KV PHARMACEUTICAL COMPANY
February 17, 1997
Xxxx X. Xxxxxxxx
General Partner
Xxxx Xxxxxxx
c/o KV Pharmaceutical Company
0000 Xxxxx Xxxxxx Xxxx
Xx. Xxxxx, XX 00000
RE: Lease of 0000 Xxxxx Xxxxxx Xxxx
Dear Xxxx:
Reference is hereby made to the Commercial Lease (the "Lease") dated March 11,
1971 for the premises located at 0000 Xxxxx Xxxxxx Xxxx, Xxxxxxxxx, XX 00000
(the "Premises"), as amended by the Supplement to the Lease, dated November 9,
1972, entered into by your predecessor-in-interest in the Premises, as Landlord
and KV Pharmaceutical Company, as tenant, and by letter agreement dated November
12, 1979 and five (5) year extension dated November 20, 1986 to the term of the
Lease through December 31, 1991 signed by you and KV Pharmaceutical Company and
a five (5) year extension dated November 20, 1991 to the term of the lease
signed by you and the Company, and a five (5) year extension to the term of the
Lease through December 31, 2001.
KV Pharmaceutical Company has a need for additional office and lab space at the
0000 Xxxxx Xxxxxx location. The Landlord is not currently in a position to
finance such an expansion, but is willing to entertain a proposal to expand such
facilities by the tenant and grant certain lease concessions to the tenant as
consideration for the investment by KV. The cost of the expansion approximates
$1,800,000.
In consideration of the tenant investing in the proposed improvements, Xxxxxxxx
agrees to an addendum to the lease to reflect the following:
1. The expiration date of the lease extension effective January
1, 1997 shall be extended to December 31, 2006.
2. One additional five (5) year option to extend the term of the lease
beginning January 1, 2007 shall be added under the same terms as the
prior lease extensions.
3. KV shall have a right of first refusal to purchase the property upon
notification of an offer to purchase the property by a bona fide third
party. KV shall have 30 calendar days to match the bona fide third
party offer.
4. Rentals for the first seven (7) years after the completion of the
construction will be at the current rate, effective January 1, 1997
(adjusted for the Consumer Price Index, U.S. City Average, All Items)
on 25,000 square feet. At the end of the seven (7) year period from
completion of construction, rentals shall be increased to a fair market
rate on the total expanded square footage of approximately 35,000
square feet, but not less than the rate per square foot being charged.
5. KV agrees that at the request of the lessor, an appraisal or third
party real estate opinion may be requested and the lease rates adjusted
to such higher rate as supported by the appraisal/opinion. Lessor may
request such appraisal/third party real estate opinion not more
frequently than once every four years.
6. If for any reason during the current lease extension or additional
option period, KV elects to vacate the premises, KV will be responsible
for remodeling the special use laboratory space up to a maximum
liability of $300,000.
Please indicate your acceptance and agreement of the terms of this letter by
signing and returning the enclosed copy of this letter to the undersigned.
Very truly yours,
KV PHARMACEUTICAL COMPANY
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
Vice President, Finance
Accepted and agreed:
/s/ Xxxx X. Xxxxxxxx 2/17/97
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Xxxx X. Xxxxxxxx Date
