Exhibit 10.18
SUBLEASE AGREEMENT
THIS SUBLEASE AGREEMENT (this "Sublease") is made as of the ____ day of
February, 1995,(but effective in all respects as of January 18, 1995) by and
between MARYLAND ECONOMIC DEVELOPMENT CORPORATION1 a body politic and corporate
and constituted as a public instrumentality of the State of Maryland
("Sublandlord") and OSIRIS THERAPEUTICS, INC., a Delaware corporation
("Subtenant").
RECITALS
A. On January __, 1995, SAGA Limited Partnership, a Maryland limited
partnership (the "Landlord") and Sublandlord executed a Lease Agreement (the
"Master Lease").
B. Pursuant to the terms of the Master Lease (a copy of which is attached
hereto as Exhibit A and incorporated herein by reference) the Landlord leased to
Sublandlord certain property located in Baltimore City, Maryland all as more
particularly described in the Master Lease (the "Premises").
C. Subtenant desires to sublease all of the Premises from Sublandlord
(the "Subleased Premises") and Sublandlord desires to sublease the Subleased
Premises to the Subtenant. The Subleased Premises consist of 30,000 square
feet, more or less, within the Building (as hereinafter defined), which is
the space to be leased by Sublandlord under the Master Lease and outlined in
Exhibit A-1,which may be increased from time to time by the incorporation of the
Expansion Premises (as hereinafter defined) in accordance with options/rights
granted to Subtenant. The actual square footage of the Subleased Premises
shall be measured in accordance with BOMA standards, and the parties hereto
agree to execute confirmatory statements (prior to the Rental Commencement Date
and in the event the square footage increases due to Subtenant's exercise of any
option rights contained herein) to record in writing the actual square footage
contained in the Subleased Premises. As used in this Sublease, the term
"Building" shall mean the building known as 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx 00000-0000, consisting of 184,962 square feet, more or less, as
measured in accordance with BOMA standards.
D. The parties desire to enter into this Sublease defining their
respective rights, duties, obligations and liabilities relating to the
Subleased Premises.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Sublandlord and Subtenant hereby
covenant and agree as follows:
l. Demised. Sublandlord hereby sublets to Subtenant and Subtenant hereby
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sublets from Sublandlord the Subleased Premises and the Parking Spaces (as
defined in the Master Lease). Except as otherwise provided herein, Subtenant
hereby assumes and agrees to perform all of the duties and
obligations imposed in respect of the Subleased Premises upon Sublandlord, as
tenant, by the Master Lease for the term of this Sublease, and it is agreed that
Sublandlord shall have all the rights and powers as Sublandlord hereunder as are
conferred upon the Landlord in the Master Lease.
2. Term. The term of this Sublease shall commence on the day upon which
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the Master Lease commences and shall terminate on ___________ 200__ (the day
which is one (1) day less than the Original Term (as defined in the Master
Lease) (the "Initial Term").
By written notice to Sublandlord not more than six (6) months nor less than
three (3) months prior to the expiration of the Initial Term, Subtenant may
extend the Initial Term for a period of six (6) years and six (6) months (the
"Extended Term") on the same terms and conditions (excluding the Annual Rent)
which apply to the Initial Term provided that Sublandlord exercises the
necessary and corresponding extension option under the Master Lease and
Subtenant is not then in default of any material term, covenant or condition of
this Sublease (or if so, such default is cured prior to the expiration of any
applicable grace period). Notwithstanding the foregoing to the contrary,
provided that (i) Sublandlord is not in default of any of its obligations under
the Master Lease or this Sublease, (ii) Landlord is not in default of any of its
obligations under the Master Lease, and (iii) indebtedness incurred in
connection with certain bond financing for the funding of certain components of
Landlord's Work will still be outstanding on the date on which the Extended Term
would commence, Subtenant shall exercise its option to extend the terms of this
Sublease for the Extended Term.
Provided that Subtenant has exercised its option to extend the term for
the Extended Term, and provided further that Sublandlord exercises the
necessary and corresponding extension option under the Master Lease and
Subtenant is not then in default of any material term, covenant or condition
of this Sublease (or if so, such default is cured prior to the expiration of
any applicable grace period), Subtenant may, by written notice to Sublandlord
(the "First Extension Notice") not more than six (6) months nor less than
three (3) months prior to the expiration of the Extended Term, extend the
Extended Term for a period of (5) years (the "First Option Term") on the same
terms and conditions which apply to the Extended Term (excluding the Annual
Rent).
Provided that Subtenant has exercised its option to extend the term for the
First Option Term, and provided further that Sublandlord exercises the necessary
and corresponding extension
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option under the Master Lease and Subtenant is not then in default of any
material term, covenant or condition of this Sublease (or if so, such default is
cured prior to the expiration of any applicable grace period), by written notice
to Sublandlord not more than six (6) months nor less than three (3) months prior
to the expiration of the First Option Term, Subtenant shall have the right to
extend the First Option Term for an additional period of five (5) years (the
"Second Option Tern") on the same terms and conditions which apply to the First
Option term (excluding the Annual Rent).
Notwithstanding anything to the contrary contained in this Sublease,
Sublandlord hereby expressly covenants and agrees that it shall, so long as it
is entitled to do so under the terms of the Master Lease, exercise each
extension or renewal option to which it is entitled under the Master Lease (at
the time and in the manner provided for in the Master Lease) which may be
necessary or appropriate to permit Subtenant to exercise each option or
extension term to which it is entitled under this Sublease.
3. Rent. Commencing on the Rental Commencement Date (as defined in the
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Master Lease), Subtenant shall, begin to pay to Sublandlord and shall continue
to pay during the remaining term of this Sublease, the Annual Rent and the
Additional Rent (as hereinafter defined). Subtenant shall pay the monthly
installments of Annual Rent in advance on the first day of each month for the
term of this Sublease without deduction, set-off, recoupment, counterclaim, or
demand, at Sublandlord's address. If the term of this Sublease shall commence on
a day other than the first day of a month, rent shall be prorated based on a per
diem basis, and Subtenant shall pay to the Sublandlord the prorated installment
of rent together with one (1) monthly installment of Annual Rent due for the
following month.
During the first three (3) years of this Sublease from the Rental
Commencement Date (each twelve month period during the term of this Sublease
commencing on the Rental Commencement Date or any anniversary of such date being
referred to as a "Lease Year"), the Annual Rent shall be the sum of $6.82 per
square foot, per annum, multiplied by the square footage of the Subleased
Premises (the "Annual Rent"), payable in equal monthly installments. The actual
square foot area of the Subleased Premises shall be calculated in accordance
with the definition of the term "Premises" as set forth in the Master Lease
prior to the Rental Commencement Date. Commencing on and as of the first day of
the fourth (4th) Lease Year, the Annual Rent shall be increased by ten and
nine-tenths percent (10.9%), being $7.561 per square foot, per annum.
Commencing on and as of the first day of the fifth Lease Year and on the
anniversary of such date each and every year thereafter, during the Initial Term
and any extension term(s) of this Sublease, the Annual Rent for the Subleased
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Premises shall be increased by three and one-half percent (3.5%) per annum.
Accordingly, the Annual Rent for the Subleased Premises shall be increased as
follows:
Amount
Increase Date Per SQ. Ft.
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Anniversary Date, 1998 $7.561
" " 1999 $7.826
" " 2000 $8.100
" " 2001 $8.384
" " 2002 $8.677
" " 2003 $8.981
and so forth, increasing at three and one-half percent
(3.5%) per annum.
The Annual Rent for the Expansion Premises (as hereinafter defined in
Section 23) shall be calculated as follows:
As to any Expansion Premises for which Subtenant shall have executed any
option or right, the Annual Rent for the Expansion Premises if leased during
the first three (3) years of this Sublease shall be the sum of $5.15 per
square foot, per annum, multiplied by the actual square footage of the
Expansion Premises (as determined by measurement in accordance with the
requirements of the Master Lease), payable in equal monthly installments.
Commencing at expiration of the third Lease Year of this Sublease, the
Annual Rent for the Expansion Premises shall be increased by ten and
nine-tenths percent (10.9%), being $5.711 per square foot, per annum.
Commencing at the expiration of the fourth Lease Year of this Sublease and
the anniversary of such date each and every year thereafter, during the Initial
Term and any extension term(s) of this Sublease, the Annual Rent for the
Expansion Premises shall be increased by three and one-half percent (3.5%) per
annum. Accordingly, the Annual Rent for the Expansion Premises shall be
increased as follows:
Amount
Increase Date Per SQ. Ft.
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Anniversary Date, 1998 $5.711
" " 1999 $5.911
" " 2000 $6.118
" " 2001 $6.332
" " 2002 $6.554
" " 2003 $6.783
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and so forth, increasing at three and one-half percent (3.5%) per annum.
In addition to the Annual Rent, Subtenant shall, during the term of this
Sublease, pay to Sublandlord the following sums as additional rent (the
"Additional Rent"):
(a) $11.16 per square foot representing the straight line
amortization of Sublandlord's Work over a period of twelve
(12) years and six (6) months;
(b) all utilities furnished to and consumed upon the Subleased
Premises;
(c) Subtenant's proportionate share (determined on the basis of the
ratio that the square footage area of the Subleased Premises
bears to the aggregate square footage area of the Building)
of the following costs and expenses:
(i) real property taxes and general assessments payable in
respect of the taxing periods during the tern of this
Sublease; and
(ii) operating expenses, including all "Common Area costs" as
such term is described (and as such costs are determined)
under Section 11 of the Master Lease.
Notwithstanding anything contained in the foregoing to the contrary,
Subtenant shall be entitled to the benefit of any and all enterprise zone or
tax abatement programs, including without limitation "economic empowerment
zone" programs, and reduction in bond financing terms, which may relate to or
include the Subleased Premises. Sublandlord shall, and shall use reasonable
efforts to cause Landlord to, apply for and maintain qualification for
inclusion in such programs.
4. Subject to Master Lease. This Sublease is subject and subordinate
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to the Master Lease. Capitalized terms which are used but not defined in
this Sublease shall have the meaning ascribed to such terms in the Master
Lease. Sublandlord covenants and agrees to observe, perform and discharge all
of duties and obligations under and pursuant to the terms of the Master Lease
as and when required thereby, and to provide Subtenant with true and correct
copies of all notices and other written communications sent or received by
Sublandlord with respect to the Master Lease within five (5) business days of
its sending or receipt thereof.
5. Assignment and Subletting. Subtenant shall not assign, transfer,
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mortgage, or otherwise encumber this Sublease or all or any of Subtenant's
rights hereunder or interest herein, or sublet, rent or permit anyone to occupy
the Subleased Premises or
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any part thereof, without obtaining the express prior written consent of
Sublandlord; provided, however, that assignment of this Sublease or sublease
of all or any portion of the Subleased Premises to any party owned or
controlled by, or under common ownership or control with, Subtenant or to any
corporation or other entity with which or into which Subtenant may be merged
or consolidated, or to any corporation or other entity which may acquire all
or substantially all of Subtenant's assets or capital stock, shall not
require the consent of Sublandlord.
Sublandlord shall not unreasonably withhold or condition its consent to
any other proposed assignment or sublease to a third party provided that (i)
such third party agrees to use the Subleased Premises only for the purposes
permitted by this Sublease and the Master Lease and executes an assumption of
Subtenant's obligations hereunder in form satisfactory to Sublandlord, and
(ii) Subtenant shall not be released from its obligations hereunder and shall
so confirm in writing to Sublandlord, (iii) such third party's tangible net
worth (without regard to goodwill or other intangible assets) shall equal or
exceed Subtenant's net worth immediately prior to such assignment or sublet,
and (iv) such assignment or sublease is in accordance with Section 30 of the
Master Lease.
6. Use. Subtenant shall use and occupy the Subleased Premises solely for
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the purposes set forth in the Master Lease. Sublandlord acknowledges and agrees
that the business of Subtenant as a medical research entity conforms to the use
permitted by the Master Lease.
7. Taxes and Assessments. In addition to any tax obligations, if any,
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set forth in the Master Lease, Subtenant will pay all taxes and assessments
of every kind and description whatsoever levied against any personal property
or equipment owned by Subtenant and located at the Subleased Premises which,
if unpaid, could result in the imposition of a lien against the Subleased
Premises. Subtenant agrees to comply with all laws, rules and regulations
applicable to it based upon its doing business in the State of Maryland.
8. Inspection. Sublandlord and its agents shall have the right to enter
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the Subleased Premises, at any time, and from time to time, after at least
twenty-four (24) hours prior notice to Subtenant, to inspect the condition of
the Subleased Premises. Sublandlord shall use its best reasonable efforts not
to interrupt unreasonably or interfere with Subtenant's operations at the
Subleased Premises in connection with any such entry or inspection.
Sublandlord recognizes and agrees that the nature of Subtenant's business
requires that Sublandlord use its best reasonable efforts to keep
confidential any operations or other aspect of Subtenant's business observed
by Sublandlord in connection with any such entry or inspection.
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9. Surrender. (a) At the expiration or earlier termination of the
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term of this Sublease, Subtenant shall peaceably surrender the Subleased
Premises in broom clean condition and good order and repair and otherwise in
the same condition as the Subleased Premises were upon the commencement of this
Sublease, except ordinary wear and tear.
(b) If Sublandlord elects to require that alterations, installations,
changes, work, replacements, additions, or improvements comprised within the
Tenant TI Work and made by or on behalf of Subtenant to the Subleased Premises
be removed at the termination of this Sublease, Subtenant hereby agrees to cause
the same to be removed at its sole cost and expense. If Subtenant fails to
remove the same, Sublandlord may cause them to be removed at Subtenant's
expense, and Subtenant hereby agrees to reimburse Sublandlord for the cost of
such removal together with all and any damages which Sublandlord may suffer and
sustain by reason of failure of Subtenant to remove the same. At Sublandlord's
election, any or all of the Tenant TI Work, alterations, installations, changes,
replacements, additions to, or improvements made by Subtenant upon the Subleased
Premises shall remain at the termination of this Sublease and not be removed.
Subtenant shall surrender to Sublandlord all keys for the Subleased Premises at
the place then fixed for the payment of rent and shall notify Sublandlord in
writing of all combinations of locks, safes, and vaults, if any, in the
Subleased Premises. Subtenant's obligation to observe and perform the covenants
set forth in this Section 9 shall survive the expiration or earlier termination
of this Sublease.
(c) At the termination of this Sublease, Subtenant shall immediately
remove all personal property which it owns and is permitted to remove from the
Subleased Premises under the provisions of this Sublease, and failing to do so,
Sublandlord at its option may either (i) cause that personal
property to be removed at the risk and expense of Subtenant (both as to loss and
damage), and Subtenant hereby agrees to pay all reasonable costs and expenses
incurred thereby, including sums paid to store the personal property elsewhere
and the cost of any repairs to the Subleased Premises caused by the removal of
the property, or (ii) upon twenty (20) days' written notice to Subtenant, which
the parties agree is commercially reasonable, sell at public or private sale any
or all such personal property, whether exempt or not from sale under execution
or attachment (such property being deemed charged with a lien in favor of
Sublandlord for all sums due hereunder), with the proceeds to be applied as
Sublandlord desires, or (iii) at Sublandlord's option, title shall pass to
Sublandlord.
10. Insurance. Subtenant will indemnify and save harmless Landlord and
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Sublandlord and their respective successors and assigns, from any and all
claims, demands, actions, causes of action, and judgments, for bodily injury or
property damage, asserted by any person arising out of Subtenant's use and
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occupancy of the Subleased Premises. Subtenant shall, throughout the term of
this Sublease, keep in full force and effect, at its own expense, (a)
comprehensive general liability insurance with respect to claims for personal
injury, death and damages to property at or relating to the Subleased Premises
in the amount of $5,000,000 for personal injury or death or property damage
resulting from any one occurrence, and $5,000,000 in the aggregate, and (b)
hazardous material/environmental insurance in form required by the Master Lease
affording coverage in an amount of $2,000,000, and (c) such other insurance as
may be required by Section 21(a) of the Master Lease in such form and amounts
required thereby and (d) such other insurance as the Sublandlord may deem
reasonably necessary. All such insurance must be maintained in accordance with
all applicable laws of the State of Maryland and the Sublandlord and the
Landlord shall be named as additional insurers in all such insurance policies.
Such policies shall contain a provision for not less than thirty (30) days
notice to Sublandlord and Landlord prior to modification or cancellation of such
insurance policies as well as a waiver of subrogation provision. Subtenant will
furnish evidence of such insurance coverage to Sublandlord and Landlord at least
ten (10) days prior to the Rental Commencement Date. Sublandlord and Subtenant
will cooperate in good faith with respect to the settlement and compromise of
any claim arising under any insurance policy maintained pursuant to this Section
10, provided that Subtenant shall have the exclusive right to settle or
compromise any claims made under the insurance maintained by Subtenant
hereunder.
11. Environmental. Subtenant shall comply with all Environmental Laws (as
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hereinafter defined) relating to its use of the Subleased Premises including,
without limitation, the obligation to obtain and maintain in effect and comply
with all permits and reporting and notification requirements applicable to such
use. As used in this Sublease, the term "Hazardous Materials" means, (a) any
"hazardous substance" as defined in Section 101(14) of CERCLA (42 U.S.C. Section
9601(14)) or regulations promulgated thereunder; (b) any "solid waste",
"hazardous waste", "toxic substances" or "infectious waste", as such terms are
defined in any other Environmental Law; and (c) asbestos (or any substance
containing asbestos), polychlorinated biphenyls ("PCBs"), nuclear fuel or
material, radioactive materials, explosives, chemicals known or suspected to
cause cancer or reproductive toxicity, pollutants, effluents, contaminations,
emissions, petroleum products and by-products and other toxic or hazardous
materials or substances listed or identified in, or regulated by, any
Environmental Laws. As used in this Sublease, the term "Environmental Laws"
means the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"), 42 U.S.C. Section 9601 et seg., as amended by the Superfund
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Amendment and Reauthorization Act of 1986 ("XXXX"), the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901 et seq, the Hazardous Materials
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Transportation Act, 49 U.S.C. Section 1802 et seq., the Toxic Substances Control
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Act, 15 U.S.C.
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Section 2601 et seq., the Federal Water Pollution Control Act, 33
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U.S.C. Section 1251 et seq., the Clean Water Act, 33 U.S.C. Section 1321 et
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seq., the Clean Air Act, 42 U.S.C. Section 7401 et seq., the Safe Drinking Water
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Act, 42 U.S.C. Section 300f et seq., the Occupational Safety and Health Act, 29
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U.S.C. Section 655, etc., the Federal Insecticide, Fungicide and Rodenticide
Act, 7 U.S.C. Section 136 et seq. and any other present or future local, state,
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Federal or international law, treaty, statute, ordinance, rule, regulation,
advisory or guideline having the force of law relating to public health,
safety or the environment and any and all amendments, regulations, orders,
decrees, permits, licenses or restrictions now or hereafter promulgated
thereunder. Subtenant hereby agrees that (a) no activity will be conducted on
the Subleased Premises that will produce or cause the release of any Hazardous
Materials in violation of any Environmental Law; (b) the Subleased Premises will
not be used in any manner for the storage of any Hazardous Materials in
violation of any Environmental Law; and (c) Subtenant will not permit any
Hazardous Materials in violation of any Environmental Law to be brought onto the
Subleased Premises; and if so brought or found located thereon, the same shall
be immediately removed, at Subtenant's sole cost and expense; all required
cleanup and disposal procedures shall be diligently undertaken in accordance
with all Environmental Laws, and upon request Subtenant shall provide
Sublandlord with evidence satisfactory to Sublandlord of Subtenant's compliance
with all Environmental Laws. If at any time during or after the term of this
Sublease, the Subleased Premises are found to be contaminated with Hazardous
Materials in violation of any Environmental Law resulting from Subtenant's
use thereof or Subtenant's use of the Subleased Premises which results in a
violation or alleged violation of any Environmental Law, Subtenant agrees to
indemnify, hold harmless, protect and defend Landlord and Sublandlord from all
claims, demands, actions, liabilities, costs, expenses (including reasonable
attorneys' fees), damages and obligations of any nature arising from or as a
result of the use of the Subleased Premises by Subtenant, as set forth below.
This indemnification shall survive the termination or expiration of this
Sublease.
Subtenant agrees to indemnify, defend, and hold Sublandlord and Landlord
harmless from any claims, losses, costs, expenses, damages, liabilities or
causes of action (including reasonable attorneys' fees) which (a) arise during
or after the term of this Sublease and are related to or connected with the use
or occupancy by Subtenant and/or any assignee, subtenant, concessionaire, or
licensee of the Subleased Premises, or (b) result or arise out of or pertain to
the failure by Subtenant to comply with all Environmental Laws at the Subleased
Premises, provided such indemnification shall not apply to the negligence or
willful acts of Sublandlord or Landlord or their respective contractors or
subcontractors, or its or their agents or employees.
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12. Default. Should Subtenant default in the performance of any
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obligation or duty imposed upon it by the terms and conditions of this Sublease
(including without limitation the payment of Annual Rent or Additional Rent), or
by the terms and conditions of the Master Lease, in addition to all other rights
given it as Sublandlord by law, Sublandlord shall have the right, after written
notice to Subtenant specifically describing such default and an opportunity for
Subtenant to cure such default within five (5) days thereafter for any monetary
default and within thirty (30) days thereafter for any non-monetary default,
unless such non-monetary default is not capable of being cured within such
thirty-day period then such period shall be extended so long as Subtenant
commences such cure within such thirty-day period and diligently pursues
completion thereof, to terminate this Sublease or at its option, the right to
re-enter the Subleased Premises without terminating this Sublease and
thereafter, as agent for Subtenant, re-rent such Premises to any third party,
applying the net proceeds to such rental, after deducting all reasonable
expenses incurred in connection therewith, to the rental due Sublandlord
hereunder, and Subtenant shall remain liable to Sublandlord for any deficiency
in such rent.
13. Hold Harmless. Subtenant agrees that it will defend, indemnify and
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hold Sublandlord and Landlord harmless, from and against any and all losses,
claims, damages or expenses which it may incur, suffer or expend from any
default of Subtenant or failure of the Subtenant to perform fully its
obligations under the terms and conditions of the Master Lease (in so far as the
same pertain to the Subleased Premises) and/or this Sublease, including the
payment of reasonable attorneys' fees. Such indemnification shall be with
respect only to losses, claims, damages or expenses which arise from or relate
to events, acts or circumstances occurring during the term of this Sublease.
Such indemnification shall survive the termination of this Sublease.
14. Compliance with Master Lease. Sublandlord shall pay all sums payable
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to the Landlord under the Master Lease throughout the term of this Sublease and
shall observe, perform and discharge all of its obligations under the Master
Lease as and when required thereby, and shall not consent to anything or do
anything or fail to do anything which would or could terminate said Master Lease
or create any default under said Master Lease or waive or exercise any right it
shall have under said Master Lease without Subtenant's express prior written
consent in each instance. Sublandlord shall not, without in each case obtaining
the prior written consent of Subtenant (which consent shall not be unreasonably
withheld or delayed), modify, amend, or supplement the Master Lease, or waive
the performance of any obligations of Landlord thereunder.
15. Estoppel Certificate. Upon the request of either party, at any
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time from time to time, Sublandlord and Subtenant agree to execute and deliver
to the other, within thirty (30)
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days after such request, a written instrument, duly executed, (a) certifying
that this Sublease has not been modified and is in full force and effect or, if
there has been a modification of this Sublease, that this Sublease is in full
force and effect as modified, stating such modifications, (b) specifying the
date to which the Annual Rent and, if any, Additional Rent has been paid, (c)
stating whether, to the knowledge of the party executing such instrument, the
other party hereto is in default and, if such party is in default, stating the
nature of such default, and (d) stating the date of commencement of Annual Rent.
16. Fixtures. Subject to the terms of Section 9 of this Sublease, all
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fixtures and equipment placed on the Subleased Premises by Subtenant may be
removed by Subtenant at any time during the term of this Sublease and within two
(2) months of the expiration or termination of this Sublease. In the event of
any such removal, Subtenant shall promptly repair, at its own expense, all
damage to the Subleased Premises caused by the removal of such fixtures or
equipment.
17. Condemnation. Subtenant hereby assigns to Sublandlord all awards to
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which it may be or become entitled and which it must remit to the Sublandlord in
the event of any taking for any public or quasi-public use by any lawful power
or authority by exercise of the right of condemnation or of eminent domain
affecting all or any part of the Subleased Premises, which occurs during the
term of this Sublease; provided, however, that Subtenant shall, at its sole cost
and expense, be entitled to maintain an action against the condemning authority
for loss of business and damage to Subtenant's fixtures and personally. In
furtherance hereof Subtenant hereby grants Sublandlord the sole right to file
all claims and to bring such causes of action as Sublandlord shall desire for
the purpose of obtaining any such award. Subtenant hereby covenants to notify
promptly Sublandlord of all such takings of which Subtenant has knowledge or of
which Subtenant receives notice. Subtenant hereby agrees to cooperate at
Sublandlord's expense with Sublandlord to the fullest extent possible in the
bringing of such causes of action and in filing such claims for such awards.
18. Repairs. In the event a condition exists in the Subleased Premises
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that Landlord is obligated to repair under the Master Lease, Subtenant shall so
advise Sublandlord, and Sublandlord, in turn, shall advise Landlord thereof.
Sublandlord shall have no liability to Subtenant for Landlord's failure
to make any such repair; provided, however, that Sublandlord shall diligently
seek to enforce its rights and Landlord's obligations under the Master Lease.
Sublandlord shall keep, or cause to be kept, the structure, roof, common
areas and any shared Building systems or equipment, including without
limitation, any shared system providing heating, ventilation or air conditioning
in a constant state of good condition and repair, and shall, at no expense to
Subtenant,
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perform all maintenance and repair which may be or become necessary or
appropriate in connection therewith. Subtenant shall perform, or cause to be
performed, all maintenance and repair of the Subleased Premises, excluding the
structural elements of the Building and any other shared systems or facilities
serving the Subleased Premises and other space within the Building or the
property. Subtenant shall have the right at its sole cost and expense to
install and maintain a security system serving the Subleased Premises
exclusively.
19. Quiet Enjoyment. Sublandlord hereby covenants and agrees that if
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Subtenant shall fully perform, comply with and observe all of the covenants and
agreements herein stipulated to be performed on Subtenant's part, Subtenant
shall at all times during the term of this Sublease have peaceable and quiet
enjoyment and possession of the Subleased Premises without hindrance from
Sublandlord or any person or persons claiming the Subleased Premises by, through
or under Sublandlord; subject, however, to (x) matters affecting title to the
Premises to which this Sublease is subordinate and (y) the terms of the Master
Lease; provided, however, that Sublandlord's covenant and obligation to observe,
perform and comply with the Master Lease shall not be limited or restricted by
this reference.
20. Nondisturbance. Sublandlord shall, or shall use reasonable efforts to
--------------
cause Landlord to, procure from any present or future holder of any mortgage,
leasehold mortgage, deed of trust, or underlying or ground lease, including,
without limitation, any refinancing, replacement, renewal, modification,
extension or consolidation thereof which is placed upon Landlord's or
Sublandlord's respective interest in the Subleased Premises from time to time by
Landlord or Sublandlord, an agreement providing in substance that so long as
Subtenant shall discharge the obligations on its part to be kept and performed
under the terms of this Sublease, Subtenant's tenancy will not be disturbed nor
this Sublease affected by any default under such mortgage, deed of trust or
underlying or ground lease.
21. Subtenant's Contingencies. All of the obligations of Subtenant
-------------------------
hereunder are subject to and conditioned upon the satisfactory completion of the
following:
l. Sublandlord shall cause the Structural Work, more specifically
described on Exhibit B attached hereto and made a part hereof by
this reference, to be performed in a good and workmanlike manner
in accordance with the approved plans and specifications therefor
and, in all material respects, with the applicable requirements
imposed by law, and to be completed in accordance with the
schedule agreed upon by the parties.
2. Sublandlord shall cause the TI Work, more specifically described
on Exhibit C attached
-12-
hereto and made a part hereof by this reference, to be
performed in a good and workmanlike manner in accordance with
the approved plans and specifications therefor and, in all
material respects, with the applicable requirements imposed by
law, and to be completed in accordance with the schedule
agreed upon by the parties. The Structural Work and TI Work
shall hereinafter be referred to collectively as the
"Sublandlord's Work".
For purposes of this Section 21, "Sublandlord's Work" shall
be deemed to be completed when (x) all certificates of occupancy
and other governmental approvals required for the lawful
occupancy of the Subleased Premises have been issued and are in
full force and effect and (y) Subtenant's architect shall have
executed an AIA form certification of substantial completion.
3. Qualified architects or engineers selected by Subtenant shall
have inspected the Subleased Premises and provided a written
report to Subtenant and Sublandlord indicating whether the
condition of the floors, ceilings, roof, walls, HVAC systems,
utilities, water, sewer, electrical and mechanical systems of the
Subleased Premises are adequate for Subtenant's intended use.
The cost of such inspections and reports shall be shared equally
by Subtenant and Sublandlord.
4. A qualified environmental consultant selected by Subtenant shall
have inspected the Subleased Premises and provided a written
report to Subtenant and Sublandlord indicating whether the
Subleased Premises are affected in any manner which could be
material and adverse to Subtenant or its occupancy of the
Subleased Premises, by any adverse environmental condition. The
cost of such inspection and report shall be shared equally by
Subtenant and Sublandlord.
The first $2,550,000 of the cost of performing Sublandlords Work shall be
made available to or as directed by Subtenant as the performance of such work
proceeds.
22. Sublandlord's Representations and Warranties. Sublandlord represents
--------------------------------------------
and warrants to Subtenant that (i) to Sublandlord's knowledge the Subleased
Premises are zoned so as to permit the use of the Subleased Premises as intended
by Subtenant, (ii) Sublandlord will neither do, nor to the extent of its right
to control the same, permit any other tenant or occupant of the Building to take
any action which would jeopardize Subtenant's right to use the Subleased
Premises for
-13-
its intended purposes throughout the term of this Sublease, and (iii) to
Sublandlord's knowledge and without any independent investigation: (a)
no Hazardous Materials have been used, stored, generated, or disposed of on the
Property in connection with any activity conducted thereon, and (b) there are no
Hazardous Materials or storage tanks of any kind in, at, on or under the
property. For purposes of this Section 22, "Sublandlord's knowledge" shall mean
the knowledge of Xxxx X. Xxxxx (in his capacity as Executive Director of the
Sublandlord) who is the individual with superior knowledge of any such matter.
23. Expansion Option. Provided that Sublandlord has exercised its option
----------------
under the Master Lease for the rental of such space, (which Sublandlord agrees
to do (so long as it is entitled to do so under the terms of the Master Lease)
in the event that Subtenant elects to exercise its option on the Expansion
Premises under this Section 23), Subtenant may expand the Subleased Premises to
include all or any part of the fifty thousand (50,000) square feet located on
the first floor of the Building and adjacent to the initial Subleased Premises
(the "Expansion Premises"), on the same terms and conditions as the initial
Subleased Premises (except for the rental of such space), by providing written
notice of Subtenant's election to so expand to Sublandlord on or before the
expiration of the third full lease year of the Initial Term. Upon Subtenant's
exercise of its right to expand, Sublandlord shall (i) cause structural work
comparable to the Structural Work to be performed in the Expansion Premises to
Subtenant's reasonable satisfaction, and (ii) use its best efforts to make
available to Subtenant a tenant improvement allowance in the amount of $140.00
per square foot of the Expansion Premises. In the event that Sublandlord is
unable, despite its reasonable best efforts, to perform the foregoing
obligations, Subtenant shall have the right to terminate this Sublease;
provided, however, upon such termination Subtenant shall pay to Sublandlord an
amount equal to the unamortized principal balance, at the time of such
termination, of the tenant improvement bond financing used to fund the TI Work.
Any Expansion Premises leased by Subtenant shall be deemed to be included
within the term Subleased Premises as used herein and any annual rent and
additional rent due in connection therewith shall be deemed to be included
within the terms Annual Rent and Additional Rent as used herein; provided,
however, that Annual Rent for such space shall be as provided in Section 3 of
this Sublease. Such rent shall commence on the first day following the
completion of the Structural Work and the TI Work for the Expansion Premises.
Excluding the distinctions in rent, all terms and conditions of this Sublease
applicable to the Subleased Premises shall be applicable to any or all of the
Expansion Premises which are leased by Subtenant.
24. Right of First Offer, Purchase Option. Reference and incorporation
-------------------------------------
are hereby made to those provisions of the Master Lease (Section 37) which
provide Sublandlord, as the tenant
-14-
thereunder (as well as any subtenant), the right of first offer to lease
additional space within the Building and the right
to purchase the property upon which the Building is situate.
25. Successors and Assigns. The terms and provisions of this Sublease
----------------------
shall inure to the benefit of and be binding upon the respective successors and
assigns of Subtenant and Sublandlord. This Section 25 is not intended, nor
shall it be construed to modify, vary otherwise alter the provisions of Section
5 of this Sublease.
26. Entire Agreement. This Sublease contains the entire agreement of the
----------------
parties, with regard to the subleasing, occupancy and use of the Subleased
Premises, and no representations, inducements, promises or agreements, oral or
otherwise, not embodied herein, shall be of any force or effect.
27. Notices. In every instance in which notice is required to be given
-------
hereunder, such notice shall be in writing and personally delivered, sent by
telecopier, or sent by certified or registered mail addressed as follows:
If to Sublandlord: 00 Xxxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxx
Executive Director
Telecopier Number: (000) 000-0000
with a copy to: Xxxxx X. Xxxx, Esquire
Miles & Stockbridge,
a Professional Corporation
00 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telecopier Number: (000) 000-0000
If to Subtenant: 00000 Xxxxxx Xxxxxx
Xxxxx Xxxxxxxx, Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attn: Xxxxx X. Xxxxx
President and Chief
Executive Officer
Telecopier Number:_________________
and
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx 5 Xxxxx
President and Chief
Executive Officer
Telecopier Number:__________________
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If to Landlord: 000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attn: X.X. Xxxxx, III
General Partner
Telecopier Number: (000) 000-0000
All notices sent by mail shall be deemed given the second day after the
same are posted. All notices sent by telecopier shall be deemed given the day
sent, but such notices shall be sent promptly by first class mail as well.
Either party may change the address or telecopier number to which notices to it
are to be sent by sending written notice of such new address or telecopier
number to the other party.
28. Partial Invalidity. In the event any provision of this Sublease (or
------------------
any part of any provision) is held by a court of competent jurisdiction to be
invalid, illegal, or unenforceable in any respect, such invalidity, illegality,
or unenforceability shall not affect any other provision (or remaining part of
the affected provision) or this Sublease, but this Sublease shall be construed
as if such invalid, illegal, or unenforceable provision (or part thereof) had
not been contained in this Sublease1 but only to the extent it is invalid,
illegal, or unenforceable.
29. Captions. The captions herein set forth are for convenience only and
--------
shall not be deemed to define, limit, or describe the scope or intent of this
Sublease.
30. Governing Law. The provisions of this Sublease shall be construed,
-------------
interpreted and enforced in accordance with the laws of the State of Maryland as
the same may be in effect from time to time.
31. Amendments. This Sublease may not be modified or amended except by an
----------
agreement in writing, signed by the party against whom enforcement of the change
is sought.
32. Counterparts. This Sublease may be executed in any number of
------------
counterparts, each of which shall be considered an original for all purposes,
but all such counterparts shall together constitute one and the same instrument.
-16-
IN WITNESS WHEREOF, the parties hereto have caused this Sublease to be properly
executed under seal as of the day and year first above written.
ATTEST: SUBLANDLORD:
MARYLAND ECONOMIC DEVELOPMENT
CORPORATION
/s/ Elle S. Wigz By: /s/ Xxxx X. Xxxxx
-------------------- -------------------------------
Xxxx X. Xxxxx
Executive Director
ATTEST: SUBTENANT:
OSIRIS THERAPEUTICS, INC.
/s/ Xxxxx X. Xxxxx By: Xxxxx X. Xxxxx
-------------------- ------------------------------- (SEAL)
Xxxxx X. Xxxxx
President & Chief
Executive Officer
STATE OF MARYLAND, CITY/COUNTY OF BALTIMORE, TO WIT:
I HEREBY CERTIFY, that on this 28 day of February, 1995, before me, the
undersigned Notary Public of said State, personally appeared Xxxx X. Xxxxx, who
acknowledged himself to be the Executive Director of Maryland Economic
Development Corporation, a body politic and corporate and constituted as a
public instrumentality of the State of Maryland, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument, and
acknowledged that he executed the same for the purposes therein contained as the
duly authorized Executive Director of said entity by signing the name of the
entity by himself as Executive Director.
WITNESS my hand and Notarial Seal.
/s/ Xxxxxxxxx X. Xxxxxxx
--------------------------------
Notary Public
My Commission Expires: March 1, 1999
-17-
STATE OF OHIO, CITY/COUNTY OF CUYAHOGA, TO WIT:
I HEREBY CERTIFY, that on this 8th day of February, 1995, before me, the
undersigned Notary Public of said State, personally appeared Xxxxx 5 Xxxxx, who
acknowledged himself to be the President and Chief Executive Officer of Osiris
Therapeutics, Inc., a Delaware corporation, known to me (or satisfactorily
proven) to be the person whose name is subscribed to the within instrument, and
acknowledged that he executed the same for the purposes therein contained as the
duly authorized President and Chief Executive Officer of said corporation by
signing the name of the corporation by himself as President and Chief Executive
Officer.
WITNESS my hand and Notarial Seal.
/s/ Xxxxxxxxx X. Xxxxx
--------------------------------
Notary Public
My Commission Expires:
-18-
FIRST AMENDMENT TO SUBLEASE AGREEMENT
THIS FIRST AMENDMENT TO SUBLEASE AGREEMENT (this "Amendment") is made as
of this 2nd day of June 1995, by and between OSIRIS THERAPEUTICS INC., a
Delaware corporation (Subtenant) and MARYLAND ECONOMIC DEVELOPMENT CORPORATION1
a body politic and corporate and constituted as a public instrumentality of the
State of Maryland ("Sublandord").
WITNESSETH:
WHERE, Sublandord and Subtenant entered into that certain Sublease
Agreement, undated but effective as of January 18, 1995 (the "Sublease") for the
sublease of premises located at 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx, as
more particularly described therein; and
WHEREAS, Sublandlord and Subtenant desire to complete certain items of the
Sublease that were incomplete and to amend certain terms of the Sublease as
provided herein.
NOW, THEREFORE, in consideration of the foregoing premises, of the mutual
covenants set forth herein and other good and valuable consideration, the
receipt and sufficient of which are hereby acknowledged, the parties hereto
agree as follows:
l. Defined Terms. Except as specifically defined herein, all capitalized
terms shall have the definitions provided in the Sublease.
2. Dates. The parties agree that the Sublease shall be dated as of
the25th day of February, but still be effective in all respects as of January
18, 1995. The parties further agree that the date in the first recital
(designated A shall be "January 18, 1995" and that the date set forth in Section
2 of the Sublease shall be "December 30,2001."
3. Exhibits. The parties agree that attached hereto as Exhibits A, A-i,
B and C are the true and correct copies of Exhibits A, A-i, B and C as
referenced in the Sublease.
4. Additional Rent The parties confirm that the cost of the Landlord's
Work: is $3,100,000. The parties also confirm that a $503,000 MICRF loan to
Sublandlords to be paid out of Additional Rent proceeds. The parties further
confirm that Subtenant is entitled to receive interest in connection with a
reserve account established in connection with the bond financing
of Sublandlord's Work. In recognition of these facts and agreements, the parties
agree that Section 3 of the Sublease shall be amended as follows:
(a) Subsection (a) of Section 3 (page 5 of the Sublease) shall be
amended to replace the amount of Additional Rental of "$11.16 per square foot"
with "$382,873.44 per annum, in equal monthly installments of $31,906.12 each."
It is understood and agreed that such amount is equal to $3,100,000, amortized
over twelve and
-2-
one-half years at 7% percent per annum. Such payment shall apply through the
term for a period of twelve and one-half years.
(b) A new subsection (d) shall be added as follows: "(d) In order to
repay a $50,000 loan from MICRF to Sublandlord, the proceeds of which will be
used in connection with the financing of the Sublandlord's Work, Subtenant shall
pay $0.18 per square foot per annum, such amount being 50,000 amortized over
twelve and one-half years at 5 percent per annum, and divided by 30,000. In the
event the square footage of the Subleased Premises is adjusted by reason of
remeasurement of the Premises, then such rental amount shall also be adjusted in
accordance with the fore going calculation. In the event the Expansion Premises,
or any part thereof are added to the Subleased Premises, such amount shall not
be adjusted, nor shall such amount be due with respect to the Expansion
Premises, or any part thereof, except as may be provided in an amendment to the
Sublease executed at the time the Expansion Premises, or any part thereof are
added to the Subleased Premises. Such payment shall apply through the term for a
period of twelve and one-half years.
(c) A new subsection (e) shall be added as follows: "(e) Sublandlord,
provided Subtenant is not in default under the Sublease (subject to any
applicable notice and cure periods), shall pay to Subtenant those amounts that
Sublandlord receives as interest pursuant to Section 3.2 (d) of that certain
Financing and Construction Loan Agreement dated the date hereof between
Sublandlord, Subtenant, The Xxxxxxx-Xxxxxx Contracting Company, the Mayor and
the City of Baltimore and Signet Trust Company (the Loan Agreement"). Such
amounts shall be paid quarterly, or more or less frequently as the parties may
agree based upon Sublandlord's report to Subtenant of the interest received over
the prior three month period. The first such payment shall be made on September
1, 1955 (accounting for all interest Sublandlord receives prior to such date
regardless of the number of months actually covered) and subsequent payments
shall be made on each succeeding December 1, March 1' June 1 and September 1 of
each year during the Sublease term (as the same may be extended) and shall
continue until the "Reserve Fund" (as defined in the Loan Agreement) is fully
disbursed, at which time the last payment hereunder shall be equal to the
interest received by Sublandlord calculated from the date of computation of the
immediately preceding payment through the date of such final disbursement.
Sublandlord covenants that, subject to and except for the rights of the holder'
(as defined in the Loan Agreement) under the Loan Agreement, Sublandlords right
to such interest payments is not subject to any pledge, encumbrance or security
interest, and agrees that it shall not further pledge, encumber or grant a
security interest in its right to such interest payments. Subject to the rights
of the holder under the Loan Agreement, Sublandlord hereby pledges, assigns,
transfers and grants a security interest in such interest payments to Subtenant
as security for its obligation hereunder, and agrees, upon Subtenant's request,
to execute such further assurances and U.C.C. financing statements as Subtenant
may reasonably request to perfect such security interest."
5. Payment. In lieu of direct payment to Sublandlord Subtenant may make
the following payments of rent to the following parties:
(a) To The Xxxxxxx-Xxxxxx Contracting Company, or other
successor holder of that certain $3,100,000 Maryland Economic Development
Corporation, Taxable
-3-
Economic Development Revenue Bond (Osiris Therapeutics, Inc. Facility), 1995
Issue, June 2 1995, all amounts payable as Additional Rent pursuant to
subsection (a) of Section 3 of the sublease, as and when such payments are due
under the Sublease and paid by wire transfer as required under Section 2.8 of
the loan Agreement, with simultaneous notice to Sublandlord of such payments.
(b) To SAGA Limited Partnership, or other successor landlord
under the Master Lease, all amounts payable as Annual Rent pursuant to Section 3
of the Sublease, as and when such payments are due under the Sublease, with
simultaneous notice to Sublandlord of such payments.
6. No Other Changes. Except as modified by this Amendment, the terms of
the Sublease are hereby reaffirmed and shall remain in full force and effect.
7. Binding Effect. This Amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successor and assigns.
8. Governing Law. This Amendment shall be interpreted and construed in
accordance with the laws of the State of Maryland.
IN WITNESS WHEREOF, the parties have executed this Amendment under seal as
of the day and year first above written:
SUBTENANT
OSIRIS THERAPEUTICS, INC.
By: /s/ Xxxxx X. Xxxxx
---------------------------------
Name: Xxxxx X. Xxxxx
---------------------------------
Its: President
---------------------------------
SUBLANDLORD:
MARYLAND ECONOMIC
DEVELOPMENT CORPORATION
By: /s/ Xxxx X. Xxxxx
---------------------------------
Name: Xxxx X. Xxxxx
---------------------------------
Its: Executive Director
---------------------------------
