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EXHIBIT 10.25
THIRD AMENDMENT OF LEASE
THIS THIRD AMENDMENT OF LEASE (this "Amendment") is made this 1 day of
August, 1997 but shall be deemed effective as of June 1, 1997 (the "Effective
Date") by and between M.O.R. COLUMBIA LIMITED PARTNERSHIP, a Maryland limited
partnership ("Landlord") and MARTEK BIOSCIENCES CORPORATION, a Delaware
corporation ("Tenant").
INTRODUCTION
A. Landlord's predecessor in title, Aetna Life Insurance Company,
and Tenant entered into a Lease dated August 15, 1992 (the "Original Lease"),
whereby Tenant agreed to lease twenty-seven thousand one hundred fifty (27,150)
square feet (the "Original Leased Premises") in a building known as Building K
(the "Building") in an office and research and development complex known as
"Columbia Business Center" in Xxxxxx County, Maryland. The Original Lease was
amended by a Lease Modification Agreement (the "First Amendment") dated October
14, 1993 and by a Second Lease Modification Agreement (the "Second Amendment")
dated September 22, 1994. The Original Lease, as amended by the First
Amendment and the Second Amendment, is herein collectively referred to as the
"Lease."
B. Pursuant to the various expansion rights of Tenant set forth
in Article 50 of the Lease, Tenant expanded the Original Leased Premises by a
total of twelve thousand five hundred fifty-four (12,554) square feet (the
"Expansion Space") so that, as of this date, Tenant leases a total amount of
space equal to thirty-nine thousand seven hundred four square feet (39,704)
(the "Leased Premises").
C. Pursuant to a Consent to Sublease of Lease by and among
Landlord, Tenant and Fidelity Mortgage and Finance Co. ("Sub-Tenant"), dated
November 4, 1996, Landlord consented to the sublease by Tenant to Sub-Tenant of
six thousand two hundred seventy-one (6,271) square feet of the Leased Premises
(the "Subleased Premises").
D. But for this Amendment, the initial term of the Lease would
expire on October 31, 1998.
E. Pursuant to Article 49 of the Lease, Tenant has an option to
extend the term of the Lease. Landlord and Tenant desire to extend the term of
the Lease for a term ending November 30, 2004.
F. Unless otherwise defined herein or unless the context requires
a contrary meaning, all capitalized terms used in this Amendment shall have the
meanings given to them in the Lease.
NOW, THEREFORE, in consideration of the foregoing Introduction, which
is deemed a substantive part of this Amendment, the covenants of the parties
herein and in the Lease and
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other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Landlord and Tenant hereby agree as follows:
1. TERM. The term of the Lease is hereby extended for a term
commencing as of June 1, 1997 (the "Renewal Commencement Date") and terminating
at 11:59 p.m. on November 30, 2004 (the "Renewal Term"), unless otherwise
terminated in accordance with the provisions of the Lease, as amended hereby,
on the same terms and conditions as are set forth in the Lease except as
specifically set forth herein.
2. RENT. As of the Renewal Commencement Date through the Renewal
Term, Tenant shall pay Landlord Basic Annual Rent in equal monthly installments
at the times and otherwise in the manner as set forth in the Lease as follows:
RENEWAL BASIC MONTHLY RENT PER
YEAR ANNUAL RENT INSTALLMENT SQUAREFOOT
---- ----------- ----------- ----------
June 1, 1997-May 31, 1998 $322,396.48 $26,866.37 $8.12
June 1, 1998-May 31, 1999 $326,763.92 $27,230.33 $8.23
June 1, 1999-May 31, 2000 $369,247.20 $30,770.60 $9.30
June 1, 2000-May 31, 2001 $380,761.36 $31,730.11 $9.59
June 1, 2001-May 31, 2002 $392,275.52 $32,689.63 $9.88
June 1, 2002-May 31, 2003 $404,186.72 $33,682.23 $10.18
June 1, 2003-May 31, 2004 $416,494.96 $34,707.91 $10.49
June 1, 2004-November 30, 2004 $428,803.20 $35,733.60 $10.80
3. LEASE AMENDMENTS. Sections 49 and 50 of the Lease are hereby
deleted in their entireties and the following new Sections 49, 50 and 51 are
incorporated into the Lease:
"Section 49. Expansion Option.
A. Provided: (i) the Lease is in full force and
effect, (ii) Tenant is not in breach or default (beyond any applicable
cure period) of any monetary provision or material non-monetary
provisions of the Lease at the time of exercising the Expansion Option
(as hereinafter defined), and (iii) Tenant shall have given Landlord
written notice (the "Expansion Notice") at least 120 days prior to the
Expansion Commencement Date (as hereinafter defined) of Tenant's
election to exercise the Expansion Option, Tenant shall have the right
(the "Expansion Option") to lease all or any portion of any then
available space in the Building (the "Expansion Space") as long as the
space remaining in the Building after such expansion is leasable in
the Landlord's reasonable discretion and any cost to demise the
Expansion Space that exceeds Tenant's Expansion Contribution (as
hereinafter
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defined) is borne by Tenant. The Basic Annual Rent with respect to
the Expansion Space shall be the per square foot rental rate
applicable to the Leased Premises, subject to the same adjustments
during the Renewal Term, or the Additional Term (as defined below), as
the per square foot rental rate applicable to the Leased Premises, and
shall be paid at the times and in the manner as provided with respect
to, and in addition to, the monthly installments of Basic Annual Rent
with respect to the Leased Premises as set forth in the Lease. Tenant
shall have the right to lease and occupy the Expansion Space at any
time prior to May 31, 1998 (the "Expansion Commencement Date").
B. Notwithstanding any other provision hereof,
the following provisions shall apply to the Expansion Option and to
Tenant's lease, if any of the Expansion Space:
(i) Tenant shall not be entitled to exercise the
Expansion Option unless at the date Tenant gives Landlord notice of
such exercise and on the Expansion Commencement Date, Tenant is in
possession of the Leased Premises and Tenant is not in breach or
default (beyond any applicable cure period) of any monetary provision
or material non-monetary provisions of the Lease;
(ii) Tenant's rental of the Expansion Space shall
be for a term commencing on the Expansion Commencement Date, and
continuing through the balance of the Renewal Term (and of any
subsequent renewal term if Tenant shall have exercised its renewal
option pursuant hereto), under and subject to the terms of the Lease,
with the same force and effect as though this Lease had originally
provided for the rental of the Expansion Space.
(iii) Landlord shall contribute Ten Dollars
($10.00) per square foot of the Expansion Space (the "Expansion
Contribution"), for any improvements to be made by Landlord for Tenant
to the Expansion Space. At the Tenant's option, Landlord shall
competitively bid all work to be performed in the Expansion Space or
the Leased Premises in connection with such expansion. Any
improvements to be made shall be performed in accordance with
drawings, plans and specifications prepared by Tenant and approved by
Landlord, such approval shall not be unreasonably withheld or delayed.
All costs in excess of the Expansion Contribution shall be paid by
Tenant within thirty (30) days after receipt of an invoice from
Landlord therefor. In the event that Manekin Corporation is no longer
involved in the ownership or management of the Building, Tenant may
use a reputable contractor of its choice, subject to Landlord's
reasonable approval, to perform tenant improvements in the Expansion
Space or in the Leased Premises.
(iv) From and after the Expansion Commencement
Date, all references in the Lease to the Leased Premises shall refer
to the aggregate of the original Leased Premises and the Expansion
Space and all references to the area or Rentable Area of the Leased
Premises shall, for all purposes of this Lease, be
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deemed to include both the area of the original Leased Premises and of
the Expansion Space. Tenant's Portion shall be adjusted accordingly
to reflect the leasing of the Expansion Space.
(v) Except as otherwise expressly provided in
this Section 49, from and after the Expansion Commencement Date, all
of the covenants and agreements set forth in the Lease shall apply to
the Expansion Space.
Time is of the essence with respect to Tenant's exercise of
its rights under this Section 49 and Tenant acknowledges that the
Expansion Notice must be in writing and timely sent.
Section 50. Right of First Offer. Tenant shall have the
right of first offer (the "First Offer") to lease any space in the
Building as it becomes available (the "First Offer Space") at a Basic
Annual Rent equal to the price per square foot rental rate Tenant is
then paying with respect to the Leased Premises, subject to the same
adjustments during the Renewal Term, or the Additional Term, as the
per square foot rental rate applicable to the Leased Premises.
Said rent shall be payable in equal monthly installments (and
fractions thereof), at the times and subject to the terms and
conditions as provided with respect to, and in addition to, the
monthly installments of the Basic Annual Rent as set forth in this
Lease.
Tenant's exercise of its First Offer shall be effective only
upon written notification by Tenant to Landlord thereof (the
"Notice"). Such notification must be given to Landlord before the
close of business on the tenth full calendar day after Tenant's
receipt of Landlord's written notification to Tenant of the
availability of the First Offer Space and the terms on which Landlord
intends to offer the First Offer Space for rental (the "Offer"). An
Offer does not include the exercise by another tenant of its right of
renewal, refusal or expansion.
In the event Tenant fails to so notify Landlord within said
ten calendar day period, Landlord shall be free to offer said First
Offer Space to third parties and Tenant shall have no further rights
in such space.
This First Offer is personal to Tenant and shall not be
separated from the Lease or transferred by Tenant independently of the
leasehold interest without the prior written consent of Landlord.
Notwithstanding any other provision hereof, the following
provisions shall apply to the First Offer and to Tenant's lease, if
any, of the First Offer Space:
(i) Tenant shall not be entitled to exercise the
rights accorded to Tenant in the first paragraph, unless at the date
of such exercise or at the date on
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which Tenant's lease, if any, of the First Offer Space becomes
effective, Tenant is in possession of the Leased Premises and Tenant
is not in breach or default (beyond any applicable cure period) of any
monetary provision or material non-monetary provisions of the Lease;
(ii) Tenant shall have the right to lease and
occupy the First Offer Space commencing on the date set forth in
Landlord's Offer (the "First Offer Space Commencement Date"), and
terminating on the termination of the Renewal Term (or of any
subsequent renewal term if Tenant shall have exercised its renewal
option pursuant hereto), on the same terms, conditions, and provisions
as are in this Lease set forth, except to the extent modified by the
Offer, with the same force and effect as though this Lease had
originally provided for the rental of the Leased Premises and the
First Offer Space;
(iii) Landlord shall contribute for any
improvements to be made by Landlord for Tenant to the First Offer
Space (i) $10.00 per square foot of the First Offer Space if the First
Offer Space Commencement Date is on or before November 30, 2000; and
(ii) $0.17 per square foot of the First Offer Space multiplied by the
number of months remaining in the Renewal Term as of the First Offer
Space Commencement Date, if the First Offer Space Commencement Date is
after November 30, 2000 (either of which is the "Offer Contribution").
Any improvements to be made shall be performed in accordance with
drawings, plans and specifications prepared by Tenant and approved by
Landlord, such approval shall not be unreasonably withheld or delayed.
At Tenant's option, Landlord shall competitively bid all work to be
performed in the First Offer Space or the Leased Premises in
connection with such expansion. All costs in excess of the Offer
Contribution shall be paid by Tenant within thirty (30) days after
receipt of an invoice from Landlord therefor. In the event that
Manekin Corporation is no longer involved in the ownership or
management of the Building, Tenant may use a reputable contractor of
its choice, subject to Landlord's reasonable approval, to perform
tenant improvements in the First Offer Space or the Leased Premises.
(iv) The Lease shall be amended, as may be
appropriate, to reflect the leasing of the First Offer Space; and
(v) This First Offer right is subordinate to any
previously granted rights of any tenant of the Building, including,
without limitation, renewal rights, expansion rights, rights of
refusal and rights of offer, or Landlord's agreement to allow any
existing tenant of the First Offer Space to extend its Lease thereof,
whether or not such right exists currently.
Time is of the essence with respect to Tenant's exercise of
its rights under this Section 50 and Tenant acknowledges that Landlord
requires strict adherence to the requirement that the Notice be timely
made and in writing.
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Section 51. Renewal Option. Provided (i) this Lease is then
in full force and effect and, (ii) Tenant is not in breach or default
(beyond any applicable cure period) of any monetary or material
non-monetary provisions of this Lease either on the date Tenant elects
to renew or on the date the Additional Term (as defined below)
commences, Tenant shall have the right to renew this Lease for one (1)
renewal term of five (5) years (the "Additional Term"), to commence
immediately following the expiration of the Renewal Term and to end on
November 30, 2009, and to be on the same terms, conditions, and
provisions as are set forth in this Lease with the same force and
effect as though this Lease had originally provided for such an
extended term, save that:
(i) there shall be no further right of renewal,
after the Additional Term, and
(ii) the Basic Annual Rent payable with respect to
the Leased Premises during the Additional Term shall be adjusted to
reflect ninety-five percent (95%) of the prevailing rental rate for
comparable space within the market area of the Building as of the
commencement of the Additional Term (as determined below).
Tenant shall be deemed to have waived the right to exercise
this renewal option unless not less than one hundred eighty (180)
days prior to the date of termination of the Renewal Term, Tenant
shall have notified Landlord in writing of Tenant's election to renew
(the "Renewal Notice"). Landlord shall give Tenant written notice of
the prevailing rental rate within thirty (30) days after Landlord's
receipt of the Renewal Notice (the "Rent Notice"). Tenant may elect
to have the prevailing rent determined as set forth below if it does
not agree with Landlord's determination thereof by giving Landlord
written notice (the "Appraisal Notice") within ten (10) days after
Tenant's receipt of the Rent Notice.
Within five (5) business days after the Landlord receives the
Appraisal Notice from Tenant, Landlord and Tenant shall give written
notice to the other that each, at its own expense, has hired and
appointed a disinterested real estate broker of recognized competence
and professional experience as a broker of comparable commercial and
industrial real estate in the Baltimore-Washington Metropolitan Area.
The two brokers thus appointed shall mutually agree upon the
appointment of a third broker, the cost of which shall be shared
equally by Landlord and Tenant, which broker shall also be a
disinterested person of recognized competence and professional
experience as a broker of comparable commercial and industrial real
estate in the Baltimore-Washington Metropolitan Area. In the event
that the two brokers shall be unable to agree, within ten (10) days
after their appointment, on the appointment of the third broker, then
Tenant shall choose three brokers from whom Landlord shall choose one
who shall serve as the third broker. Landlord shall notify Tenant of
the selection of the third broker within ten (10) days of Tenant's
notice to
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Landlord of the selection of such three brokers from which Landlord is
to choose. The third broker shall as promptly as possible, but in no
event more than thirty (30) days after the date of his selection,
conduct an appraisal of the Building for purposes of determining the
then prevailing rental rate therein, taking into account rent
concessions then being offered in the market area. Upon completion of
his appraisal, the third broker shall immediately give written notice
to the parties hereto stating his determination, and shall furnish to
each party hereto a copy of such determination signed by him which
determination shall be final and binding on the parties.
Time is of the essence with respect to Tenant's exercise of
its rights under this Section 51 and Tenant acknowledges that Landlord
requires strict adherence to the requirement that the Renewal Notice
and Appraisal Notice be timely made and in writing.
4. AMENDMENT. From and after the date hereof, the Lease shall be
amended and in full force and effect in such respects as are set forth in this
Amendment, and all other provisions, terms, conditions and riders of and to the
Lease in all respects shall remain in full force and effect as set forth in the
Lease.
5. REAFFIRMATION. Tenant hereby reaffirms and restates, and
agrees to be bound by the covenants, promises, representations and agreements
set forth in the Lease (except to the extent that they are expressly superseded
by this Amendment) as if made herein.
6. BINDING ON SUCCESSORS. The terms and conditions contained in
this Amendment shall bind and inure to the benefit of Landlord and Tenant, and
their respective heirs, distributees, executors, administrators and other legal
and personal representatives, successors and permitted assigns.
7. AUTHORITY. Tenant represents and warrants to Landlord that
Tenant is a Delaware corporation, duly organized and in good standing and
qualified to transact business in the State of Maryland, and that the name and
address of Tenant's resident agent in Maryland are CSC Lawyers Incorporating,
00 X. Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000.
8. COMMISSIONS. Tenant represents that Tenant has dealt directly
with, and only with, Manekin Corporation and The Xxxx Xxxx Company as brokers
in connection with this Amendment, and that insofar as Tenant knows, no other
broker negotiated this Amendment or is entitled to any commissions in
connection with it. Landlord agrees to pay the commissions of Manekin
Corporation and The Xxxx Xxxx Company in accordance with its separate agreement
with said brokers. Tenant shall hold Landlord harmless from and indemnify
Landlord for any costs incurred by Landlord arising out of any other brokers'
claim that such broker has assisted Tenant with respect to this Amendment.
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9. LENDER'S CONSENT. In connection with Landlord's refinancing
of the Project with Allstate Life Insurance Company ("Lender") in December
1995, Tenant, Landlord and Lender entered into a subordination, non-disturbance
and attornment agreement (the "SNDA") and Tenant executed an estoppel
certificate (the "Certificate"). Pursuant to Section 5 of the Certificate and
Section 5 of the SNDA, Tenant acknowledged that Lender would not be bound by
any amendments to the Lease which Lender had not approved. As a result
thereof, this Amendment is specifically contingent on obtaining the Lender's
consent hereto. The parties agree to seek such consent promptly after
execution of this Amendment by Tenant and, unless such consent is granted by
Lender on or before July 31, 1997, this Amendment shall, at Tenant's or
Landlord's option, be null and void and of no further force and effect. In no
event shall this Amendment be binding upon Lender unless and until Lender
consents to its terms.
IN WITNESS WHEREOF, Landlord and Tenant have respectively signed and
sealed this Third Amendment of Lease as of the day and year first above
written, intending to be bound as of the Effective Date.
WITNESS: M.O.R. COLUMBIA LIMITED PARTNERSHIP
By: Manekin Columbia Limited Partnership
By: RA & DM, Inc.
[sig]
By: /s/ R. Colfax Xxxxxxx, Jr. [SEAL]
--------------------------
Name: R. Colfax Xxxxxxx, Jr.
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Title: Vice President
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LANDLORD
ATTEST: MARTEK BIOSCIENCES CORPORATION
/s/ Xxxxxxxx X. Xxxxxxx By: /s/ Xxxxx Xxxxxxx, Xx. [SEAL]
----------------------- ----------------------
Name: Xxxxx Xxxxxxx, Xx.
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Title: CEO
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Tenant
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STATE OF MARYLAND, COUNTY/CITY OF XXXXXX, TO WIT:
I HEREBY CERTIFY that on this 1st day of August 1997, before me, the
subscriber, a Notary Public of the State of Maryland and County/City of
Baltimore, personally appeared before me R. Colfax Xxxxxxx, Jr., known to me or
satisfactorily proven to be the person whose name is subscribed to the foregoing
instrument, who acknowledged himself/herself to be the Vice President of RA &
DM, Inc., the general partner of Manekin Columbia Limited Partnership, the
general partner of M.O.R. COLUMBIA LIMITED PARTNERSHIP, Landlord and he/she
acknowledged the foregoing Third Amendment of Lease to be the act and deed of
said limited partnership.
WITNESS my hand and notarial seal.
[sig]
------------------
Notary Public
My Commission Expires: 0-00-00
XXXXX XX XXXXXXXX,XXXXXX/XXXX XX XXXXXX, TO WIT:
I HEREBY CERTIFY that on this 3rd day of July, 1997, before me, the
subscriber, a Notary Public of the State aforesaid and County/City of Xxxxxx,
personally appeared before me Xxxxx Xxxxxxx, Xx., known to me or satisfactorily
proven to be the person whose name is subscribed to the foregoing instrument,
who acknowledged herself/himself to be the CEO of MARTEK BIOSCIENCES
CORPORATION, Tenant, and she/he acknowledged the foregoing Third Amendment of
Lease to be the act and deed of said corporation.
WITNESS my hand and notarial seal.
Xxxxxxxx X. Xxxxxxx
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Notary Public
My Commission Expires: 7/31/98
[Lender's Consent Follows]
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Lender signs below for purposes of evidencing its consent to the terms
of the above Third Amendment of Lease.
WITNESS: ALLSTATE LIFE INSURANCE COMPANY
Xxxxxx Xxxxxxx By: Xxxxxxx Xxxxx [SEAL]
--------------- ---------------------
Name: Xxxxxxx Xxxxx
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Title: Assistant Vice Pres.
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[sig] By: Xxxxxx Xxxxxx [SEAL]
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Name: Xxxxxx Xxxxxx
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Title: Regional Mgr
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its authorized signatories
Approved as of this 5 day of September, 1997.
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