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Exhibit 10.6
FIFTH AMENDMENT TO
NEW LEASE
This Fifth
Amendment to New Lease ("Amendment") is entered into, and dated for
reference purposes, as of July 11, 2008 (the "Execution Date") by
and between METROPOLITAN LIFE INSURANCE COMPANY, a New York
corporation ("Metropolitan"), as Landlord ("Landlord"), and
PHARMACYCLICS, INC., a Delaware corporation ("Pharmacyclics"), as
Tenant ("Tenant"), with reference to the following facts
("Recitals"):
A. Landlord and
Tenant are parties to that certain written lease comprised of the
following: that certain Lease and Lease Termination Agreement dated
as of June 14, 2000 (the "New Lease"), that certain First Amendment
to New Lease dated as of April 10, 2001 (the "First Amendment"),
that certain Second Amendment to New Lease dated as of June 29,
2001 (the "Second Amendment"), that certain Third Amendment to New
Lease dated as of February 5, 2003 (the "Third Amendment") and that
certain Fourth Amendment to New Lease dated as of August 14, 2006
(the "Fourth Amendment") for the premises more particularly
described therein of 64,776 rentable
square feet ("RSF") located at 995 and 999 E. Arques Avenue,
Sunnyvale, California ("Existing Premises"). The New Lease, as
amended, is referred to herein as the "Existing Lease."
B. Landlord and
Tenant desire to surrender a portion of the Existing Premises
defined in the First Amendment as "Expansion Space A," and referred
to herein as Expansion Space A, add an expansion space to the
Existing Premises previously defined in the Second Amendment as
"Expansion Space B," however for purposes of this Amendment shall
hereinafter be defined as the "Expansion Space C" and provide for
extension of the Lease Term and other amendments of the Existing
Lease as more particularly set forth below.
NOW, THEREFORE,
in consideration of the foregoing, and of the mutual covenants set
forth herein and of other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties
hereto agree as follows:
Section 1
. Scope of Amendment; Defined Terms . Except as expressly
provided in this Amendment, the Existing Lease shall remain in full
force and effect. Should any inconsistency arise between this
Amendment and the Existing Lease as to the specific matters which
are the subject of this Amendment, the terms and conditions of this
Amendment shall control. The term "New Lease" as used herein and in
the Existing Lease shall refer to the Existing Lease as modified by
this Amendment, except as expressly provided in this Amendment. All
capitalized terms used in this Amendment and not defined herein
shall have the meanings set forth in the Existing Lease unless the
context clearly requires otherwise.
Section 2.
Retroactive Effect . Landlord and Tenant have executed this
Amendment on the respective dates set forth below their respective
signatures at the end of this Amendment, but intend and agree that
it shall be effective as of July 1, 2008 with the same force and
effect as if executed on that date. Promptly after execution of
this Amendment, Landlord shall bill Tenant for the amount of
Monthly Installments of rent and all other rent due pursuant to
this Amendment in excess of amounts actually paid by Tenant for the
period from and after the Expansion Space C Commencement Date
(defined below), and Tenant shall pay the amount due within ten
(10) days after receipt of such bill. In the event that amounts
actually paid by Tenant on after the Expansion Space C Commencement
Date and before execution of this Amendment exceed the amount due
pursuant to this Amendment, Landlord shall credit any such
overpayment to rent next coming due from Tenant hereunder. Within a
reasonable time after such execution, Landlord shall refund to
Tenant any excess, and Tenant shall pay Landlord any shortage, in
payments received from Tenant with respect to the period from the
Expansion Space C Commencement Date through the date of such
execution in comparison to payments due pursuant to this Amendment
for the same period.
Section 3
. Surrender of 999 E. Arques Avenue .
(a) Surrender
Date . On or before 11:59 p.m. on June 30, 2008 (the
"Surrender Date"), except as set forth in Section 3(c)(i) below,
Tenant shall vacate and deliver to Landlord exclusive possession of
the portion of the Existing Premises which is located at 999 E.
Arques Avenue, Sunnyvale, California ("Expansion Space A"), in
broom clean condition, except that Landlord and Tenant acknowledge
that cubicles and office furniture currently existing in Expansion
Space A shall remain in the space following the Surrender Date.
Tenant shall deliver to Landlord any plans and specifications,
maintenance records, warranties, permits, approvals and
licenses
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pertaining to the Expansion Space A or to any
improvements remaining thereon, or to both (but not pertaining to
Tenant's business conducted therein) in the possession of
Tenant.
(b)
Obligations Until Surrender . Through and including the
Surrender Date, (i) Tenant must continue to pay all Monthly
Installment of rent and Additional Rent as they become due and
payable under the Existing Lease, and (ii) all of the terms,
covenants, agreements and conditions of the Lease remain in full
force and effect with respect to the Expansion Space A. As of 11:59
p.m. on the Surrender Date, the surrender of the Expansion Space A
will be deemed effective and the monetary obligations with respect
to the Surrender Space must be prorated, billed and payable in the
manner provided in the Existing Lease, in the same manner as would
apply if the term of the Existing Lease expired on the Surrender
Date with respect to the Surrender Space.
(c) Effect on
Existing Lease After Surrender Date . After the Surrender Date,
the Existing Lease shall continue in full force and effect for the
Lease Term upon and subject to all of the terms and provisions of
the Existing Lease, as amended by this Amendment, including,
without limitation, the following modifications of the Existing
Lease:
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(i) Tenant shall have no right to possession,
use or lease of the Expansion Space A, or any options or other
rights with respect to the Expansion Space A, except that Landlord
shall allow Tenant access to Expansion Space A after the Surrender
Date for the following: (v) access and use of the server room and
the small room next to the server room which contains the fire
suppression system, and the relocation of the server room to the
Remaining Premises (defined below), which relocation shall be
completed by no later than August 1, 2008; (w) general access by
employees of Tenant through July 11, 2008; and (x) maintenance and
movement of the small switch and T1 line (the location of which is
shown on Exhibit D attached hereto) in the server room which shall
be completed no later than September 18, 2008. Landlord will
instruct its contractor to not cut the T1 line until the earlier of
(y) the date the T1 line moved or (z) September 19, 2008. Tenant
shall notify Landlord of its desired time(s) of entry to movement
of the T1 line and shall submit for Landlord's approval the name(s)
of the contractor(s) who will perform such work. All such access
and work described in this subsection shall be permitted as long as
such entry will not interfere with the timely and orderly
construction and completion of the work to be undertaken by
Landlord in Expansion Space A. Tenant shall be responsible for and
be required to reimburse Landlord for its pro rata share of the
electrical costs incurred in Expansion Space A through and until
the completion of such relocation of the server room within ten
(10) days of demand therefor. Such entry shall be without payment
of Monthly Installments of rent or Rent Adjustments, but such entry
and all acts and omissions in connection with it are subject to and
governed by all other provisions of the Existing Lease, including
Tenant's indemnification obligations, insurance obligations,
obligations under Sections 6, 13 and 14;
(ii) the regular Monthly Installment of rent and
Additional Rent allocable to the Expansion Space A shall no longer
accrue; and
(iii) the rentable area of the Existing Premises
is reduced by 32,256 RSF. The premises after the Surrender Date is
conclusively presumed to be 32,520 RSF (the "Remaining Premises")
located at 995 E. Arques Avenue.
(d) Holding
Over . In the event that Tenant fails timely to
vacate and deliver exclusive possession of the Expansion Space A to
Landlord by the Surrender Date as required under this Amendment and
the Existing Lease, then:
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(i) Such holding over shall not constitute
a renewal, extension, a month to month tenancy or other permitted
tenancy, but such continued possession shall be subject to the
other covenants, conditions and agreements of the Lease, except as
otherwise expressly provided in this Amendment. Tenant shall be
deemed to be holding over with respect to the Expansion Space A
without the express written consent of Landlord and shall be liable
to Landlord for rent with respect to the Expansion Space A at the
holdover rate provided in the Lease and shall indemnify Landlord
against loss or liability resulting from any delay of Tenant in not
surrendering such premises on the Surrender Date, including, but
not limited to, additional costs or losses incurred
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by Landlord in preparing such space for third
parties to whom it is now or hereafter leased, any amounts required
to be paid to third parties who were to have occupied all or part
of such premises, Landlord's loss of income and profit if payment
of rent is deferred or delayed under any lease to a third party, or
if any such lease is cancelled or lost, due to Tenant's failure
timely to vacate and deliver possession, and any attorneys' fees
related to the foregoing.
(ii) Such failure shall constitute an event
of default and breach of the Lease without any applicable grace
period, notice from Landlord or period to cure; and
(e) No
Release . Notwithstanding any provision of the foregoing to the
contrary, neither this Amendment nor the acceptance by Landlord of
the Expansion Space A shall in any way:
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(i) be deemed to excuse or release Tenant from any
obligation or liability with respect thereto (including, without
limitation, any obligation or liability under provisions of the
Lease to indemnify, defend and hold harmless Landlord or other
parties, or with respect to any breach or breaches of the Lease)
which obligation or liability (i) first arises on or prior to the
date on which Tenant delivers to Landlord possession of the
Expansion Space A, or (ii) arises out of or is incurred in
connection with events or other matters which took place on or
prior to such date, or
(ii) affect any obligation under the Lease
which by its terms is to survive the expiration or sooner
termination of the Lease.
Section 4
. Extension of Term; Monthly Installments; Tenant's Pro Rata
Share .
(a) Landlord and
Tenant acknowledge and agree that, before giving effect to this
Amendment, pursuant to the Existing Lease, the Expiration Date of
the Lease Term of the Existing Lease is scheduled to be December
31, 2009. Notwithstanding any provision of the Existing Lease to
the contrary, the Existing Lease is hereby amended to provide that
the Lease Term of this Lease with respect to the Remaining Premises
shall continue for a term of twenty-four (24) months (the "Third
Extended Term") beginning on January 1, 2010 (the "Third Extended
Term Commencement Date") and expiring on December 31, 2011
(hereafter, the "Expiration Date" with respect to the Third
Extended Term), unless sooner terminated pursuant to the terms of
the Lease. Landlord and Tenant acknowledge
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