monthly or annually over the lease term.
All Comparable Transactions
and Economic Terms should be adjusted to simulate a net rent structure, wherein
the tenant is responsible for the payment of all property operating expenses and
taxes in a manner consistent with this Lease.
This results in the estimate of
Net Equivalent Rent received by each landlord for each Comparable Transaction
being expressed as a periodic net rent payment.
5.2Any free rent or similar inducements received over time should be deducted in
the time period in which they occur, resulting in the net cash flow arrayed over
the lease term.
5.3The resultant net cash flow from the lease should be then discounted (using
an annual discount rate equal to 8.0%) to the lease commencement date, resulting
in a net present value estimate.
5.4From the net present value, up front inducements (improvements allowances and
other concessions) should be deducted.
These items should be deducted directly,
on a "dollar for dollar" basis, without discounting since they are typically
incurred at lease commencement, while rent (which is discounted) is a future
receipt.
5.5The net present value should then amortized back over the lease term as a
level monthly or annual net rent payment using the same annual discount rate of
8.0% used in the present value analysis.
This calculation will result in a
hypothetical level or even payment over the option period, termed the "Net
Equivalent Lease Rate" (or constant equivalent in general financial terms).
6.USE OF NET EQUIVALENT LEASE RATES FOR COMPARABLE TRANSACTIONS.
The Net
Equivalent Lease Rates for the Comparable Transactions shall then be used to
reconcile, in a manner usual and customary for a real estate appraisal process,
to a conclusion of Market Rent which shall be stated as a Net Equivalent Lease
Rate applicable the Option Term.
EXHIBIT F
EXHIBIT G
PRELIMINARY DEVELOPMENT COSTS BUDGET
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EXHIBIT G
EXHIBIT H
[INTENTIONALLY OMITTED]
EXHIBIT H
EXHIBIT I
APPROVED FORM OF LETTER OF CREDIT
BENEFICIARY:
HCPI/SORRENTO, LLC
C/O HCP, INC.
1920 MAIN STREET, SUITE 1200
IRVINE, CALIFORNIA, 92614
ATTENTION: LEGAL DEPARTMENT
LADIES AND GENTLEMEN:
AT THE REQUEST OF:
APPLICANT:
NUVASIVE, INC.
WE HEREBY ISSUE IN YOUR FAVOR OUR IRREVOCABLE CREDIT NO. ___________________ FOR
THE ACCOUNT OF NUVASIVE, INC. FOR AN AMOUNT OF $1,350,000.00 (ONE MILLION THREE
HUNDRED FIFTY THOUSAND DOLLARS) AVAILABLE BY YOUR DRAFTS AT SIGHT ON
_______________ BANK, N.A. EFFECTIVE IMMEDIATELY AND EXPIRING AT OUR OFFICE ON
AUGUST 31, 2018.
WE ARE INFORMED THIS LETTER OF CREDIT IS ISSUED RELATIVE TO THE LEASE AGREEMENT
FOR SORRENTO SUMMIT DATED AUGUST 28, 2017, INCLUDING ANY AMENDMENTS AND
RESTATEMENTS THERETO, BETWEEN NUVASIVE, INC., AS TENANT, AND HCPI/SORRENTO, LLC
AS LANDLORD (THE "LEASE") FOR PREMISES LOCATED AT 7473 AND 7475 LUSK BOULEVARD,
SAN DIEGO, CALIFORNIA 92121, AND AT THAT CERTAIN TO BE CONSTRUCTED BUILDING TO
BE KNOWN AS THE LUSK 3 BUILDING.
FUNDS UNDER THIS CREDIT ARE AVAILABLE AGAINST YOUR DRAFT(S) MARKED "DRAWN UNDER
___________ BANK, N.A. LETTER OF CREDIT NO. ____________________" ACCOMPANIED BY
THE FOLLOWING:
BENEFICIARY'S SIGNED AND DATED STATEMENT