Item 1.01
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Entry into a Material Definitive Agreement.
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Lease Agreement
On January 31, 2019,
Gritstone Oncology, Inc. (the Company) entered into an Office/Laboratory Lease (the New Lease), effective as of January 28, 2019, with Emery Station West, LLC (the Landlord) to lease approximately 34,469
square feet of office and laboratory space located at 5959 Horton Street, Emeryville, California 94608 (the Premises) for the Companys new principal executive offices.
The term of the New Lease (the Lease Term) commences on the earlier of (i) the date on which the Landlord delivers the newly constructed
Premises, substantially completed, and tenders possession to the Company of, the Premises or (ii) the date upon which the Company, with the Landlords consent, takes possession of any portion of the Premises to commence construction of
certain tenant improvements (the Commencement Date). Beginning on the earlier of (x) 270 days after the Commencement Date or (y) the date on which the Company opens for business in any portion of the Premises (the Rent
Commencement Date), the New Lease provides for annual base rent of approximately $1.7 million, which increases on a yearly basis up to approximately $2.6 million for the final 12 months of the initial Lease Term (the Initial
Lease Term). In addition, the Company deposited with the Landlord a security deposit of approximately $0.6 million, equal to three months base rent.
The Initial Lease Term terminates on the last day of the 120th calendar month following the Rent Commencement Date, unless terminated earlier in accordance
with the New Lease. The Company has the option to extend the Lease Term for two consecutive additional five year terms (the Renewal Terms). The New Lease provides for the base rent during the applicable Renewal Term to be calculated
based on the fair market rental value of the Premises at such time, as described in the New Lease. The Company will also be obligated to pay to the Landlord for certain costs, taxes and operating expenses related with the New Lease and the Premises,
subject to certain exclusions.
Under the New Lease, the Landlord will provide the Company with an improvement allowance of up to approximately
$4.0 million in the aggregate for costs relating to the design, permitting and construction of improvements that are permanently affixed to the Premises.
Lease Termination Agreement
On January 31,
2019, the Company also entered into a Lease Termination Agreement (the Termination Agreement), effective as of January 28, 2019, with Emery Station Joint Venture, LLC (the Current Landlord), pursuant to which the Company
and the Current Landlord agreed to early terminate the Companys lease, dated November 23, 2015, as subsequently amended (the Current Lease), of the premises located at 5858 Horton Street, Emeryville, California 94608 (the
Current Premises). Pursuant to the Termination Agreement, the Current Lease will terminate effective no later than 60 days after the Rent Commencement Date under the New Lease. In the event that the Company is deemed to hold over in
possession of the Current Premises, the Company will be liable for 150% of the monthly base rent under the Current Lease and 100% of any increases for rent adjustments, as reasonably determined by the Current Landlord.
The foregoing descriptions of the New Lease and the Termination Agreement do not purport to be complete and are subject to, and qualified in their entirety by
reference to, the full terms of the New Lease and the Termination Agreement, copies of which are filed as Exhibits 10.1 and 10.2 to this Current Report on Form
8-K,
and are incorporated by reference herein.