California-Marina del Rey-4503 Glencoe Avenue Lease [Assignment] - John Wayne Cancer Institute and CancerVax Corp.
AGREEMENT OF LEASE ASSIGNMENT
This AGREEMENT OF LEASE ASSIGNMENT ("Agreement"), dated as of August
4, 2000, is by and between John Wayne Cancer Institute, a non-profit corporation
(the "Institute"), and CancerVax Corporation, a Delaware corporation
("CancerVax"). The Institute and CancerVax are each referred to herein as a
"Party" and collectively referred to as the "Parties."
RECITALS
A. The Institute's mission, in part, is to continue the research
and development of useful technologies for the treatment of cancer and, through
collaboration with Saint John's Health Center ("Saint John's"), to apply such
technologies to the treatment of patients and for the benefit of mankind.
CancerVax's mission is to commercialize immunotherapies for cancer, including a
melanoma vaccine and other allogeneic cellular vaccines for cancer.
B. Donald L. Morton, M.D. ("Dr. Morton"), a principal director
and shareholder of CancerVax, has been working in the field of vaccines for
cancer since 1960. Between 1960 and 1971, while at the National Cancer Institute
("NCI"), he developed and tested the first autologous cell cancer vaccines
derived from patients' own tumors. From 1971 to 1991, while a faculty member at
the University of California, Los Angeles ("UCLA"), he developed and commenced
human clinical studies of an allogeneic cellular vaccine for cancer. As a result
of these studies, Dr. Morton discovered a new concept for a vaccine for human
melanoma and other cancers. According to University procedures, in the spring of
1989, Dr. Morton submitted this invention to the Intellectual Property Division
at UCLA requesting that a patent application be filed on this discovery. The
University of California office declined to file a patent application and
according to University policy, released the rights to the invention to Dr.
Morton and informed the National Institutes of Health ("NIH") of its decision.
This created a dilemma for Dr. Morton because, due to the great cost of
obtaining FDA approval for new drugs, no biopharmaceutical company would be
likely to ever commercialize and bring to the benefit of cancer patients the
results of his life's work without the ability to obtain patent protection for
the commercial rights to the vaccine. Consequently, Dr. Morton filed the patent
application at his own expense, and in accordance with federal law, petitioned
the NIH to release the rights to the invention to him. The NIH released the
rights to Dr. Morton and a patent application was filed on November 3, 1989. The
patent
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application on the vaccine was filed prior to the formation of the Institute and
has been prosecuted at the personal expense of Dr. Morton.
C. Prior to moving to the Institute, Dr. Morton disclosed to the
Board of Directors of the Institute (the "Institute's Board") and to appropriate
individuals, including the President and CEO of Saint John's, his proprietary
interest in allogeneic cellular vaccine technology developed at UCLA and his
interest in continuing research in the field at the Institute. It was recognized
that, even though the Institute was being allowed to use the vaccine technology
for research purposes relating to melanoma, the commercialization of the
melanoma vaccine technology would be subject to any patents issued on Dr.
Morton's patent applications.
D. The Institute and Saint John's have performed additional
research on the melanoma vaccine and treated patients with it. As a result of
such activities and scientific medical publications, the Institute and Saint
John's have become the largest center in the United States for treating melanoma
cancer and have received international recognition. Patients from thirty-two
(32) countries and forty-eight (48) states have been treated for melanoma cancer
at Saint John's using the melanoma vaccine.
E. The Institute and CancerVax, Inc., a California corporation
("CancerVax, Inc.") entered into that certain Cross-License Agreement dated as
of July 24, 1998 (the "Cross-License Agreement") relating to the melanoma
vaccine, among other things. CancerVax, Inc. has or will assign its interest in
the Cross-License Agreement to CancerVax.
F. Dr. Morton will be exclusively licensing, directly or
indirectly, all of his interest in the melanoma vaccine technology (including
patents, patent applications and related vaccine cell lines) to CancerVax, which
has the right to sublicense them.
G. The Institute applied to the NCI for research funds to
undertake clinical trials with the melanoma vaccine and was granted funding by
the NCI of more than Thirty Four Million Dollars ($34,000,000) to carry out
Phase III multicenter trials with the melanoma vaccine in patients with Stage
III or Stage IV melanoma.
H. The Institute leased property commonly known as Suite 100 of
the Marina Business Center, located at 4503 Glencoe Avenue, Marina Del Rey,
California (the "Premises"). The Premises consists of approximately 25,600
rentable square feet and is leased pursuant to that certain Lease dated as of
July 22, 1999, by and between Spieker Properties, L.P. ("Spieker"), as landlord,
and the Institute, as tenant (the "Lease").
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I. In order to manufacture the melanoma vaccine according to FDA
specifications under Good Manufacturing Practices for use in clinical trials,
the Institute has constructed or planned to construct certain improvements
("Improvements") to the Premises. The Institute desires that, subject to the
terms and conditions of this Agreement: (a) the Institute's interest under the
Lease be assigned to and assumed by CancerVax; and (b) CancerVax take over the
construction of the Improvements and assume all obligations associated with such
construction.
J. CancerVax has agreed to assume the obligations of the
Institute under the Lease and with respect to the construction of the
Improvements subject to the terms and conditions of this Agreement.
K. Because Dr. Morton is a principal shareholder, officer, and
director of CancerVax, as well as an officer and director of the Institute, this
Agreement has been reviewed and recommended by an independent special committee
of the Institute's Board (with the advice of consultants and legal counsel
representing the Institute and Dr. Morton) and approved by the independent
members of the Institute's Board. To avoid any perception of conflict of
interest, Dr. Morton has taken a 6-month leave of absence from his duties as an
officer and director of the Institute during the time period this Agreement is
being completed and various other contractual relationships or other
arrangements between the Institute and CancerVax are being completed.
NOW, THEREFORE, in reliance on the preceding recitals, and in
consideration of the terms and conditions of this Agreement, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties hereby agree as follows:
I. ASSIGNMENT OF LEASE
1.1 Assignment and Assumption of Lease. The Institute hereby
assigns as of the Effective Date (defined below) to CancerVax all of the
Institute's right, title, interest, and obligations under the Lease, and
CancerVax hereby accepts such assignment and assumes all of the Institute's
right, title, interest and obligations under the Lease. CancerVax further agrees
as of the Effective Date to keep, perform, comply with, and fulfill all the
terms, representations, agreements, covenants, conditions, and obligations
required to be kept, performed and fulfilled by the Institute under the Lease,
including the timely payment of all amounts due by the tenant under the Lease.
CancerVax, through the officer executing this instrument on its behalf,
acknowledges that it has received a counterpart original or a copy of the Lease,
that it has read the Lease, and that it understands the Lease terms including
all obligations which CancerVax will be required to perform under the Lease.
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1.2 No Modification. CancerVax hereby agrees that it will not
amend or modify the Lease without the prior written consent of the Institute,
which consent will not be unreasonably withheld; provided that this Section 1.2
will have no further force or effect after the date on which the Institute is
relieved from liability under the Lease.
1.3 Notice to Landlord. The Parties acknowledge and agree that,
under the terms of Section 21(F) of the Lease, written notice of this assignment
must be provided to Spieker thirty (30) days before the Lease assignment. The
Parties hereby acknowledge that the Institute has delivered such notice, and the
Parties will provide any financial or other information reasonably requested by
Spieker in connection with the Lease assignment.
1.4 Release of Liability. CancerVax acknowledges that the
Institute will request that Spieker agree to release the Institute from
liability under the Lease as of the Effective Date. CancerVax agrees to use
commercially reasonable efforts to assist the Institute in obtaining such a
release, including the execution of documents reasonably requested by Spieker;
provided that CancerVax will not be required to incur costs or liabilities in
connection with the release in addition to the monetary obligations and
liabilities it is incurring or assuming in this Agreement. The Institute agrees
to use its best efforts to cause Spieker to consent to the assignment of the
Lease from the Institute to CancerVax; provided, however, that the Institute
shall not be required to expend any funds in connection with such efforts.
1.5 Condition of the Premises. The Premises will be delivered to
CancerVax by the Institute in an "As Is" condition, without representations or
warranties relating to its condition or suitability for any particular use.
1.6 CancerVax Indemnity. CancerVax hereby agrees to indemnify,
defend, and hold harmless the Institute and the Institute's officers, directors,
and employees from any costs, claims, liabilities, damages, or expenses
(including reasonable attorneys' fees) arising from: (i) CancerVax's breach of
the Lease or failure to perform any obligation of the tenant under the Lease
after the Effective Date; and (ii) third party claims arising from the Premises
after the Effective Date.
1.7 Institute Indemnity. The Institute hereby agrees to indemnify,
defend, and hold harmless CancerVax and CancerVax's officers, directors,
employees, and affiliates from any costs, claims, liabilities, damages, or
expenses (including reasonable attorneys' fees) arising from: (i) the
Institute's breach of the Lease or failure to perform any obligation of the
tenant under the Lease prior to the Effective Date; and (ii) third party claims
arising from the Premises prior to the Effective Date.
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II. LETTER OF CREDIT
Within five (5) business days following the timely satisfaction or
written waiver of all of the Conditions Precedent except for the Condition
Precedent (defined below) set forth in Section 5.1 (a), below, CancerVax shall
issue in favor of Spieker and deliver to Spieker a letter of credit (the
"CancerVax Letter of Credit") in the amount of Three Hundred Fifty Thousand
Dollars ($350,000) and shall request Spieker to return to the Institute or
cancel the letter of credit currently held by Spieker pursuant to Section 39G of
the Lease (the "Institute Letter of Credit").
III. CONSTRUCTION OF THE PREMISES
3.1 Assumption of Obligations. As of the Effective Date, CancerVax
will assume all of the Institute's obligations and costs associated with the
construction of the Improvements. CancerVax's obligations will include, without
limitation, obtaining Spieker's approval as required under the Lease, finalizing
the plans and specifications, obtaining any requisite permits and certificates
from applicable governmental agencies, and completing construction of the
Improvements in accordance with such plans and specifications and permits.
CancerVax must comply with the applicable provisions of the Lease and the
attached work letter relating to the construction of the Improvements.
3.2 Contracts. CancerVax will assume the Institute's position
under all construction contracts, architect contracts, maintenance contracts,
security contracts, or other contracts relating to the Premises (collectively,
the "Contracts") pursuant to that certain Assignment of Contracts, the form of
which is attached hereto as Exhibit "A". The Parties will use good faith efforts
to obtain the consent of any third party that has the right to consent to an
assignment of a Contract.
IV. REPRESENTATIONS AND WARRANTIES
4.1 Institute Representations and Warranties.
The Institute hereby represents and warrants to CancerVax that the
following statements in this Section 4.1 are true, correct, and complete as of
the Effective Date:
(a) The Institute has the full capacity, power, authority, and
legal right to perform the obligations of the Institute under this Agreement.
The person executing this Agreement on behalf of the Institute has the legal
power and authority to bind the Institute to the terms and conditions of this
Agreement.
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(b) To the Institute's knowledge, it is not in default under the
Lease nor would it be in default under the Lease with the passage of time or the
giving of notice or both. Additionally, to the Institute's knowledge, it has
received no notice from Spieker that it is in default under the Lease or that it
would be in default under the Lease with the giving of notice or the passage of
time or both.
(c) The Institute has not previously assigned, conveyed,
transferred, or encumbered the Lease.
For purposes of this Section 4.1, the term "the Institute's knowledge," means
the actual knowledge, without duty of inquiry, of Dr. James Hardin (the
Institute's Executive Vice President and Chief Operating Officer), the Chief
Financial Officer of the Institute, and all other members of the Institute's
Board. If any of the representations or warranties in this Section 4.1 are not
true as of the Effective Date, but Dr. Morton or Bill Minshall know that such
representations or warranties are untrue, or the actions of Dr. Morton or Mr.
Minshall have caused them to be untrue, then the Institute will have no
liability for the fact that such representations or warranties are untrue.
4.2 CancerVax Representations and Warranties. CancerVax hereby
represents and warrants to the Institute that CancerVax has the full capacity,
power, and authority and legal right to perform the obligations of CancerVax
under this Agreement. The person executing this Agreement on behalf of CancerVax
has the legal power and authority to bind CancerVax to the terms and conditions
of this Agreement.
V. CONDITIONS PRECEDENT
5.1 Institute's Conditions Precedent. The following are conditions
precedent to the Institute's obligation to assign the Lease and the Contracts to
CancerVax, and to satisfy its other obligations under this Agreement.
(a) Letter of Credit. CancerVax must have delivered the
CancerVax Letter of Credit to Spieker, and Spieker must have cancelled
the Institute Letter of Credit or otherwise released the Institute from
its obligations under the Institute Letter of Credit.
(b) Transfer Agreements. CancerVax must have executed and
delivered to the Institute the Assignment of Contracts, and all parties
to the Contracts with a right to consent to an assignment to CancerVax
will have consented to the assignment.
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(c) Representations and Warranties. The representations
and warranties made by CancerVax in this Agreement shall be true and
correct as of the Effective Date.
(d) CL Assignment and Reimbursement Agreements. The
following documents shall have been fully executed: (i) that certain
Assignment of Cross-License Agreement dated of even date herewith by,
among others, the Institute and CancerVax (the "CL Amendment"); and
(ii) that certain Reimbursement Agreement dated of even date herewith
by and among the Institute and CancerVax (the "Reimbursement
Agreement").
The Institute may, in its sole discretion, agree in writing to waive
any of the above conditions, but such waiver will not affect the Institute's
right to require the satisfaction of the other conditions precedent in this
Section 5.1.
5.2 CancerVax's Conditions Precedent. The following are conditions
precedent to CancerVax's obligation to assume the obligations under the Lease
and the Contracts, to pay the funds it is required to pay under this Agreement,
and to satisfy its other obligations under this Agreement.
(a) Transfer Agreements. The Institute must have executed
and delivered to CancerVax the Assignment of Contracts, and all parties
to the Contracts with a right to consent to an assignment to CancerVax
must have consented to the assignment.
(b) Spieker's Consent. Spieker must have consented to the
assignment of the Lease to CancerVax in form and substance reasonably
acceptable to CancerVax.
(c) Representations and Warranties. The representations
and warranties made by the Institute in this Agreement shall be true
and correct as of the Effective Date.
(d) CL Amendment and Reimbursement Agreements. The CL
Amendment and the Reimbursement Agreement must be fully executed.
CancerVax may, in its sole discretion, agree in writing to waive any of
the above conditions, but such waiver will not affect CancerVax's right to
require the satisfaction of the other conditions precedent in this Section 5.2.
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VI. TERMINATION
If the conditions precedent set forth in Sections 5.1 and 5.2, above
(collectively the "Conditions Precedent"), are not satisfied, or waived in
writing by the Party entitled to waive such conditions, on or before forty (40)
days from the date of this Agreement, then the Parties will have no further
obligation to each other with respect to the terms of this Agreement, and this
Agreement will have no further force or effect. The date when the last of the
Conditions Precedent are satisfied, or waived in writing by the Party entitled
to waive such Conditions Precedent, shall be the "Effective Date". Upon the
occurrence of the Effective Date, the Parties shall execute a letter agreement
acknowledging the Effective Date.
VII. MISCELLANEOUS
7.1 No Assignment. Neither Party may assign its rights or
obligations under this Agreement without the prior written consent of the other
Party, which consent may be withheld in the absolute discretion of the Party who
does not intend to assign this Agreement. Subject to the foregoing, all of the
terms, obligations, and provisions of this Agreement shall be binding upon and
inure to the benefit of the Parties hereto and their respective transferees,
successors and assigns.
7.2 Governing Law. This Agreement shall in all respects be
governed by the laws of the State of California.
7.3 Entire Agreement. This Agreement, together with the exhibits
attached hereto contains all the agreements of the parties hereto and supersedes
any previous negotiations, discussions, or agreements relating to the Lease and
the subject matter of this Agreement. The Parties acknowledge that the Parties
have made no representations or warranties relating to the subject matter of
this Agreement other than those expressly set forth in this Agreement and the
exhibits.
7.4 Modification. This Agreement may not be modified except by a
written instrument signed by the Parties hereto.
7.5 Severability. If for any reason whatsoever, any of the
provisions hereof are held to be unenforceable or invalid by any court or
arbitrator of competent jurisdiction, then all of the other provisions shall be
and remain in full force and effect and be unaffected by such holding.
7.6 Drafting and Determination Presumption. The Parties
acknowledge that this Agreement has been agreed to by all the Parties, that each
Party has consulted with attorneys with respect to the terms of this Agreement
and its exhibits. No presumption will be created against either Party because of
its role in drafting this
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Agreement. Except as otherwise specifically set forth in this Agreement, if
either Party fails to respond to any request for its consent within a specified
time period, that Party will be deemed to have disapproved such request.
7.7 Exhibits. The exhibits attached hereto are hereby incorporated
herein by this reference and made a part of this Agreement as though fully set
forth herein.
7.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original.
7.9 Notices. Any notice or other communication required or
permitted hereunder shall be sufficiently given if sent by (i) registered,
certified or first class United States mail if mailed from Los Angeles County,
postage prepaid, (ii) reputable overnight private delivery service generally
used for business purposes, or (iii) personal delivery, addressed as follows:
If to the Institute:
John Wayne Cancer Institute
2200 Santa Monica Boulevard
Santa Monica, California 90404
Attn: Dr. James Hardin
Fax: (310)683-7185
With a copy to:
Munger, Tolles & Olson LLP
355 South Grand Avenue, Suite 3500
Los Angeles, California 90071-1560
Attn: Dana S. Treister, Esq.
Fax: (310)683-4076
If to CancerVax:
CancerVax Corporation
P.O. Box 1089
Pacific Palisades, California 90272
Attn: Anthony Maida
Fax: (310)377-0903
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With a copy to:
Perkins Coie, LLP
1620 26th Street, Suite 600
Santa Monica, California 90404
Attn: Mark Birnbaum, Esq.
Fax: (310)788-3399
or such other address as shall be furnished in writing by either Party, and such
notice or communication shall be deemed to have been received as of three (3)
business days after the date so mailed if sent by United States mail, one (1)
business day after the date sent if sent by overnight delivery service, or on
the date so delivered if delivered in person before 5:00 P.M. Los Angeles time.
7.10 Time is of the Essence. Time is of the essence in this
Agreement.
7.11 Rights Cumulative; No Waiver. All of the Parties' rights,
privileges and elections of remedies are cumulative and not alternative, to the
extent permitted by law and except as otherwise provided herein. No waiver by
either party of any of its rights or remedies hereunder shall be effective
unless such waiver is set forth in writing. Additionally, no waiver by either
party of any of its rights or remedies hereunder shall be considered a waiver of
any other right or remedy.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized officers as of the day and year first above
written.
JOHN WAYNE CANCER INSTITUTE,
a California non-profit corporation
By: /s/ James W. Hardin
----------------------------------
Name: Dr. James Hardin
Title: Chief Operating Officer and
Executive Vice President
CANCERVAX CORPORATION, a
Delaware corporation
By: /s/ Anthony Maida
----------------------------------
Name: Anthony Maida
Title: President
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EXHIBIT "A"
ASSIGNMENT OF CONTRACTS
THIS ASSIGNMENT OF CONTRACTS (this "ASSIGNMENT") is made as of
___________________________________________, 2000, by and between JOHN WAYNE
CANCER INSTITUTE, a non-profit corporation ("Assignor") and CANCERVAX
CORPORATION, a Delaware corporation ("Assignee").
RECITALS
Whereas, Assignor leases that certain premises commonly known as Suite
100 of the Marina Business Center, located at 4503 Glencoe Avenue, Marina Del
Rey, California ("Premises") pursuant to a lease between Assignor, as tenant,
and Spieker Properties, as landlord, dated as of July 22, 1999 ("Lease"); and
Whereas, Assignor and Assignee have entered into that certain Agreement
of Lease Assignment, dated______________________, pursuant to which Assignor has
agreed to assign the Lease to Assignee, and Assignee has agreed to assume all of
Assignor's liabilities in connection with the construction of the Premises and
assume Assignor's position under the Contracts (defined below).
AGREEMENT
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and
sufficiency of which are hereby acknowledged, Assignor hereby transfers and
assigns unto Assignee all of Assignor's right, title and interest in, to and
under the contracts and agreements described in Exhibit 1 ("Contracts") attached
hereto and incorporated herein by this reference.
Assignor hereby agrees to indemnify, protect, defend and hold
Assignee harmless from and against any and all claims, demands, damages, losses,
liabilities, costs and expenses (including reasonable attorneys' fees) arising
in connection with the Contracts if the action giving rise to such claims,
demands, damages, losses, liabilities, costs and expenses occurred before the
date hereof. Assignee hereby accepts the foregoing assignment and agrees to
assume any executory obligations of Assignor in connection with the Contracts
and to indemnify, protect, defend and hold Assignor harmless from and against
any and all claims, demands, damages, losses,
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liabilities, costs and expenses (including reasonable attorneys' fees) arising
in connection with the Contracts if the action giving rise to such claims,
demands, damages, losses, liabilities, costs and expenses occurs after the date
hereof.
Assignor hereby covenants that it will, at any time and from
time to time upon written request therefor, at Assignee's sole expense and
without the assumption of any additional liability therefor, execute and deliver
to Assignee, and its successors and assigns, any new or confirmatory instruments
and take such further acts as Assignee may reasonably request to fully evidence
the assignment contained herein and to enable Assignee, and its successors and
assigns, to fully realize and enjoy the rights and interests assigned hereby.
The provisions of this Assignment shall be binding upon, and
shall inure to the benefit of, the successors and assigns of Assignor and
Assignee, respectively.
This Assignment may be executed in any number of counterparts,
each of which will be deemed an original, but all of which when taken together
will constitute one and the same instrument. The signature page of any
counterpart may be detached therefrom without impairing the legal effect of the
signature(s) thereon, provided such signature page is attached to any other
counterpart identical thereto except having additional signature pages executed
by other parties to this Assignment attached thereto.
IN WITNESS WHEREOF, Assignor and Assignee have caused their
duly authorized representatives to execute this Assignment as of the date first
above written.
Assignor
JOHN WAYNE CANCER INSTITUTE
By: ________________________________________
Name: Dr. James Hardin
Title: Chief Operating Officer and
Executive Vice President
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Assignee
CANCERVAX CORPORATON
By: ________________________________________
Name: Anthony Maida
Title: President
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EXHIBIT "1"
[List Contracts]
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CERTIFICATE REGARDING EFFECTIVE DATE
This CERTIFICATE REGARDING EFFECTIVE DATE (this "Certificate"), dated
as of September 19, 2000, is by and between John Wayne Cancer Institute, a
non-profit corporation (the "Institute"), and CancerVax Corporation, a Delaware
corporation ("CancerVax").
RECITALS
A. The Institute and CancerVax entered into that certain
Agreement of Lease Assignment dated August 4, 2000 (the "Assignment").
B. Pursuant to the Assignment, the Institute and CancerVax have
agreed to execute this Certificate acknowledging the date when the last of the
Conditions Precedent are satisfied, or waived in writing by the Party entitled
to waive such Conditions Precedent (the "Effective Date").
NOW, THEREFORE, the Institute and CancerVax hereby agree as follows:
1. Definitions. All capitalized terms not specifically defined
in this Certificate shall have the meanings assigned to them in the Assignment.
2. Effective Date. The Effective Date is September 7, 2000.
IN WITNESS WHEREOF, the Parties hereto have caused this Certificate to
be executed by their duly authorized officers as of the day and year first above
written.
JOHN WAYNE CANCER INSTITUTE
By: /s/ James W. Hardin
-------------------------------
Name: Dr. James Hardin
Title: Chief Operating Officer and
Executive Vice President
CANCERVAX CORPORATION
By: /s/ Anthony Maida
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Name: Anthony Maida
Title: President