SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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|Item 1.01.|| |
Entry into a Material Definitive Agreement.
On July 7, 2022, NGM Biopharmaceuticals, Inc. (the “Company”), entered into a lease agreement (the “Lease”) with HCP BTC, LLC (the “Landlord”), pursuant to which the Company agreed to lease from Landlord approximately 121,706 rentable square feet located at 333 Oyster Point Boulevard, South San Francisco, California 94080 (the “Premises”), consisting of general office, research and development, engineering, laboratory, vivarium, and storage or warehouse space. The Company currently occupies the Premises pursuant to a sublease agreement that is scheduled to expire on December 31, 2023.
The term of the Lease (the “Initial Term”) will commence on January 1, 2024 and will expire December 31, 2033, unless earlier terminated pursuant to the terms of the Lease. The Company will be obligated to pay $900,624.40 in monthly base rent for the first year of the Initial Term, which shall increase at an annual rate of 3.5% each year thereafter. No base rent is due for the first three full calendar months of the Initial Term. In addition to the base rent, the Company shall be obligated to pay its share of operating and tax expenses as specified under the terms of the Lease. The Company is entitled to an allowance of approximately $4.9 million for tenant improvements. Pursuant to the Lease, the Company also has the right of first offer with respect to any space located in the building with an address of 331 Oyster Point Boulevard. The Company must execute this right within the first five (5) years of the Initial Term.
The Company is obligated to provide Landlord an irrevocable letter of credit in the amount of approximately $2.5 million which Landlord may draw from upon the occurrence of certain events outlined in the Lease. This letter of credit or any renewal thereof or substitute therefor shall not be deemed to be or treated as a “security deposit” under any applicable law. The Company, and any permitted transferee or permitted assignee of the Company, has the option to extend the term of the Lease for a period of either eight (8) or ten (10) years (as applicable, the “Option Term”) beyond the Initial Term, provided that no more than fifteen (15) months’ and no less than twelve (12) months’ prior written notice is given to Landlord. The rental rate for the Option Term would be subject to market adjustment. In the event of a default of certain of the Company’s obligations under the Lease, Landlord would have the right to terminate the Lease.
The foregoing description of the material terms of the Lease does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full terms of the Lease. The Company intends to file a copy of the Lease with the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022.
|Item 2.03.|| |
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 above is incorporated by reference herein.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|NGM Biopharmaceuticals, Inc.|
|Dated: July 13, 2022||By:|
|Valerie L. Pierce|
|Senior Vice President and General Counsel|