EXHIBIT 10.41
FIRST AMENDMENT TO LEASE AGREEMENT
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THIS FIRST AMENDMENT ("Amendment") is made as of the 21st day of
JANUARY, 1999 by and between the LIBERTY PROPERTY LIMITED PARTNERSHIP
("Landlord"), successor in interest to Indian Creek Holding Associates Limited
Partnership, and AMVAX, INC. f/k/a SELCORE LABORATORIES, INC. ("Tenant").
RECITAL A. Landlord leases to Tenant approximately 22,800 rentable
square feet of space in the building located at 00000 Xxxxxx Xxxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxxx (the "Building") pursuant to a Lease Agreement dated
December 31, 1987 (the "Lease Agreement"). The Lease Agreement, together with
the Rider to Agreement of Lease (the "Rider") and all other exhibits attached
thereto, are collectively referred to herein as the "Lease".
RECITAL B. Landlord and Tenant have agreed to amend the Lease under the
terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. AMENDMENT TO SECTION 2 - TERM. The "Term" of the Lease, defined in
Section 2 of the Lease, is hereby extended for an additional period of 10 years
(the "Extension Period") beyond the Term set forth in the Lease. Likewise, the
"Expiration Date" of the Term of the Lease, also defined in Section 2 of the
Lease, is hereby changed to February 28, 2009. In addition, Sections 2(a) and
(b) of the Lease are hereby deleted and replaced with the following:
If Tenant, or person claiming through Tenant, shall
continue to occupy the Premises after the expiration or
termination of this Lease or any renewal thereof, such
occupancy shall be deemed to be under a month-to-month tenancy
under the same terms and conditions set forth in the Lease,
except that the monthly installment of Minimum Rent during
such continued occupancy shall be double the amount applicable
to the last month of the Term. Anything to the contrary
notwithstanding, any holding over by Tenant without Landlord's
prior written consent shall constitute a default hereunder and
shall be subject to all the remedies available to Landlord.
2. AMENDMENT TO SECTION 5 - MINIMUM RENT. Beginning on March 1, 1999,
and continuing during the Extension Period, the net component of the minimum
annual rent under the Lease, set forth in Section 5 of the Lease, shall be as
follows:
Year of Annual Monthly
Extension Period Amount Installment
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3/1/99 - 2/29/00 $356,986.00 $29,748.83
3/1/00 - 2/28/01 $367,695.58 $30,641.30
3/1/01 - 2/28/02 $378,726.45 $31,560.54
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3/1/02 - 2/28/03 $390,088.24 $32,507.35
3/1/03 - 2/29/04 $401,790.89 $33,482.57
3/1/04 - 2/28/05 $413,844.61 $34,487.05
3/1/05 - 2/28/06 $426,259.95 $35,521.66
3/1/06 - 2/28/07 $439,047.75 $36,587.31
3/1/07 - 2/29/08 $452,219.18 $37,684.93
3/1/08 - 2/28/09 $465,785.76 $38,815.48
Such net component of the Minimum Rent and all additional rent and other
charges under the Lease, shall continue to be paid in the manner and at the
times provided in the Lease.
3. Sections 2 and 31(g) of the Rider to the Lease are hereby deleted
from the Rider and replaced with the following provisions:
Tenant shall have an option to renew the Term of the Lease
upon its expiration for an additional period of 10 years (the
"Renewal Term," which shall be deemed part of the Term),
subject to the following terms:
(A) In order to exercise this option to renew the Lease, Tenant
must give Landlord written notice of its election to renew not later
than 365 days before the expiration of the then-current Term. All terms
of the Lease shall remain in full force and effect for the Renewal Term,
except that at Landlord's option, the standard terms of the Lease which
are not specific to the Tenant's occupancy shall be replaced with the
Landlord's then-current lease agreement form (with the understanding
that the new Rider Section 11 set forth in Paragraph 5 of this Amendment
below is not one such clause to be replaced), which Tenant shall execute
within 30 days after receipt thereof, and except that the annual minimum
rent for the Renewal Term shall be as follows:
Year of Annual Monthly
Extension Period Amount Installment
---------------- ------ -----------
3/1/09 - 2/29/10 $489,075.05 $40,756.25
3/1/10 - 2/28/11 $513,528.80 $42,794.07
3/1/11 - 2/28/12 $539,205.24 $44,933.77
3/1/12 - 2/28/13 $566,165.50 $47,180.46
3/1/13 - 2/29/14 $594,473.78 $49,539.48
3/1/14 - 2/28/15 $624,197.47 $52,016.46
3/1/15 - 2/28/16 $655,407.34 $54,617.28
3/1/16 - 2/28/17 $688,177.71 $57,348.14
3/1/17 - 2/29/18 $722,586.59 $60,215.55
3/1/18 - 2/28/19 $758,715.95 $63,226.33
(B) If Tenant fails to give notice exercising the foregoing
option by the date required herein, or if at the time Tenant exercises
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such option or at commencement of the Renewal Term the Tenant is in
default of any term of this Lease past applicable notice or grace
periods, or if this Lease is assigned by Tenant or the Premises sublet
in whole or in part to any party which is not affiliated with Tenant,
then Tenant's right and option to renew shall be automatically
terminated and of no further force or effect.
4. AMENDMENT TO SECTION 7 - INSURANCE. Section 7(b) of the Lease is
hereby deleted and replaced with the following provision:
Tenant, at its own expense, shall keep in effect
comprehensive general liability insurance with respect to the
Premises and the Property, including contractual liability
insurance, with such limits of liability for bodily injury
(including death) and property damage as reasonably may be
required by Landlord from time-to-time, but not less than a
combined single limit of $1,000,000 per occurrence and a
general aggregate limit of not less than $3,000,000 (which
aggregate limit shall apply separately to each of Tenant's
locations if more than the Premises); however, such limits
shall not limit the liability of Tenant hereunder. The policy
of comprehensive general public liability insurance also shall
name Landlord and Landlord's agent as insured parties with
respect to the Premises, shall be written on an "occurrence"
basis and not on a "claims made" basis, shall provide that it
shall not be cancelable or reduced without at least 30 days
prior written notice to Landlord, and shall be issued in form
satisfactory to Landlord. The insurer shall be a responsible
insurance carrier which is authorized to issue such insurance
and licensed to do business in the state in which the Property
is located and which has at all times during the Term a rating
of no less than A VII in the most current edition of Best's
Insurance Reports. Tenant shall deliver to Landlord on or
before the date on which the Extension Period becomes
effective, and subsequently renewals of, a certificate of
insurance evidencing such coverage and the waiver of
subrogation described herein.
5. AMENDMENT TO RIDER SECTION 11 - ALTERATIONS BY TENANT. Section 11 of
the Rider to the Lease is hereby deleted from the Rider and replaced with the
following:
Notwithstanding anything in Section 11 of the Lease to the
contrary, in those instances where Tenant is required to seek
Landlord's prior written approval for alterations or
improvements to the Premises, Tenant shall deliver to
Landlord, in advance of any proposed construction, plans,
specifications, bid proposals, work contracts and such other
information concerning the nature and cost of the alterations
or improvements as may be reasonably requested by Landlord.
Deliveries to Landlord pursuant to this section shall be
subject to the terms of the written confidentiality agreement
dated December 23, 1997 and previously executed by Landlord
and Tenant if designated for such treatment by Tenant at the
time of delivery to Landlord. Landlord agrees to respond to
Tenant's request for approval within 15 days after receiving
such information. Landlord acknowledges that the conduct of
Tenant's business and the use of the Premises in connection
with Tenant's business are subject to the rules and
regulations of the U.S. Food and Drug Administration and other
governmental agencies, offices, departments, bureaus and
boards. Landlord agrees that it shall not unreasonably
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withhold or condition its consent for any such approvals to
the extent the same are reasonably necessary to cause Tenant
or the Premises to be in compliance with all laws, rules,
orders, ordinances, directives, regulations, and requirements
of all governmental agencies, offices, departments, bureaus
and boards having jurisdiction over the same ("Legal
Requirement"). Nothing in this Lease shall be construed to
require Tenant to violate any Legal Requirement, and if it is
determined that there are any additional restoration costs
associated with any improvements, alterations or additions
proposed by Tenant as a result of a Legal Requirement or
otherwise, then as a condition of Landlord's approval Tenant
may be required to pay Landlord as an additional security
deposit an amount equal to the incremental demolition costs
(if any) necessary as a result of such improvements,
alterations or additions to restore the Premises to a building
shell condition. In each instance, such incremental demolition
costs shall be determined based on estimates of a third party
contractor mutually acceptable to the parties.
In addition, and notwithstanding anything in the Lease to
the contrary, Tenant shall be obligated, at the Tenant's
expense and prior to the expiration of the last day of the
Term of the Lease, to (i) remove all trade fixtures,
machinery, equipment and personal property installed at the
Premises by Tenant, (ii) restore the Premises to a so-called
"building shell" condition as existing prior to any
alterations or improvements made by Tenant, and (iii) repair
any damage to the Premises or the building or property caused
by such removal and restoration.
6. AMENDMENT TO RIDER SECTION 18 - INDEMNIFICATION. Section 18 of the
Rider to the Lease is hereby deleted from the Rider and replaced with the
following:
(A) Landlord hereby indemnifies and holds harmless the Tenant
from any claims, suits, losses, damages (but not consequential damages)
and expenses, including attorneys' fees and court costs, arising from
any maintenance, repair or other construction work which is performed by
the Landlord at the Premises after the receipt by Landlord from Tenant
of written notice of the need for such work.
(B) Tenant shall be responsible for insuring, at replacement
cost as appropriate, all furniture, equipment, machinery, appliances and
other personal property owned by the Tenant and all alterations,
fixtures and improvements made by Tenant at the Premises.
7. AMENDMENT TO SECTIONS 25 AND 28 - DEFAULTS/REMEDIES. Sections 25 and
28 of the Lease and Section 28 of the Rider to Lease are hereby deleted and
replaced with the following:
(A) An "event of default" shall have occurred under the Lease
upon occurrence of any one of the following: (a) the Tenant fails to pay
any amount of annual minimum or basic rent, additional rent or any other
sum due hereunder, and such delinquency continues for a period of 10
days after written notice from Landlord, or (b) Tenant fails to perform
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any of its other duties or obligations, and such breach continues for a
period of 30 days after written notice from Landlord or, if such breach
cannot be cured within 30 days, within a reasonable time not to exceed
90 days provided that tenant commences to cure such breach within 30
days after such notice and diligently prosecutes such cure to
completion.
(B) Upon the occurrence of any event of default, the Landlord
may take any or all of the following actions:
(1) Perform on behalf of and at the expense of Tenant any
obligation of Tenant under this Lease which Tenant has failed to perform, the
total cost of which by Landlord, together with interest thereon at the rate of
12% per annum from the date of such expenditure, shall be deemed additional rent
and shall be payable by Tenant to Landlord upon demand.
(2) With or without terminating the Lease, re-enter the Premises
with or without court action or summary proceedings and remove all property and
persons therefrom, all without resort to legal process and without Landlord
being deemed guilty of trespass or becoming liable for any loss or damage
occasioned thereby.
(3) With or without terminating this Lease, and from time to
time, make such improvements, alterations and repairs as may be necessary in
order to relet the Premises, and relet the Premises or any part thereof upon
such term or terms, at such rental or rentals and upon such other terms and
conditions as Landlord in its sole discretion may deem advisable.
(4) Enforce any provision of the Lease or any other agreement
between the parties by injunction, temporary restraining order or other similar
equitable remedy, to which the Tenant hereby expressly consents and agrees.
(5) Exercise any other legal or equitable right or remedy which
it may have by law or otherwise.
(C) Upon any event of default, Tenant shall remain liable to
the Landlord for the following amounts: (i) any rent of any kind
whatsoever which may have become due with respect to the period in the
Term which has already expired, (ii) all rent which becomes due during
the remainder of the Term (except that which is actually collected from
replacement tenants, if any), (iii) all out-of-pocket costs, fees and
expenses incurred by Landlord in leasing the Premises to others from
time to time, including but not limited to leasing commissions,
construction and other build-out costs, design and permitting costs and
the like, and (iv) all out-of-pocket costs, fees and expenses incurred
by Landlord in pursuit of its remedies hereunder, including but not
limited to attorneys' fees and court costs. Furthermore, at Landlord's
option, Tenant shall be obligated to pay, in lieu of item (ii) above in
this paragraph, an amount (the "Substitute Amount") which is equal to
(a) the present value of all rent which would become due during the
remainder of the Term, including all additional rent, with such present
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value to be determined by discounting at an annual rate of interest
which is equal to the bond-equivalent yield for the most recent auction
of U.S. Treasury Bills with a 1-year maturity (the "Discount Rate"),
minus (b) the fair market rental value of the Premises for the remainder
of the Term, as determined and calculated (i) taking into account
vacancy periods for reletting, build-out costs for new tenants and other
factors, (ii) by discounting to present value at the Discount Rate as
appropriate, and (iii) by an independent real estate professional
selected by Landlord. Tenant and Landlord acknowledge and agree that
payment to Landlord of the foregoing Substitute Amount is a reasonable
forecast of the actual damages which will be suffered by Landlord in
case of an event of default by Tenant, which actual damages are
otherwise difficult or impossible to ascertain, and therefore such
payment and reimbursement together constitute liquidated damages and not
a penalty. All such amounts shall be payable upon demand by Landlord.
(D) All parties hereto, both the Landlord and Tenant as
principals and any guarantors, hereby release and waive any and all
rights provided by law to a trial by jury in any court or other legal
proceeding initiated to enforce the terms of this Lease, involving any
such parties, or connected in any other manner with this Lease.
(E) Any amount of annual minimum or basic rent, additional rent
or other sum or charge which is not paid when due hereunder shall bear
interest at an annual rate of 12% from the date due until paid.
8. AMENDMENT TO SECTION 32 - NOTICES. Section 32 of the Lease is hereby
deleted in its entirety and the following is substituted in lieu thereof:
Any notice, consent, demand, xxxx, statement or other
communication required or permitted to be given hereunder must
be in writing and may be given by (i) personal delivery, (ii)
overnight courier, (iii) U.S. certified or registered mail
(and, if given by mail, such notice or other communication
shall be deemed given 2 days after being posted), or (iv)
confirmed facsimile transmission, to the parties at the
following addresses:
Landlord:
Liberty Property Limited Partnership
c/o Liberty Property Trust
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Tenant:
AMVAX, Inc.
c/o North American Vaccine, Inc.
00000 Xxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
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Either party may, by notice to the other given pursuant to this Section
32, specify additional or different addresses for notice purposes.
9. AMENDMENT TO SECTION 33 - SECURITY DEPOSIT. Simultaneously with the
execution and delivery of this Amendment by Tenant to Landlord, Tenant shall pay
to Landlord an amount of $154,200.00 by certified check or wire transfer of
funds, to be held by Landlord as additional security deposit money pursuant to
Section 33 of the Lease. The parties hereby agree that such payment, together
with the $60,800.00 previously paid by Tenant as a security deposit under the
Lease (notwithstanding anything to the contrary in the Lease), shall comprise a
total security deposit of $215,000.00, and such amount shall be held, without
interest, for the duration of the Term as security for Tenant's performance of
the Lease.
10. APPROVAL OF IMPROVEMENTS. By its execution of this Amendment,
Landlord approves the alterations to the Premises made by the Tenant as
described in the architectural and engineering plans prepared by Quasar
Engineers, Architects and Constructors (Project # 94-E-101) submitted to
Landlord under transmittals numbered 98-023 (dated 2/13/98), 98-024 (dated
2/20/98) and 98-112 (dated 10/27/98). In addition, Landlord hereby acknowledges
that, to Landlord's knowledge (without independent investigation), provided
Tenant makes the payment required by Section 8 of this Amendment above, (i)
Tenant is not in default under the Lease as of the date of this Amendment, and
(ii) there exists no occurrence or circumstance which, with the giving of notice
and the passing of time, will become an event of default under the Lease.
11. SURVIVAL. The Lease will remain in full force and effect, binding on
the parties and unmodified except as expressly set forth in this Amendment. In
the case of any conflicts between the terms of the Lease and the terms of this
Amendment, the terms of this Amendment shall govern.
IN WITNESS WHEREOF, Landlord and Tenant have executed this Amendment
intending to be legally bound thereby.
Landlord:
LIBERTY PROPERTY LIMITED PARTNERSHIP
By: Liberty Property Trust, Sole General Partner
Date signed: 1-22-98 By: /s/ Xxxxxxx X. Xxxxxxxxx
Name: Xxxxxxx X. Xxxxxxxxx
Title: Sr. Vice President
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TENANT:
Date signed: January 21, 1999
________________ AMVAX, INC.
Witness/Attest:
/s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxxxxxx X. Xxxxxxxx
______________________________ ____________________________________________
Name: XXXXXXX X. XXXXXX Name: XXXXXXXX X. XXXXXXXX
Title: ASSISTANT SECRETARY Title: VICE PRESIDENT-FINANCE
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