Document:

krys-20211231ex1017_sixt

13th 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Larry Walsh COOkrys-20211231ex1018_seve

   1    SEVENTH AMENDMENT TO LEASE AGREEMENT      THIS SEVENTH AMENDMENT TO LEASE AGREEMENT (this “Seventh  Amendment”) is made as of the _____ day of May 2021 (the “Effective Date”), by and between  Wharton Lender Associates, LP, a Pennsylvania limited partnership (“Landlord”), and Krystal  Biotech, Inc., a Delaware corporation, formerly known as Krystal Biotech, LLC, a California  limited liability company (“Tenant”).    WITNESSETH:     WHEREAS, by Lease dated May 26, 2016 (the “Original Lease”), as amended by First  Amendment to Lease Agreement dated July 26, 2016,  Second Amendment to Lease Agreement  dated February 27, 2017, Third Amendment to Lease Agreement dated May 31, 2018 (the “Third  Amendment”), Fourth Amendment to Lease Agreement dated October 22, 2018, (the “Fourth  Amendment”),  Fifth Amendment to Lease Agreement dated December 10, 2018 (the “Fifth  Amendment”) and Sixth Amendment to Lease Agreement/First Amendment to Storage Space  Agreement dated January 13, 2021 (the “Sixth Amendment”) (the Original Lease as amended,  collectively, the "Lease"), Landlord currently leases to Tenant and Tenant currently leases from  Landlord certain premises consisting of a total of 27,870 rentable square feet (the “Existing  Premises”) located in that certain building known as 2100 Wharton Street, Pittsburgh,  Pennsylvania (the “Building”), being comprised of 10,978 rentable square feet on the 7th Floor of  the Building, designated as Suite 701, and 16,892 rentable square feet on the 3rd floor of the  Building, designated as Suite 301; and     WHEREAS, by Storage Space Agreement dated April 27, 2020 (the “Storage Space  Agreement”), Landlord currently leases to Tenant and Tenant currently leases from Landlord  certain storage space consisting of 2,060 square feet on the 3rd Floor of the Building (the “Storage  Space”); and    WHEREAS, Landlord and Tenant now desire to amend the Lease to: (i) lease to Tenant an  additional 7,578 rentable square feet of office space located on the 7th Floor of the Building,  designated as Suite 720, as outlined on Exhibit “A” attached hereto and made a part hereof (the  “Seventh Floor Additional Space”), and 6,003 rentable square feet of office space located on the  6th Floor of the Building, designated as Suite 625, as outlined on Exhibit “B” attached hereto and  made a part hereof (the “Sixth Floor Space”), thereby increasing Tenant’s rentable area of office  space in the Building to a total of 41,451 rentable square feet of office space in the Building; (ii)  extend the Term of the Lease; and (iii) modify certain other terms of the Lease, all in accordance  with the terms and provisions hereof.     NOW THEREFORE, the parties hereto, in consideration of the mutual premises contained  herein, and intending to be legally bound hereby, do covenant and agree as follows:     1. Recitals.  The foregoing preamble is incorporated by reference herein as if set forth  at length.  Capitalized terms not otherwise defined herein shall have the meaning given to such  terms in the Lease.  All references herein to the Lease shall include this Seventh Amendment.     11 

 

   2    2. Sixth Floor Space.               (a) Commencing as of the Effective Date hereof, the Sixth Floor Space shall  become part of the Premises, accordingly, the Term of the Lease for the Sixth Floor Space and  Tenant’s obligation to pay Fixed Rent and additional rent for the Sixth Floor Space shall  commence on the Effective Date hereof.  Accordingly, effective as of the Effective Date until the  Seventh Floor Additional Space Commencement Date (as defined below), “Premises” shall mean  33,873 rentable square feet in the Building.      (b)    Sixth Floor Space Utilities, Janitorial and Cleaning.  Notwithstanding  anything to the contrary contained in the Lease, Tenant shall be responsible, at Tenant’s sole cost  and expense, for providing: (i) cleaning and janitorial services in a first class manner and keeping  with the standards of the Building, including, but not limited to garbage and rubbish removal on a  daily basis and the costs of dumpsters and services thereof for the Sixth Floor Space; and (ii) all  extraordinary utilities usage, costs and expenses (e.g., above standard office usage) used in the  Sixth Floor Space.    (c) Sixth Floor Space Utilities, Janitorial and Cleaning.  Notwithstanding  anything to the contrary contained in the Lease, Tenant shall be permitted to use the Sixth Floor  Space for general office and/or warehouse use (including inventory storage), and Tenant shall be  permitted to install workstations therein, provided that no more than fifty percent (50%) of floor  area comprising the Sixth Floor Space shall be used for such workstations, at Tenant’s sole cost  and expense, subject in all respects to the terms and conditions set forth in the Lease.    3. Seventh Floor Additional Space; Seventh Floor Additional Space Commencement  Date.        (a) Effective as of the Seventh Floor Additional Space Commencement Date  (as defined below), the Seventh Floor Additional Space shall become part of the Premises.   Accordingly, effective as of the Seventh Floor Additional Space Commencement Date, Premises  shall mean 41,451 rentable square feet in the Building.      (b) Seventh Floor Additional Space Commencement Date; Expiration Date.   The Term of the Lease for the Seventh Floor Additional Space (being 7,578 rentable square feet)   and Tenant’s obligation to pay Fixed Rent and additional rent for the Seventh Floor Additional  Space shall commence on the earlier to occur of the following (as applicable the earlier to occur,  the “Seventh Floor Additional Space Commencement Date”): (i) the date that Tenant occupies  and begins conducting business operations in all or part of the Seventh Floor Additional Space;  and (ii) the date that is one hundred and fifty (150) days after Landlord has delivered possession  of the Seventh Floor Additional Space.  Promptly after the occurrence of the Seventh Floor  Additional Space Commencement Date, Landlord and Tenant shall execute a memorandum that  memorializes the Seventh Floor Additional Space Commencement Date and the Expiration Date  (as extended pursuant to Section 4 below).     (c)  Subject to any Force Majeure and any Tenant Delay, and provided that  Tenant executes this Seventh Amendment or mutually satisfactory indemnification agreement by  

 

   3    May 11, 2021, time being of the essence, in the event Landlord has not delivered possession of the  Seventh Floor Additional Space on or before June 15, 2021 (the “Outside Delivery Date”), then  Tenant shall be entitled to Fixed Rent abatement for the Seventh Floor Additional Space only equal  to (i) two (2) days of Fixed Rent for the Seventh Floor Additional Space only for each one (1) day  of actual delay in Landlord’s delivery of the Seventh Floor Additional Space beyond the Outside  Delivery Date on a day for day basis until June 30, 2021 and (ii) four (4) days of Fixed Rent for  the Seventh Floor Additional Space only for each one (1) day of actual delay in Landlord’s delivery  of the Seventh Floor Additional Space beyond June 30, 2021 on a day for day basis until the  Landlord delivers possession of the Seventh Floor Additional Space to Tenant.    4. Extended Term of Lease for Premises.  The Term of the Lease for the Premises (as  expanded pursuant to this Seventh Amendment) is hereby extended for an additional period  commencing on the Seventh Floor Additional Space Commencement Date and ending on the date  that is ten (10) years after the Seventh Floor Additional Space Commencement Date (the  “Expiration Date”).  In the event the Seventh Floor Additional Space Commencement Date occurs  on a day other than the first day of a calendar month, the Term of this Lease shall be extended by  the number of days necessary to cause the Expiration Date to be on the last day of the calendar  month.        5. Fixed Rent.    (a) Fixed Rent for the Sixth Floor Space.  Commencing on the Effective Date  hereof and thereafter until February 28, 2027, Tenant shall pay Landlord Fixed Rent for the Sixth  Floor Space pursuant to the terms of the Lease and in accordance with the following table at the  annual rates as follows:     LEASE   PERIOD  PORTION OF  PREMISES   $PER  RENTABLE  SQ FT  MONTHLY   FIXED RENT  INSTALLMENT  ANNUAL   FIXED RENT  AMOUNT   Effective Date  hereof – 2/28/22    6,003 rsf  Sixth Floor Space  20.00 $10,005.00 $120,060.00  3/1/22 – 2/28/23 6,003 rsf  Sixth Floor Space  20.40 $10,205.10 $122,461.20  3/1/23 – 2/29/24 6,003 rsf  Sixth Floor Space  20.81 $10,410.20 $124,922.43  3/1/24 – 2/28/25 6,003 rsf  Sixth Floor Space  21.23 $10,620.31 $127,443.69  3/1/25 – 2/28/26 6,003 rsf  Sixth Floor Space  21.65 $10,830.41 $129,964.95  3/1/26 – 2/28/27 6,003 rsf  Sixth Floor Space  22.08 $11,045.52 $132,546.24      (b) Fixed Rent for the Existing Premises.  From the Effective Date hereof until  February 28, 2027, Tenant shall continue to pay Fixed Rent for the Existing Premises being 27,870  rentable square feet (consisting of 10,978 rentable square feet on the 7th Floor and 16,892 rentable  

 

   4    square feet on the 3rd floor) in accordance with the terms of the Original Lease, Third Amendment,  Fourth Amendment, Fifth Amendment and Sixth Amendment.     (c) Fixed Rent for the Seventh Floor Additional Space.  Commencing on the  Seventh Floor Additional Space Commencement Date and thereafter until February 28, 2027,  Tenant shall pay Landlord Fixed Rent for the Seventh Floor Additional Space pursuant to the terms  of the Lease and in accordance with the following table at the annual rates as follows:     LEASE   PERIOD  PORTION OF  PREMISES   $PER  RENTABLE  SQ FT  MONTHLY   FIXED RENT  INSTALLMENT  ANNUAL   FIXED RENT  AMOUNT   Seventh Floor  Additional Space  Commencement  Date – 2/28/22    7,578 rsf  Seventh Floor Additional Space  23.41 $14,783.42 $177,400.98  3/1/22 – 2/28/23 7,578 rsf  Seventh Floor Additional Space  23.88 $15,080.22 $180,962.64  3/1/23 – 2/29/24 7,578 rsf  Seventh Floor Additional Space  24.36 $15,383.34 $184,600.08  3/1/24 – 2/28/25 7,578 rsf  Seventh Floor Additional Space  24.85 $15,692.78 $188,313.30  3/1/25 – 2/28/26 7,578 rsf  Seventh Floor Additional Space  25.35 $16,008.53 $192,102.30  3/1/26 – 2/28/27 7,578 rsf  Seventh Floor Additional Space  25.86 $16,330.59 $195,967.08    (d) Fixed Rent for the Premises.                 (i)     Fixed Rent for the Existing Premises and the Seventh Floor Additional  Space.  Commencing on March 1, 2027 and thereafter until the Expiration Date (as defined in  Section 4 of this Seventh Amendment), Tenant shall pay Landlord Fixed Rent for the Existing  Premises and the Seventh Floor Additional Space (consisting of a total of 35,448 rentable square  feet) pursuant to the terms of the Lease and in accordance with the following table at the annual  rates as follows:     LEASE   PERIOD  PORTION OF  PREMISES   $PER  RENTABLE  SQ FT  MONTHLY   FIXED RENT  INSTALLMENT  ANNUAL   FIXED RENT  AMOUNT   3/1/27 – 2/29/28 35,448 rsf  Existing Premises and Seventh  Floor Additional Space  26.38 $77,926.52 $935,118.24  3/1/28 – 2/28/29 35,448 rsf  Existing Premises and Seventh  Floor Additional Space  26.91 $79,492.14 $953,905.68  3/1/29 – 2/28/30 35,448 rsf  Existing Premises and Seventh  Floor Additional Space  27.45 $81,087.30 $973,047.60  

 

   5    3/1/30 – 2/28/31 35,448 rsf  Existing Premises and Seventh  Floor Additional Space  28.00 $82,712.00 $992,544.00  3/1/31 – Expiration  Date  35,448 rsf  Existing Premises and Seventh  Floor Additional Space  28.56 $84,366.23 $1,012,394.80     (ii) Fixed Rent for the Sixth Floor Space.  Commencing on March 1,  2027 and thereafter until the Expiration Date, Tenant shall pay Landlord Fixed Rent for the Sixth  Floor Space pursuant to the terms of the Lease and in accordance with the following table at the  annual rates as follows:     LEASE   PERIOD  PORTION OF  PREMISES   $PER  RENTABLE  SQ FT  MONTHLY   FIXED RENT  INSTALLMENT  ANNUAL   FIXED RENT  AMOUNT   3/1/27– 2/29/28    6,003 rsf  Sixth Floor Space  22.52 $11,265.63 $135,187.56  3/1/28 – 2/28/29 6,003 rsf  Sixth Floor Space  22.97 $11,490.74 $137,888.91  3/1/29 – 2/28/30 6,003 rsf  Sixth Floor Space  23.43 $11,720.86 $140,650.29  3/1/30 – 2/28/31 6,003 rsf  Sixth Floor Space  23.90 $11,955.98 $143,471.70  3/1/31 – Expiration  Date  6,003 rsf  Sixth Floor Space  24.38 $12,196.10 $146,353.14    All Fixed Rent shall be payable in equal monthly installments in advance on the first day of each  month during the Term without demand, notice, offset or deduction.    6. Tenant’s Share; Tenant's Percentage.  Commencing as of the Effective Date and  continuing until the Seventh Floor Additional Space Commencement Date, “Tenant’s Percentage”  as defined in Paragraph 1.L. of the Original Lease and “Tenant’s Share”, as defined in Paragraph  4.A.(ii) of the Original Lease shall mean “14.98%” and all references in the Lease to “Tenant’s  Share and “Tenant’s Percentage” shall mean “14.98%”. Commencing on the Seventh Floor  Additional Space Commencement Date, “Tenant’s Percentage” as defined in Paragraph 1.L. of the  Original Lease and "Tenant's Share", as defined in Paragraph 4.A.(ii) of the Original Lease shall  mean “18.33%”, and all references in the Lease to “Tenant’s Share” and "Tenant's Percentage"  shall mean “18.33%”.      7. Condition of the Premises.  Notwithstanding anything contained in the Lease to the  contrary: (i) Landlord shall deliver the Sixth Floor Space and the Seventh Floor Additional Space  to Tenant and Tenant accepts delivery and possession of the Sixth Floor Space and the Seventh  Floor Additional Space in their current “as-is” where is condition with the sole exception that  Landlord shall remove the current tenant’s property and deliver the Seventh Floor Space to Tenant  broom-clean and free of all tenancies; and (ii) Tenant shall perform, at Tenant's sole cost and  expense, all other work and modifications to the Premises that is required, necessary or desired,  subject to, and in accordance with, the terms of the Lease; and (iii) Tenant’s continued possession  

 

   6    of the Existing Premises for the Extended Term shall be in its current “as-is” where is condition,  subject to clause (ii) above.    8. New Elevator.       (a) Commencing as of the Effective Date, Tenant shall have the right, upon at  least two (2) business days’ prior written notice to Landlord to request service of the existing  freight elevator serving the Building (the “Freight Elevator”) after regular business hours and on  Saturdays and Sundays in  accordance to the terms and conditions of this Section 8.(a).  Tenant  acknowledges and agrees that the use of the Freight Elevator after regular business hours and on  Saturdays and Sundays by tenants of the Building will require the Landlord to employ an operator  of the Freight Elevator to provide such service after hours (the “After Hours Elevator Service”).   In the event Tenant requires such After Hours Elevator Service,  Landlord shall use commercially  reasonable efforts to employ such operator of the Freight Elevator to provide such After Hours  Elevator Service to the Tenant.  .  Tenant shall reimburse and pay Landlord, as Additional Rent,  the reasonable overtime hourly wages paid to such operator of the After Hours Elevator Service   for such After Hours Elevator Service(s) provided to Tenant.    (b) Notwithstanding the foregoing, Tenant shall have the option, exercisable in  Tenant’s sole discretion, to install an elevator lift system between the Sixth Floor Space and the  portion of Tenant’s Premises located on the Seventh Floor (the “New Elevator”) pursuant to the  following terms and conditions:    (i) In the event Tenant desires to install the New Elevator, Tenant shall  provide written notice to Landlord of its election to do so, together with all proposed specifications,  plans and drawings depicting the location and necessary to design and construct the New Elevator  (the “Tenant’s Elevator Plans”) for Landlord’s review and approval, which shall not be  unreasonably withheld, conditioned or delayed.  Landlord and Tenant shall cooperate and use good  faith efforts to reach agreement on the Tenant’s Elevator Plans as promptly and as reasonably  possible.  Tenant’s Elevator Plans shall include fully engineered drawings, that include impact to  the structure of the Building and otherwise affecting the Building, prepared and stamped by a  structural engineer approved by Landlord and licensed in the Commonwealth of Pennsylvania.   Prior to preparation of Tenant’s Elevator Plans, Tenant shall provide to Landlord, at Tenant’s sole  cost and expense, a plan for structural due diligence to be performed on the Building. In furtherance  of the foregoing, Landlord shall review and respond to Tenant with any objections or requested  modifications to Tenant’s Elevator Plans within fifteen (15) business days from receipt of the  Tenant’s Elevator Plans. Unless Landlord objects in writing within such 15-business day period,  Landlord shall be deemed to have approved such Tenant’s Elevator Plans. Notwithstanding the  foregoing,  solely in the event that Tenant retains Steve Bentz, BECS, (steve.bentz.@becsmd.com;  703-402-7121) for the preparation of the foregoing structural plans and Tenant’s Elevator Plans,  then Landlord’s review period shall be reduced to ten (10) business days.  In the event Landlord  provides a written objection to the location of the New Elevator or otherwise to Tenant’s Elevator  Plans, together with commercially reasonable justification for such objection, within the  aforementioned 15-business day (or 10 business day, as the case may be) period, Tenant shall  modify such plans and specifications for the New Elevator and resubmit the same for Landlord’s  approval, and the aforementioned process shall continue until the plans and specifications for the  

 

   7    New Elevator are agreed to between Landlord and Tenant.  Within thirty (30) days after Landlord’s  invoice therefor together with copies of invoices for the same, Tenant shall reimburse Landlord  for its reasonable out-of-pocket third-party costs (including, but not limited to, structural engineer  costs) Landlord incurred in reviewing the Tenant’s Elevator Plans.    (ii) Tenant and Tenant’s contractors and subcontractors shall comply in  all respects with the terms of Paragraph 12 of the Original Lease in connection with the  performance of the New Elevator work.  Tenant shall be solely responsible for all costs and  expenses associated with the New Elevator, including, but not limited to the costs of design,  permits, approvals, installation, maintenance, utilities, cleaning, power, structural issues, roof  warranty compliance (if applicable), repair, removal, liability and operation of and relating to the  New Elevator. Tenant shall be solely liable for the New Elevator and any and all matters arising  from and/or in connection with the operation of the New Elevator.    (iii) In addition, Tenant agrees to indemnify, defend and hold harmless  Landlord and its representatives from and against all claims, actions, losses, liabilities, damages,  liabilities, costs and expenses of any nature whatsoever (including attorneys’ and other legal fees  and costs) arising from or relating to the New Elevator and related equipment, including, but not  limited installation, maintenance, replacement, use or removal of the New Elevator and all related  facilities and equipment (including, without limitation, for any liabilities or damages related to the  New Elevator failing to comply with any applicable laws, regulations or ordinances, or for any  damage caused by the New Elevator or as a result of servicing the New Elevator which damages  the Building).  Except as otherwise expressly set forth herein, Landlord shall maintain  responsibility for all maintenance obligations set forth in Paragraph 13 of the Original Lease.  For  the sake of clarification, Tenant shall be liable for all costs and expenses for all repairs and  restoration arising from the New Elevator and/or related facilities and equipment.  At any time  after the installation of the New Elevator, during the Term, upon Landlord’s request, Tenant shall  deliver to Landlord a certificate of insurance naming Landlord as additional insured and  satisfactory to Landlord covering the New Elevator and Tenant’s contractual obligations of  indemnification with respect to the New Elevator as set forth in this paragraph. To the maximum  extent allowed by applicable law, Landlord and its property manager shall not be responsible or  liable for, and Tenant hereby expressly waives all claims against Landlord for, injury to persons  caused by the installation and operation of the New Elevator (and the wiring and other equipment  related thereto) or damage to the New Elevator or any equipment related thereto .  Tenant shall  pay all fees to any and all governmental and quasi-governmental authorities relating to or arising  from the New Elevator.  Following the installation of the New Elevator, Tenant shall, at its sole  cost and expense, maintain and operate New Elevator in good, clean and safe condition and repair.    (iv)  Upon Landlord’s request (the “Landlord’ Removal Request”),  Tenant shall remove the New Elevator and all related equipment at the expiration or earlier  termination of this Lease, provided that such request is delivered to Tenant no later than sixty (60)  days after the expiration or earlier termination of this Lease.  This Section 8.(b) (iv) shall survive  the expiration or earlier termination of this Lease.  In the event Landlord provides Tenant with  Landlord’s Removal Request, Tenant shall be obligated to remove the New Elevator and Tenant  shall repair and restore the areas of the Building impacted by the installation or operation of the  New Elevator, at Tenant’s expense, all to be completed within a reasonable time from receipt of  

 

   8    Landlord’s Removal Request, in accordance with this Section 8 and the terms of Paragraphs 11  and 12 of the Original Lease, provided, that in the event of any inconsistency between this Section  8 and Paragraphs 11 and 12 of the Original Lease, this Section 8 shall control.  For the sake of  clarity, Tenant shall be responsible for all costs and expenses arising from Tenant’s installation,  maintenance and/or removal of the New Elevator including, but not limited to, all damage to the  roof and the Building that is caused by or arising from Tenant’s installation, maintenance or  removal of the New Elevator and shall comply with all applicable laws and regulations with respect  to the New Elevator.     9. Right of First Offer.  So long as no event of default by Tenant has occurred under  the terms of the Lease beyond the expiration of all applicable notice and cure periods, Tenant shall  have a right of first offer for the Offer Space (as hereinafter defined) during the Extended Term of  this Lease, such right of first offer to be on the terms and conditions as set forth in this Section 8.     (a) Landlord will provide written notice (the “Offer Notice”) to Tenant of the  availability of the lease for that certain space consisting of approximately 9,190 rentable square  feet of space on the 7th Floor of the Building as outlined in Exhibit “C” attached hereto and made  a part hereof (the “Offer Space”).  Tenant will then have the right to lease all (but not less than all)  of the Offer Space by giving written notice to Landlord of Tenant’s election to do so within fifteen  (15) business days following receipt of the Offer Notice. Tenant’s lease of the Offer Space shall  be in its then current “as-is” where is condition, at the then current rental rate in effect for the  Premises (at the time Tenant exercises its right of first offer) for the remainder of the Extended  Term, with a proportional increase in Tenant’s parking rights.  In the event Tenant exercises its  option to lease the Offer Space, Tenant shall have the right to terminate its lease with respect to  the Additional Third Floor Space (as defined in the Sixth Amendment).   Tenant’s Share will be  adjusted to include the total amount of rentable square feet of the Offer Space that Tenant has  exercised its right to lease.  After Tenant’s exercise of its right of first offer set forth in this Section  8, Landlord and Tenant shall promptly thereafter enter into an amendment to this Lease which  memorializes the terms thereof, inclusive of all applicable terms and conditions set forth above.    (b) Time shall be of the essence with regard to this right of first offer, and in  the event that Tenant fails to reply in writing within the aforesaid 15-business day period, such  failure to reply shall be deemed a waiver by Tenant of its right of first offer of the Offer Space and  Tenant shall have no further rights whatsoever to the Offer Space, and this right of first offer, as  provided in this Section 9, shall be deemed extinguished, null and void, and of no further effect.       10.  Vehicle Parking.  Section 7 of the Sixth Amendment is hereby deleted in its  entirety and replaced with the following (to be effective as of the Effective Date of this  Amendment):      "Subject to the Parking Rules set forth in Exhibit B to the Original Lease, as  modified by Landlord from time to time (the "Rules"), Tenant shall be entitled to  use up to ninety-five (95) unreserved parking spaces in the parking facility of the  Property, at the rate of One Hundred Forty and 00/Dollars ($140.00) per month per  parking space.  Tenant shall pay Landlord, as additional rent, without demand,  notice, offset or deduction, the foregoing rate per parking space per month for each  

 

   9    month of the remainder of the Term hereof for each of the parking spaces utilized  by Tenant.  Notwithstanding the foregoing, so long as Tenant is not in material  default under the terms of the Lease beyond the expiration of all applicable notice  and cure periods, if any, twenty-eight (28) of the foregoing unreserved parking  spaces shall be provided at no charge. Landlord shall use commercially reasonable  efforts to accommodate Tenant’s future parking spaces requirements, subject to  availability of parking spaces (the “Additional Spaces”) and pursuant to the Rules,  at the then current prevailing rate per month per parking space.  Tenant shall pay  Landlord, as additional rent, without demand, notice, offset or deduction, the then  current prevailing rate(s) per parking space per month for each month of the Term  for each of the Additional Spaces used, utilized or requested by Tenant.”     11. Roof Repairs.      (a) Subject to any Force Majeure delay and/or Tenant Delay, Landlord, at  Landlord’s sole cost and expense, will replace that certain portion of the Building’s roof located  over the Seventh Floor Additional Space (the “Phase 1 Roof Replacement Area”) on or prior to  October 1, 2021.  Such Phase 1 Roof Replacement Area is depicted on Exhibit “D-1” attached  hereto and made a part hereof.  In the event the replacement of the Phase 1 Roof Replacement  Area has not been completed by October 31, 2021, subject to any Force Majeure delay or Tenant  Delay, and provided that Tenant executes this Seventh Amendment or mutually satisfactory  indemnification agreement by May 11, 2021, time being of the essence, commencing on  November 1, 2021, Tenant shall be entitled to Fixed Rent abatement solely for the Seventh Floor  Additional Space  equal to one (1) day of Fixed Rent solely for the Seventh Floor Additional Space  for each one (1) day of actual delay in Landlord’s completion of the replacement of the Phase 1  Roof Replacement Area beyond October 31, 2021 on a day for day basis until the Landlord  completes the replacement of the Phase 1 Roof Replacement Area.  Notwithstanding the foregoing,  for each day between May 1, 2021 and November 1, 2021 that the Landlord’s roofing contractor  is not able to perform roofing work that it is scheduled to perform on any particular day during  such period of time due to any weather conditions (including, but not limited to, rain) (as  applicable, a “Phase 1 Weather Delay”), the date of November 1, 2021 shall be extended by each  day of Phase 1 Weather Delay.     (b) Subject to any Force Majeure delay and Tenant Delay, in addition to the  replacement of the Phase 1 Roof Replacement Area, Landlord, at Landlord’s sole cost and expense,  will replace that certain portion of the Building’s roof (the “Phase 2 Roof Replacement Area”)  that is not a part of the Phase 1 Roof Replacement Area and was not previously replaced during  the 2018 calendar year.  Such Phase 2 Roof Replacement Area is depicted on Exhibit “D-2”  attached hereto and made a part hereof.  In the event the replacement of the Phase 2 Roof  Replacement Area has not been completed by June 30, 2022, subject to any Force Majeure delay  or Tenant Delay, and provided that Tenant executes this Seventh Amendment or mutually  satisfactory indemnification agreement by May 11, 2021, time being of the essence, commencing  on July 1, 2022, Tenant shall be entitled to Fixed Rent abatement solely for the Seventh Floor  Additional Space equal to one (1) day of Fixed Rent solely for the Seventh Floor Additional Space  for each one (1) day of actual delay in Landlord’s completion of the replacement of the Phase 2  Roof Replacement Area beyond June 30, 2022 on a day for day basis until the Landlord completes  

 

   10    the replacement of the Phase 2 Roof Replacement Area.   Notwithstanding the foregoing, for each  day between May 1, 2021 and June 30, 2022 that the Landlord’s roofing contractor is not able to  perform the roofing work that it is scheduled to perform on any particular day during such period  of time due to any weather conditions (including, but not limited to, rain) (as applicable, a “Phase  2 Weather Delay”), the date of July 1, 2022 shall be extended by each day of Phase 2 Weather  Delay.      (c) The replacement of the Phase 1 Roof Replacement Area and Phase 2 Roof  Replacement Area are collectively referred to as the “Roof Replacement Work”.  The terms  “Force Majeure” and “Tenant Delay” used herein shall have the same meanings set forth in  Section 24.J of the Original Lease and Section 6(b) of the Third Amendment and respectively and  as set forth below.  Landlord acknowledges that Tenant has certain equipment located on the  Building’s roof and Tenant may require that certain equipment be relocated or new equipment to  be installed on the Building’s roof.  Accordingly, Landlord and Tenant shall use commercially  reasonable efforts to coordinate the phasing and performance of Landlord’s Roof Replacement  Work to minimize any potential Tenant Delay due any of Tenant’s equipment located on the  Building’s roof.  Notwithstanding anything to the contrary in the foregoing, Tenant shall be  responsible, at Tenant’s sole cost, expense, and liability, to remove all of Tenant’s equipment on  and in the Phase 1 Roof Replacement Area and/or the Phase 2 Roof Replacement Area (as  applicable, “Tenant’s Roof Equipment”) on a timely basis and pursuant to the terms and  conditions of Section 10 of the Sixth Amendment. Tenant’s failure to timely remove Tenant’s  Roof Equipment shall be deemed a Tenant Delay.  Upon completion of each portion of the work  to be performed pursuant to Sections 11(a) and 11(b) above, Tenant may replace Tenant’s Roof  Equipment located in the applicable portion of the roof pursuant to the terms and conditions of  Section 10 of the Sixth Amendment.    12. Broker.  Landlord and Tenant each hereby represents and warrants to the other that  it has not dealt with any real estate broker, sales person, or finder in connection with this Seventh  Amendment except for Landlord's Broker, CBRE, Inc. (“Broker”).  Landlord shall be responsible  for the payment of any commission owed to the Broker based upon Landlord's separate agreement  with such Broker.  Landlord and Tenant each agree to indemnify and hold harmless the other party  and their respective agents and employees, from and against any and all liabilities and claims for  commissions and fees arising out of a breach of the foregoing representation (including without  limitation, any other broker claiming to have been engaged by such indemnifying party in  connection with this Seventh Amendment).     13. Full Force and Effect.  Except as specifically set forth herein, the terms, covenants  and conditions of the Lease shall remain in full force and effect.  The Lease and this Seventh  Amendment shall not be further modified or amended, except in writing signed by both Landlord  and Tenant.  This Seventh Amendment sets forth the entire understanding of the parties with  respect to the matters set forth herein and there are no other rights, including but not limited to,  any renewals, extensions, expansions, purchases, rights of first refusal, allowances, etc., granted  to Tenant other than those expressly set forth in the Lease that have not been deleted or otherwise  nullified or this Seventh Amendment.  Landlord and Tenant hereby ratify and affirm all of the  remaining terms and conditions of the Lease not modified or supplemented by this Seventh  

 

   11    Amendment.  Tenant hereby acknowledges that, as of the date of this Seventh Amendment,  Landlord is not in default of any of the terms and conditions of the Lease.    14. Provisions Binding.  All rights and liabilities herein given to or imposed upon the  parties to this Seventh Amendment shall extend to, and be binding upon and inure to the benefit  of, the parties hereto and their respective successors and assigns.    15. Confidentiality.  Tenant agrees that it shall maintain in confidence and shall not  divulge to any third party (except to its employees, brokers, attorneys, accountants or other  professional service providers as needed, or as may otherwise be required by the Securities and  Exchange Commission or applicable law) any of the items, covenants and conditions of the Lease  and this Seventh Amendment, including without limitation, any information related to the rental  rate, the length of the Term, and any other terms and conditions thereof.  Tenant further agrees to  take commercially reasonable precautions to prevent the unauthorized disclosure of any such  information to any third parties.  Tenant’s obligations under this Section 15 shall survive the  termination of the Lease.    16. Counterparts; Delivery.  This Seventh Amendment may be executed in any number  of counterparts, and by each of the parties on separate counterparts, each of which, when so  executed, shall be deemed an original, but all of which shall constitute but one and the same  instrument provided that all parties execute and deliver a counterpart to the other party. Delivery  of an executed counterpart of this Seventh Amendment by electronic delivery shall be equally as  effective as delivery of a manually executed counterpart of this Seventh Amendment. Any party  delivering an executed counterpart of this Seventh Amendment by electronic delivery shall also  endeavor to deliver a manually executed counterpart of this Seventh Amendment, but the failure  to deliver a manually executed counterpart shall not affect the validity, enforceability or binding  effect of this Seventh Amendment.      [SIGNATURE PAGE FOLLOWS]  

 

   12      IN WITNESS WHEREOF, the parties hereto have executed this Seventh Amendment to  Lease Agreement on the day and year set forth below.        LANDLORD:    WHARTON LENDER ASSOCIATES, LP,   a Pennsylvania Limited Partnership    By: WHARTON LENDER PROPERTIES, LLC,  a Pennsylvania Limited Liability Company,   its General Partner    By:             Name:             Title:             Date:   May ___, 2021          TENANT:    KRYSTAL BIOTECH INC.,   a Delaware corporation        By:             Name:             Title:               Date: May ___, 2021                                 ! !    Larry Walsh COO 11 

 

   A-1    EXHIBIT "A"    Seventh Floor Additional Space    

 

   B-1    EXHIBIT "B"    Sixth Floor Space    

 

   C-1    EXHIBIT "C"    Offer Space      

 

   D-1-1    EXHIBIT “D-1”    Phase 1 Roof Replacement Area      

 

   D-2-1    EXHIBIT “D-2”    Phase 2 Roof Replacement Area

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