EXHIBIT 10.16

 

AMENDMENT TO LEASE

Dated September 1, 2001

 

This amendment to Lease is entered into this 1st day of September 2001, by and
between Ekwill Street, LP a California limited partnership, hereinafter referred
to as “Landlord,” and McGhan Medical Corporation, hereinafter referred to as
“Tenant.”

 

WHEREAS, Landlord and Tenant entered into that certain Lease Agreement dated
July 1, 1985, as amended, for the premises commonly known as 5511, 5531, 5551
and 5571 Ekwill Street, Santa Barbara, California.

 

WHEREAS, the parties desire to amend said lease as follows:

 

1.                                       Articles 2, Term:  The term of the
above referenced lease is amended as follows:

 

The lease term for the building containing 11,200 SF commonly known as 5551
Ekwill Street is hereby extended for eighteen (18) months.  The lease
termination date is hereby changed to December 31, 2003.  All the lease
termination dates pertaining to 5511, 5531 and 5571 Ekwill Street will remain as
specified in the Amendments to Lease dated December 15, 1999 and May 1, 2001.

 

2.                                       Articles 10 and 11, Insurance and
Taxes:  Tenant shall continue to pay all of the costs associated with property
and casualty insurance and property taxes to September 1, 2001. From September
1, 2001 to January 1, 2002, Tenant shall pay 75% of the above referenced costs.
From January 1, 2002 to July 1, 2002, tenant shall pay 50% of the above
referenced costs. From July 1, 2002 to January 1, 2004, tenant shall pay 25% of
the above referenced costs.

 

3.                                       Articles 3.1 and 3.2, Minimum Monthly
Rent and Rental Adjustment:

 

A.                                   From July 1, 2001 to September 1, 2001, the
minimum monthly base rent will be fifty-eight thousand ninety four and 68/100
dollars ($58,094.68) per month plus a rent increase calculated as specified in
Article 3.2 of the above referenced lease as amended;

 

B.                                     From September 1, 2001 to January 1,
2002, the minimum monthly base rent will be forty-three thousand five hundred
seventy one and 01/100 dollars ($43,571.01);

 

C.                                     From January 1, 2002 to July 1, 2002, the
minimum monthly base rent will be twenty-nine thousand forty-seven and 34/100
dollars ($29,047.34); and

 

D.                                    From July 1, 2002 to July 1, 2003, the
minimum monthly base rent will be fifteen thousand six hundred eighty dollars
($15,680.00). From July 1, 2003 to January 1, 2004, a rent increase calculated
as specified in Article 3.2 of the above referenced lease, as amended, shall be
applied to the minimum monthly base rent.

 

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4.                                       Prior to vacating the individual
buildings comprising the leased premises, Tenant will complete the work
described in exhibit “A” attached hereto and included by reference.  Tenants
failure to complete the work on or before the times described shall constitute a
material default under the lease and upon any such default, Landlord is entitled
to (A) terminate the lease (B) recover as damages the costs incurred by Landlord
in causing such work to be completed. The obligation of the Tenant hereunder
shall survive the termination of the lease.

 

5.                                       Item one (1) of Exhibit “A” of the
Amendment to Lease dated December 15, 1999 will be deleted as it pertains to
5571 Ekwill only.  Tenant will leave the interior of 5571 Ekwill in broom clean
condition with its current wall partitions and clean room facility left in
place.

 

EXCEPT as set forth in this Amendment to Lease, all provisions of the original
Lease Agreement and subsequent Lease Amendments will remain unchanged and in
full force and effect, and the parties hereby ratify and confirm said lease as
so amended, and agree to be bound by its terms.

 

LANDLORD:

 

TENANT:

 

Ekwill Street, LP

 

McGhan Medical Corporation

 

a California limited partnership

 

 

 

 

 

 

 

 

 

 

 

By

/s/ James P. Knell

 

By

/s/ Nicholas Teti

 

 

James P. Knell, General Partner

 

 

Nicholas Teti, President and CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

Dated:

September 1, 2001

 

Dated

Nov. 2, 2001

 

 

 

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EXHIBIT “A”

 

McGhan Medical Corporation (“Tenant”) is responsible to perform the work and pay
all the costs associated with the following upon vacating the Property.  Tenant
will complete the work described below (A) not later than August 31, 2001 with
respect to the building known as 5571 Ekwill; (B) not later than December 31,
2001 with respect to the building known as 5531 Ekwill; (C) not later than June
30, 2002 with respect to the building known as 5511 Ekwill (D) and not later
than December 31, 2003 with respect to the building known as 5551 Ekwill.  All
the above referenced buildings hereinafter shall be known as the “Property”.

 

1.             Remove all temporary walls and partitions constructed at any time
during the life of the lease;

2.             Repair, resurface and stripe the entire parking lot per the
previously agreed to specifications;

3.                                       Tear off and replace the roof covering
the manufacturing building located at 5551 Ekwill per the previously agreed to
specifications;

4.                                       Maintain the landscaping for the
Property during the two-year period ending 6 30-2002. Ekwill Street, LP
(“Landlord”) will contribute towards the cost during the second year (2) on a
pro-rata basis, based upon the ratio between the original square footage of the
leased premises and the square footage of the area being leased  by the Tenant
during the second year. Landlord will contract with and pay for the landscaper
to maintain the landscaping at the Property from July 1, 2002 forward and Tenant
will reimburse Landlord for 25% of the costs relating to the landscaping from
July 1, 2002 to January 1, 2004.

5.                                       Upon vacating the Property, leave the
interior of the premises in broom clean condition and clean all of the windows.

6.                                       Landlord will hire a professional
engineering company to perform all of the required procedures involved in Phase
II Environmental testing.  If the tests show no contamination resulting from the
Tenant’s business practices, than Landlord will pay for the testing.  If any
contamination  is found, Tenant will pay for the tests and all costs associated
with the clean up of the contamination.

7.                                       Any and all additions to the Property,
whether attached to the buildings or free standing, (fences, additions, storage,
signage...), shall be removed and all damage associated with the removal shall
be repaired.

8.                                       Upon move out, each of the four (4)
buildings will contain four (4) operational entry doors and four (4) fully
functioning roll-up doors.  The entry doors shall be constructed in the same
fashion as those on site during the October 1999 inspection.  The roll up doors
will be constructed in the same fashion as those on site during the October 1999
inspection.

9.                                       All work must by performed by a
licensed, bonded and insured contractor.  Tenant will obtain all lien releases
upon completion of the required construction .  All costs relating to the
above-described work, unless specified to the contrary, are the sole
responsibility of Tenant.  Tenant agrees to fully indemnify Landlord and all of
its affiliates, against any and all issues that arise from the work performed as
a result of the move-out.

 

LANDLORD:

 

TENANT:

Ekwill Street, LP

 

McGhan Medical Corporation

a California limited partnership

 

 

 

 

 

 

 

 

By

/s/ James P. Knell

 

By

/s/ Nicholas Teti

 

James P. Knell, General Partner

 

 

Nicholas Teti, President and CEO

 

 

 

 

 

 

 

Dated

September 1, 2001

 

Dated

Nov. 2, 2001

 

 

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