Exhibit 10.1

FIFTH AMENDMENT TO LEASE

THIS FIFTH AMENDMENT TO LEASE (“Amendment”) dated this ____day of April, 2005,
is made and entered into by and between OYSTER POINT TECH CENTER LLC, a Delaware
limited liability company, (“Landlord”) and VAXGEN, INC., a Delaware corporation
(“Tenant”).

BACKGROUND

A.      Landlord is the owner of the project known as Oyster Point Tech Center
(the “Project”) which consists of two 2-story buildings for a total of
approximately 105,120 square feet: (I) the building known as the 347 Oyster
Point Boulevard (the “347 Oyster Point Building”), located at 347 Oyster Point
Boulevard, South San Francisco, California containing approximately 39,780
square feet and (ii) the building known as the 349 Oyster Point Boulevard (the
“349 Oyster Point Building”), located at 349 Oyster Point Boulevard, South San
Francisco, California containing approximately 65,340 square feet.

B.      Landlord and Tenant are parties to that certain Lease entered into on or
about October 26, 1998, as amended by a First Amendment dated as of June 1,
1999, a Second Amendment dated as of June 1, 1999, and a Third Amendment dated
as of October 5, 2000 (collectively, the “VaxGen Lease”) for certain premises in
the 347 Oyster Point Building containing approximately 9,675 square feet (the
“Suite 102”). Suite 102 is more particularly described in the VaxGen Lease. The
current term of the VaxGen Lease expires on April 30, 2006.

C.      Landlord and Tenant entered into a Fourth Amendment to Lease dated as of
March 31, 2004 (the “VaxGen Fourth Amendment”). Tenant subleased from Technology
Solutions, Inc. (“TSI”) approximately 10,258 square feet located in the 347
Oyster Point Building (“Suite 202”). TSI’s Lease for Suite 202 expired on March
31, 2004. Pursuant to the VaxGen Fourth Amendment, effective March 31, 2004,
Tenant continued to occupy Suite 202 on a month-to-month basis on the terms and
conditions set forth in the VaxGen Fourth Amendment. Suite 202 is more
particularly described in the VaxGen Fourth Amendment.

D.      Landlord and Tosoh Medics Incorporated, a Delaware corporation (“Tosoh”)
are parties to that certain Lease entered into on or about October 30, 1997, as
amended by a First Amendment dated as of September 21, 1998 (collectively, the
“Tosoh Lease”), for certain premises in the 347 Oyster Point Building consisting
of approximately 19,847 square feet (the “Suite 201”). Suite 201 is more
particularly described in the Tosoh Lease. The current term of the Tosoh Lease
expires on September 30, 2005.

E.      Landlord and Cellegy Pharmaceuticals, Inc., a California corporation
(“Cellegy”), are parties to that certain Lease entered into on or about April 8,
1998 (the “Cellegy Lease”), pursuant to which Cellegy leased the entire 349
Oyster Point Building containing approximately 65,340 square feet. The current
term of the Cellegy Lease expires on December 31, 2008.

 

 

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F.      Cellegy subleased to Tenant pursuant to an Office and R&D Sublease dated
August 1, 2002 (the “VaxGen Sublease”) certain premises located in the 349
Oyster Point Building. Tenant currently occupies approximately 49,919 square
feet (“Suite 101a”) pursuant to the VaxGen Sublease. Cellegy remains in
possession of approximately 15,421 square feet under the Cellegy Lease (“Suite
101b”).

G.

Landlord intends to terminate the Cellegy Lease as of April 1, 2005.

H.      Tenant desires to amend the VaxGen Lease to reflect the addition of
Suites 201 and 202 in the 347 Oyster Point Building and of all of the 349 Oyster
Point Building on the terms and conditions set forth in this Amendment.

AGREEMENT

NOW, THEREFORE, in consideration of the covenants and agreements contained
herein, the parties hereby mutually agree as follows:

1.

LEASE TERM. The term of the VaxGen Lease is extended to expire on December 31,
2016.

2.       PREMISES. As of the date of this Amendment, the term “Premises” is
revised to include Suite 102 (9,675 square feet) and Suite 202 (10,258 square
feet) for a total of 19,933 square feet in the 347 Oyster Point Building. As of
the later of (a) the date of termination of the Cellegy Lease or (b) the date
Landlord gains possession of Suite 101b of the 349 Oyster Point Building (the
“Effective Date”), the term “Premises” shall be revised to include Suite 101a
(49,919 square feet) and Suite 101b (15,421 square feet) for a total of 65,340
(or 100%) of the 349 Oyster Point Building, for an aggregate total of 85,273
square feet.

3.      CONDITIONS TO EXPANSION. Tenant’s expansion into the 349 Oyster Point
Building is contingent upon the termination of the Cellegy Lease and of the
VaxGen Sublease. Tenant shall cooperate with Landlord to expedite the
termination of the VaxGen Sublease and affirms that Tenant shall consent to the
termination of the Cellegy Lease and the VaxGen Sublease and shall execute any
and all documents necessary to effectuate such lease terminations.

4.       SUITE 201 (Tosoh Lease). The Tosoh Lease (which relates to Suite 201)
expires on September 30, 2005. Landlord shall deliver possession of Suite 201
(the “Expansion Date”) to Tenant on the date Tosoh delivers possession of Suite
201 to Landlord. As of the Expansion Date, which is estimated to be on or about
October 1, 2005 (if Tosoh does not hold over in Suite 201), the term “Premises”
shall be revised to include Suite 201 (19,847 square feet) for a total of 39,780
square feet (or 100%) of the 347 Oyster Point Building for an aggregate total of
105,120 square feet consisting of all of the 347 Oyster Point Building and all
of the 349 Oyster Point Building. Landlord hereby agrees to use commercially
reasonable efforts to repossess Suite 201 no later than September 30, 2005.
Landlord

 

 

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shall not agree to allow Tosoh to holdover in Suite 201 past September 30, 2005
and shall diligently pursue all available remedies if Tosoh should unlawfully
holdover past September 30, 2005.

5.      TENANT’S PRO RATA SHARE. After delivery of each respective portion of
the Project, Tenant’s Pro Rata Share shall be revised to be as follows:

 

Portion of Project

(105,120 sq. ft)

Estimated
Delivery Date

Rent
Commence-
ment Date

% of 347
Oyster Point
Building
(39,780 sq ft)

% of 349
Oyster Point
Building
(65,340 sq ft)

% of
Project

Suite 102
(9,675 sq. ft) and
Suite 202
(10,258 sq. ft)

Upon execution
of Amendment

April 1, 2005

50.11%

0%

18.96%

Suite 101a
(49,919 sq. ft) and
Suite 101b
(15,421 sq. ft)

Upon
termination of
Cellegy Lease
and VaxGen
Sublease

Upon
termination of
Cellegy Lease
and VaxGen
Sublease

50.11%

100%

81.12%

Suite 201
(19,847 sq. ft)

Date of
possession of
Suite 201

Date Landlord
delivers
possession to
Tenant
(estimated to
be October 1,
2005)
 

100%

100%

100%

6.      RENT. As of the Effective Date, the Base Rent for the Premises shall be
as set forth on Exhibit B.

7.      BUILDINGS. As of the Effective Date, the term “Building” in the Basic
Lease Information shall be replaced with the word “Buildings” and shall be
amended to read as follows:

Those two 2-story buildings comprising the Project and known as 347 Oyster Point
Boulevard, South San Francisco, California 94890 and as 349 Oyster Point
Boulevard, South San Francisco, California 94090, consisting of 39,780 square
feet and 65,340 square feet, respectively.

8.      LETTER OF CREDIT. As of the Effective Date, the term “Letter of Credit”
shall be added to the Basic Lease Information and shall mean the Letter of
Credit described in paragraph 39 of the Lease. Paragraph 39 “Letter of Credit”
shall be added to the Lease to read as follows:

a.       As a condition to this Lease, Landlord requires that Tenant deliver to
Landlord either a cash deposit (the “Cash Deposit”) or a new or amended letter
of credit in favor of Landlord in the amount of Two Million Three Hundred Fifty
Thousand and NO/100 Dollars ($2,350,000.00) as security for Tenant’s performance
of its obligations under the Lease, including without limitation, its
obligations to pay rent, to remove personal property and Tenant Improvements (as
defined below), and to restore the Premises at the expiration or earlier
termination of the Lease. If Tenant delivers a cash deposit, Tenant shall retain
ownership of the interest on such cash deposit. The letter of credit initially
delivered pursuant to this paragraph and all substitutions, replacements and
renewals of it, must be consistent with the letter

 

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of credit in the amount of Four Hundred and Fifty Thousand and No/100 Dollars
($450,000.00) previously issued by Wells Fargo Bank NA and noted as Letter of
Credit No. NZS45343. The Letter of Credit shall provide that the face amount of
the Letter of Credit shall be reduced per the schedule referenced in Exhibit C
based on Tenant’s ability to meet certain financial benchmarks set forth on
Exhibit C attached hereto, for four (4) continuous calendar quarters, beginning
in the last quarter of 2009. The term “Letter of Credit” shall mean and refer to
a letter of credit conforming to this subparagraph.

b.       The Letter of Credit shall be delivered and accepted by Landlord
concurrently with, and as a condition to, the execution of this Amendment, in
form acceptable to Landlord.

c.       Landlord may draw on the Cash Deposit or the Letter of Credit, in whole
or in part at Landlord’s election, without advance notice to Tenant, at any time
or from time to time, if (i) Tenant, or anyone in possession of the Premises
through Tenant, fails to comply with the removal and restoration obligations
under the Lease resulting in a material Event of Default or material Default
thereunder, (ii) Landlord is given notice by the issuer of the Letter of Credit
that it is terminating the Letter of Credit, (iii) the Letter of Credit expires
on a specified date by its terms and is not renewed or replaced at least thirty
(30) days in advance of its expiration date, or (iv) to the extent permitted by
law, any bankruptcy, insolvency, reorganization or any other debtor creditor
proceeding is instituted by or against Tenant. Proceeds of any draw upon the
Letter of Credit for reasons other than in clause (i) above shall be placed in
trust by Landlord and held as security for the full and faithful performance of
Tenant’s obligations under the Lease.

d.       Landlord may apply any sum drawn on the Cash Deposit or the Letter of
Credit to amounts owing to Landlord pursuant to this Lease, except a portion
totaling Four Hundred Fifty Thousand and No/100 Dollars ($450,000.00) may only
be used for the restoration of the manufacturing space previously subleased from
Cellegy. If any of the proceeds drawn on the Letter of Credit for the purpose of
restoring the Premises as referenced in the preceding sentence are not applied
to sums owing to Landlord under this Lease, Landlord shall return any such
excess proceeds to Tenant, without interest, within sixty (60) calendar days
after completion of the restoration of the Premises and receipt of all invoices
for work in connection with such restoration.

e.       Additionally, Landlord’s draw and application of all or any portion of
the proceeds of the Letter of Credit shall not impair any other rights or
remedies provided under applicable law and shall not be construed as a payment
of liquidated damages. If Tenant shall have fully complied with all of the
covenants and conditions of this Lease, the Letter of Credit shall be returned
to Tenant, without interest, within thirty (30) calendar days after the
expiration or termination of the term of the Lease and delivery of possession of
the Premises to Landlord.

f.        On any request by Landlord made during the term of the Lease, Tenant
shall cooperate in accomplishing any reasonable modification of the Letter of
Credit requested by Landlord. If the Letter of Credit should be lost, mutilated,
stolen or destroyed, Tenant shall cooperate in obtaining the issuance of a
replacement.

 

 

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g.       Tenant shall not assign or grant any security interest in the Letter of
Credit and any attempt to do so shall be void and of no effect.

h.       In the event of a sale or transfer of Landlord’s estate or interest in
the Land and Building, Landlord shall transfer the Letter of Credit to the
vendee or the transferee, Tenant shall pay any transfer fees charged by the
issuing bank and Landlord shall thereafter be considered released by Tenant from
all liability for the return of the Letter of Credit. Tenant shall cooperate in
effecting such transfer.

9.      REMOVAL AND RESTORATION OBLIGATIONS. On the expiration or earlier
termination of this Lease, Tenant shall remove its trade fixtures, personal
property, office supplies and office furniture and equipment if (a) such items
are readily moveable and are not permanently attached to the Premises; and (b)
Tenant immediately repairs all damage caused by or resulting from such removal.
All Tenant Improvements (i.e., all existing improvements in manufacturing areas
of the Premises, together with all other improvements hereafter installed or
constructed in the Premises), regardless of which party constructed or paid for
them, shall become the property of Landlord and shall remain upon and be
surrendered with the Premises upon the expiration or earlier termination of this
Lease; provided that, at Landlord’s election made in a written notice to Tenant
within thirty (30) days after Tenant’s failure to exercise an option to renew
or, if no additional options to renew exist, no later than six (6) months prior
to the expiration date of the VaxGen Lease, as amended from time to time, Tenant
shall be required, at its sole cost and expense, to remove all or any portion
(as designated by Landlord) of the Tenant Improvements upon the expiration or
earlier termination of the VaxGen Lease and to repair any damages resulting from
such removal and return the Premises to the same condition as existed prior to
such Tenant Improvements, normal wear and tear and casualty excepted. Tenant
waives all rights to any payment or compensation for such Tenant Improvements
that are not designated for removal by Landlord.

10.     MAINTENANCE AND REPAIR BY LANDLORD. Paragraph 9 “Landlord’s Repairs and
Services” is revised to read as follows:

Landlord shall, at Landlord’s expense, maintain the structural soundness of the
roof, the foundations and exterior walls of the Building in good repair,
reasonable wear and tear excepted; provided that, Landlord shall not be
responsible for the cost of any repairs resulting from damage, destruction or
deterioration which is caused by Tenant, Tenant’s Parties, or by an act or event
which is not fully insured. The term “exterior walls” as used herein shall not
include windows, glass or plat glass, doors, special store fronts or office
entries. Landlord shall perform on behalf of Tenant and other tenants of the
Project, as an item of Basic Operating Cost, the exterior maintenance of the
Building, the Project, and public and common areas of the Project, including but
not limited to the items listed on Exhibit E, and any other maintenance item
which affects the operation and exterior appearance of the Project, which
determination shall be at Landlord’s sole discretion. Landlord shall maintain
the exterior of the Building, the Project, and public and common areas of the
Project in a first class condition, consistent with other class A office
buildings in the South San Francisco, California area. Except for the expenses
directly involving the items specifically described in the first sentence of
this paragraph, Tenant shall reimburse Landlord for all such costs in accordance
with Basic Operating Cost. Landlord agrees to give Tenant advance notice if
Landlord intends to perform any non-routine maintenance item (except in an
emergency) and shall coordinate with Tenant to minimize as much as reasonably
possible

 

 

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any interference to the conduct of Tenant’s business caused by the performance
of such non- routine maintenance item. Any damage caused by or repairs
necessitated by any act of Tenant or Tenant’s Parties may be repaired by
Landlord at Landlord’s option and at Tenant’s expense. Tenant shall immediately
give Landlord written notice of any defect or need of repairs after which
landlord shall have a reasonable opportunity to repair same. Landlord’s
liability with respect to any defects, repairs, or maintenance for which
Landlord is responsible under any of the provisions of this Lease shall be
limited to the cost of such repairs or maintenance unless caused by Landlord’s
gross negligence or willful misconduct.

11.

MAINTENANCE AND REPAIR BY TENANT. Paragraph 11 will be revised to read as
follows:

Tenant shall, at Tenant’s expense, through the Term of the Lease, maintain those
items list on Exhibit E attached, including maintaining all parts of the
Premises in a good, clean and secure condition and promptly making all necessary
repairs and replacements, including but not limited to the items listed on
Exhibit E. Tenant shall, at Tenant’s own expense, enter into a regularly
scheduled preventive maintenance/service contract with a maintenance contractor
for servicing all hot water, heating and air conditioning systems and equipment
within or serving the Premises. The maintenance contractor and the contract must
be approved by Landlord which approval shall not be unreasonably withheld or
delayed. The service contract must include all services suggested by the
equipment manufacturer within the operation/maintenance manual and must become
effective and a copy thereof delivered to Landlord within thirty (30) days after
the Term Commencement Date.

12.     MANAGEMENT. Tenant shall be responsible for the management of the
Project during the term of this Lease. Tenant shall pay to Landlord a
supervisory management fee of Four Thousand and no/100 Dollars ($4,000.00) per
month, to be increased by three percent (3%) annually commencing on January 1,
2007. Subject to the provisions of this Lease, Tenant shall provide such
services, amenities and utilities to the Premises consistent with those provided
by first class professional property management firms in other R&D/Class A
office buildings in the South San Francisco, California area.

13.    ACCESS. Tenant shall have access to the Buildings and Premises (including
the on-site parking) 24 hours per day, 7 days per week, 365 days per year.
Landlord or Landlord’s representative shall have access to the Buildings and
Premises (including the on-site parking) during the Buildings’ normal operating
hours and at any time if there is an emergency. The Buildings’ normal operating
hours are anticipated to be from 6:00 a.m. to 7:30 p.m. on Mondays through
Fridays and 6:00 a.m. to 7:00 p.m. on Saturdays, exclusive of all Holidays.
Tenant shall determine the hours of operation of the Building.

14.    COMMON AREAS/SECURITY. Tenant shall have the right to install, at
Tenant’s sole cost and expense, a full campus security system, including but not
limited to fencing, gates, motion sensors and camera surveillance. Tenant’s
rights under this paragraph are subject to all the obligations, limitations and
requirements as set forth in paragraph 12 of the VaxGen Lease captioned
“Alterations”. Except as otherwise described in the Lease, Landlord has no duty
or obligation to provide any security services in, on or around the Premises,
Land or Buildings. Tenant may, at its sole cost and expense, install, establish
and maintain additional security services within the Premises; provided that,
such security services (including any apparatus, facilities, equipment or people
utilized in connection with the provision of such security services) shall
comply with the Governmental Requirements and shall not

 

 

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cause the Building to be out of compliance with the Governmental Requirements.
Notwithstanding the foregoing, any such security services installed, established
or maintained by Tenant shall not in any way limit or interfere with Landlord’s
ability to access the Premises for emergency purposes and to inspect the
Premises and shall not reduce or impair the two currently existing access points
to the 345 Oyster Point Building. Access to the 345 Oyster Point Building and
common areas shall be maintained at all times during the term of the Lease
without passing through any security measures.

15.    TENANT IMPROVEMENTS. Landlord shall provide Tenant Improvement Allowance
(the “TI Allowance”) for the Premises as described on Exhibit F attached.
Landlord shall reimburse Tenant for the cost of Tenant Improvements from the TI
Allowance within thirty (30) calendar days after receipt of Tenant’s periodic
requests for reimbursement (along with invoices, lien waivers, and evidence of
payment) submitted no earlier than November 1, 2005 and no later than April 30,
2006. Landlord shall not be responsible for the cost of any Tenant Improvements
not invoiced to Landlord by April 30, 2006. Except for the Tenant Improvements
described in this paragraph, Tenant shall accept the Premises in their current
“AS-IS” condition and acknowledges that (i) Landlord has made no covenants or
agreements to alter, remodel, repair, clean or improve any part of the Premises,
(ii) Landlord has not made and makes no representation or warranty as to the
condition of the Premises or the Project; and (iii) because Tenant has been the
occupant of the 347 Oyster Point Building since 1998, and subsequent spaces in
349 Oyster Point Building, Tenant is aware of the current condition of the space
in the 347 and 349 Oyster Point Buildings occupied by Tenant prior to the date
of this Amendment.

16.    OPTION TO RENEW. Provided that Tenant is not in Default as of the time of
exercise of this option and the commencement date of the First Option Period,
and provided that as of such date there is no act or omission of Tenant that
would become a Default with the passage of time or the giving of notice, Tenant
shall have an option (“First Extension Option”) to extend the Term of the Lease
for the Premises in “as-is” condition at the expiration of the original Lease
Term for a period of five (5) years (“First Option Period”). All of the terms
and conditions of this Lease except for Base Rent and the provisions of this
paragraph shall be applicable to the First Option Period. Provided that Tenant
is not in Default as of the time of exercise of this option and the commencement
date of the Second Option Period, that as of said date there is no act or
omission of Tenant that would become a Default with the passage of time or the
giving of notice, and that Tenant has duly exercised the First Extension Option,
Tenant shall have a second option (“Second Extension Option”) to extend the Term
of the Lease for the Premises in “as-is” condition at the expiration of the
First Option Period for a period of five (5) years (“Second Option Period”). All
of the terms and conditions of this Lease except for Base Rent and the
provisions of this Paragraph shall be applicable to the Second Option Period.

a.       The Base Rent for the Premises under each option shall be ninety-five
percent (95%) of the then current market rent for comparable facilities in the
proximate South San Francisco market area. The definition of comparable
facilities shall incorporate the parking amenities of the Premises, and the
Building’s location, age, quality, amenities, identity, exterior appearance,
interior

 

 

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improvements, and type of construction, excluding laboratory and manufacturing
improvements paid for by Tenant.

b.       Tenant shall give Landlord written notice of its intent to exercise its
option at least nine (9), but not more than fifteen (15) months prior to the
expiration of the then current Term for the Premises. Within fifteen (15) days
after Tenant exercises its option to extend, Landlord shall provide Tenant with
the Base Rent, as determined by Landlord, for the Option Period. The parties are
obligated to negotiate in good faith to agree on the Base Rent. If the parties
haven not mutually agreed on the Base Rent within thirty (30) days from
notification by Landlord to Tenant of Landlord’s determination of Base Rent,
each party hereto shall appoint one representative who shall be a licensed real
estate broker experienced in the leasing of comparable facilities in the County
of San Mateo to act as an arbitrator. The two (2) arbitrators so appointed shall
determine the Base Rent for the relevant Option Period. The determination of
said Base Rent shall be made by said two (2) arbitrators within sixty (60) days
from notification by landlord to Tenant of Landlord’s determination of Base Rent
and they shall submit said determination in writing and signed by said
arbitrators in duplicate. One of the written notifications shall be delivered to
Landlord and the other to Tenant.

c.       In the event the two (2) arbitrators of the parties hereto cannot agree
on the Base Rent for the Premises herein, said two (2) arbitrators shall appoint
a third arbitrator who shall be a licensed real estate broker experienced in the
leasing and of comparable facilities in the County of San Mateo, to act as an
arbitrator. The Base Rent for the relevant Option Period shall be independently
determined by the third of said arbitrators, which said determination shall be
made within ninety (90) days from notification by Landlord to Tenant of
Landlord’s determination of Base Rent. The role of the third arbitrator shall
then be to immediately select from the proposed resolution of arbitrators #1 and
#2 the one that most closely approximates the third arbitrator’s determination
of Base Rent. The third arbitrator shall have the right to adopt a compromise or
middle ground of any modification of either of the two final proposed
resolutions. The resolution that the third arbitrator chooses as most closely
approximating his determination of the Base Rent shall constitute the decision
of all arbitrators and shall be final and binding upon the parties.

d.       The parties hereto shall pay the charges of the arbitrator appointed by
it and any expenses incurred by such arbitrator. The charges and expenses of the
third arbitrator, as provided herein, shall be paid by the parties hereto in
equal shares.

e.       In the event either arbitrator #1 or arbitrator #2 fails to present a
Base Rent figure within the thirty (30) day period, the Base Rent presented by
the other arbitrator shall be considered final and binding on both parties.

f.        Notwithstanding anything to the contrary herein contained, Tenant’s
right to extend the term by exercise of the foregoing Option shall be
conditioned upon the following: (i) at the time of the exercise of the Option,
and at the time of the commencement of the extended term, Tenant and/or Tenant’s
Affiliates shall be in possession of and occupying the Premises for the conduct
of its business

 

 

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there and not more than twenty-five percent (25%) of the Premises shall be
occupied by any assignee, subtenant or licensee other than an Affiliate of
Tenant, and (ii) the notice of exercise shall constitute a representation by
Tenant to Landlord, effective as the date of the exercise and as of the date of
commencement of the extended term, that Tenant has no current intention to
assign the lease, in whole or in part, or to sublet more than twenty-five
percent (25%) of the Premises to anyone other than an Affiliate of Tenant, the
election to extend the term being used for purposes of utilizing the Premises
for Tenant’s purposes in the conduct of Tenant’s business therein. For purposes
of the Lease, an .Affiliate. shall mean any person, entity, firm or corporation
which shall be controlled by, under the control of, or under common control with
Tenant, and .control. shall mean the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of a
person, entity, firm or corporation, whether through the ownership of voting
securities, by contract or otherwise. In the event Tenant is a publicly traded
corporation, the sale of stock shall not be deemed to constitute an assignment
or transfer of this Lease.

17.

FIRST OPPORTUNITY TO PURCHASE.

a.       During the Lease Term, subject to the terms and conditions set forth in
this paragraph, if Landlord decides to sell the Project, Landlord shall provide
Tenant with written notice of its intention to sell the Project and Tenant shall
have the one-time first opportunity to purchase the Project (the “First
Opportunity to Purchase”). In order to exercise the First Opportunity to
Purchase, as of the date that Landlord provides Tenant with the notice of the
availability of the Project, and as of the closing date applicable to the sales
transaction, there shall be no Event of Default by Tenant under the VaxGen Lease
and there shall have occurred no act or omission which, with the passage of time
or the giving of notice, or both, would become an Event of Default by Tenant
under the VaxGen Lease; and (b) at no point in time prior to the closing date
applicable to such sale shall Tenant have assigned or subleased more than ten
percent (10%) of the Premises to a party other than an Affiliate of Tenant.

b.       Upon receipt of Landlord’s notice Tenant shall have ten (10) days to
(i) make an offer, (ii) decline to make an offer, or (iii) be silent and not
respond (the “Response Period”). In the event that Tenant does not elect to make
an offer within the Response Period, Landlord shall be free to sell the Project
unencumbered, subject to the terms of paragraph 17(c) below. If an offer is
submitted by Tenant to Landlord, Landlord shall have ten (10) days from receipt
to (i) make a counteroffer to Tenant or (ii) accept Tenant’s offer. In the event
that a counteroffer is made, both parties shall have ten (10) days to agree upon
terms for a sale (“Negotiation Period”). In the event that the parties do not
reach agreement within the ten (10) d ay Negotiation Period, Landlord shall be
free to sell the Project unencumbered, subject to the terms of paragraph 17(c)
below. In the event that Landlord and Tenant reach agreement and accept purchase
and sale offer terms, the parties agree to negotiate in good faith and to sign a
written purchase and sale agreement within ten (10) business days of the sooner
of the acceptance of such terms or the expiration of the Negotiation Period.

 

 

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c.        If Landlord sells the Project after completion of the process
described in paragraph 18(b) above, and the closing of the sale occurs within
twelve (12) months (i) after the expiration of the Response Period if Tenant
declined to make an offer or was silent and did not respond or (ii) after the
expiration of the Negotiation Period if Tenant submitted an offer and Landlord
and Tenant did not reach agreement on the terms, then the First Opportunity to
Purchase shall expire. If Landlord fails to close the sale of the Project after
completion of the process described in paragraph 17(b) within the applicable
12-month period, then the First Opportunity to Purchase shall not expire and
shall continue to be effective.

18.     TERM/TERMINATION OF FIRST OPPORTUNITY TO PURCHASE. The term of the First
Opportunity to Purchase granted under this Amendment shall commence upon the
full and unconditional execution and delivery of this Amendment and shall
terminate upon any of the following:

a.        The expiration or earlier termination of the VaxGen Lease for any
reason in accordance with the terms thereof and in accordance with applicable
law.

b.        In the event Tenant timely elects to exercise the First Opportunity to
Purchase, but thereafter Tenant fails to purchase the Project in connection with
the terms set forth in the Purchase Agreement.

c.        Tenant’s failure to timely exercise the First Opportunity to Purchase
as set forth in paragraph 17 above, and thereafter, the sale of the Project.

Concurrently with the execution of this Amendment, Tenant shall execute,
acknowledge and deliver to Landlord a standard quitclaim deed, substantially in
the form attached as Exhibit D (the “Quitclaim Deed”) relinquishing the
opportunity of Tenant to purchase the Project pursuant to the terms of this
paragraph. The Quitclaim Deed shall be held in trust by Landlord’s counsel and
not filed by Landlord until following the termination of the First Opportunity
to Purchase pursuant to the terms of this paragraph.

19.     HAZARDOUS SUBSTANCES. The VaxGen Lease is amended by the addition of the
following provisions:

a.        Tenant is authorized and permitted to store, handle and use reasonable
quantities and types of cleaning fluids and office supplies in the Premises for
prudent, usual and customary cleaning and maintenance of bathrooms, windows,
kitchens and administrative offices and for functions customarily performed in
an administrative office.

b.        By virtue of Tenant’s use of the Premises for the Permitted Use,
Tenant from time to time will store, handle and generate Hazardous Substances on
the Premises. With respect to any such Hazardous Substances stored, handled or
generated at the Premises, Tenant shall only do so in accordance with a
hazardous materials program (including without limitation, plans for spill
prevention and emergency spill response) adopted by Tenant, fully disclosed to
Landlord, substantially consistent with the hazardous materials program
currently conducted in its current facility, with appropriate modifications for
the new or expanded Premises, processes, and activities, and in full compliance
with

 

 

10

 

--------------------------------------------------------------------------------

subparagraph 19(e) below. Tenant agrees that Tenant shall implement training,
procedures, and management guidelines for the hazardous materials program at the
Premises.

c.        Upon expiration or earlier termination of the VaxGen Lease, Tenant
shall be obligated to remove all unsafe amounts (as determined by applicable
Governmental Requirements) of Hazardous Substances stored, placed, manufactured,
refined, handled, generated, blended, recycled, used, located, disposed of, or
released from on, in, under or about the Premises, and the Building by Tenant or
Tenant’s Agents. If there are no applicable Governmental Requirements with
respect to what constitutes “unsafe” amounts of any such Hazardous Substance,
then Tenant shall remove all detectable levels of such Hazardous Substance.

d.        At least once during each twelve (12) month period of the Lease Term,
Tenant shall provide Landlord with an updated inventory list describing the
minimum and maximum quantities of each of the chemicals and Hazardous Substances
reasonably anticipated to be generated, handled, stored and disposed of during
the succeeding twelve (12) month period and the methods of disposal of waste
chemicals, together with copies of Tenant’s hazardous materials program relating
thereto.

e.        Tenant agrees that (i) the storage, handling and use of all Hazardous
Substances permitted pursuant to this paragraph must at all times conform to all
Governmental Requirements and to applicable fire, safety and insurance
requirements; (ii) the types and quantities of permitted Hazardous Substances
which are stored in the Premises must be reasonable and appropriate to the
nature and size of Tenant’s operation in the Premises and reasonable and
appropriate for a first-class building of the same or similar use and in the
same market area as the Building; and f. no Hazardous Substance shall be spilled
or disposed of on, in, under or around the Land, Building or Project or
discharged from the Premises. Upon request from Landlord, Tenant shall deliver
to Landlord copies of all environmental permits required by Governmental
Requirements, (including without limitation, hazardous waste disposal,
wastewater discharge, and air emissions permits). In no event will Tenant be
permitted to store, handle or use on, in, under or around the Premises any
Hazardous Substance which will increase the rate of fire or extended coverage
insurance on the Land or Building, unless a. such Hazardous Substance and the
expected rate increase have been specifically disclosed in writing to Landlord;
and b. Tenant has agreed in writing to pay any rate increase related to each
such Hazardous Substance.

f.        Tenant agrees to notify Landlord immediately if Tenant receives
notification or otherwise becomes aware of: (1) any threatened or actual
release, spill or discharge of any Hazardous Substances in, on, about or over
the Premises, the Building, the Land or the Project or (2) any threatened or
actual lien, action, proceeding or notice that any Hazardous Substance is not
being generated, stored, treated, removed, transported, placed, manufactured,
handled or disposed of in strict compliance with any Governmental Requirements
or applicable fire, safety or insurance requirements. If Tenant or any Tenant’s
Agent is responsible or potentially responsible for such condition, situation,
lien, action or notice

 

 

11

 

--------------------------------------------------------------------------------

under this paragraph, Tenant’s notice to Landlord shall include a statement as
to the actions Tenant proposes to take in response to such condition, situation,
lien, action or notice.

g.        Tenant shall not excavate, disturb or conduct any testing of any soils
on or about the Land or the Project without obtaining Landlord’s prior written
consent, and any investigation or remediation on or about the Land or Project
shall be conducted only by a consultant approved in writing by Landlord and
pursuant to a work letter, approved in writing by Landlord. Tenant shall
indemnify, defend and hold harmless Landlord and Landlord’s Agents from and
against any and all Claims and damages arising out of any breach of any
provision of this paragraph. Landlord’s expenses shall include laboratory
testing fees, personal injury claims, clean-up costs and environmental
consultants' fees.

h.        Landlord shall have the right to perform a physical walkthrough of the
Premises annually to ascertain whether there is any physical evidence of
chemical releases to the environment. In the event that Landlord in good faith
believes Tenant has breached any of the terms and conditions of this paragraph
19, Tenant shall permit Landlord and Landlord’s Agents to conduct a level I
environmental inspection of Tenant’s activities with respect to the Hazardous
Substances in, on and about the Premises, and if the results of the level I
environmental inspection indicate that Tenant is in breach of the terms and
conditions of this paragraph 19, Landlord shall be permitted to conduct a level
II environmental inspection of all affected areas and activities. Except in case
of emergency, Landlord shall give Tenant at least two (2) Business Days' notice
of such environmental inspection. All environmental inspections described in
this paragraph shall be conducted at the sole cost and expense of Landlord,
except if such inspections confirm or substantiate that Tenant has breached any
of the material terms and conditions of this paragraph, in which case Tenant
shall promptly pay or reimburse Landlord for the cost of such inspections.

i.        Landlord shall have the right (but not the obligation) to enter upon
the Premises and cure any non-compliance by Tenant with the terms of this
paragraph or any Governmental Requirements applicable to Hazardous Substances or
any release, discharge, spill, improper use, storage, handling or disposal of
Hazardous Substances on, under, from, or about the Premises, the Building, the
Land or Project, regardless of the quantity of such release, discharge, spill,
improper use, storage, handling or disposal of Hazardous Substances, the full
cost of which shall be deemed to be Rent and shall be due and payable by Tenant
to Landlord immediately upon demand. If Landlord elects to enter upon the
Premises and cure any such non-compliance or release, discharge, spill, improper
use, storage, handling or disposal of Hazardous Substances, Tenant shall not be
entitled to participate in Landlord’s activities on the Premises. After good
faith consultation with Tenant, Landlord shall reasonably determine the scope
and nature of the cure of Tenant’s non-compliance, including without limitation,
the extent of any remediation based on the standards set forth in subparagraph
19(c) above.

j.         If any information provided to Landlord by Tenant under this
paragraph, or otherwise relating to information concerning Hazardous Substances
is false, incomplete, or misleading in any material respect, it shall be deemed
an Event of Default by Tenant. In addition to, and without

 

 

12

 

--------------------------------------------------------------------------------

limiting the effect of, any of the provisions of the VaxGen Lease, Tenant agrees
to indemnify, defend and hold harmless Landlord and Landlord’s Agents from and
against any and all Claims arising directly or indirectly from or out of, or are
in any way connected with, k. the generation, storage, use, treatment, removal,
transport, placement, manufacture, handling, or disposal of Hazardous Substances
by Tenant in, on, about or over the Premises, the Building or the Project, and
l. the inaccuracy or breach of any of the representations, warranties,
covenants, or agreements set forth in this Amendment, which expenses shall
include, without limitation, laboratory testing fees, personal injury claims,
clean-up costs and environmental consultants’ fees. Tenant agrees that Landlord
may be irreparably harmed by Tenant’s breach of this paragraph and that a
specific performance action may appropriately be brought by Landlord; provided
that, Landlord’s election to bring or not bring any such specific performance
action shall in no way limit, waive, impair or hinder Landlord’s other remedies
against Tenant.

k.       Without limiting in any way Tenant’s obligations under other provisions
of the VaxGen Lease, Landlord’s damages shall include, without limitation, (i)
damages arising out of the diminution in value of the Premises, Building, Land
or Project or any portion thereof, and (ii) damages for the loss of the
Premises, Building, Land or Project.

20.    LANDLORD’S INSURANCE. Paragraph 8A of the Lease is hereby deleted in its
entirety and replaced with the following:

 

Landlord’s Insurance. Throughout the Lease Term, Landlord shall maintain (a)
commercial general liability insurance, insuring against claims of bodily injury
and death or property damage or loss and (b) “Special Form” property insurance
(which is commonly called “all risk”) covering the Building and Landlord’s
personal property located on the Land for one hundred percent (100%) of the then
current replacement value of such property. Landlord shall select the amount of
the deductibles and endorsements of such coverage. Landlord may maintain other
types of insurance as Landlord deems appropriate, including property insurance
coverage for earthquakes and floods in such amounts as Landlord deems
appropriate, at Landlord’s option, and insurance against loss of Base Rent and
Additional Rent, in an amount equal to the amount of Base Rent and Additional
Rent payable by Tenant for a period of at least twelve (12) months commencing on
the date of loss. Tenant shall have the opportunity to review the insurance
coverage maintained by Landlord and, at Tenant’s option, may require that
Landlord obtain additional types or amounts of insurance, if available. The cost
of any additional insurance required by Tenant shall be paid for entirely by
Tenant within thirty (30) days after receipt of an invoice from Landlord.

21.

CASUALTY DAMAGE.

   a.       Paragraph 24 of the Lease is hereby deleted in its entirety and
replaced with the following:

A. General. If the Premises or the Building are damaged by fire, earthquake or
other casualty (the “Casualty”), Tenant shall give immediate written notice
thereof to Landlord. Within sixty (60) days after Landlord’s receipt of such
notice, Landlord shall notify Tenant whether in Landlord’s reasonable opinion
such repairs can reasonably be made either: (1) within twelve (12) months from
the date of such notice; or (2) in more than twelve (12) months from the date of
such notice.

B. 12 Months or Less and Sufficient Insurance Proceeds. If Landlord estimates
that the damage can be repaired to meet Tenant’s business needs within twelve
(12) months

 

13

 

--------------------------------------------------------------------------------

after Landlord is notified by Tenant of such damage, and if there are sufficient
insurance proceeds available to repair such damage, then Landlord shall proceed
with reasonable diligence to restore the Premises to substantially the condition
which existed prior to the Casualty.

C. Greater than 12 Months or Insufficient Insurance Proceeds. If Landlord
estimates that the damage to the Premises can not be repaired to meet Tenant’s
business needs within twelve (12) months after Landlord is notified by Tenant of
such damage, or there are insufficient insurance proceeds available to repair
such damage (provided that Landlord has obtained the insurance required to be
maintained by Landlord under this Lease), then Landlord shall have the option to
elect either: (1) to rebuild or repair the Premises to substantially the
condition in which they existed prior to such damage; or (2) to terminate the
Lease effective upon the date of the Casualty, in which event the Rent shall be
abated during the unexpired portion of the Lease. If Landlord elects to
terminate this Lease, Landlord shall deliver to Tenant a written notice of its
election (“Termination Notice”). Tenant shall have thirty (30) days after
Tenant’s receipt of Landlord’s Termination Notice to deliver written notice to
Landlord (“Restoration Notice”) that Tenant desires to require Landlord to
restore the Premises to substantially the condition which existed prior to the
Casualty. If Tenant delivers a Restoration Notice to Landlord within the 30-day
period, the Lease shall not terminate but shall continue in full force and
effect and Landlord shall proceed with reasonable diligence to restore the
Premises or the Building to substantially the condition which existed prior to
the Casualty; provided that, Tenant shall unconditionally commit in writing (a)
to fund any and all costs of restoration in excess of available insurance
proceeds, including without limitation, Landlord’s related costs due to
interruption of the lease of the Premises, and (b) to pay all Rent during the
restoration period that is not reimbursed to Landlord through Landlord’s rental
interruption insurance (provided that Landlord has maintained the rental
interruption insurance required of it). Tenant shall secure its funding
obligations under clause (a) of the previous sentence in a manner reasonably
satisfactory to Landlord and shall promptly make all payments requested by
Landlord. The Restoration Notice shall be binding on Tenant upon receipt by
Landlord and Tenant shall not be able to rescind such notice once it is
delivered. Tenant’s failure to pay for Landlord’s costs described in this
paragraph shall be an Event of Default under the Lease. In addition to the
remedies described in Paragraph 26.B of the Lease, Landlord shall have the right
to cease restoration of the Premises or the Building upon Tenant’s failure to
pay for Landlord’s restoration costs as provided in this paragraph.

D. Abatement of Rent. Notwithstanding any other provision of this Lease,
Landlord shall not be required to rebuild, repair or replace any part of the
partitions, fixtures, additions and other improvements owned by Tenant which may
have been placed in, on or about the Premises. Except as provided in paragraph
24C above, if the Premises are untenantable in whole or in part following the
Casualty, the Rent payable hereunder during the period in which they are
untenantable shall be abated proportionately, but only to the extent the
Premises are unfit for occupancy and for a period not to exceed twenty- four
(24) months in the aggregate.

E. Proceeds Applied to Loan. Notwithstanding anything herein to the contrary, in
the event that the holder of any indebtedness secured by a mortgage or deed of
trust covering the Premises (a “Lender”) requires that the insurance proceeds be
applied to such indebtedness, such action shall not affect the parties’
obligations with respect to the restoration of the Premises and the continuance
of this Lease as described hereinabove.

22.    AUTHORITY. Landlord and Tenant warrant to each other that all necessary
corporate actions have been duly taken to permit Landlord and Tenant,
respectively, to enter into this Agreement and that each undersigned officer has
been duly authorized and instructed to execute this Agreement.

 

 

14

 

--------------------------------------------------------------------------------

23.    FULL FORCE AND EFFECT. Except as expressly modified above, all terms and
conditions of the Lease remain in full force and effect and are hereby ratified
and confirmed. Landlord and Tenant hereby acknowledge and agree that, except as
provided in this Agreement has not been modified, amended, canceled, terminated,
released, superseded or otherwise rendered of no force or effect.

 

Designated Address for Landlord:

c/o Kennedy Associates Real Estate Counsel,
Inc.

 

LANDLORD:

OYSTER POINT TECH CENTER LLC, a
Delaware limited liability company

Attn: Executive Vice President – Asset
Management
1215 Fourth Avenue, Suite 2400
Seattle, WA 98161
Facsimile: 206-682-4769

 

By:

Multi-Employer Property Trust, a trust
organized under 12 C.F.R., Section 9.18, its
Managing Member

and to:

 

 

By:

Kennedy Associates Real Estate
Counsel, Inc., its Authorized Signatory

c/o Kennedy Associates Real Estate Counsel,
Inc.
Attn: Vice President – Asset Management
7315 Wisconsin Ave., Suite 350 West
Bethesda, MD 20814
Facsimile: 301-656-9339

 

 

 

By: ____________________________
Name: __________________________
Its: _____________________________

 

and to:

Multi-Employer Property Trust
c/o Riggs Bank N.A.
Attn: Senior Vice President/MEPT
or Patrick O. Mayberry
808-17th Street NW, 7th Floor
Washington, D.C. 20006-3944
Facsimile: 202-835-6887

 

 

 

 

 

Designated Address for Tenant:

 

 

TENANT:

VaxGen, Inc.
Attn:_______________________
347 Oyster Point Boulevard
South San Francisco, CA ______
Facsimile: __________________

 

 

 

VAXGEN, INC., a Delaware corporation

By: ________________________________
Name: _____________________________
Its: ________________________________

By: ________________________________
Name: _____________________________
Its: ________________________________

 

 

EXHIBITS

A

Floor Plans of Premises and Expansion Areas

 

B

Rent/Tenant Improvement/Lease Commencement/Prorata Share

 

C

Letter of Credit – Composition/Purpose and Reduction Schedule and Financial
Benchmarks

 

15

 

--------------------------------------------------------------------------------

D

Quitclaim Deed Form

E

Maintenance and Repair Responsibilities

F

Tenant Improvement Work Letter

LANDLORD

STATE OF WASHINGTON

)

 

) ss.

COUNTY OF KING

)

On this _____ day of ____________, 2005, before me, a Notary Public in and for
the State of Washington, personally appeared _______________________, to me
known to be a _____________________ of Kennedy Associates Real Estate Counsel,
Inc., the Authorized Signatory for the Multi-Employer Property Trust, the trust
that executed the within and foregoing instrument and acknowledged said
instrument to be the free and voluntary act and deed of said Trust for the uses
and purposes therein mentioned, and on oath stated that _____ was authorized to
execute said instrument.

WITNESS my hand and official seal hereto affixed the day and year first as above
written.

 

 

 

Name:

 

 

Notary Public in and for the State of Washington,

 

      residing at

 

 

My commission expires

 

[NOTARIAL SEAL]

 

TENANT

STATE OF CALIFORNIA

)

 

) ss.

COUNTY OF ____________

)

On this ______ day of ___________, 2005, before me personally appeared
__________________________, to me known to be the _______________ of VaxGen,
Inc., the Delaware corporation that executed the within and foregoing
instrument, and acknowledged said instrument to be the free and voluntary act
and deed of said limited liability company, for the uses and purposes therein
mentioned and on oath stated that ____ (he or she) was authorized to execute
said instrument and that the seal affixed thereto is the corporate seal of said
limited liability company.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year first above written.

 

 

 

Printed Name:

 

 

NOTARY PUBIC in and for the State of California,

 

residing at

 

 

My commission expires:

 

[NOTARIAL SEAL]

 

 

16

--------------------------------------------------------------------------------

Oyster Point

Exhibit List to the Fifth Amendment to the Vaxgen Lease

 

Exhibit

 

Description

 

 

 

 

A

 - 

Floor Plans of Premises and Expansion Areas

B

 - 

Rent / Tenant Improvement / lease Commencment / Prorata Share Schedule

C

 - 

Letter of Credit - Composition / Purpose / and Reduction Schedule and Financial
Benchmarks

D

 - 

Quit Claim Deed Form

E

 - 

Maintenance and Repair Responsiblilites

F

 - 

Tenant Improvement Work Letter

 

--------------------------------------------------------------------------------

 

[img1.jpg]

 

 

--------------------------------------------------------------------------------

Oyster Point

Exhibit “B” of the Fifth Amendment to the Vaxgen Lease Summary

 

 DIRECT SPACE

 

 

SQUARE FEET

 

 

BASE RENT (PSF)

 

 

BASE RENT (PSF)

TERM

 

 

TERM & BLOCKS OF SPACE

 

 

Tenant Improvements
Rent per space per square foot

 

 

TOTAL LEASED BY VAXGEN

Start

End

No.
of
Mos.

 

 

VaxGen
Direct
(Suite 102)

 

VaxGen 
Mo-Mo
(Suite 
202-TSI)

 

(*) Tosoh
(Suite
 201)

 

Cellegy
(Sub-
leased-
Suite
101 a)

Cellegy
(Suite
101 b)

 

 

VaxGen
Direct
(Suite 102)

 

VaxGen 
Mo-Mo 
(Suite
 202-TSI)

 

Tosoh
(Suite
 201)(*)

 

Cellegy
(Sub-
leased-
Suite
101 a)

 

Cellegy
(Suite
101 b)

 

 

 

 

 

 

 

 

 

 

 

 

 

Premises Date Possession

 

 

12/31/1998

 

4/1/2005

 

(*) 10/1/05

 

4/1/2005

4/1/2005

 

 

12/31/1998

 

4/1/2005

 

(*) 10/1/05

 

4/1/2005

 

4/1/2005

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease Commencement Date

 

 

12/31/1998

 

4/1/2005

 

11/1/2005

 

4/1/2005

4/1/2005

 

 

12/31/1998

 

4/1/2005

 

11/1/2005

 

4/1/2005

 

4/1/2005

 

 

 

 

 

 

 

 

 

 

 

 

 

Rent Commencement Date

 

 

5/1/1999

 

4/1/2005

 

11/1/2005

 

4/1/2005

4/1/2005

 

 

5/1/1999

 

4/1/2005

 

11/1/2005

 

4/1/2005

 

4/1/2005

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease Expiration Date

 

 

12/31/2016

 

12/31/2016

 

12/31/2016

 

12/31/2016

12/31/2016

 

 

12/31/2016

 

12/31/2016

 

12/31/2016

 

12/31/2016

 

12/31/2016

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Leases Expire

 

 

4/30/2006

 

MTM

 

9/30/2005

 

12/31/2008

12/31/2008

 

 

4/30/2006

 

MTM

 

9/30/2005

 

12/31/2008

 

12/31/2008

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Suite Size

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

9,675

 

10,258

 

19,847

 

49,919

 

15,421

 

 

SF
During
Period

 

Prorata
Share

 

Mon-
thly
Rental

 

Ann-
ual
Incr.

 

Monthly
Rental
Rate

 

Total ($)
Rent 
for Period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4/1/05

4/30/05

1

 

 

9,675

 

10,258

 

0

 

49,919

15,421

 

 

$1.80

 

$2.29

 

$0.00

 

$1.91

 

$1.73

 

 

85,273

 

81.12%

 

$1.91

 

 

 

$162,679.85

 

$162,680

5/1/05

10/31/05

6

 

 

9,675

 

10,258

 

0

 

49,919

15,421

 

 

$1.85

 

$2.29

 

$0.00

 

$1.91

 

$1.73

 

 

85,273

 

81.12%

 

$1.91

 

 

 

$163,163.60

 

$978,982

11/1/05

4/30/06

6

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$1.85

 

$2.29

 

$2.29

 

$1.96

 

$1.78

 

 

105,120

 

100.00%

 

$2.02

 

 

 

$211,880.23

 

$1,271,281

5/1/06

10/31/06

6

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.36

 

$2.36

 

$2.36

 

$1.96

 

$1.78

 

 

105,120

 

100.00%

 

$2.08

 

3%

 

$218,870.11

 

$1,313,221

11/1/06

4/30/07

6

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.36

 

$2.36

 

$2.36

 

$1.96

 

$1.78

 

 

105,120

 

100.00%

 

$2.08

 

 

 

$218,921.83

 

$1,313,531

5/1/07

10/31/07

6

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.48

 

$2.48

 

$2.48

 

$2.02

 

$1.84

 

 

105,120

 

100.00%

 

$2.16

 

5%

 

$227,536.27

 

$1,365,218

11/1/07

12/31/08

14

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.60

 

$2.60

 

$2.60

 

$2.02

 

$1.84

 

 

105,120

 

100.00%

 

$2.21

 

5%

 

$232,465.01

 

$3,254,510

1/1/09

12/31/09

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.68

 

$2.68

 

$2.68

 

$2.68

 

$2.68

 

 

105,120

 

100.00%

 

$2.68

 

3%

 

$281,717.08

 

$3,380,605

1/1/10

12/31/10

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.81

 

$2.81

 

$2.81

 

$2.81

 

$2.81

 

 

105,120

 

100.00%

 

$2.81

 

5%

 

$295,802.93

 

$3,549,635

1/1/11

12/31/11

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$2.95

 

$2.95

 

$2.95

 

$2.95

 

$2.95

 

 

105,120

 

100.00%

 

$2.95

 

5%

 

$310,593.08

 

$3,727,117

1/1/12

12/31/12

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$3.10

 

$3.10

 

$3.10

 

$3.10

 

$3.10

 

 

105,120

 

100.00%

 

$3.10

 

5%

 

$326,122.73

 

$3,913,473

1/1/13

12/31/13

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$3.20

 

$3.20

 

$3.20

 

$3.20

 

$3.20

 

 

105,120

 

100.00%

 

$3.20

 

3%

 

$335,906.42

 

$4,030,877

1/1/14

12/31/14

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$3.29

 

$3.29

 

$3.29

 

$3.29

 

$3.29

 

 

105,120

 

100.00%

 

$3.29

 

3%

 

$345,983.61

 

$4,151,803

1/1/15

12/31/15

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$3.39

 

$3.39

 

$3.39

 

$3.39

 

$3.39

 

 

105,120

 

100.00%

 

$3.39

 

3%

 

$356,363.12

 

$4,276,357

1/1/16

12/31/16

12

 

 

9,675

 

10,258

 

19,847

 

49,919

15,421

 

 

$3.49

 

$3.49

 

$3.49

 

$3.49

 

$3.49

 

 

105,120

 

100.00%

 

$3.49

 

3%

 

$367,054.01

 

$4,404,648

 

 

141

 

 

 

 

 

TENANT IMPROVEMENTS PSF>>

 

$12.00

 

$18.00

 

$30.00

 

$20.00

 

$20.00

 

105,120

 

 

 

 

 

 

 

 

 

$41,093,938

 

 

 

 

 

 

 

 

Total Tenant Improvement Allowance >>

 

$116,100

 

$184,644

 

$595,410

 

$998,380

 

$308,420

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Tenant Improvements ($):

 

$2,202,954

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Tenant Improvements (PSF):

 

$20.96

 

 

 

 

 

 

 

 

 

 

 

 

(*)

Tosoh space “Anticipated” to be delivered to VaxGen 10/1/05. This Exhibit B to
be revised to reflect the actual dates of possession and commencement.

 

 

--------------------------------------------------------------------------------

Exhibit “C” of the Fifth Amendment to the VaxGen LeaseSummary

VaxGen Inc. - Letter of Credit

 

  Financial Benchmarks

 

Benchmark

 

I

 

Cash Equivalents: (1)

 

$

15,000,000

 

 

 

 

 

 

 

 

II

 

Current Ratio: (1)

 

 

2.00

 

 

 

Current Assets

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

 

 

 

III

 

Assets to Liabilities Ratio: (1)

 

 

3.00

 

 

 

Total Assets

 

 

 

 

 

 

Total Liabilities

 

 

 

 

             

IV

 

Net Worth: (1)

 

 

 

 

 

 

Total Assets

 

 

 

 

 

 

Less: Total Liabilities

 

 

 

 

 

 

Net Worth /Stockholders Equity

 

$

35,000,000

 

 

 

 

 

V   “Operating Cash Flow”: (defined below (2))

 

$

25,000,000

 

           

 

  Notes:

 

 

 

 

 

(1)

The Financial Benchmarks above must be met or exceeded for the preceding four
consecutive quarters to allow the scheduled Letter of Credit reductions to
occur.

 

(2)

“Operating Cash Flow” shall mean the aggregate of the actual Operating Cash Flow
received during the preceding four quarters (as opposed to measuring individual
quarters similarly to the first four benchmarks). Operating Cash Flow shall
exclude any additions of capital or loan proceeds and non-cash line items such
as depreciation and accrual adjustments. This term is strictly measuring the
cash received from operations and the cash used for operations (including
capital expenditures). For the purposes of measuring this benchmark it will be
deemed to have been met and acceptable to have irregular cash flows during the
individual quarters, even negative during individual quarters, as long as the
aggregate exceeds the Operating Cash Flow benchmark amount.

 

--------------------------------------------------------------------------------

 

Exhibit “C” of the Fifth Amendment to the VaxGen Lease Summary

VaxGen Inc. - Letter of Credit

 

  Letter of Credit Composition, Purpose and Reduction Schedule

 

 

 

Purpose

 

 Purpose

  Reduction Date

 

Manufacturing
Space
Restoration

 

Credit
Enhancement
(replaces
Cellegy LOC -
General
Purpose)

 

Credit
Enhancement
($350,000 of
Additional
Tenant
Improvements -
General
Purpose)

 

Credit
Enhancement
(General
Purpose)

 

Total Letter of
Credit (“LOC”)

 

 

   Initial Amount

 

450,000

 

 

 

227,500

 

 

 

350,000

 

 

 

1,322,500

 

 

 

2,350,000

 

 

January 1, 2009

 

450,000

 

 

 

227,500

 

 

 

350,000

 

(4)

 

1,058,000

 

(1)

 

2,085,500

 

 

January 1, 2010

 

450,001

 

 

 

227,500

 

 

 

 

 

 

 

793,500

 

(1)

 

1,471,001

 

 

January 1, 2011

 

450,002

 

 

 

227,500

 

 

 

 

 

 

 

529,000

 

(1)

 

1,206,502

 

 

January 1, 2012

 

450,003

 

 

 

227,500

 

 

 

 

 

 

 

264,500

 

(1)

 

942,003

 

 

January 1, 2013

 

450,004

 

 

 

227,500

 

 

 

 

 

 

 

—

 

 

 

677,504

 

 

January 1, 2014

 

450,005

 

 

 

227,500

 

 

 

 

 

 

 

 

 

 

 

677,505

 

 

January 1, 2015

 

450,006

 

 

 

227,500

 

 

 

 

 

 

 

 

 

 

 

677,506

 

 

February 1, 2017

 

450,007

 

 

 

227,500

 

(2)

 

 

 

 

 

 

 

 

 

677,507

 

 

March 28, 2017

 

450,007

 

(3)

 

 

 

 

 

 

 

 

 

 

 

 

 

450,007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(*) All reductions are subject to the tenant not being in default.

(1) Reduction subject financial benchmarks being met. The Financial Benchmarks
above must be met or exceeded for the preceding four consecutive quarters to
allow the scheduled Letter of Credit reductions to occur.

(2) Reduction subject to the final walk through inspection and general
restoration requirements being met. Amounts are to be carried forward if lease
is renewed.

(3) Reduction subject to manufacturing space restoration provisions being met.
Amounts are to be carried forward if lease is renewed.

(4) Scheduled reduction date is 12/31/09

 

--------------------------------------------------------------------------------

 

RECORDING REQUESTED BY

 

 

AND WHEN RECORDED MAIL THIS DEED AND,
UNLESS OTHERWISE SHOWN BELOW, MAIL
TAX STATEMENT TO:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SPACE ABOVE THIS LINE FOR RECORDER’S USE

QUITCLAIM DEED

(Remainder Interest)

THE UNDERSIGNED GRANTOR DECLARES:

  

DOCUMENTARY TRANSFER TAX IS

 

$ - 0 –

 

CITY TAX IS

 

$

 

 

[  

]

computed on full value of property conveyed, or

 

 

[  

]

computed on full value less value of liens or encumbrances remaining at time of
sale.

 

[  

]

Unincorporated are [  

] City of _________________

 

FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, VAXGEN,
INC., a Delaware corporation, hereby REMISES, RELEASES AND FOREVER QUITCLAIMS to
OYSTER POINT TECH CENTER LLC, a Delaware limited liability company (the
“Beneficiary”), all of Grantor’s rights to purchase the following described real
property in the County of San Mateo, City of South San Francisco, California:

THE REAL PROPERTY DESCRIBED ON EXHIBIT “A” ATTACHED HERETO AND MADE A

PART HEREOF BY REFERENCE.

This Quitclaim Deed is solely with respect to the termination of Tenant s First
Opportunity to Purchase as set forth in paragraph 17 of that certain FIFTH
AMENDMENT TO LEASE between Grantor, as tenant, and Beneficiary, as landlord,
dated ________________2005, and no other terms or conditions of the Lease
between Grantor, as tenant, and Beneficiary, as landlord, dated December 11,
1998, as amended from time to time, shall be affected hereby.

 

Dated: ______________, 20___.

 

 

GRANTOR:

VAXGEN, INC., a Delaware corporation

 

 

By: _______________________________
Name: ____________________________
Its: _______________________________

 

 

 

 

--------------------------------------------------------------------------------

 

STATE OF CALIFORNIA

)

 

 

 

)

ss.

 

COUNTY OF_____________

)

 

 

 

On this ______ day of ___________, 2005, before me personally appeared
__________________________, to me known to be the _______________ of VaxGen,
Inc., the Delaware corporation that executed the within and foregoing
instrument, and acknowledged said instrument to be the free and voluntary act
and deed of said limited liability company, for the uses and purposes therein
mentioned and on oath stated that ____ (he or she) was authorized to execute
said instrument and that the seal affixed thereto is the corporate seal of said
limited liability company.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year first above written.

 

 

 

 

Printed Name:

 

 

NOTARY PUBIC in and for the State of

 

California, residing at

 

 

My commission expires:

 

[NOTARIAL SEAL]

 

 

 

2

--------------------------------------------------------------------------------

Exhibit “E” of the Fifth Amendment to the Vaxgen Lease

347 and 349 OYSTER POINT BLVD.

 

 

 

LANDLORD Repair &
Maintenance

 

 

TENANT Repair &
Maintenance

 

 

Provide copy of
Contract &
Repairs

 

 

Subject to
Inspection

Real Estate Taxes

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Insurance Premium

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Landscaping

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Parking Lot Light Maintenance

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Utility – Electricity -Parking Lot Lights

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Exterior and Sidewalk Power Washing

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Sidewalk Repair

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Parking Lot Asphalt seal and stripe, curb painting and hydrant painting

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Parking Lot sweeping

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

Roof Maintenance

 

X - LANDLORD

 

 

 

 

 

 

 

 

 

HVAC Maintenance Contract

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Elevator Maintenance and Monitoring Contract

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Elevator Permit

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Fire Extinguishers

 

 

 

 

XX—TENANT

 

 

 

 

 

 

Fire Sprinkler Monitoring Contract

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Phone Lines - Fire Sprinklers, elevators

 

 

 

 

XX—TENANT

 

 

 

 

 

 

Fire Sprinkler Quarterly Testing Contract & 5-year Test

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Plumbing Repair

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Interior Painting, Lights and Ceiling Tiles Replacement

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Janitorial Contract, Restroom/Cleaning Supplies

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Garbage and Recycling

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Security Guard or Alarm

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Utility -Electricity

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Utility – Water – Domestic, Fire Service & Irrigation

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Window Replacement

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Window Washing

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Exterior Door Repair

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Painting of Exterior Metal and Signs

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Tow of Unauthorized Automobiles

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Security – Parking Lot

 

 

 

 

XX—TENANT

 

 

X

 

 

X

Trash Removal and Debris Removal (except parking lot sweeping)

 

 

 

 

XX—TENANT

 

 

X

 

 

X

 

--------------------------------------------------------------------------------

EXHIBIT F

TENANT IMPROVEMENT WORK LETTER

Landlord and Tenant shall negotiate in good faith to finalize the Tenant
Improvement Work Letter, which shall be inserted as Exhibit F to this Amendment.

 

 

1

 

--------------------------------------------------------------------------------