EXHIBIT 10.1
LEASE AMENDMENT AND ATTORNMENT AGREEMENT
THIS LEASE AMENDMENT AND ATTORNMENT AGREEMENT ("Amendment") dated as of March
15, 2004 by and among DANBURY BUILDINGS CO., L.P., a Delaware limited
partnership having offices c/o Sunbelt Investment Holdings, Inc., 220 Congress
Park Drive, Delray Beach, FL 33445 ("Overlandlord"), UNION CARBIDE CORPORATION,
a New York corporation having offices at 400 West Sam Houston Parkway South,
Houston, TX 77042 ("Landlord"), and PENWEST PHARMACEUTICALS CO., a Washington
corporation having offices at 39 Old Ridgebury Road, Danbury, CT 06810
("Tenant").
WITNESSETH:
WHEREAS, Overlandlord's predecessor corporations and Landlord executed that
certain Lease Agreement dated as of December 29, 1986, as amended thereafter,
for the building now known as Corporate Center (the "Prime Lease"); and
WHEREAS, Landlord and Tenant executed that certain Lease Agreement dated as of
February 3, 2003 (the "Lease") to sublease office space at Corporate Center; and
WHEREAS, Tenant wishes to increase and relocate its office space within
Corporate Center and to have certain Renewal Options (as hereinafter defined) to
extend the Term of the Lease beyond the term of the Prime Lease, and Landlord
and Overlandlord are agreeable thereto subject to the terms and conditions
hereof; and
WHEREAS, the parties wish to amend the Lease accordingly;
NOW, THEREFORE, in consideration of the mutual covenants and obligations
contained herein, Landlord and Tenant hereby amend the Lease as follows:
1. PREMISES
Effective as of May 1, 2004 ("Effective Date"), Article 1.01 of the Lease is
hereby amended such that the space as shown on Exhibit A-1 attached hereto and
hereby incorporated herein and made a part hereof, which all parties hereto
agree that for all purposes of the Lease consists of approximately 21,487
rentable square feet located on the third floor of Building A, is hereby
substituted as the Demised Premises and shall be referred to as the "Demised
Premises" in the Lease and this Amendment as of the Effective Date. Landlord
shall deliver such substituted Demised Premises broom clean and furnished with
furniture similar to that in the Existing Demised Premises (as hereinafter
defined), subject to Tenant's reasonable approval. As of the Effective Date such
furniture shall be deemed the "Furniture" as such term is used in the Lease and
as more particularly shown in Exhibit B-2, attached hereto and made a part
hereof (all at Landlord's sole cost). Tenant shall surrender the space it
currently occupies (the "Existing Demised Premises") in broom clean condition,
together with the Furniture provided to Tenant by Landlord during the Term prior
to this Amendment, with all of Tenant's personal possessions removed, and any
damage caused by such removal shall be repaired (all at Tenant's sole cost)
pursuant to the terms of Article 10 of the Lease. The parties acknowledge that,
in connection
with such surrender, no Alteration removal nor restoration work is required to
be performed by Tenant in the Existing Demised Premises pursuant to Section 9.02
of the Lease. Subject to such surrender, Tenant's obligation to pay Base Rent,
Additional Rent, and Electricity Costs on the Existing Demised Premises shall
cease as of the Effective Date, except to the extent such obligations have been
incurred and not satisfied prior to the Effective Date.
2. TERM
As of the Effective Date, Article 1.02 of the Lease is hereby amended to extend
the Term to a new Expiration Date of December 30, 2006.
3. RENT
As of the Effective Date, Article 1.03(a) of the Lease is hereby amended such
that Base Rent shall be in accordance with the following schedule: May 1, 2004
through January 31, 2005: $36,706.95 ($440,483.50 or $20.50 per rentable square
foot per year); February 1, 2005 through January 31, 2006: $38,497.54
($461,970.50 or $21.50 per rentable square foot per year); and February 1, 2006
through December 30, 2006: $39,500.27 ($474,003.22 or $22.06 per rentable square
foot per year). Tenant shall not have any obligation to pay Base Rent from May
1, 2004 until August 1, 2004. Tenant's obligation to pay Electricity Costs and
to pay Additional Rent, if any, shall not be excused during such period.
As of the Effective Date, Article 1.03(b) shall be amended by replacing the
phrase "11,429 rentable square feet" with "21,487 rentable square feet".
4. PARKING
As of the Effective Date, Article 1.05 is hereby amended such that Tenant shall
have the right to four (4) Reserved Spaces.
5. WORK ALLOWANCE
As of the Effective Date, the second and third sentences of Article 1.06 of the
Lease are hereby deleted in their entirety.
6. RENEWAL OPTION/ATTORNMENT/CONTINUATION
As of the Effective Date, the current language of Article 1.07 of the Lease is
hereby deleted in its entirety and the following language is hereby inserted in
its place:
"(a) Provided that Tenant is not in default under this Lease beyond
any applicable notice and cure period on the date Tenant delivers a
Renewal Notice, as hereinafter defined, Tenant shall have the right
("the Renewal Option") to extend the Term for all premises then
demised hereunder for two (2) one (1)-year periods ( each a "Renewal
Term"). The first Renewal Term shall commence on the date
immediately succeeding the Expiration Date, and end on the first
(1st) anniversary of the Expiration Date, and the second Renewal
Term shall commence on the date immediately succeeding the end of
the first (1st) Renewal Term and shall end on the second (2nd)
anniversary of the Expiration
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Date. Each Renewal Option shall be exercisable only by Tenant giving
Overlandlord, and, with respect to the first Renewal Term, Landlord,
written notice of such exercise (herein called the "Renewal
Notice"), which notice shall be received by such parties not later
than March 31, 2006 with respect to the first Renewal Term and not
later than March 31, 2007 with respect to the second Renewal Term.
All of the terms and provisions of this Lease, except this Paragraph
(a), shall be applicable to each Renewal Term, including without
limitation Tenant's obligations to pay Additional Rent and to pay
Electricity Costs for the substituted Demised Premises at the rate
set forth in Section 1.03(b) of the Lease, except that: (i) Base
Rent for the first Renewal Term shall be equal to the product
determined by multiplying Twenty Five Dollars and No Cents ($25.00)
times the rentable square fee of the premises then demised
hereunder, as herein set forth, which shall be payable in equal
monthly installments in the amount of one twelfth (1/12th) of such
product, and (ii) Base Rent for the second Renewal Term shall be
equal to the product determined by multiplying Twenty Six Dollars
and No Cents ($26.00) times the rentable square feet of the premises
then demised hereunder, as herein set forth, which shall be payable
in equal monthly installments in the amount of one twelfth (1/12th)
of such product. Tenant agrees to accept the premises to be covered
by this Lease during the Renewal Term in an "as is" physical
condition and Tenant shall not be entitled to receive any allowance,
credit, concession or payment from Landlord or Overlandlord for the
improvement thereof. In the event Tenant exercises a Renewal Option,
Landlord and Tenant shall mutually execute and deliver an amendment
to this Lease reflecting the renewal of the Term on the terms herein
provided. The Renewal Option herein granted shall automatically
terminate upon the earliest to occur of (i) the expiration or
termination of this Lease, (ii) the termination of Tenant's right to
possession of the premises, (iii) any assignment or subletting by
Tenant except as provided for in Section 6.03, or (iv) the failure
of Tenant to timely or properly exercise the Renewal Option.
Landlord and Tenant acknowledge and agree that any real estate
brokerage commission or finder's fee shall be payable by Landlord
and Tenant, respectively, in connection with any exercise by Tenant
of the Renewal Option herein contained in the manner set forth in
Article 26 of the Lease.
"(b) The parties acknowledge that the Prime Lease will, by its
terms, expire on December 31, 2006. In the event that Tenant
exercises a Renewal Option or if the Prime Lease should terminate
prior to December 31, 2006 for any reason, the parties hereto agree
that Overlandlord shall succeed to the rights of, and Landlord shall
be released from the obligations of, Landlord hereunder from and
after such date, except to the extent of any of Landlord's
obligations under the Lease that expressly survive the termination
thereof. In such event, Overlandlord shall accept Tenant's
attornment and Tenant agrees to so attorn and recognize Overlandlord
as Tenant's landlord under this Lease without further requirement
for execution and delivery of any instrument to further evidence the
attornment set forth herein. Tenant will, upon the request of
Overlandlord, execute and deliver such reasonably acceptable
instruments to evidence such attornment. When Overlandlord shall
succeed to the rights of Landlord hereunder, this Lease shall
continue in full force and effect as, or as if it were, a direct
lease between Overlandlord and Tenant upon all of the then executory
terms, conditions and covenants as are set forth in this Lease, and
shall be applicable after such attornment, provided however, that
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Overlandlord shall not be: (i) subject to any credits, offsets,
defenses or claims which Tenant might have against Landlord except
as expressly provided in the Lease; (ii) bound by any prepayment of
rent which Tenant might have paid to Landlord; (iii) liable for any
act or omission of Landlord except any continuing defaults by
Landlord; (iv) bound by any covenant to undertake or complete any
improvement to the Demised Premises; (v) required to account for any
security deposit; or (vi) bound by any modification of this Lease
made without Overlandlord's prior written consent. Tenant waives the
provisions of any statute or rule of law now or hereafter in effect
that may give or purport to give it any right or election to
terminate or otherwise adversely affect this Lease or the
obligations of Tenant thereunder by reason of any action or
proceeding for the purpose of terminating the Prime Lease by reason
of any default thereunder or the actual termination thereof by
reason of such default.
7. EXPANSION OPTION
Provided that Tenant is not in default under this Lease beyond any applicable
notice and cure period, Tenant shall have the right, ("Expansion Option") to be
exercised on or before one month prior to the expiration of any Term under the
Lease, as hereby amended, to expand the Demised Premises to include the
additional premises depicted on Attachment 2 attached hereto and made a part
hereof, which the parties hereto agree for all purposes under this Lease,
contains an area of 3,041 rentable square feet ("Expansion Space"). Tenant shall
give Landlord and Overlandlord thirty (30) days prior written notice of its
exercise of the right to expand into the Expansion Space as herein provided.
Tenant agrees to accept the Expansion Space in an "as is" physical condition and
Tenant shall not be entitled to receive any allowance, credit, concession or
payment from Landlord for the improvement thereof. All of the terms and
provisions of this Lease shall be applicable to the Expansion Space. The annual
Base Rent for the Expansion Space shall be equal to: (i) Twenty Dollars and
Fifty Cents ($20.50) per rentable square foot per year thereof during the period
commencing on May 1, 2004 and ending on January 31, 2005; (ii) $21.50 per
rentable square foot per year thereof during the period commencing February 1,
2005 and ending on January 31, 2006; (iii) Twenty Two Dollars and Six Cents
($22.06) during the period commencing on February 1, 2006 and ending on December
30, 2006; (iv) Twenty Five Dollars and No Cents ($25.00) per rentable square
foot per year during the first Renewal Term, if any; and (v) Twenty Six Dollars
and No Cents ($26.00) per rentable square foot per year during the second
Renewal Term, if any, which shall be payable in equal monthly installments on
the first day of each month after the Expansion Space is so added to the Demised
Premises. In the event Tenant exercises the Expansion Option, Landlord and
Tenant shall mutually execute and deliver an amendment to this Lease reflecting
the Expansion Space on the terms herein provided. The Expansion Option herein
granted shall automatically terminate upon the earliest to occur of (i) the
expiration or termination of this Lease, (ii) the termination of Tenant's right
to possession of the premises, (iii) any assignment or subletting by Tenant
except as provided for in Section 6.03, or (iv) the failure of Tenant to timely
or properly exercise the Expansion Option.
8. DEFINITIONS
Capitalized terms used herein shall have the same meaning as defined in the
Lease or in the Prime Lease, as the case may be, unless they are otherwise
defined herein.
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9. ENTIRE AGREEMENT
This Amendment contains the entire agreement of the parties and hereby expressly
supercedes and replaces any other agreement, whether written or oral, with
respect to the subject matter hereof.
10. CONTINUING LEASE
Except as specifically changed herein, all other terms and conditions of the
Lease shall remain unchanged and in full force and effect.
11. NOTICE TO OVERLANDLORD
All Notices to Overlandlord hereunder shall be sent in the manner required under
the Lease to DANBURY BUILDINGS, INC., c/o Sunbelt Management Company, Attn:
Richard M. Reeves, President, 220 Congress Park Drive, Delray Beach, FL 33445,
with a copy to Benjamin J. Randall, Randall & Kenig, 455 North Cityfront Plaza,
Suite 3160 Chicago, Illinois 60611, or to such other address(es) as the
Overlandlord may advise by Notice to the Landlord and the Tenant.
SIGNATURES ON THE FOLLOWING PAGE
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed by
their duly authorized representatives as of the date first written above.
DANBURY BUILDINGS CO. L.P.,
a Delaware limited partnership
By: DANBURY BUILDINGS, INC.
Its: General Partner
By: /s/ Richard M. Reeves
__________________________________
Name: RICHARD M. REEVES
________________________________
Title: AUTHORIZED SIGNATORY
_______________________________
By: /s/ Raymond G. Gardner
__________________________________
Name: RAYMOND G. GARDNER
________________________________
Title: AUTHORIZED SIGNATORY
_______________________________
UNION CARBIDE CORPORATION
By: /S/ M.J. Lehman
__________________________________
Name: M. J. LEHMAN
________________________________
Title: AUTHORIZED AGENT
_______________________________
PENWEST PHARMACEUTICALS CO.
By: /s/ Jennifer L. Good
__________________________________
Name: JENNIFER L. GOOD
________________________________
Title: SR. VP FINANCE & CFO
_______________________________
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