use, apply or retain
all or any part of the Security Deposit for the payment of any Rent or other sum
in default, for the payment of any amount which Sublessor may expend or become
obligated to expend by reason of Sublessee's default, or to compensate Sublessor
for any loss or damage which Sublessor may suffer by reason of Sublessee's
default. Sublessor shall have no obligation to apply the Security Deposit in
such manner and may exercise any right or remedy available under this Sublease
or at law or in equity with or without resort to the Security Deposit. The
Security Deposit does not constitute prepayment of the last month's rent (or any
other). If any portion of the Security Deposit is used or applied, Sublessee
shall deposit with Sublessor, within ten (10) days after written demand
therefor, cash in an amount sufficient to restore the Security Deposit to its
original amount. Sublessor shall not be required to keep the Security Deposit
separate from its general funds. The Security Deposit, or such much of it as may
remain, shall be returned, without interest, to Sublessee within thirty (30)
days after expiration of the term hereof. If any bankruptcy, insolvency,
reorganization, receivership or other similar proceedings shall be instituted by
or against Sublessee, the Security Deposit shall be applied first to the payment
of rent and additional charges due to Sublessor for the period prior to the
institution of such proceedings, and any balance of the Security Deposit may
thereafter be retained and held by Sublessor in accordance with the terms of
this section.
5. Use. The Premises shall be used and occupied only for laboratory,
research and development, wet chemistry, biological laboratories, related
offices and uses which are ancillary thereto, and which are consistent with the
requirements and limitations set forth in the Master Lease, and for no other
purpose without the prior written consent of Sublessor and Master Lessor.
Sublessor agrees not to unreasonably withhold, delay or condition its consent to
any such requested change.
6. Master Lease.
(a) Sublease Is Subordinate to Master Lease. This Sublease is subject
and subordinate to the Master Lease. Sublessee represents and warrants to
Sublessor that it has read and is familiar with the terms and conditions of the
Master Lease. Sublessee shall not commit or permit to be committed on the
Premises any act or omission which shall violate any term or condition of the
Master Lease. If the Master Lease terminates, this Sublease shall terminate.
Sublessor shall have no liability to Sublessee if the Master Lease terminates
without fault of Sublessor.
(b) Application of Master Lease Provisions. Except as otherwise
expressly provided in this Sublease, Sublessee shall assume and perform the
obligations of Sublessor as Lessee under the Master Lease. Therefore, except as
otherwise provided, for the purpose of this Sublease, wherever in the Master
Lease "Landlord" is used, it shall be deemed to mean
4.
Sublessor, and wherever in the Master Lease "Tenant" is used, it shall be deemed
to mean Sublessee, and wherever in the Master Lease "Lease" is used, it shall be
deemed to mean this Sublease.
(c) Incorporation of Master Lease Provisions.
(1) All of the terms and conditions in the Master Lease are
incorporated herein except for: Basic Lease Provisions; 1 (Premises); 3 (Term);
5 (Base Rent); 8 (Tenant Improvements); 9.a. and 9.e. (Use of Premises); 10.c.
(Ownership of Alterations) 11.b. (Landlord's Ongoing Obligations); 11.c.
(Landlord's Delivery Obligations); 12 (Damage or Destruction); 13 (Eminent
Domain); 14.c. (Casualty Insurance); 15.e. (Payment on Sublet); 18 (Security
Deposit); 19 (Acceptance of Premises); 20 (Holding Over); 36 (Notices); 39.h.
(Entire Agreement); and Schedule A; Exhibit D (Construction Rider); and Exhibit
E (Memorandum).
(2) Except as otherwise provided herein, Sublessor is responsible
for all financial obligations of the tenant under the Master Lease. Whenever any
provision of the Master Lease has not been incorporated herein, except as
otherwise provided, any provision of the Addendum which pertains to a provision
of the Master Lease which has not been incorporated herein, shall not be
incorporated herein. In addition, Master Lease Addendum Section 25 (stated to
pertain to Section 14.b., but really pertaining to Section 14.c.), Master Lease
Addendum Section 42 (pertaining to Master Lease Section 34) and Master Lease
Addendum Section 46 (pertaining to options to extend) shall not be incorporated
into this Sublease.
(d) Indemnity. Without in any way limiting Sublessee's assumption of
the indemnity set forth in the Master Lease, Sublessee hereby agrees to defend,
indemnify and hold Sublessor and Master Lessor harmless from and against any and
all losses, liabilities, causes of action, judgments, costs, damages, expenses,
claims or demands, including reasonable attorney's fees, arising out of
Sublessee's failure to comply with or perform Sublessee's obligations under this
Sublease.
(e) Master Lease in Effect. Sublessor represents to Sublessee that the
Master Lease is in full force and effect and that, to Sublessor's knowledge, no
default exists on the part of any party to the Master Lease. Subject to the
terms and provisions of this Sublease, Sublessor agrees to keep the Master Lease
in full force and effect during the term of this Sublease, subject, however, to
any earlier termination of the Master Lease without the default of Sublessor.
(f) Default. Any act or omission by Sublessee which would constitute a
breach or default by Sublessor under Section 16 of the Master Lease shall
constitute a default on the part of Sublessee hereunder. In the event of any
breach or default by Sublessee hereunder or under the Master Lease, Sublessor
shall have all of the rights and remedies afforded Master Lessor under the
Master Lease, and in addition Sublessor shall have the right, but without any
obligation to do so, to cure any such breach or default by Sublessee, with
Sublessee to be obligated to reimburse Sublessor immediately upon demand for all
costs which Sublessor may incur in effecting the cure of such breach or default.
5.
7. Alterations. Notwithstanding the provisions of Section 10.a. of the
Master Lease, any alteration which requires Master Lessor's approval pursuant
to the Master Lease shall not be commenced by Sublessee unless and until such
consent is obtained. Any alteration made by Sublessee shall become a part of
the Premises, and at Sublessor's election, shall be surrendered to Sublessor at
the end of the Sublease term. Notwithstanding the foregoing, except as
otherwise provided in the Master Lease, any alteration made by Sublessee shall
remain Sublessee's property throughout the Sublease term. In the event
Sublessor is (or becomes) obligated under the Master Lease to remove any of
Sublessee's alterations, Sublessee shall be obligated to remove same at
Sublessee's sole cost and expense and to restore the Premises to its condition
prior to the alteration. Sublessee shall (i) pay to Sublessor, or at direction
of Sublessor, directly to Master Lessor, an amount equal to one percent (1%) of
the total cost of the alterations (and for purposes of calculating the total
costs, such cost shall include architectural and engineering fees but shall not
include permit fees) as compensation to Master Lessor for miscellaneous costs
and time incurred by Master Lessor in connection with the alterations, and (ii)
reimburse Master Lessor any reasonable amounts it pays to architect, engineers
or other consultants in connection with reviewing such alterations. Such
amounts shall be paid in advance of, or during or upon completion of the
alterations, as Master Lessor shall determine and Sublessee shall submit such
evidence of the cost of the alterations as master Lessor may reasonably require.
8. Repairs. Pursuant to Section 11.b. of the Master Lease, Master Lessor
is responsible to repair and maintain the roof, exterior walls, foundation and
HVAC system (including distribution ducts) (provided that the cost of
maintaining, repairing and replacing the HVAC system shall be included in
Operating Expenses, pursuant to the terms of Section 6 of the Master Lease),
unexposed portions of the building plumbing and electrical systems (except to
the extent installed or modified by Sublessor or Sublessee), the Common Areas,
and structural portions of the Building. Master Lessor also has the obligation
to repair certain categories of items as provided in Section 17 of the Addendum
to the Master Lease. Sublessor's sole obligation to Sublessee shall be to
request performance of such obligations by Master Lessor. In the event Master
Lessor breaches its obligations, Sublessor will assign to Sublessee its right to
enforce such obligation and shall otherwise cooperate with Sublessee in
connection therewith, provided, however, Sublessee, at its sole cost and
expense, shall be responsible for enforcement thereof without reimbursement from
Sublessor. Sublessee, not Master Lessor, shall be responsible for the repair of
the roof and structural portions of the Building to the extent the need for
maintenance or repair is caused in whole or in part by the act, neglect, fault
or omission of any duty of Sublessee, its agents, servants, contractors,
subcontractors, employees or invitees, in which case Sublessee shall pay to
Sublessor the cost of the maintenance and repairs caused in whole or in part by
Sublessee (except (i) to the extent the damage is covered by any insurance
maintained by Master Lessor, or, (ii) if Master Lessor fails to maintain the
insurance required to be maintained by Master Lessor pursuant to the terms of
the Master Lease, to the extent the damage would have been covered by insurance,
if Master Lessor had maintained the required insurance). There shall be no
abatement of rent and no liability of Master Lessor or Sublessor by reason of
any injury to or interference with Sublessee's business arising from the making
of any repairs, alterations or improvements in or to the fixtures, appurtenances
and equipment therein, provided that Sublessor shall request Master Lessor to
use reasonable efforts to minimize the interruption of Sublessee's use and
occupancy of the Premises in connection with its performance of the repairs and
maintenance (although nothing contained herein shall be deemed
6.
to obligate Master Lessor to pay any overtime costs in order to minimize such
interference, or otherwise to perform the repairs or maintenance during hours
other than normal business hours).
9. Insurance.
(a) Property Insurance. Sublessee shall, at its sole cost and'
expense, obtain and maintain in force a policy or policies of fire and property
damage insurance providing protection against those perils included within the
classification of "all risk" insurance from an insurance company or companies
reasonably satisfactory to Sublessor and Master Lessor and in a form reasonably
satisfactory to Sublessor and Master Lessor insuring the Tenant Improvements (as
defined in the Master Lease) and all other improvements, in an amount equal to
the full replacement cost thereof (which amount shall be subject to Sublessor's
and Master Lessor's approval). The insurance policy or policies shall name
Master Lessor and Sublessor and the lenders of either of them, if any, as
additional insureds and shall provide that the policy or policies may not be
canceled on less than thirty (30) days prior written notice to Master Lessor,
Sublessor and the lenders of either of them. If Sublessee fails to carry the
insurance or to furnish Sublessor with copies of all the policies after a
request to do so, Sublessor shall have the right to obtain the insurance and
collect the costs thereof from Sublessee as additional rent.
(b) Liability Insurance. In addition to the above referenced
insurance, Sublessee shall maintain liability insurance coverage as required by
Section 14 of the Master Lease which has been incorporated into this Sublease by
reference. Each policy of insurance which Sublessee is required to maintain
pursuant to this Lease shall name both Sublessor and Master Lessor as additional
insureds (including cross-liability endorsements). Sublessee's insurance
coverage shall be primary and non-contributory as respects any insurance
maintained by Sublessor and/or Master Lessor. Sublessee shall deliver evidence
of the coverage required hereunder (i) within seven (7) days after execution and
delivery of this Sublease by Sublessor and Sublessee, and (ii) within ten (10)
days of the renewal date for each policy of insurance required hereunder.
(c) Master Lessor Insurance. Pursuant to the terms of the Master Lease
as provided in Section 25 of the Addendum thereto, Master Lessor is obligated to
maintain certain insurance coverage with respect to certain perils and to
maintain a certain level of liability coverage. Sublessor's sole obligation to
Sublessee with respect to Master Lessor's obligations pursuant to said Section
25 shall be to request performance of such obligations by Master Lessor. In the
event Master Lessor breaches its obligations, Sublessor will assign to Sublessee
its right to enforce such obligation and shall otherwise cooperate with
Sublessee in connection therewith, provided, however, Sublessee, at its sole
cost and expense, shall be responsible for enforcement thereof without
reimbursement from Sublessor.
(d) Evidence of Insurance. Upon the Commencement Date (or upon the
date of early possession if early possession is granted hereunder), Sublessee
shall deliver to Sublessor and Master Lessor certificates of insurance showing
that Sublessee has the insurance required hereunder.
7.
10. Damage or Destruction.
(a) Master Lessor Has Obligation to Restore. If the Premises are
damaged or destroyed, Master Lessor has the obligation pursuant to Section 12 of
the Master Lease to promptly and diligently repair the Premises, unless Master
Lessor has the right to terminate. If Master Lessor fails to perform its
obligations pursuant to Section 12 of the Master Lease, Sublessor's sole
obligation to Sublessee shall be to request performance of such obligations by
Master Lessor. In the event Master Lessor breaches its obligations, Sublessor
will assign to Sublessee its right to enforce such obligation, provided,
however, Sublessee, at its sole cost and expense, shall be responsible for
enforcement thereof without reimbursement from Sublessor.
(b) Termination of Master Lease. If the Master Lease terminates
pursuant to Section 12 of the Master Lease, this Sublease shall terminate
concurrently with the termination of the Master Lease.
(c) Sublessee Notice; Right to Terminate. In the event that Sublessor
receives notice from Master Lessor pursuant to Section 12 of the Master Lease of
Master Lessor's determination that repair of the Premises or the Building cannot
be completed within two hundred seventy (270) days after a casualty, Sublessor
shall so notify Sublessee in writing and shall request Sublessee to notify it
whether Sublessee agrees to continue this Sublease in effect. Within twenty
(20) days following written request from Sublessor, Sublessee shall give notice
to Sublessor in writing whether Sublessee agrees to continue this Sublease in
effect if Master Lessor reasonably determines that the repair of the Premises or
the Building cannot be completed within two hundred seventy (270) days after the
casualty. If Sublessee does not so agree to continue this Sublease in effect,
then Sublessor may elect to terminate the Master Lease and this Sublease. If
Sublessee agrees to continue this Sublease in effect as aforesaid, then
Sublessor shall have no right to exercise its right to terminate the Master
Lease or this Sublease. If (i) Master Lessor reasonably determines that the
repair of the Premises or the Building cannot be completed within two hundred
seventy (270) days after the casualty, (ii) neither Master Lessor nor Sublessor
have elected to terminate the Master Lease, and (iii) Sublessee agrees to
continue this Sublease in effect notwithstanding the time to reconstruct, then
this Sublease shall continue in effect, and Sublessee shall fulfill all of the
obligations of Sublessor pursuant to the provisions of Section 12 of the Master
Lease.
(d) Limited Obligation to Repair. Master Lessor's obligation, should
Master Lessor elect or be obligated to repair or rebuild, shall be limited to
replacing/restoring the Building shell and Building systems so that the Building
shell and Building systems as repaired and restored are comparable (in scope of
improvements) to the Building shell and Building systems which were in existence
on the Master Lease Commencement Date. Master Lessor shall have no obligation
to replace or restore the Tenant Improvements or any other alterations installed
by Sublessor or Sublessee. If this Sublease has not been terminated, Sublessee
shall be obligated to (i) with respect to those portions of the Premises which
are damaged and were built out for office use as of the Master Lease
Commencement Date, either: (A) promptly build-out those portions with new tenant
improvements approved by Master Lessor and Sublessor in accordance with Exhibit
D to the Master Lease, and spend an amount equal to or greater than the Building
Standard Improvements Allowance (defined below) on the build-out; (B) promptly
build-out-those portions with new tenant improvements approved by Master Lessor
and
8.
Sublessor in accordance with Exhibit D and spend an amount less than the
Building Standard Improvement Allowance (in which case promptly upon completion
of the Tenant Improvements, Sublessee shall pay to Sublessor the difference
between the amount spent by Sublessee for new tenant improvements and the
Building Standard Improvements Allowance); or (C) pay to Sublessor an amount
equal to the Building Standard Improvements Allowance multiplied by the rentable
square footage of the office space so affected; and (ii) with respect to those
portions of the Premises which are damaged, but were not built out for office
use as of the Master Lease Commencement Date, either: (A) promptly construct new
tenant improvements approved by Master Lessor and Sublessor in accordance with
Exhibit D in the space so affected (and expend no less than the Tenant
Improvement Allowance for the improvements); (B) promptly construct new tenant
improvements approved by Master Lessor and Sublessor in accordance with Exhibit
D in the space so affected, expending less than the Tenant Improvement Allowance
(in which case Tenant shall pay to Sublessor the difference between the amount
expended and the Tenant Improvement Allowance promptly upon completion of the
construction); or (C) pay to Sublessor an amount equal to the Tenant Improvement
Allowance applicable to the affected space. Any payment by Tenant to Sublessor
in accordance with subsections (i) (C) or (ii) (C) of the preceding sentence
must be made upon the earlier of ten (10) days following Sublessee's receipt of
insurance proceeds thereof, or ninety (90) days after the occurrence of the
damage or destruction, or Sublessee shall be deemed to have elected to restore
and rebuild the portions of the Premises which were damaged. As used herein, the
term "Building Standard Improvements Allowance" shall have the meaning set forth
in Section 12.c. of the Master Lease. Sublessee shall at its sole cost and
expense restore all improvements made by Sublessee.
(e) Abatement of Rent. Rent under this Sublease shall xxxxx to the
same extent as the rent owing by Sublessor under the Master Lease abates.
(f) Damage Near End of Term. In addition to the rights to terminate
specified in Section 10.c. of this Sublease, either Sublessor or Sublessee
shall have the right to cancel and terminate this Sublease as of the date of the
occurrence of destruction or damage if the Premises or the Building is
substantially destroyed or damaged (i.e., there is damage or destruction which
Landlord determines would require more than four (4) months to repair) and made
untenantable during the last twelve (12) months of the term of the Master Lease.
Sublessor and Sublessee shall give notice of their election to terminate this
Sublease under this subsection f. within thirty (30) days after Master Lessor
or Sublessor determines that the damage or destruction would require more than
four (4) months to repair. If either Master Lessor or Sublessor elect to
terminate the Master Lease pursuant to Section 12.e. of the Master Lease, this
Sublease shall terminate concurrently with the termination of the Master Lease.
If neither Master Lessor nor Sublessor terminates the Master Lease and if either
Sublessor or Sublessee elects to terminate this Sublease, the repair of the
damage shall be governed by Sections 12.c. or 12.e. of the Master Lease, as the
case may be.
(g) Insurance Proceeds. If this Sublease is terminated, Master Lessor
and Sublessor may each keep all their respective insurance proceeds resulting
from the damage except for those proceeds, if any, which specifically insure
Sublessee's personal property and trade fixtures which Sublessee has a right .or
obligation to remove upon the expiration of the Sublease term. Sublessor shall
be entitled to receive from Sublessee the proceeds of insurance carried by
Sublessee with respect to Tenant Improvements or other alterations installed in
the
9.
Premises by Sublessor or at Sublessor's expense. To the extent that Sublessee
has paid for any alterations regardless of whether the alterations may become
the property of Sublessor upon termination of this Sublease, Sublessee shall
receive any portion of the insurance proceeds payable with respect to the then
unamortized cost (based on an 8-year, straight line, amortization schedule) for
the applicable alterations, reduced by the amounts necessary to pay off any
equipment lease or other lien against the applicable alteration, and the balance
of the proceeds, if any, will be payable to Sublessor. With respect to those
alterations which Sublessee is obligated to remove at the end of the Sublease
term which are the property of Sublessee, all proceeds shall be paid to
Sublessee.
(h) Uninsured Casualty. If the Master Lease terminates pursuant to the
provisions of Section 12.g. of the Master Lease, this Sublease shall terminate.
Sublessor shall have no obligation to deposit funds with Master Lessor pursuant
to said Section 12.g.; provided, however, if Sublessor and Sublessee have so
agreed that Sublessee will provide the funds for deposit with Master Lessor in
that amount which Sublessor is permitted to contribute to repairs in order to
keep the Master Lease from terminating pursuant to Section 12.g., then upon
Sublessee providing such funds, this Sublease shall continue in effect.
11. Eminent Domain. If all or any part of the Premises is taken for
public or quasi-public use by a governmental authority under the power of
eminent domain or is conveyed to a governmental authority in lieu of such
taking, and if the taking or conveyance causes the remaining part of the
Premises to be untenantable and inadequate for use by Sublessee for the purpose
for which they were leased, then Sublessee, at its option and by giving notice
within fifteen (15) days after the taking, may terminate this Sublease as of the
date Sublessee is required to surrender possession of the Premises. If a part
of the Premises is taken or conveyed but the remaining part is tenantable and
adequate for Sublessee's use, then this Sublease shall be terminated as to the
part taken or conveyed as of the date Sublessee surrenders possession; Master
Lessor is obligated, at no cost or expenses to Sublessor or Sublessee, to
restore the Premises (other than any Tenant Improvements) to a complete
architectural unit of a design comparable to the design of the Premises (other
than any Tenant Improvements or alterations) immediately prior to the
condemnation, and the rent shall be reduced based on any decrease in use to
Sublessee of the Premises. All compensation awarded for the taking or
conveyance shall be the property of Master Lessor and Sublessor, as their
interests may appear, and Sublessee hereby assigns to Sublessor all its right,
title and interest in and to the award, unless the governmental authority makes
only one (1) award, and the award contains compensation for the value of moving
expenses, Sublessee's personal property, trade fixtures and alterations, in
which case, subject to the rights of any mortgagee or beneficiary of a deed of
trust holding a lien, Sublessee shall be entitled to the compensation paid for
Sublessee's moving expenses, trade fixtures, personal property and the portion
of the award attributable to the then unamortized cost of alterations and
improvements constructed at Sublessee's expense (which are to be amortized on a
straight line basis over the term of this Sublease). Sublessee shall have the
right, however, to recover from the governmental authority, but not from
Sublessor or Master Lessor, except as provided in the preceding sentence, such
compensation as may be awarded to Sublessee on account of the interruption of
Sublessee's business, moving and relocation expenses and removal of Sublessee's
trade fixtures and personal properly.
10.
12. Assignment and Subletting. Sublessee shall obtain the consent and
approval of Sublessor and Master Lessor pursuant to Section 15 of the Master
Lease prior to any further sublease or assignment of this Sublease.
Notwithstanding any provision of this Sublease to the contrary, if Sublessor
consents to a sublease or assignment, Sublessee shall pay to Sublessor on a
monthly basis as additional Rent, on the date Base Rent is due, an amount equal
to fifty percent (50%) of the amount by which the rent payable to Sublessee
("Subrent") under the sublease or assignment exceeds the rent due for the
applicable portion of the Premises after deducting from the Subrent (A) the
reasonable out-of-pocket costs incurred by Sublessee for brokerage commissions
and tenant concessions (which concessions are not reflected in the reduced
Subrent), and (B) the costs of any additional improvements constructed by
Sublessee in connection with the sublease or assignment (amortized on a straight
line basis over the term of the sublease). Sublessor shall not unreasonably
withhold, delay, or condition such consent.
13. Access to Premises. Master Lessor shall have the same right of access
to the Premises as Sublessor.
14. Surrender at End of Term. Sublessee shall surrender the Premises to
Sublessor in the same condition received, broom clean, except for any
alterations Sublessee is not required to remove, normal wear and tear, acts of
God, damage, destruction (except to the extent Sublessee is obligated to restore
the same under Section 10 of this Sublease) and eminent domain covered by the
provisions of this Sublease. Sublessee shall remove from the Premises all of
Sublessee's personal property and trade fixtures and any alterations and
improvements Sublessee is required to remove, and shall repair all damage caused
by the removal. Sublessee shall obtain and deliver to Sublessor a closure
certificate if required by the City of South San Francisco. Sublessee shall
indemnify Sublessor against all loss or liability resulting from delay by
Sublessee in so surrendering the Premises, including without limitation, any
claims made by any succeeding tenant, losses to Sublessor due to lost
opportunities to lease to a succeeding tenant, and attorneys' fees and costs.
15. Signs. Master Lessor shall have the same approval rights with respect
to signs as Sublessor.
16. Holding Over. This Sublease shall terminate without further notice at
the expiration of the Sublease term. Any holding over by Sublessee after the
expiration or sooner termination of this Sublease without the consent of
Sublessor shall be construed to be a tenancy at sufferance. Rent for the
Premises during any tenancy at sufferance, or if Sublessor shall have consented
to Sublessee's holding over, shall be at a rate equal to 150% of the Base Rent
for the last month of the term, and shall otherwise be on the terms and
conditions herein specified insofar as applicable, including, without
limitation, those providing for additional rent.
17. Brokers. For the purposes of Section 29 of the Master Lease as
incorporated into this Sublease, Cornish & Xxxx Commercial-Oncor International
is the only broker to whom a Commission is owing, which commission shall be paid
by Fibrogen, Inc.
18. Notices. All notices or demands of any kind required to be given by
Sublessor or Sublessee hereunder shall be in writing and shall be delivered
personally or sent by registered or certified mail, return receipt requested, to
Sublessor or Sublessee, respectively, at the following
11.
addresses, or at such other address as such party shall designate by written
notice to the other party. Such addresses are:
Sublessor:
000 Xxxxxxx Xxx
Xxxxx Xxx Xxxxxxxxx, XX 00000
Attention: Chief Financial Officer
Sublessee:
000 Xxxxxxxxxxx Xxxx
Xxxxx Xxx Xxxxxxxxx, XX 00000
Attention: Xx. Xxxx Xxxxxxx
Personal delivery may be accomplished by means of commercial "overnight" or
"express" delivery services. Notices shall be deemed delivered upon receipt or
refusal to accept delivery. All rent and other payments due under this Sublease
or the Master Lease shall be made by Sublessee to Sublessor at the above
address.
19. Attorneys' Fees. Without in any way limiting the provisions of
Section 28 of the Master Lease, if there is any legal action or proceeding
between Sublessor and Sublessee to enforce any provision of this Sublease, or to
protect or to establish any right or remedy of either party hereunder, the
prevailing party in such action or proceeding shall be entitled to recover from
the other party all costs and expenses, including reasonable attorneys' fees and
expert witness fees incurred by such prevailing party in connection with any
such action or any appeal in connection therewith.
20. Consent of Master Lessor. This Sublease is contingent upon Sublessor
obtaining the consent of Master Lessor. Sublessee shall pay all costs and
expenses payable by Sublessor to Master Lessor or Simeon Commercial Properties
pursuant to Paragraph 8 of the Consent to Sublease and Agreement executed by
Master Lessor, Sublessor and Sublessee, up to a maximum amount of $5,000.
12.
In Witness Whereof, the undersigned have executed this Sublease as of the
dates set forth below.
Sublessor:
Arris Pharmaceutical Corporation,
a Delaware corporation
By: /s/ Xxxx Xxxxxxxxxx Date: July 6, 1997
-------------------------------- ----------------------------------
Its: VP + CFO
-------------------------------
Sublessee:
Exelixis Pharmaceuticals, Inc.,
a Delaware corporation
By: /s/ Xxxx Xxxxxxx Date: July 6, 1997
-------------------------------- -----------------------------------
Its: Chief Operating Officer
-------------------------------
Landlord:
Utah Partners Limited a California Limited Partnership, by Simeon Commercial
Properties, A California Corporation, General Partner
By: /s/ Xxxx X. Xxxxxx Date: July 6, 1997
-------------------------------- ----------------------------------
Its: VP
-------------------------------
13.
