Exhibit 10.3

 

 

SECOND AMENDMENT TO

STANDARD INDUSTRIAL/COMMERCIAL

MULTI-TENANT LEASE - GROSS

 

This Second Amendment to Standard Industrial/Commercial Multi-Tenant Lease -
Gross (the “Second Amendment”) is entered into as of September 12, 2016
(“Amendment Date”) by and between COMMERCIAL STREET PROPERTIES, LLC, a
California limited liability company (“Lessor”), and VIVEVE, INC., a California
corporation (“Lessee”), with reference to the following:

 

RECITALS

 

A.     The Castine Group, a California corporation (“Castine”), and Lessee
entered into that certain Standard Industrial/Commercial Multi-Tenant Lease -
Gross dated as of January 25, 2012, as amended by that certain First Amendment
to Lease dated January 15, 2015 (the “First Amendment,” and collectively, the
“Lease”) for the premises located at 150–154 Commercial Street, Sunnyvale
California 94086 (the “Premises”).

 

B.     The Lease incorrectly identified Castine as the lessor of the Premises
rather than Lessor. Lessor is the entity that is and was the true owner and
lessor of the Premises at all times relevant to the Lease.

 

C.     Lessor and Lessee now wish to amend the Lease on the terms and conditions
set forth in this Amendment to reflect (i) the proper identification of Lessor
as the lessor of the Premises pursuant to the Lease for all purposes, (ii) the
leasing by Lessee of the Premises for an extended term, (iii) the establishment
of Lessee’s rental obligation for the extended term, and such other matters as
set forth in this Second Amendment.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.     Recitals. Lessor and Lessee hereby agree that the hereinabove recitals
are true and correct.

 

2.     Definitions. Unless defined otherwise in this Second Amendment, all
capitalized terms used in this Second Amendment shall have the same meaning and
definition given to them in the Lease.

 

3.     True Lessor. Lessor and Lessee acknowledge that the Lease incorrectly
identified Castine as the lessor of the Premises. Lessor and Lessee hereby
acknowledge and agree that Lessor, and not Castine, was at all times the true
lessor of the Lease, and that all of Castine’s purported rights, obligations and
interests in, to and under the Lease were and are in fact Lessor’s rights,
obligations and interests in, to and under the Lease, all of which accrued to
Lessor or otherwise arose on January 25, 2012.

 

 
 

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4.     Extension of Term. The Lease term as stated in Section 2 of the First
Amendment is hereby extended to March 31, 2018 (the “Extended Term”), unless the
Lease is sooner terminated as provided for in the Lease.

 

5.     Base Rent. The Base Rent payable by Lessee for the Extended Term shall be
as follows:

 

Months of Extended Term

 

Monthly Base Rent

   

Annual Base Rent

                   

April 1, 2017 - March 31, 2018

  $ 27,219.50     $ 326,634  

 

6.     Base Year. The Base Year as defined in Section 4.2 of the Lease is hereby
amended to be defined as the 2017 calendar year.

 

7.     Extension Option.

 

(a)     Extension. Provided that Lessee is in possession of the Premises, and
that this Lease is not previously cancelled or terminated by either party as
provided in the Lease, by operation of law or otherwise, and further provided
that Lessee has fully complied with and performed all of the covenants and
conditions in the Lease, as amended, on its part to be performed during the Term
and is not in default at the time of exercise of this option, then Lessor and
Lessee covenant and agree that Lessee shall have the option to extend the term
of the Lease for one (1) six (6) month period commencing upon the expiration of
the term of this Lease (the “Extension”), upon the same terms, covenants and
provisions herein set forth except that Base Rent during the Extension shall be
adjusted to the Fair Market Rental Rate, as hereinafter defined. The option for
the Extension shall be exercised written notice to Lessor by Lessee not less
than ninety (90) days prior to the expiration of the term of this Lease.

 

(b)     Fair Market Rental Rate. The term “Fair Market Rental Rate” shall mean
the market rental rate for the time period such determination is being made for
commercial space in Sunnyvale, California of comparable condition and of
equivalent quality, size, utility, and location. Prior to the commencement of
the Extension, Lessor and Lessee shall attempt to agree upon what the Fair
Market Rental Rate will be. If agreement cannot be reached within thirty (30)
days, then either:

 

(1)     Lessor and Lessee shall immediately appoint a mutually acceptable
appraiser or broker to establish the new Fair Market Rental Rate within the next
thirty (30) days, with any associated costs to be split equally between the
parties, or

 

(2)     Both Lessor and Lessee shall each immediately make a reasonable
determination of the Fair Market Rental Rate and submit such determination, in
writing, to arbitration in accordance with the following provisions:

 

(i)     Within fifteen (15) days thereafter, Lessor and Lessee shall each select
an independent third party appraiser or broker of their choice to act as an
arbitrator; provided, however, that the parties may not select any of the
brokers involved in negotiating the Lease or any amendments thereto to so act.
The two arbitrators so appointed shall immediately select a third mutually
acceptable appraiser or broker to act as a third arbitrator.

 

 
 

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(ii)     The three arbitrators shall within thirty (30) days of the appointment
of the third arbitrator reach a decision as to what the actual Fair Market
Rental Rate for the Premises is, and whether Lessor’s or Lessee’s submitted Fair
Market Rental Rate is the closest thereto. The decision of a majority of the
arbitrators shall be binding on the parties. The submitted Fair Market Rental
Rate which is determined to be the closest to the actual Fair Market Rental Rate
shall thereafter be used by the parties.

 

(iii)     If either of the parties fails to appoint an arbitrator within the
specified fifteen (15) days, the arbitrator timely appointed by one of them
shall reach a decision on his or her own, and said decision shall be binding on
the parties.

 

(iv)     The entire cost of such arbitration shall be paid by the party whose
submitted Fair Market Rental Rate is not selected, i.e., the one that is NOT the
closest to the actual Fair Market Rental Rate.

 

(c)     Applicable Considerations. When determining Fair Market Rental Rate, the
Lessor, Lessee and the arbitrators shall consider the terms of comparable market
transactions which shall include, but not be limited to, rent, rental
adjustments, abated rent, lease term and financial condition of tenants.

 

(d)     Base Rent Minimum. Notwithstanding the foregoing, the Fair Market Rental
Rate shall not be less than the rent payable for the month immediately preceding
the commencement of the Extension.

 

8.     Lessee’s Acceptance of Premises “AS IS”. Lessor and Lessee acknowledge
that Lessee currently occupies the Premises. Lessee accepts the Premises in its
“AS IS” condition and as of the commencement of the above extended term in its
then “AS IS” condition. During the remaining Lease term, Lessee shall continue
to occupy the Premises in its “AS IS” condition.

 

9.     Security Deposit. The parties acknowledge and agree that the Security
Deposit, as previously reduced from time to time in accordance with the Lease,
shall continue to be held by Lessor for the Extended Term.

 

10.     Brokers. Lessor has been represented in connection with this Amendment
by Cushman & Wakefield U.S., Inc. acting solely as Lessor’s agent, and Lessee
has been represented by Jones Lang LaSalle (“JLL”) acting solely as Lessee’s
agent. Lessor hereby agrees to pay JLL a commission in the amount of a market
procuring commission for the Premises pursuant to a separate agreement by and
between Lessor and JLL.

 

11.     Ratification. Except as expressly amended by this Amendment, the terms
and provisions of the Lease, as amended, are hereby ratified, confirmed, and
shall remain in full force and effect.

 

 
 

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12.     No Other Changes. Except as expressly set forth herein, the Lease, as
amended by this Amendment, remains in full force and effect and unamended.

 

IN WITNESS WHEREOF, Lessor and Lessee have executed this Amendment as of the
Amendment Date.

 

LESSOR:

 

COMMERCIAL STREET PROPERTIES, LLC, a California limited liability company

 

 

By:   /s/ Marshall Goldman                                                

       MARSHALL GOLDMAN, General Manager

 

 

LESSEE:

 

VIVEVE, INC., a California corporation

 

 

By:   /s/ Scott Durbin                                                          

       SCOTT DURBIN, CFO