Exhibit 10.28
ADDENDUM X TO THE LEASE AGREEMENT BY AND BETWEEN
MAIN LINK BUSINESS PARK ASSOCIATES
("Landlord")
AND
TANOX, INC. (f/k/a Tanox Biosvstems. Inc.)
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("Tenant")
DATED DECEMBER 4,1986
The Lease Agreement as defined above is hereby amended this 22nd day of October,
2001 as follows, with all obligations under this Addendum to become effective on
the date hereof, except as otherwise specified below. Landlord and Tenant
acknowledge that, except as changed by this Addendum X, the terms of the Lease
Agreement dated December 4, 1986, and Addendum II, III, IV, V, VI and VIII shall
remain in full force and effect.
Section 1 - Premises: The original Lease Premises of 4,832 square feet,
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expanded by 8,013 square feet in Addendum II to the Lease Agreement, and
an additional 6,569 square feet in Addendum III to the Lease Agreement,
and an additional 7,342 square feet in Addendum V to the Lease Agreement,
and an additional 8,868 square feet in Addendum VIII to the Lease
Agreement, shall be further expanded by 6,504 square feet ("Expansion"),
as shown on the attached Exhibit "A". The entire Lease Premises as of the
date of this Addendum X to the Lease Agreement shall be 42,128 square
feet.
Section 2 - Term: The Commencement Date for the 42,128 square feet shall
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be April 1, 2002 and shall expire sixty (60) months following such date on
March 31, 2007.
Section 3 - Rent: The monthly rent for the 42,128 square feet, payable in
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accordance with the terms of the Lease Agreement, shall be $29,489.60
through March 31, 2007, for a total lease contract amount of
$1,769,376.00. Such rental shall not be subject to C.P.I. escalation.
Section 3 (a) - Additional Rent; Insert the following:
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Tenant shall pay to Landlord, as an inducement for Landlord granting
Tenant the two (2) additional five (5) year renewal options contained
herein, additional rent equal to $100,000.00 to be amortized at 8% per
annum over twelve equal monthly rental payments of $8,698.84 commencing
April 1, 2002.
Addendum X - Tanox, Inc.
Page 2
Section 4 - Maintenance: The second sentence in Paragraph 2 shall be
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amended to read "Tenant agrees to reimburse to Landlord for such
maintenance and service at the rate of $10.00 per 1,000 square feet, in
the amount of $421.74 per month as additional rent." This represents a
CAM increase of $65.50 for Addendum X, in addition to the $88.68 for
Addendum VIII, $73.42 for Addendum V, $65.69 for Addendum IV, $80.13 for
Addendum II and $48.32 for the original space."
Section 6 - Taxes: The following shall replace the first sentence in the
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paragraph: "Landlord agrees to pay all ad valorem taxes, real estate and
personal property taxes up to a maximum amount of the taxes for the Base
Year 2000 ($48,557.60), assessed against the property and improvements
located thereon. Should the Landlord's cost exceed the Base Year 2000,
then tenant agrees to pay to Landlord, as additional rent, Tenant's pro
rata share of the amount of such excess each year."
Section 10 - Insurance: The following shall replace the second and third
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sentence in Paragraph 2 and apply to the total premises of 42,128 square
feet: "Should the Landlord's cost of maintaining insurance herein exceed
the Base Year 2001 cost ($5,077.00), then Tenant agrees to pay to
Landlord, as additional rent, Tenant's pro rata share of the amount of
such excess each year."
Section 13 - Miscellaneous: Delete all Addendum provisions for renewal
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options, expansion options, etc., and add:
Section 13 - Miscellaneous;
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(c) Renewal Option:
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Tenant shall have the right to extend the term of the Lease subject to
all of the same terms, covenants and conditions for two (2) additional
periods of five (5) years, commencing on the day after the last day of
the Addendum X term. The rental rate for each renewal term shall be the
prevailing Fair Market Value (as defined below) at the time of the
notice, but in no event shall such rate be less than a ten (10) percent
increase over the previous lease term rate per square foot, per month,
nor greater than a thirty (30) percent per square foot, per month,
including operating expenses as defined in the Lease for the year in
which the renewal term commences.
The Fair Market Value ("FMV") shall mean the average of the annual rental
rates being charged for space of comparable size and condition in
comparable buildings in Houston, Texas, taking into consideration use,
location within the applicable building, definition of rentable area, the
time the applicable rate first became effective, term, building standard
leasehold improvements provided or to be provided, quality, age and
location of applicable building, and rental concessions.
Addendum X - Tanox, Inc.
Page 3
In order to exercise such renewal option, Tenant shall advise Landlord in
writing of its desire to renew, no more than nine (9) months and no less
than six (6) months prior to the end of the original term. Within fifteen
(15) days thereafter, Landlord shall advise Tenant in writing of its
estimation of the FMV applicable during the renewal term. Within thirty
(30) days after Tenant has received such rental information from
Landlord, Tenant shall give Landlord written notice of its agreement or
disagreement with Landlord's estimation of FMV.
In the event Tenant and Landlord are able to reach a written agreement
regarding FMV within such thirty (30) day period, Tenant shall thereafter
have fifteen (15) days to notify Landlord in writing of the exercise of
the Renewal option.
In the event Tenant and Landlord are unable to agree on the FMV within
such thirty (30) day period, the FMV shall be determined as follows:
Landlord and Tenant shall each appoint an appraiser who is knowledgeable
in commercial property values in the area in which the Premises are
located and the two appraisers shall, within ten (10) days after their
selection, agree upon the FMV of the Premises. If they are unable to
agree, they shall appoint a third appraiser with the same qualifications
and the three appraisers shall then, within fifteen (15) days thereafter,
prepare appraisals of the Premises for the Second Option Period;
provided, however, that if any appraiser's estimate is either (a) less
than ninety percent (90%) of the average figure, or (b) more than one
hundred ten percent (110%) of such average, then the FMV of the Premises
will be the average of the remaining figures which are between ninety
percent (90%) and one hundred ten percent (110%), otherwise, the middle
figure of the three appraisals shall be the FMV even if the middle figure
is the same as the higher or lower figure. Landlord and Tenant shall
each bear the cost of its appraiser and shall share equally the cost of
the third.
After the FMV has been determined in accordance with such appraisal
procedures, Landlord shall advise Tenant in writing of the rental rate
for the renewal term as determined by such appraisal, subject, if
applicable, to the limitations set forth above. Tenant shall thereafter
have fifteen (15) days to notify Landlord in writing of the exercise of
the Renewal option.
Failure of Tenant to give the appropriate written notice within the
specified periods of time, as provided above, shall cause the Renewal
option to be void and of no further effect.
Addendum X - Tanox, Inc.
Page 4
(d) Security:
The Letter of Credit obligations defined in Paragraph 4 of Addendum IV
and Paragraph 4 of the Lease Agreement shall be deleted in entirety and
of no further force and effect.
This Addendum X and the Lease Agreement dated December 4, 1986, and
Addendum II, III, IV, V, VI and VIII to the Lease Agreement constitute
the entire understanding between the parties with regard to leasing space
at ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇. Default
under any of the aforesaid agreements will constitute default under all
of the agreements.
Except for the foregoing changes, all of the covenants, terms and
conditions of the prior Lease Agreement, and Addendum II, III, IV, V, VI
and VIII remain the same.
MAIN LINK BUSINESS PARK ASSOCIATES
(Landlord)
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Attest: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President, Amega Corporation
Managing General Partner
TANOX, INC.
(Tenant)
By: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Attest: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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Print: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: VP, Finance and CFO