California-Irvine-2010 Main Plaza Lease - EOP-2010 Irvine LLC and Phobo.com Inc.
2010 MAIN PLAZA
IRVINE, CALIFORNIA
STANDARD FORM OFFICE LEASE
BETWEEN
EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY COMPANY, AS BENEFICIARY
OF LAND TRUST DATED JUNE 5,1997 AND KNOWN AS SHELI Z. ROSENBERG TRUST NO. 2010
("LANDLORD"),
AND
PHOBO.COM, INC., A DELAWARE CORPORATION
("TENANT")
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TABLE OF CONTENTS
I. BASIC LEASE INFORMATION; DEFINITIONS........................... 1
II. LEASE GRANT................................................... 4
III. POSSESSION................................................... 4
IV. RENT.......................................................... 4
V. USE............................................................ 10
VI. SECURITY DEPOSIT.............................................. 10
VII. SERVICES TO BE FURNISHED BY LANDLORD......................... 11
VIII. LEASEHOLD IMPROVEMENTS...................................... 12
IX. GRAPHICS...................................................... 12
X. REPAIRS AND ALTERATIONS........................................ 12
XI. USE OF ELECTRICAL SERVICES BY TENANT.......................... 13
XII. ENTRY BY LANDLORD............................................ 14
XIII. ASSIGNMENT AND SUBLETTING................................... 14
XIV. LIENS........................................................ 16
XV. INDEMNITY AND WAIVER OF CLAIMS................................ 16
XVI. TENANT'S INSURANCE........................................... 17
XVII. SUBROGATION................................................. 18
XVIII. LANDLORD'S INSURANCE....................................... 19
XIX. CASUALTY DAMAGE.............................................. 19
XX. DEMOLITION.................................................... 19
XXI. CONDEMNATION................................................. 20
XXII. EVENTS OF DEFAULT........................................... 20
XXIII REMEDIES.................................................... 21
XXIV. LIMITATION OF LIABILITY..................................... 22
XXV. NO WAIVER.................................................... 23
XXVI. EVENT OF BANKRUPTCY......................................... 23
XXVII. WAIVER OF JURY TRIAL....................................... 24
XXVIII. RELOCATION................................................ 24
XXIX. HOLDING OVER................................................ 24
XXX. SUBORDINATION TO MORTGAGES; ESTOPPEL CERTIFICATE............. 25
XXXI. ATTORNEYS' FEES............................................. 25
XXXII. NOTICE..................................................... 25
XXXIII. LANDLORD'S LIEN........................................... 26
XXXIV. EXCEPTED RIGHTS............................................ 26
XXXV. SURRENDER OF PREMISES....................................... 27
XXXVI. MISCELLANEOUS.............................................. 27
XXXVII. ENTIRE AGREEMENT.......................................... 29
I
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OFFICE LEASE AGREEMENT
THIS OFFICE LEASE AGREEMENT (the "Lease") is made and entered into as of
the 5th day of March, 1999, by and between EOP-2010 IRVINE, L.L.C., A DELAWARE
LIMITED LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND
KNOWN AS SHELI Z. ROSENBERG TRUST NO. 2010 ("Landlord") and PHOBO.COM, INC., A
DELAWARE CORPORATION ("Tenant").
I. BASIC LEASE INFORMATION; DEFINITIONS.
A. The following are some of the basic lease information and defined
terms used in this Lease.
1. "Additional Base Rental" shall mean Tenant's Pro Rata Share of
Basic Costs and any other sums (exclusive of Base Rental) that
are required to be paid by Tenant to Landlord hereunder, which
sums are deemed to be additional rent under this Lease.
Additional Base Rental and Base Rental are sometimes
collectively referred to herein as "Rent."
2. "Base Rental" shall mean the sum of Eighty Thousand Two
Hundred Sixty Seven and 40/100 Dollars ($80,267.40), payable
by Tenant to Landlord in twelve (12) monthly installments as
follows:
a. Twelve (12) equal installments of Six Thousand Six
Hundred Eighty Eight and 95/100 Dollars ($6,688.95) each
payable on or before the first day of each month during
the period beginning April 1, 1999 and ending March 31,
2000, provided that the installment of Base Rental for
the first full calendar month of the Lease Term shall be
payable upon the execution of this Lease by Tenant.
3. "Building" shall mean the office building located at 2010 Main
Street, City of Irvine, County of Orange, State of California,
commonly known as 2010 Main Plaza.
4. The "Commencement Date," "Lease Term" and "Termination Date"
shall have the meanings set forth in subsection I.A.4.a.
below:
a. The "Lease Term" shall mean a period of twelve (12)
months, commencing on April 1, 1999 (the "Commencement
Date") and, unless sooner terminated as provided herein,
ending on March 31, 2000 (the "Termination Date").
b. INTENTIONALLY OMITTED.
5. "Premises" shall mean the area located on the fifth (5th)
floor of the Building, as outlined on EXHIBIT A attached
hereto and incorporated herein and known as Suite #570.
Landlord and Tenant hereby stipulate and agree that the
"Rentable Area of the Premises" shall mean 2,347 square feet
and the "Rentable Area of the Building" shall mean 280,882
square feet. If the Premises being leased to Tenant hereunder
include one or more floors within the Building in their
entirety, the definition of Premises with respect to such full
floor(s) shall include all corridors and restroom facilities
located on such floor(s). Notwithstanding the foregoing,
unless specifically provided herein to the contrary, the
Premises shall not include any telephone closets, electrical
closets, janitorial closets, equipment rooms or similar areas
on any full or partial floor that are used by Landlord for the
operation of the Building.
6. "Permitted Use" shall mean general office use.
7. "Security Deposit" shall mean the sum of Seven Thousand Three
Hundred Fifty Seven and 85/100 Dollars ($7,357.85).
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8. "Tenant's Pro Rata Share" shall mean eight thousand three
hundred fifty six ten thousandths percent (0.8356%) which is
the quotient (expressed as a percentage), derived by dividing
the Rentable Area of the Premises by the Rentable Area of the
Building.
9. "Guarantor(s)" shall mean Fred H. Lerner and any other party
that agrees in writing to guarantee this Lease.
10. "Notice Addresses" shall mean the following addresses for
Tenant and Landlord, respectively:
Tenant:
On and after the Commencement Date, notices shall be sent to
Tenant at the Premises.
Prior to the Commencement Date, notices shall be sent to
Tenant at the following address:
PHOBO.COM, INC.
2311 Easter Circle
Huntington Beach, California 92649
Attention: Fred Lerner
Landlord:
EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY COMPANY,
AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS
SHELI Z. ROSENBERG TRUST NO. 2010
c/o Equity Office Properties Trust
2010 Main Street
Suite No. 350
Irvine, California 92614
Attention: Building Manager
With a copy to Landlord:
EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY COMPANY,
AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS
SHELI Z. ROSENBERG TRUST NO. 2010
c/o Equity Office Properties Trust
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Attention: Regional Counsel - Pacific Region
Payments of Rent only shall be made payable to the order of:
EQUITY OFFICE PROPERTIES
at the following address:
EOP Operating Limited Partnership
DBA 2010 Main Plaza
Department #8799
Los Angeles, California 90084-8799
B. The following are additional definitions of some of the defined
terms used in the Lease.
1. "Base Year" shall mean 1999.
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2. "Basic Costs" shall mean all costs and expenses paid or
incurred in connection with operating, maintaining, repairing,
managing and owning the Building and the Property, as further
described in Article IV hereof.
3. "Broker" means None.
4. "Building Standard" shall mean the type, grade, brand, quality
and/or quantity of materials Landlord designates from time to
time to be the minimum quality and/or quantity to be used in
the Building.
5. "Business Day(s)" shall mean Mondays through Fridays exclusive
of the normal business holidays ("Holidays") of New Year's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving
Day and Christmas Day. Landlord, from time to time during the
Lease Term, shall have the right to designate additional
Holidays, provided that such additional Holidays are commonly
recognized by other office buildings in the area where the
Building is located.
6. "Building Common Areas" shall mean those areas provided for
the common use or benefit of all tenants generally and/or the
public, such as corridors, elevator foyers, common mail rooms,
restrooms, vending areas, lobby areas (whether at ground level
or otherwise) and other similar facilities.
7. "Landlord Work" shall mean the work, if any, that Landlord is
obligated to perform in the Premises pursuant to the Work
Letter Agreement, if any, attached hereto as EXHIBIT D.
8. "Maximum Rate" shall mean the greatest per annum rate of
interest permitted from time to time under applicable law.
9. "Normal Business Hours" for the Building shall mean 8:00 A.M.
to 6:00 P.M. Mondays through Fridays, and 8:00 A.M. to 12:00
P.M. on Saturdays, exclusive of Holidays.
10. "Prime Rate" shall mean the per annum interest rate publicly
announced by The First National Bank of Chicago or any
successor thereof from time to time (whether or not charged in
each instance) as its prime or base rate in Chicago, Illinois.
11. "Property" shall mean the Building and the parcel(s) of land
on which it is located, the Building garage, if any, and all
other improvements owned by Landlord and serving the Building
and the tenants thereof and the parcel(s) of land on which
they are located.
12. "Project" shall mean the parcel(s) of real estate outlined on
EXHIBIT A-2 attached hereto and incorporated herein, the
buildings commonly known as 1920 Main Plaza and 2010 Main
Plaza, and the Exterior Common Areas, all of which are located
in the City of Irvine, County of Orange, State of California.
13. "Exterior Common Areas" shall mean those areas of the Project
or the Property which are not located within the Building and
which are provided and maintained for the use and benefit of
Landlord and tenants of the Building or the Project generally,
and the employees, invitees and licensees of Landlord and such
tenants, including, without limitation any parking garage,
surface parking, fountains, artificial lakes, sidewalks,
walkways, plazas, roads, loading and unloading areas, trash
areas, and landscapes.
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II. LEASE GRANT.
Subject to and upon the terms herein set forth, Landlord leases to Tenant
and Tenant leases from Landlord the Premises, together with the right, in common
with others, to use the Common Areas.
III. POSSESSION.
A. INTENTIONALLY OMITTED.
B. By taking possession of the Premises, Tenant is deemed to have
accepted the Premises and agreed that the Premises is in good order
and satisfactory condition, with no representation or warranty by
Landlord as to the condition of the Premises or the Building or
suitability thereof for Tenant's use.
C. Notwithstanding anything to the contrary contained in the Lease,
Landlord shall not be obligated to tender possession of any portion
of the Premises or other space leased by Tenant from time to time
hereunder that, on the date possession is to be delivered, is
occupied by a tenant or other occupant or that is subject to the
rights of any other tenant or occupant, nor shall Landlord have any
other obligations to Tenant under this Lease with respect to such
space until the date Landlord: (1) recaptures such space from such
existing tenant or occupant; and (2) regains the legal right to
possession thereof. This Lease shall not be affected by any such
failure to deliver possession and Tenant shall have no claim for
damages against Landlord as a result thereof, all of which are
hereby waived and released by Tenant. The Commencement Date shall be
postponed until the date Landlord delivers possession of the
Premises to Tenant, in which event the Termination Date shall, at
the option of Landlord, correspondingly be postponed on a per diem
basis.
D. If Tenant takes possession of the Premises prior to the Commencement
Date, such possession shall be subject to all the terms and
conditions of the Lease and Tenant shall pay Base Rental and
Additional Base Rental to Landlord for each day of occupancy prior
to the Commencement Date. Notwithstanding the foregoing, if Tenant,
with Landlord's prior approval, takes possession of the Premises
prior to the Commencement Date for the sole purpose of performing
any Landlord-approved improvements therein or installing furniture,
equipment or other personal property of Tenant, such possession
shall be subject to all of the terms and conditions of the Lease,
except that Tenant shall not be required to pay Base Rental or
Additional Base Rental with respect to the period of time prior to
the Commencement Date during which Tenant performs such work. Tenant
shall, however, be liable for the cost of any services (e.g.
electricity, HVAC, freight elevators) that are provided to Tenant or
the Premises during the period of Tenant's possession prior to the
Commencement Date. Nothing herein shall be construed as granting
Tenant the right to take possession of the Premises prior to the
Commencement Date, whether for construction, fixturing or any other
purpose, without the prior consent of Landlord.
IV. RENT.
A. During each calendar year, or portion thereof, falling within the
Lease Term, Tenant shall pay to Landlord as Additional Base Rental
hereunder the sum of (1) Tenant's Pro Rata Share of the amount, if
any, by which Taxes (hereinafter defined) for the applicable
calendar year exceed Taxes for the Base Year plus (2) Tenant's Pro
Rata Share of the amount, if any, by which Expenses (hereinafter
defined) for the applicable calendar year exceed Expenses for the
Base Year. For purposes hereof, "Expenses" shall mean all Basic
Costs with the exception of Taxes. Tenant's Pro Rata Share of
increases in Taxes and Tenant's Pro Rata Share of increases in
Expenses shall be computed separate and independent of each other
prior to being added together to determine the "Excess". In the
event that Taxes or Expenses, as the case may be, in any calendar
year decrease below the amount of Taxes or Expenses for the Base
Year, Tenant's Pro Rata Share of Taxes or Expenses, as the case may
be, for
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such calendar year shall be deemed to be $0, it being understood
that Tenant shall not be entitled to any credit or offset if Taxes
or Expenses decrease below the corresponding amount for the Base
Year. Prior to the Commencement Date and prior to January 1 of each
calendar year during the Lease Term, or as soon thereafter as
practical, Landlord shall make a good faith estimate of the Excess
for the applicable calendar year and Tenant's Pro Rata Share
thereof. On or before the first day of each month during such
calendar year, Tenant shall pay to Landlord, as Additional Base
Rental, a monthly installment equal to one-twelfth of Tenant's Pro
Rata Share of Landlord's estimate of the Excess. Landlord shall have
the right from time to time during any such calendar year to revise
the estimate of Basic Costs and the Excess for such year and provide
Tenant with a revised statement therefor, and thereafter the amount
Tenant shall pay each month shall be based upon such revised
estimate. If Landlord does not provide Tenant with an estimate of
the Basic Costs and the Excess by January 1 of any calendar year,
Tenant shall continue to pay a monthly installment based on the
previous year's estimate until such time as Landlord provides Tenant
with an estimate of Basic Costs and the Excess for the current year.
Upon receipt of such current year's estimate, an adjustment shall be
made for any month during the current year with respect to which
Tenant paid monthly installments of Additional Base Rental based on
the previous year's estimate. Tenant shall pay Landlord for any
underpayment within ten (10) days after demand. Any overpayment
shall, at Landlord's option, be refunded to Tenant or credited
against the installment of Additional Base Rental due for the months
immediately following the furnishing of such estimate. Any amounts
paid by Tenant based on any estimate shall be subject to adjustment
pursuant to the immediately following paragraph when actual Basic
Costs are determined for such calendar year.
As soon as is practical following the end of each calendar year
during the Lease Term, Landlord shall furnish to Tenant a statement
of Landlord's actual Basic Costs and the actual Excess for the
previous calendar year. If the estimated Excess actually paid by
Tenant for the prior year is in excess of Tenant's actual Pro Rata
Share of the Excess for such prior year, then Landlord shall apply
such overpayment against Additional Base Rental due or to become due
hereunder, provided if the Lease Term expires prior to the
determination of such overpayment, Landlord shall refund such
overpayment to Tenant after first deducting the amount of any Rent
due hereunder. Likewise, Tenant shall pay to Landlord, within ten
(10) days after demand, any underpayment with respect to the prior
year, whether or not the Lease has terminated prior to receipt by
Tenant of a statement for such underpayment, it being understood
that this clause shall survive the expiration of the Lease.
B. Basic Costs shall mean the sum of (y) all direct and indirect costs
and expenses paid or incurred in each calendar year in connection
with operating, maintaining, repairing, managing and owning the
Building or the Property, inclusive of the Exterior Common Areas,
and (z) the Building's allocable percentage of all direct and
indirect costs of operating and maintaining the Project imposed upon
the Building, and all fees payable to the company or association, if
applicable, managing the parking areas within the Project,
including, but not limited to, the following:
1. All labor costs for all persons performing services required
or utilized in connection with the operation, repair,
replacement and maintenance of and control of access to the
Building and the Property, including but not limited to
amounts incurred for-wages, salaries and other compensation
for services, payroll, social security, unemployment and other
similar taxes, workers' compensation insurance, uniforms,
training, disability benefits, pensions, hospitalization,
retirement plans, group insurance or any other similar or like
expenses or benefits.
2. All management fees, the cost of equipping and maintaining a
management office at the Property or the Project and all fees
for accounting services, legal fees not attributable to
leasing and collection activity, and all other administrative
costs relating to the Project and the
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Property. If management services are not provided by a third
party, Landlord shall be entitled to a management fee
comparable to that due and payable to third parties provided
Landlord or management companies owned by, or management
divisions of, Landlord perform actual management services of a
comparable nature and type as normally would be performed by
third parties.
3. All rental and/or purchase costs of materials, supplies, tools
and equipment used in the operation, repair, replacement and
maintenance and the control of access to the Building, the
Property, and the Project.
4. All amounts charged to Landlord by contractors and/or
suppliers for services, replacement parts, components,
materials, equipment and supplies furnished in connection with
the operation, repair, maintenance, replacement of and control
of access to any part of the Building, the Property, or the
Project generally, including the heating, air conditioning,
ventilating, plumbing, electrical, elevator and other systems
and equipment. At Landlord's option, major repair items may be
amortized over a period of up to five (5) years.
5. All premiums and deductibles paid by Landlord for fire and
extended coverage insurance, earthquake and extended coverage
insurance, liability and extended coverage insurance, rental
loss insurance, elevator insurance, boiler insurance and other
insurance customarily carried from time to time by landlords
of comparable office buildings or required to be carried by
Landlord's Mortgagee.
6. Charges for water, gas, steam and sewer, but excluding those
charges for which Landlord is otherwise reimbursed by tenants,
and charges for Electrical Costs. For purposes hereof, the
term "Electrical Costs" shall mean: (i) all charges paid by
Landlord for electricity supplied to the Building, Property
and Premises, regardless of whether such charges are
characterized as distribution charges, transmission charges,
generation charges, public good charges, disconnection
charges, competitive transaction charges, stranded cost
recoveries or otherwise; (ii) except to the extent otherwise
included in Basic Costs, any costs incurred in connection with
the energy management program for the Building, Property and
Premises, including any costs incurred for the replacement of
lights and ballasts and the purchase and installation of
sensors and other energy saving equipment amortized over a
reasonably estimated payback period; and (iii) if and to the
extent permitted by law, a reasonable fee for the services
provided by Landlord in connection with the selection of
utility companies and the negotiation and administration of
contracts for the generation of electricity. Notwithstanding
the foregoing, Electrical Costs shall be adjusted as follows:
(a) any amounts received by Landlord as reimbursement for
above standard electrical consumption shall be deducted from
Electrical Costs, (b) the cost of electricity incurred in
providing overtime HVAC to specific tenants shall be deducted
from Electrical Costs, it being agreed that the electrical
component of overtime HVAC costs shall be calculated as a
reasonable percentage of the total HVAC costs charged to such
tenants, and (c) if Tenant is billed directly for the cost of
electricity to the Premises as a separate charge in addition
to Base Rental and Basic Costs, the cost of electricity to
individual tenant spaces in the Building shall be deducted
from Electrical Costs, and the electricity component of
Tenant's Basic Costs shall not be subject to gross-up
provisions (if any) stated elsewhere in this Lease.
7. "Taxes," which for purposes hereof, shall mean: (a) all real
estate taxes and assessments on the Project, the Property, the
Building or the Premises, and taxes and assessments levied in
substitution or supplementation in whole or in part of such
taxes, (b) all personal property taxes for the Building's or
the Project's personal property,
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including license expenses, (c) ail taxes imposed on services
of Landlord's agents and employees, (d) all other taxes, fees
or assessments now or hereafter levied by any governmental
authority on the Project, the Property, or the Building or its
contents or on the operation and use thereof (except as they
relate to specific tenants), and (e) all costs and fees
incurred in connection with seeking reductions in or refunds
in Taxes including, without limitation, any costs incurred by
Landlord to challenge the tax valuation of the Project, the
Property, or the Building, but excluding income taxes. For the
purpose of determining real estate taxes and assessments for
any given calendar year, the amount to be included in Taxes
for such year shall be as follows: (1) with respect to any
special assessment that is payable in installments, Taxes for
such year shall include the amount of the installment (and any
interest) due and payable during such year; and (2) with
respect to all other real estate taxes, Taxes for such year
shall, at Landlord's election, include either the amount
accrued, assessed or otherwise imposed for such year or the
amount due and payable for such year, provided that Landlord's
election shall be applied consistently throughout the Lease
Term. If a reduction in Taxes is obtained for any year of the
Lease Term during which Tenant paid its Pro Rata Share of
Basic Costs, then Basic Costs for such year will be
retroactively adjusted and Landlord shall provide Tenant with
a credit, if any, based on such adjustment. Likewise, if a
reduction is subsequently obtained for Taxes for the Base Year
(if Tenant's Pro Rata Share is based upon increases in Basic
Costs over a Base Year), Basic Costs for the Base Year shall
be restated and the Excess for all subsequent years
recomputed. Tenant shall pay to Landlord Tenant's Pro Rata
Share of any such increase in the Excess within thirty (30)
days after Tenant's receipt of a statement therefor from
Landlord.
8. All landscape expenses and costs of maintaining, repairing,
resurfacing and striping of the parking areas and garages of
the Property, or the Project, if any.
9. Cost of all maintenance service agreements, including those
for equipment, alarm service, window cleaning, drapery or
Venetian blind cleaning, janitorial services, pest control,
uniform supply, plant maintenance, landscaping, and any
parking equipment.
10. Cost of all other repairs, replacements and general
maintenance of the Project, the Property and the Building
neither specified above nor directly billed to tenants.
11. The amortized cost of capital improvements made to the
Project, the Building or the Property which are: (a) primarily
for the purpose of reducing operating expense costs or
otherwise improving the. operating efficiency of the Property
or Building; or (b) required to comply with any laws, rules or
regulations of any governmental authority or a requirement of
Landlord's insurance carrier. The cost of such capital
improvements shall be amortized over a period of five (5)
years and shall, at Landlord's option, include interest at a
rate that is reasonably equivalent to the interest rate that
Landlord would be required to pay to finance the cost of the
capital improvement in question as of the date such capital
improvement is performed, provided if the payback period for
any capital improvement is less than five (5) years, Landlord
may amortize the cost of such capital improvement over the
payback period.
12. Any other expense or charge of any nature whatsoever which, in
accordance with general industry practice with respect to the
operation of a first-class office building, would be construed
as an operating expense.
13. All contributions and payments required of Landlord pursuant
to the provisions of the Amended and Restated Declaration of
Establishment of Covenants, Conditions and Restrictions and
Grant of Easements, dated
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January 29, 1987, and recorded in the Official Records of
Orange County, California, as Instrument No. 87-074459.
In addition, if Landlord incurs any costs and expenses in connection
with the operation, maintenance, repair, management or ownership of
the Building and one or more other buildings, such costs and
expenses shall be equitably prorated between the Building and such
other buildings and the Building's equitable share thereof shall be
included in Basic Costs. Basic Costs shall not include the cost of
capital improvements (except as set forth above and as distinguished
from replacement parts or components purchased and installed in the
ordinary course), depreciation, interest (except as provided above
with respect to the amortization of capital improvements), lease
commissions, and principal payments on mortgage and other
non-operating debts of Landlord. If the Building is not at least
ninety-five percent (95%) occupied during any calendar year of the
Lease Term or if Landlord is not supplying services to at least
ninety-five percent (95%) of the total Rentable Area of the Building
at any time during any calendar year of the Lease Term, actual Basic
Costs for purposes hereof shall, at Landlord's option, be determined
as if the Building had been ninety-five percent (95%) occupied and
Landlord had been supplying services to ninety-five percent (95%) of
the Rentable Area of the Building during such year. If Tenant pays
for its Pro Rata Share of Basic Costs based on increases over a
"Base Year" and Basic Costs for any calendar year during the Lease
Term are determined as provided in the foregoing sentence, Basic
Costs for such Base Year shall also be determined as if the Building
had been ninety-five percent (95%) occupied and Landlord had been
supplying services to ninety-five percent (95%) of the Rentable
Area of the Building. Any necessary extrapolation of Basic Costs
under this Article shall be performed by adjusting the cost of those
components of Basic Costs that are impacted by changes in the
occupancy of the Building (including, at Landlord's option, Taxes)
to the cost that would have been incurred if the Building had been
ninety-five percent (95%) occupied and Landlord had been supplying
services to ninety-five percent (95%) of the Rentable Area of the
Building. In addition, if Tenant's Pro Rata Share of Basic Costs is
determined based upon increases over a Base Year and Basic Costs for
the Base Year include exit and disconnection fees, stranded cost
charges and/or competitive transaction charges, such fees and
charges may, at Landlord's option, be imputed as a Basic Cost for
subsequent years in which such fees and charges are not incurred. In
no event, however, shall the amount of such imputed fees and charges
exceed the actual amount of exit and disconnection fees, stranded
cost charges and/or competitive transaction charges that were
actually included in Basic Costs for the Base Year.
C. If Basic Costs for any calendar year increase by more than five
percent (5%) over Basic Costs for the immediately preceding calendar
year, Tenant, within ninety (90) days after receiving Landlord's
statement of actual Basic Costs for a particular calendar year,
shall have the right to provide Landlord with written notice (the
"Review Notice") of its intent to review Landlord's books and
records relating to the Basic Costs for such calendar year. Within a
reasonable time after receipt of a timely Review Notice, Landlord
shall make such books and records available to Tenant or Tenant's
agent for its review at either Landlord's home office or at the
office of the Building, provided that if Tenant retains an agent to
review Landlord's books and records for any calendar year, such
agent must be a CPA firm licensed to do business in the state in
which the Building is located. Tenant shall be solely responsible
for any and all costs, expenses and fees incurred by Tenant or
Tenant's agent in connection with such review. If Tenant elects to
review Landlord's books and records, within thirty (30) days after
such books and records are made available to Tenant, Tenant shall
have the right to give Landlord written notice stating in reasonable
detail any objection to Landlord's statement of actual Basic Costs
for such calendar year. If Tenant fails to give Landlord written
notice of objection within such thirty (30) day period or fails to
provide Landlord with a Review Notice within the ninety (90) day
period provided above, Tenant shall be deemed to have approved
Landlord's statement of Basic Costs in all respects and shall
thereafter be barred from raising any claims with respect thereto.
Upon Landlord's receipt of a timely objection notice
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from Tenant, Landlord and Tenant shall work together in good faith
to resolve the discrepancy between Landlord's statement and Tenant's
review. If Landlord and Tenant determine that Basic Costs for the
calendar year in question are less than reported, Landlord shall
provide Tenant with a credit against future Additional Base Rental
in the amount of any overpayment by Tenant. Likewise, if Landlord
and Tenant determine that Basic Costs for the calendar year in
question are greater than reported, Tenant shall forthwith pay to
Landlord the amount of underpayment by Tenant. Any information
obtained by Tenant pursuant to the provisions of this Section shall
be treated as confidential. Notwithstanding anything herein to the
contrary, Tenant shall not be permitted to examine Landlord's books
and records or to dispute any statement of Basic Costs unless Tenant
has paid to Landlord the amount due as shown on Landlord's statement
of actual Basic Costs, said payment being a condition precedent to
Tenant's right to examine Landlord's books and records.
D. Tenant covenants and agrees to pay to Landlord during the Lease
Term, without any setoff or deduction whatsoever, the full amount of
all Base Rental and Additional Base Rental due hereunder. In
addition, Tenant shall pay and be liable for, as additional rent,
all rental, sales and use taxes or other similar taxes, if any,
levied or imposed by any city, state, county or other governmental
body having authority, such payments to be in addition to all other
payments required to be paid to Landlord by Tenant under the terms
and conditions of this Lease. Any such payments shall be paid
concurrently with the payments of the Rent on which the tax is
based. The Base Rental, Tenant's Pro Rata Share of Basic Costs and
any recurring monthly charges due hereunder shall be due and payable
in advance on the first day of each calendar month during the Lease
Term without demand, provided that the installment of Base Rental
for the first full calendar month of the Lease Term shall be payable
upon the execution of this Lease by Tenant. All other items of Rent
shall be due and payable by Tenant on or before ten (10) days after
billing by Landlord. If the Lease Term commences on a day other than
the first day of a calendar month or terminates on a day other than
the last day of a calendar month, then the monthly Base Rental and
Tenant's Pro Rata Share of Basic Costs for such month shall be
prorated for the number of days in such month occurring within the
Lease Term based on a fraction, the numerator of which is the number
of days of the Lease Term that fell within such calendar month and
the denominator of which is thirty (30). All such payments shall be
by a good and sufficient check. No payment by Tenant or receipt or
acceptance by Landlord of a lesser amount than the correct amount of
Rent due under this Lease shall be deemed to be other than a payment
on account of the earliest Rent due hereunder, nor shall any
endorsement or statement on any check or any letter accompanying any
check or payment be deemed an accord and satisfaction, and Landlord
may accept such check or payment without prejudice to Landlord's
right to recover the balance or pursue any other available remedy.
The acceptance by Landlord of any Rent on a date after the due date
of such payment shall not be construed to be a waiver of Landlord's
right to declare a default for any other late payment. Tenant's
covenant to pay Rent shall be independent of every other covenant
set forth in this Lease.
E. All Rent not paid when due and payable shall bear interest from the
date due until paid at the lesser of: (1) eighteen percent (18%) per
annum; or (2) the Maximum Rate. In addition, if Tenant fails to pay
any installment of Rent when due and payable hereunder, a service
fee equal to five percent (5%) of such unpaid amount will be due and
payable immediately by Tenant to Landlord.
F. In lieu of requiring Tenant to pay Rent by good and sufficient check
in the manner described in Section IV.D. above, Landlord shall have
the right to require Tenant to pay Rent by means of an automated
debit system (the "Automatic Debit System") whereby any or all
payments of Rent shall be debited from Tenant's account in a bank or
financial institution designated by Tenant and credited to
Landlord's account in a bank or financial institution designated by
Landlord. In the event Landlord elects to have Tenant pay all or any
portion of Rent by means of the Automatic Debit System, Tenant,
within thirty (30) days
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after written request by Landlord, shall execute and deliver to
Landlord any authorizations, certificates or other documentation as
may be required to establish and give effect to the Automatic Debit
System. If Landlord elects to have less than all items of Rent paid
by the Automatic Debit System, Landlord shall advise Tenant in
writing as to those items of Rent that will be paid by the Automatic
Debit System (e.g. Base Rental only or Base Rental and Tenant's Pro
Rata Share of Basic Costs only). Either party shall have the right
to change its bank or financial institution from time to time,
provided that Tenant, no less than thirty (30) days prior to the
effective date of any such change, shall provide Landlord with
written notice of such change and any and all authorizations,
certificates or other documentation as may be required to establish
and give effect to the Automatic Debit System at Tenant's new bank
or financial institution. Tenant shall promptly pay all service fees
and other charges imposed upon Landlord or Tenant in connection with
the Automatic Debit System, including, without limitation, any
charges resulting from insufficient funds in Tenant's bank account.
In the event that any Rent is not paid on time as a result of
insufficient funds in Tenant's account, Tenant shall be liable for
any interest and/or service fee in accordance with Section IV.E.
above. Tenant shall remain liable to Landlord for all payments of
Rent due hereunder regardless of whether Tenant's account is
incorrectly debited in any given month, it being agreed that a debit
of less than the full amount of Rent due shall not be construed as a
waiver by Landlord of its right to receive any unpaid balance of
Rent.
V. USE.
The Premises shall be used for the Permitted Use and for no other purpose.
Tenant agrees not to use or permit the use of the Premises for any purpose which
is illegal, dangerous to life, limb or property or which, in Landlord's
reasonable opinion, creates a nuisance or which would increase the cost of
insurance coverage with respect to the Building. Tenant shall conduct its
business and control its agents, servants, contractors, employees, customers,
licensees, and invitees in such a manner as not to interfere with, annoy or
disturb other tenants, or in any way interfere with Landlord in the management
and operation of the Building. Tenant will maintain the Premises in a clean and
healthful condition, and comply with all laws, ordinances, orders, rules and
regulations of any governmental entity with reference to the operation of
Tenant's business and to the use, condition, configuration or occupancy of the
Premises, including without limitation, the Americans with Disabilities Act
(collectively referred to as "Laws"). Tenant, within ten (10) days after receipt
thereof, shall provide Landlord with copies of any notices it receives with
respect to a violation or alleged violation of any Laws. Tenant will comply with
the rules and regulations of the Building attached hereto as EXHIBIT B and such
other rules and regulations adopted and altered by Landlord from time to time
and will cause all of its agents, servants, contractors, employees, customers,
licensees and invitees to do so. All changes to such rules and regulations will
be reasonable and shall be sent by Landlord to Tenant in writing.
VI. SECURITY DEPOSIT
The Security Deposit, if any, shall be delivered to Landlord upon the
execution of this Lease by Tenant and shall be held by Landlord without
liability for interest (except as required by law) and as security for the
performance of Tenant's obligations under this Lease. The Security Deposit shall
not be considered an advance payment of Rent or a measure of Tenant's liability
for damages. Landlord may, from time to time, without prejudice to any other
remedy, use all or a portion of the Security Deposit to make good any arrearage
of Rent, to repair damages to the Premises, to clean the Premises upon
termination of this Lease or otherwise to satisfy any other covenant or
obligation of Tenant hereunder. Following any such application of the Security
Deposit, Tenant shall pay to Landlord on demand the amount so applied in order
to restore the Security Deposit to its original amount. If Tenant is not in
default at the termination of this Lease, after Tenant surrenders the Premises
to Landlord in accordance with this Lease and all amounts due Landlord from
Tenant are finally determined and paid by Tenant or through application of the
Security Deposit, the balance of the Security Deposit remaining after any such
application shall be returned to Tenant. If Landlord transfers its interest in
the Premises during the Lease Term, Landlord may assign the Security Deposit to
the transferee and thereafter shall have no further liability for the return of
such Security Deposit. Tenant agrees to look solely to such transferee or
assignee for the return of the Security Deposit. Landlord
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and its successors and assigns shall not be bound by any actual or attempted
assignment or encumbrance of the Security Deposit by Tenant, provided, however,
if Tenant's interest in this Lease has been assigned, Landlord shall, provided
that Landlord has been furnished with a fully executed copy of the agreement
assigning such Security Deposit, return the Security Deposit to such assignee in
accordance with the terms and conditions hereof. If Landlord returns the
Security Deposit to Tenant's assignee as aforesaid, Landlord will have no
further obligation to any party with respect thereto. Landlord shall not be
required to keep the Security Deposit separate from its other accounts.
VII. SERVICES TO BE FURNISHED BY LANDLORD.
A. Landlord, as part of Basic Costs (except as otherwise provided),
agrees to furnish Tenant the following services:
1. Water for use in the lavatories on the floor(s) on which the
Premises is located. If Tenant desires water in the Premises
for any approved reason, including a private lavatory or
kitchen, cold water shall be supplied, at Tenant's sole cost
and expense, from the Building water main through a line and
fixtures installed at Tenant's sole cost and expense with the
prior reasonable consent of Landlord. If Tenant desires hot
water in the Premises, Tenant, at its sole cost and expense
and subject to the prior reasonable consent of Landlord, may
install a hot water heater in the Premises. Tenant shall be
solely responsible for maintenance and repair of any such hot
water heater.
2. Central heat and air conditioning in season during Normal
Business Hours, (provided however, Tenant shall be furnished
heating and air conditioning on Saturdays only upon Tenant's
initiation of the heating and air conditioning system through
use of Tenant's security access card), at such temperatures
and in such amounts as are considered by Landlord, in its
reasonable judgment, to be standard for buildings of similar
class, size, age and location, or as required by governmental
authority. In the event that Tenant requires central heat,
ventilation or air conditioning at hours other than Normal
Business Hours, such central heat, ventilation or air
conditioning shall be furnished to Tenant upon Tenant's
initiation of the heating and air conditioning system after
Normal Business Hours through use of Tenant's security access
card. Tenant shall pay Landlord, as Additional Base Rental,
the entire cost of additional service as such costs are
determined by Landlord from time to time.
3. Maintenance and repair of all Common Areas in the manner and
to the extent reasonably deemed by Landlord to be standard for
buildings of similar class, size, age and location.
4. Janitor service on Business Days; provided, however, if
Tenant's use, floor covering or other improvements require
special services, Tenant shall pay the additional cost
reasonably attributable thereto as Additional Base Rental.
5. Passenger elevator service in common with other tenants of the
Building.
6. Electricity to the Premises for general office use, in
accordance with and subject to the terms and conditions set
forth in Article XI of this Lease.
B. The failure by Landlord to any extent to furnish, or the
interruption or termination of, any services in whole or in part,
resulting from adherence to laws, regulations and administrative
orders, wear, use, repairs, improvements, alterations or any causes
beyond the reasonable control of Landlord shall not render Landlord
liable in any respect nor be construed as a constructive eviction of
Tenant, nor give rise to an abatement of Rent, nor relieve Tenant
from the obligation to fulfill any covenant or agreement hereof.
Should any of the equipment or machinery used in the provision of
such services for any cause cease to function properly, Landlord
shall use reasonable diligence to repair such equipment or
machinery.
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C. Tenant expressly acknowledges that if Landlord, from time to time,
elects to provide security services, Landlord shall not be deemed to
have warranted the efficiency of any security personnel, service,
procedures or equipment and Landlord shall not be liable in any
manner for the failure of any such security personnel, services,
procedures or equipment to prevent or control, or apprehend anyone
suspected of personal injury, property damage or any criminal
conduct in, on or around the Property.
VIII. LEASEHOLD IMPROVEMENTS.
Any trade fixtures, unattached and movable equipment or furniture, or
other personalty brought into the Premises by Tenant ("Tenant's Property") shall
be owned and insured by Tenant. Tenant shall remove all such Tenant's Property
from the Premises in accordance with the terms of Article XXXV hereof. Any and
all alterations, additions and improvements to the Premises, including any
built-in furniture (collectively, "Leasehold Improvements") shall be owned and
insured by Landlord and shall remain upon the Premises, all without
compensation, allowance or credit to Tenant. Landlord may, nonetheless, at any
time prior to, or within six (6) months after, the expiration or earlier
termination of this Lease or Tenant's right to possession, require Tenant to
remove any Leasehold Improvements performed by or for the benefit of Tenant and
all electronic, phone and data cabling as are designated by Landlord (the
"Required Removables") at Tenant's sole cost. In the event that Landlord so
elects, Tenant shall remove such Required Removables within ten (10) days after
notice from Landlord, provided that in no event shall Tenant be required to
remove such Required Removables prior to the expiration or earlier termination
of this Lease or Tenant's right to possession. In addition to Tenant's
obligation to remove the Required Removables, Tenant shall repair any damage
caused by such removal and perform such other work as is reasonably necessary to
restore the Premises to a "move in" condition. If Tenant fails to remove any
specified Required Removables or to perform any required repairs and restoration
within the time period specified above, Landlord, at Tenant's sole cost and
expense, may remove, store, sell and/or dispose of the Required Removables and
perform such required repairs and restoration work. Tenant, within five (5) days
after demand from Landlord, shall reimburse Landlord for any and all reasonable
costs incurred by Landlord in connection with the Required Removables.
IX. GRAPHICS.
Landlord shall provide and install, at Tenant's cost, any suite numbers
and Tenant identification on the exterior of the Premises using the standard
graphics for the Building. Tenant shall not be permitted to install any signs or
other identification without Landlord's prior written consent.
X. REPAIRS AND ALTERATIONS.
A. Except to the extent such obligations are imposed upon Landlord
hereunder, Tenant, at its sole cost and expense, shall perform all
maintenance and repairs to the Premises as are necessary to keep the
same in good condition and repair throughout the entire Lease Term,
reasonable wear and tear excepted. Tenant's repair and maintenance
obligations with respect to the Premises shall include, without
limitation, any necessary repairs with respect to: (1) any carpet or
other floor covering, (2) any interior partitions, (3) any doors,
(4) the interior side of any demising walls, (5) any telephone and
computer cabling that serves Tenant's equipment exclusively, (6) any
supplemental air conditioning units, private showers and kitchens,
including any plumbing in connection therewith, and similar
facilities serving Tenant exclusively, and (7) any alterations,
additions or improvements performed by contractors retained by
Tenant. All such work shall be performed in accordance with Section
X.B. below and the rules, policies and procedures reasonably enacted
by Landlord from time to time for the performance of work in the
Building. If Tenant fails to make any necessary repairs to the
Premises, Landlord may, at its option, make such repairs, and Tenant
shall pay the cost thereof to the Landlord on demand as Additional
Base Rental, together with an administrative charge in an amount
equal to ten percent (10%) of the cost of such repairs. Landlord
shall, at its expense (except as included in Basic Costs), keep and
maintain in good repair and working order
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and make all repairs to and perform necessary maintenance upon: (a)
all structural elements of the Building; and (b) all mechanical,
electrical and plumbing systems that serve the Building in general;
and (c) the Building facilities common to all tenants including, but
not limited to, the ceilings, walls and floors in the Common Areas.
B. Tenant shall not make or allow to be made any alterations, additions
or improvements to the Premises without first obtaining the written
consent of Landlord in each such instance. Prior to commencing any
such work and as a condition to obtaining Landlord's consent, Tenant
must furnish Landlord with plans and specifications reasonably
acceptable to Landlord; names and addresses of contractors
reasonably acceptable to Landlord; copies of contracts; necessary
permits and approvals; evidence of contractor's and subcontractor's
insurance in accordance with Article XVI Section B. hereof; and
payment bond or other security, all in form and amount satisfactory
to Landlord. All such improvements, alterations or additions shall
be constructed in a good and workmanlike manner using Building
Standard materials or other new materials of equal or greater
quality. Landlord, to the extent reasonably necessary to avoid any
disruption to the tenants and occupants of the Building, shall have
the right to designate the time when any such alterations, additions
and improvements may be performed and to otherwise designate
reasonable rules, regulations and procedures for the performance of
work in the Building. Upon completion, Tenant shall furnish
"as-built" plans, contractor's affidavits and partial, or full and
final waivers of lien, as applicable, in recordable form, and
receipted bills covering all labor and materials. All improvements,
alterations and additions shall comply with all insurance
requirements, codes, ordinances, laws and regulations, including
without limitation, the Americans with Disabilities Act. Tenant
shall reimburse Landlord upon demand as Additional Base Rental for
all sums, if any, expended by Landlord for third party examination
of the architectural, mechanical, electric and plumbing plans for
any alterations, additions or improvements. In addition, if Landlord
so requests, Landlord shall be entitled to oversee the construction
of any alterations, additions or improvements that may affect the
structure of the Building or any of the mechanical, electrical,
plumbing or life safety systems of the Building. In the event
Landlord elects to oversee such work, Landlord shall be entitled to
receive a fee for such oversight in an amount equal to fifteen
percent (15%) of the cost of such alterations, additions or
improvements. Landlord's approval of Tenant's plans and
specifications for any work performed for or on behalf of Tenant
shall not be deemed to be a representation by Landlord that such
plans and specifications comply with applicable insurance
requirements, building codes, ordinances, laws or regulations or
that the alterations, additions and improvements constructed in
accordance with such plans and specifications will be adequate for
Tenant's use.
XI. USE OF ELECTRICAL SERVICES BY TENANT.
A. All electricity used by Tenant in the Premises shall, at Landlord's
option, be paid for by Tenant either: (1) through inclusion in Base
Rental and Basic Costs (except as provided in Section XI.B. below
with respect to excess usage); or (2) by a separate charge billed
directly to Tenant by Landlord and payable by Tenant as Additional
Base Rental within ten (10) days after billing; or (3) by a separate
charge or charges billed by the utility company(ies) providing
electrical service and payable by Tenant directly to such utility
company(ies). It is understood that electrical service to the
Premises may be furnished by one or more companies providing
electrical generation, transmission and/or distribution services and
that the cost of electricity may be billed as a single charge or
divided into and billed in a variety of categories such as
distribution charges, transmission charges, generation charges,
public good charges or other similar categories. Landlord shall have
the exclusive right to select the company(ies) providing electrical
service to the Building, Premises and Property, to aggregate the
electrical service for the Building, Premises and Property with
other buildings, to purchase electricity for the Building, Premises
and Property through a broker and/or buyers group and to change the
providers and/or manner of purchasing
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electricity from time to time. Landlord shall be entitled to receive
a reasonable fee (if permitted by law) for the services provided by
Landlord in connection with the selection of utility companies and
the negotiation and administration of contracts for the generation
of electricity. In addition, if Landlord bills Tenant directly for
the cost of electricity as Additional Base Rental, the cost of
electricity may include (if permitted by law) an administrative fee
to reimburse Landlord for the cost of reading meters, preparing
invoices and related costs.
B. Tenant's use of electrical service in the Premises shall not exceed,
either in voltage, rated capacity, use beyond Normal Business Hours
or overall load, that which Landlord deems to be standard for the
Building. In the event Tenant shall consume (or request that it be
allowed to consume) electrical service in excess of that deemed by
Landlord to be standard for the Building, Landlord may refuse to
consent to such excess usage or may condition its consent to such
excess usage upon such conditions as Landlord reasonably elects
(including the installation of utility service upgrades, submeters,
air handlers or cooling units), and all such additional usage (to
the extent permitted by law), installation and maintenance thereof
shall be paid for by Tenant as Additional Base Rental. Landlord, at
any time during the Lease Term, shall have the right to separately
meter electrical usage for the Premises or to measure electrical
usage by survey or any other method that Landlord, in its reasonable
judgment, deems to be appropriate.
C. Notwithstanding Section A. above to the contrary, if Landlord
permits Tenant to purchase electrical power for the Premises from a
provider other than Landlord's designated company(ies), such
provider shall be considered to be a contractor of Tenant and Tenant
shall indemnify and hold Landlord harmless from such provider's acts
and omissions while in, or in connection with their services to, the
Building or Premises in accordance with the terms and conditions of
Article XV. In addition, at the request of Landlord, Tenant shall
allow Landlord to purchase electricity from Tenant's provider at
Tenant's rate or at such lower rate as can be negotiated by the
aggregation of Landlord's and Tenant's requirements for electricity
power.
XII. ENTRY BY LANDLORD.
Landlord and its agents or representatives shall have the right to enter
the Premises to inspect the same, or to show the Premises to prospective
purchasers, mortgagees, tenants (during the last twelve months of the Lease Term
or earlier in connection with a potential relocation) or insurers, or to clean
or make repairs, alterations or additions thereto, including any work that
Landlord deems necessary for the safety, protection or preservation of the
Building or any occupants thereof, or to facilitate repairs, alterations or
additions to the Building or any other tenants' premises. Except for any entry
by Landlord in an emergency situation or to provide normal cleaning and
janitorial service, Landlord shall provide Tenant with reasonable prior notice
of any entry into the Premises, which notice may be given verbally. If
reasonably necessary for the protection and safety of Tenant and its employees,
Landlord shall have the right to temporarily close the Premises to perform
repairs, alterations or additions in the Premises, provided that Landlord shall
use reasonable efforts to perform all such work on " weekends and after Normal
Business Hours. Entry by Landlord hereunder shall not constitute a constructive
eviction or entitle Tenant to any abatement or reduction of Rent by reason
thereof.
XIII. ASSIGNMENT AND SUBLETTING.
A. Tenant shall not assign, sublease, transfer or encumber this Lease
or any interest therein or grant any license, concession or other
right of occupancy of the Premises or any portion thereof or
otherwise permit the use of the Premises or any portion thereof by
any party other than Tenant (any of which events is hereinafter
called a "Transfer") without the prior written consent of Landlord,
which consent shall not be unreasonably withheld with respect to any
proposed assignment or subletting. Landlord's consent shall not be
considered unreasonably withheld if: (1) the proposed transferee's
financial responsibility does not meet the same criteria Landlord
uses to select Building tenants; (2) the
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proposed transferee's business is not suitable for the Building
considering the business of the other tenants and the Building's
prestige or would result in a violation of an exclusive right
granted to another tenant in the Building; (3) the proposed use is
different than the Permitted Use; (4) the proposed transferee is a
government agency or occupant of the Building; (5) Tenant is in
default; or (6) any portion of the Building or Premises would become
subject to additional or different governmental laws or regulations
as a consequence of the proposed Transfer and/or the proposed
transferee's use and occupancy of the Premises. Tenant acknowledges
that the foregoing is not intended to be an exclusive list of the
reasons for which Landlord may reasonably withhold its consent to a
proposed Transfer. Any attempted Transfer in violation of the terms
of this Article shall, at Landlord's option, be void. Consent by
Landlord to one or more Transfers shall not operate as a waiver of
Landlord's rights as to any subsequent Transfers. In addition,
Tenant shall not, without Landlord's consent, publicly advertise the
proposed rental rate for any Transfer.
B. If Tenant requests Landlord's consent to a Transfer, Tenant,
together with such request for consent, shall provide Landlord with
the name of the proposed transferee and the nature of the business
of the proposed transferee, the term, use, rental rate and all other
material terms and conditions of the proposed Transfer, including,
without limitation, a copy of the proposed assignment, sublease or
other contractual documents and evidence satisfactory to Landlord
that the proposed transferee is financially responsible.
Notwithstanding Landlord's agreement to act reasonably under Section
XIII.A. above, Landlord may, within forty-five (45) days after its
receipt of all information and documentation required herein,
either, (1) consent to or reasonably refuse to consent to such
Transfer in writing; or (2) negotiate directly with the proposed
transferee and in the event Landlord is able to reach an agreement
with such proposed transferee, terminate this Lease (in part or in
whole, as appropriate) upon thirty (30) days' notice; or (3) cancel
and terminate this Lease, in whole or in part as appropriate, upon
thirty (30) days' notice. In the event Landlord consents to any such
Transfer, the Transfer and consent thereto shall be in a form
approved by Landlord, and Tenant shall bear all costs and expenses
incurred by Landlord in connection with the review and approval of
such documentation, which costs and expenses shall be deemed to be
at least Seven Hundred Fifty Dollars ($750.00).
C. All cash or other proceeds (the "Transfer Consideration") of any
Transfer of Tenant's interest in this Lease and/or the Premises,
whether consented to by Landlord or not, shall be paid to Landlord
and Tenant hereby assigns all rights it might have or ever acquire
in any such proceeds to Landlord. In addition to the Rent hereunder,
Tenant hereby covenants and agrees to pay to Landlord all rent and
other consideration which it receives which is in excess of the Rent
payable hereunder within ten (10) days following receipt thereof by
Tenant. In addition to any other rights Landlord may have, Landlord
shall have the right to contact any transferee and require that all
payments made pursuant to the Transfer shall be made directly to
Landlord.
D. If Tenant is a corporation, limited liability company or similar
entity, and if at any time during the Lease Term the entity or
entities who own the voting shares at the time of the execution of
this Lease cease for any reason (including but not limited to
merger, consolidation or other reorganization involving another
corporation) to own a majority of such shares, or if Tenant is a
partnership and if at any time during the Lease Term the general
partner or partners who own the general partnership interests in the
partnership at the time of the execution of this Lease, cease for
any reason to own a majority of such interests (except as the result
of transfers by gift, bequest or inheritance to or for the benefit
of members of the immediate family of such original shareholder[s]
or partner[s]), such an event shall be deemed to be a Transfer. The
preceding sentence shall not apply whenever Tenant is a corporation,
the outstanding stock of which is listed on a recognized security
exchange, or if at least eighty percent (80%) of its voting stock is
owned by another corporation, the voting stock of which is so
listed.
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E. Any Transfer consented to by Landlord in accordance with this
Article XIII shall be only for the Permitted Use and for no other
purpose. In no event shall any Transfer release or relieve Tenant or
any Guarantors from any obligations under this Lease.
XIV. LIENS.
Tenant will not permit any mechanic's liens or other liens to be placed
upon the Premises or Tenant's leasehold interest therein, the Building, or the
Property. Landlord's title to the Building and Property is and always shall be
paramount to the interest of Tenant, and nothing herein contained shall empower
Tenant to do any act that can, shall or may encumber Landlord's title. In the
event any such lien does attach, Tenant shall, within five (5) days of notice of
the filing of said lien, either discharge or bond over such lien to the
satisfaction of Landlord and Landlord's Mortgagee (as hereinafter defined), and
in such a manner as to remove the lien as an encumbrance against the Building
and Property. If Tenant shall fail to so discharge or bond over such lien, then,
in addition to any other right or remedy of Landlord, Landlord may, but shall
not be obligated to bond over or discharge the same. Any amount paid by Landlord
for any of the aforesaid purposes, including reasonable attorneys' fees (if and
to the extent permitted by law) shall be paid by Tenant to Landlord on demand as
Additional Base Rental. Landlord shall have the right to post and keep posted on
the Premises any notices that may be provided by law or which Landlord may deem
to be proper for the protection of Landlord, the Premises and the Building from
such liens.
XV. INDEMNITY AND WAIVER OF CLAIMS.
A. Tenant shall indemnify, defend and hold Landlord, its members,
principals, beneficiaries, partners, officers, directors, employees,
Mortgagee(s) and agents, and the respective principals and members
of any such agents (collectively the "Landlord Related Parties")
harmless against and from all liabilities, obligations, damages,
penalties, claims, costs, charges and expenses, including, without
limitation, reasonable attorneys' fees and other professional fees
(if and to the extent permitted by law), which may be imposed upon,
incurred by, or asserted against Landlord or any of the Landlord
Related Parties and arising, directly or indirectly, out of or in
connection with the use, occupancy or maintenance of the Premises
by, through or under Tenant including, without limitation, any of
the following: (1) any work or thing done in, on or about the
Premises or any part thereof by Tenant or any of its transferees,
agents, servants, contractors, employees, customers, licensees or
invitees; (2) any use, non-use, possession, occupation, condition,
operation or maintenance of the Premises or any part thereof; (3)
any act or omission of Tenant or any of its transferees, agents,
servants, contractors, employees, customers, licensees or invitees,
regardless of whether such act or omission occurred within the
Premises; (4) any injury or damage to any person or property
occurring in, on or about the Premises or any part thereof; or (5)
any failure on the part of Tenant to perform or comply with any of
the covenants, agreements, terms or conditions contained in this
Lease with which Tenant must comply or perform. In case any action
or proceeding is brought against Landlord or any of the Landlord
Related Parties by reason of any of the foregoing, Tenant shall, at
Tenant's sole cost and expense, resist and defend such action or
proceeding with counsel approved by Landlord or, at Landlord's
option, reimburse Landlord for the cost of any counsel retained
directly by Landlord to defend and resist such action or proceeding.
B. Landlord and the Landlord Related Parties shall not be liable for,
and Tenant hereby waives, all claims for loss or damage to Tenant's
business or damage to person or property sustained by Tenant or any
person claiming by, through or under Tenant [including Tenant's
principals, agents and employees (collectively, the "Tenant Related
Parties")] resulting from any accident or occurrence in, on or about
the Premises, the Building or the Property, including, without
limitation, claims for loss, theft or damage resulting from: (1)the
Premises, Building, or Property, or any equipment or appurtenances
becoming out of repair; (2) wind or weather; (3) any defect in or
failure to operate, for whatever reason, any sprinkler, heating or
air-conditioning equipment, electric wiring, gas, water or
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steam pipes; (4) broken glass; (5) the backing up of any sewer pipe
or downspout; (6) the bursting, leaking or running of any tank,
water closet, drain or other pipe; (7) the escape of steam or water;
(8) water, snow or ice being upon or coming through the roof,
skylight, stairs, doorways, windows, walks or any other place upon
or near the Building; (9) the falling of any fixture, plaster, tile
or other material; (10) any act, omission or negligence of other
tenants, licensees or any other persons or occupants of the Building
or of adjoining or contiguous buildings, or owners of adjacent or
contiguous property or the public, or by construction of any
private, public or quasi-public work; or (11) any other cause of any
nature except, as to items 1-9, where such loss or damage is due to
Landlord's willful failure to make repairs required to be made
pursuant to other provisions of this Lease, after the expiration of
a reasonable time after written notice to Landlord of the need for
such repairs. To the maximum extent permitted by law, Tenant agrees
to use and occupy the Premises, and to use such other portions of
the Building as Tenant is herein given the right to use, at Tenant's
own risk.
XVI. TENANT'S INSURANCE.
A. At all times commencing on and after the earlier of the Commencement
Date and the date Tenant or its agents, employees or contractors
enters the Premises for any purpose, Tenant shall carry and
maintain, at its sole cost and expense:
1. Commercial General Liability Insurance applicable to the
Premises and its appurtenances providing, on an occurrence
basis, a minimum combined single limit of Two Million Dollars
($2,000,000.00), with a contractual liability endorsement
covering Tenant's indemnity obligations under this Lease.
2. All Risks of Physical Loss Insurance written at replacement
cost value and with a replacement cost endorsement covering
all of Tenant's Property in the Premises.
3. Workers' Compensation Insurance as required by the state in
which the Premises is located and in amounts as may be
required by applicable statute, and Employers' Liability
Coverage of One Million Dollars ($1,000,000.00) per
occurrence.
4. Whenever good business practice, in Landlord's reasonable
judgment, indicates the need of additional insurance coverage
or different types of insurance in connection with the
Premises or Tenant's use and occupancy thereof, Tenant shall,
upon request, obtain such insurance at Tenant's expense and
provide Landlord with evidence thereof.
B. Except for items for which Landlord is responsible under the Work
Letter agreement, before any repairs, alterations, additions,
improvements, or construction are undertaken by or on behalf of
Tenant, Tenant shall carry and maintain, at its expense, or Tenant
shall require any contractor performing work on the Premises to
carry and maintain, at no expense to Landlord, in addition to
Workers' Compensation Insurance as required by the jurisdiction in
which the Building is located, All Risk Builder's Risk Insurance in
the amount of the replacement cost of any alterations, additions or
improvements (or such other amount reasonably required by Landlord)
and Commercial General Liability Insurance (including, without
limitation, Contractor's Liability coverage, Contractual Liability
coverage and Completed Operations coverage,) written on an
occurrence basis with a minimum combined single limit of Two Million
Dollars ($2,000,000.00) and adding "the named Landlord hereunder (or
any successor thereto), Equity Office Properties Trust, a Maryland
real estate investment trust, EOP Operating Limited Partnership, a
Delaware limited partnership, and their respective members,
principals, beneficiaries, partners, officers, directors, employees,
agents and any Mortgagee(s)", and other designees of Landlord as the
interest of such designees shall appear, as additional insureds
(collectively referred to as the "Additional Insureds").
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C. Any company writing any insurance which Tenant is required to
maintain or cause to be maintained pursuant to the terms of this
Lease (all such insurance as well as any other insurance pertaining
to the Premises or the operation of Tenant's business therein being
referred to as "Tenant's Insurance"), as well as the form of such
insurance, shall at all times be subject to Landlord's reasonable
approval, and each such insurance company shall have an A.M. Best
rating of "A-" or better and shall be licensed and qualified to do
business in the state in which the Premises is located. All policies
evidencing Tenant's Insurance (except for Workers' Compensation
Insurance) shall specify Tenant as named insured and the Additional
Insureds as additional insureds. Provided that the coverage afforded
Landlord and any designees of Landlord shall not be reduced or
otherwise adversely affected, all of Tenant's Insurance may be
carried under a blanket policy covering the Premises and any other
of Tenant's locations. All policies of Tenant's Insurance shall
contain endorsements that the insurer(s) will give to Landlord and
its designees at least thirty (30) days' advance written notice of
any change, cancellation, termination or lapse of said Tenant's
Insurance. Tenant shall be solely responsible for payment of
premiums for all of Tenant's Insurance. Tenant shall deliver to
Landlord at least fifteen (15) days prior to the time Tenant's
Insurance is first required to be carried by Tenant, and upon
renewals at least fifteen (15) days prior to the expiration of any
such Tenant's Insurance coverage, a certificate of insurance of all
policies procured by Tenant in compliance with its obligations under
this Lease. The limits of Tenant's Insurance shall in no event limit
Tenant's liability under this Lease.
D. Tenant shall not do or fail to do anything in, upon or about the
Premises which will: (1) violate the terms of any of Landlord's
insurance policies; (2) prevent Landlord from obtaining policies of
insurance acceptable to Landlord or any Mortgagees; or (3) result in
an increase in the rate of any insurance on the Premises, the
Building, any other property of Landlord or of others within the
Building. In the event of the occurrence of any of the events set
forth in this Section, Tenant shall pay Landlord upon demand, as
Additional Base Rental, the cost of the amount of any increase in
any such insurance premium, provided that the acceptance by Landlord
of such payment shall not be construed to be a waiver of any rights
by Landlord in connection with a default by Tenant under the Lease.
If Tenant fails to obtain the insurance coverage required by this
Lease, Landlord may, at its option, obtain such insurance for
Tenant, and Tenant shall pay, as Additional Base Rental, the cost of
all premiums thereon and all of Landlord's costs associated
therewith.
XVII. SUBROGATION.
Notwithstanding anything set forth in this Lease to the contrary, Landlord
and Tenant do hereby waive any and all right of recovery, claim, action or cause
of action against the other, their respective principals, beneficiaries,
partners, officers, directors, agents, and employees, and, with respect to
Landlord, its Mortgagee(s), for any loss or damage that may occur to Landlord or
Tenant or any party claiming by, through or under Landlord or Tenant, as the
case may be, with respect to their respective property, the Building, the
Property or the Premises or any addition or improvements thereto, or any
contents therein, by reason of fire, the elements or any other cause, regardless
of cause or origin, including the negligence of Landlord or Tenant, or their
respective principals, beneficiaries, partners, officers, directors, agents and
employees and, with respect to Landlord, its Mortgagee(s), which loss or damage
is (or would have been, had the insurance required by this Lease been carried)
covered by insurance. Since this mutual waiver will preclude the assignment of
any such claim by subrogation (or otherwise) to an insurance company (or any
other person), Landlord and Tenant each agree to give each insurance company
which has issued, or in the future may issue, policies of insurance, with
respect to the items covered by this waiver, written notice of the terms of this
mutual waiver, and to have such insurance policies properly endorsed, if
necessary, to prevent the invalidation of any of the coverage provided by such
insurance policies by reason of such mutual waiver. For the purpose of the
foregoing waiver, the amount of any deductible applicable to any loss or damage
shall be deemed covered by, and recoverable by the insured under the insurance
policy to which such deductible relates. In the event that Tenant is permitted
to and self-insures any risk which would have been covered by the insurance
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required to be carried by Tenant pursuant to Article XVI of the Lease, or if
Tenant fails to carry any insurance required to be carried by Tenant pursuant to
Article XVI of this Lease, then all loss or damage to Tenant, its leasehold
interest, its business, its property, the Premises or any additions or
improvements thereto or contents thereof shall be deemed covered by and
recoverable by Tenant under valid and collectible policies of insurance.
XVIII. LANDLORD'S INSURANCE.
Landlord shall maintain property insurance on the Building in such amounts
as Landlord reasonably elects. The cost of such insurance shall be included as a
part of the Basic Costs, and payments for losses and recoveries thereunder shall
be made solely to Landlord or the Mortgagees of Landlord as their interests
shall appear.
XIX. CASUALTY DAMAGE.
If the Premises or any part thereof shall be damaged by fire or other
casualty, Tenant shall give prompt written notice thereof to Landlord. In case
the Building shall be so damaged that in Landlord's reasonable judgment,
substantial alteration or reconstruction of the Building shall be required
(whether or not the Premises has been damaged by such casualty) or in the event
Landlord will not be permitted by applicable law to rebuild the Building in
substantially the same form as existed prior to the fire or casualty or in the
event the Premises has been materially damaged and there is less than two (2)
years of the Lease Term remaining on the date of such casualty or in the event
any Mortgagee should require that the insurance proceeds payable as a result of
a casualty be applied to the payment of the mortgage debt or in the event of any
material uninsured loss to the Building, Landlord may, at its option, terminate
this Lease by notifying Tenant in writing of such termination within ninety (90)
days after the date of such casualty. Such termination shall be effective as of
the date of fire or casualty, with respect to any portion of the Premises that
was rendered untenantable, and the effective date of termination specified in
Landlord's notice, with respect to any portion of the Premises that remained
tenantable. If Landlord does not elect to terminate this Lease, Landlord shall
commence and proceed with reasonable diligence to restore the Building (provided
that Landlord shall not be required to restore any unleased premises in the
Building) and the Leasehold Improvements (but excluding any improvements,
alterations or additions made by Tenant in violation of this Lease) located
within the Premises, if any, which Landlord has insured to substantially the
same condition they were in immediately prior to the happening of the casualty.
Notwithstanding the foregoing, Landlord's obligation to restore the Building,
and the Leasehold Improvements, if any, shall not require Landlord to expend for
such repair and restoration work more than the insurance proceeds actually
received by the Landlord as a result of the casualty. When repairs to the
Premises have been completed by Landlord, Tenant shall complete the restoration
or replacement of all Tenant's Property necessary to permit Tenant's reoccupancy
of the Premises, and Tenant shall present Landlord with evidence satisfactory to
Landlord of Tenant's ability to pay such costs prior to Landlord's commencement
of repair and restoration of the Premises. Landlord shall not be liable for any
inconvenience or annoyance to Tenant or injury to the business of Tenant
resulting in any way from such damage or the repair thereof, except that,
subject to the provisions of the next sentence, Landlord shall allow Tenant a
fair diminution of Rent on a per diem basis during the time and to the extent
any damage to the Premises causes the Premises to be rendered untenantable and
not used by Tenant. If the Premises or any other portion of the Building is
damaged by fire or other casualty resulting from the negligence of Tenant or any
Tenant Related Parties, the Rent hereunder shall not be diminished during any
period during which the Premises, or any portion thereof, is untenantable
(except to the extent Landlord is entitled to be reimbursed by the proceeds of
any rental interruption insurance), and Tenant shall be liable to Landlord for
the cost of the repair and restoration of the Building caused thereby to the
extent such cost and expense is not covered by insurance proceeds. Landlord and
Tenant hereby waive the provisions of any law from time to time in effect during
the Lease Term relating to the effect upon leases of partial or total
destruction of leased property. Landlord and Tenant agree that their respective
rights in the event of any damage to or destruction of the Premises shall be
those specifically set forth herein.
XX. DEMOLITION.
Landlord shall have the right to terminate this Lease if Landlord proposes
or is required, for any reason, to remodel, remove, or demolish the Building or
any substantial portion thereof.
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Such cancellation shall be exercised by Landlord by the service of not less than
ninety (90) days' written notice of such termination. Such notice shall set
forth the date upon which the termination will be effective. No money or other
consideration shall be payable by Landlord to Tenant for Landlord's exercise of
this right, and the right is hereby reserved to Landlord and all purchasers,
successors, assigns, transferees, and ground tenants of Landlord, as the case
may be, and is in addition to all other rights of Landlord. Tenant has read the
foregoing and understands that Landlord has a right to terminate this Lease as
provided above.
XXI. CONDEMNATION.
If (a) the whole or any substantial part of the Premises or (b) any
portion of the Building or Property which would leave the remainder of the
Building unsuitable for use as an office building comparable to its use on the
Commencement Date, shall be taken or condemned for any public or quasi-public
use under governmental law, ordinance or regulation, or by right of eminent
domain, or by private purchase in lieu thereof, then Landlord may, at its
option, terminate this Lease effective as of the date the physical taking of
said Premises or said portion of the Building or Property shall occur. In the
event this Lease is not terminated, the Rentable Area of the Building, the
Rentable Area of the Premises and Tenant's Pro Rata Share shall be appropriately
adjusted. In addition, Rent for any portion of the Premises so taken or
condemned shall be abated during the unexpired term of this Lease effective when
the physical taking of said portion of the Premises shall occur. All
compensation awarded for any such taking or condemnation, or sale proceeds in
lieu thereof, shall be the property of Landlord, and Tenant shall have no claim
thereto, the same being hereby expressly waived by Tenant, except for any
portions of such award or proceeds which are specifically allocated by the
condemning or purchasing party for the taking of or damage to trade fixtures of
Tenant, which Tenant specifically reserves to itself.
XXII. EVENTS OF DEFAULT.
The following events shall be deemed to be events of default under this
Lease:
A. Tenant shall fail to pay when due any Base Rental, Additional Base
Rental or other Rent under this Lease and such failure shall
continue for three (3) days after written notice from Landlord
(hereinafter sometimes referred to as a "Monetary Default").
B. Any failure by Tenant (other than a Monetary Default) to comply with
any term, provision or covenant of this Lease, including, without
limitation, the rules and regulations, which failure is not cured
within ten (10) days after delivery to Tenant of notice of the
occurrence of such failure, provided that if any such failure
creates a hazardous condition, such failure must be cured
immediately. Notwithstanding the foregoing, if Tenant fails to
comply with any particular provision or covenant of this Lease,
including, without limitation, Tenant's obligation to pay Rent when
due, on three (3) occasions during any twelve (12) month period, any
subsequent violation of such provision or covenant shall be
considered to be an incurable default by Tenant.
C. Tenant or any Guarantor shall become insolvent, or shall make a
transfer in fraud of creditors, or shall commit an act of bankruptcy
or shall make an assignment for the benefit of creditors, or Tenant
or any Guarantor shall admit in writing its inability to pay its
debts as they become due.
D. Tenant or any Guarantor shall file a petition under any section or
chapter of the United States Bankruptcy Code, as amended, pertaining
to bankruptcy, or under any similar law or statute of the United
States or any State thereof, or Tenant or any Guarantor shall be
adjudged bankrupt or insolvent in proceedings filed against Tenant
or any Guarantor thereunder; or a petition or answer proposing the
adjudication of Tenant or any Guarantor as a debtor or its
reorganization under any present or future federal or state
bankruptcy or similar law shall be filed in any court and such
petition or answer shall not be discharged or denied within sixty
(60) days after the filing thereof.
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E. A receiver or trustee shall be appointed for all or substantially
all of the assets of Tenant or any Guarantor or of the Premises or
of any of Tenant's Property located thereon in any proceeding
brought by Tenant or any Guarantor, or any such receiver or trustee
shall be appointed in any proceeding brought against Tenant or any
Guarantor and shall not be discharged within sixty (60) days after
such appointment or Tenant or such Guarantor shall consent to or
acquiesce in such appointment.
F. The leasehold estate hereunder shall be taken on execution or other
process of law or equity in any action against Tenant.
G. Tenant shall abandon or vacate any substantial portion of the
Premises without the prior written permission of Landlord.
H. Tenant shall fail to take possession of and occupy the Premises
within thirty (30) days following the Commencement Date and
thereafter continuously conduct its operations in the Premises for
the Permitted Use.
I. The liquidation, termination, dissolution, forfeiture of right to do
business, or death of Tenant or any then current Guarantor.
J. Tenant is in default beyond any notice and cure period under any
other lease with Landlord.
XXIII. REMEDIES.
A. Upon the occurrence of any event or events of default under this
Lease, whether enumerated in Article XXII or not, Landlord shall
have the option to pursue any one or more of the following remedies
without any notice (except as expressly prescribed herein) or demand
whatsoever (and without limiting the generality of the foregoing,
Tenant hereby specifically waives notice and demand for payment of
Rent or other obligations and waives any and all other notices or
demand requirements imposed by applicable law):
1. Terminate this Lease and Tenant's right to possession of the
Premises and recover from Tenant an award of damages equal to
the sum of the following:
(a) The Worth at the Time of Award of the unpaid Rent which
had been earned at the time of termination;
(b) The Worth at the Time of Award of the amount by which
the unpaid Rent which would have been earned after
termination until the time of award exceeds the amount
of such Rent loss that Tenant affirmatively proves could
have been reasonably avoided;
(c) The Worth at the Time of Award of the amount by which
the unpaid Rent for the balance of the Lease Term after
the time of award exceeds the amount of such Rent loss
that Tenant affirmatively proves could be reasonably
avoided;
(d) Any other amount necessary to compensate Landlord for
all the detriment either proximately caused by Tenant's
failure to perform Tenant's obligations under this Lease
or which in the ordinary course of things would be
likely to result therefrom; and
(e) All such other amounts in addition to or in lieu of the
foregoing as may be permitted from time to time under
applicable law.
The "Worth at the Time of Award" of the amounts referred to in
parts (a) and (b) above, shall be computed by allowing
interest at the rate specified in Article IV.E., and the
"Worth at the Time of Award" of the amount referred to in part
(c), above, shall be computed by discounting such
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amount at the discount rate of the Federal Reserve Bank of San
Francisco at the time of award plus one percent (1%);
2. Employ the remedy described in California Civil Code Section
1951.4 (Landlord may continue this Lease in effect after
Tenant's breach and abandonment and recover Rent as it becomes
due, if Tenant has the right to sublet or assign, subject only
to reasonable limitations); or
3. Notwithstanding Landlord's exercise of the remedy described in
California Civil Code Section 1951.4 in respect of an event or
events of default, at such time thereafter as Landlord may
elect in writing, to terminate this Lease and Tenant's right
to possession of the Premises and recover an award of damages
as provided above in Paragraph XXIII.A.1.
B. The subsequent acceptance of Rent hereunder by Landlord shall not be
deemed to be a waiver of any preceding breach by Tenant of any term,
covenant or condition of this Lease, other than the failure of
Tenant to pay the particular Rent so accepted, regardless of
Landlord's knowledge of such preceding breach at the time of
acceptance of such Rent. No waiver by Landlord of any breach hereof
shall be effective unless such waiver is in writing and signed by
Landlord.
C. TENANT HEREBY WAIVES ANY AND ALL RIGHTS CONFERRED BY SECTION 3275 OF
THE CIVIL CODE OF CALIFORNIA AND BY SECTIONS 1174 (C) AND 1179 OF
THE CODE OF CIVIL PROCEDURE OF CALIFORNIA AND ANY AND ALL OTHER LAWS
AND RULES OF LAW FROM TIME TO TIME IN EFFECT DURING THE LEASE TERM
PROVIDING THAT TENANT SHALL HAVE ANY RIGHT TO REDEEM, REINSTATE OR
RESTORE THIS LEASE FOLLOWING ITS TERMINATION BY REASON OF TENANTS
BREACH. TENANT ALSO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF
OR RELATING TO THIS LEASE.
D. No right or remedy herein conferred upon or reserved to Landlord is
intended to be exclusive of any other right or remedy, and each and
every right and remedy shall be cumulative and in addition to any
other right or remedy given hereunder or now or hereafter existing
by agreement, applicable law or in equity. In addition to other
remedies provided in this Lease, Landlord shall be entitled, to the
extent permitted by applicable law, to injunctive relief, or to a
decree compelling performance of any of the covenants, agreements,
conditions or provisions of this Lease, or to any other remedy
allowed to Landlord at law or in equity. Forbearance by Landlord to
enforce one or more of the remedies herein provided upon an event of
default shall not be deemed or construed to constitute a waiver of
such default.
E. This Article XXIII shall be enforceable to the maximum extent such
enforcement is not prohibited by applicable law, and the
unenforceability of any portion thereof shall not thereby render
unenforceable any other portion.
XXIV. LIMITATION OF LIABILITY.
NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS LEASE, THE
LIABILITY OF LANDLORD (AND OF ANY SUCCESSOR LANDLORD HEREUNDER) TO TENANT SHALL
BE LIMITED TO THE INTEREST OF LANDLORD IN THE BUILDING, AND TENANT AGREES TO
LOOK SOLELY TO LANDLORD'S INTEREST IN THE BUILDING FOR THE RECOVERY OF ANY
JUDGMENT OR AWARD AGAINST THE LANDLORD, IT BEING INTENDED THAT NEITHER LANDLORD
NOR ANY MEMBER, PRINCIPAL, PARTNER, SHAREHOLDER, OFFICER, DIRECTOR OR
BENEFICIARY OF LANDLORD SHALL BE PERSONALLY LIABLE FOR ANY JUDGMENT OR
DEFICIENCY. TENANT HEREBY COVENANTS THAT, PRIOR TO THE FILING OF ANY SUIT FOR AN
ALLEGED DEFAULT BY LANDLORD HEREUNDER, IT SHALL GIVE LANDLORD AND ALL MORTGAGEES
WHOM TENANT HAS BEEN NOTIFIED HOLD MORTGAGES OR DEED OF TRUST LIENS ON THE
PROPERTY, BUILDING OR PREMISES NOTICE AND REASONABLE TIME TO CURE SUCH ALLEGED
DEFAULT BY LANDLORD.
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XXV. NO WAIVER.
Failure of Landlord to declare any default immediately upon its
occurrence, or delay in taking any action in connection with an event of default
shall not constitute a waiver of such default, nor shall it constitute an
estoppel against Landlord, but Landlord shall have the right to declare the
default at any time and take such action as is lawful or authorized under this
Lease. Failure by Landlord to enforce its rights with respect to any one default
shall not constitute a waiver of its rights with respect to any subsequent
default. Receipt by Landlord of Tenant's keys to the Premises shall not
constitute an acceptance or surrender of the Premises.
XXVI. EVENT OF BANKRUPTCY.
In addition to, and in no way limiting the other remedies set forth
herein, Landlord and Tenant agree that if Tenant ever becomes the subject of a
voluntary or involuntary bankruptcy, reorganization, composition, or other
similar type proceeding under the federal bankruptcy laws, as now enacted or
hereinafter amended, then:
A. "Adequate protection" of Landlord's interest in the Premises
pursuant to the provisions of Section 361 and 363 (or their
successor sections) of the Bankruptcy Code, 11 U.S.C. Section 101 et
seq., (such Bankruptcy Code as amended from time to time being
herein referred to as the "Bankruptcy Code"), prior to assumption
and/or assignment of the Lease by Tenant shall include, but not be
limited to all (or any part) of the following:
1. the continued payment by Tenant of the Base Rental and all
other Rent due and owing hereunder and the performance of all
other covenants and obligations hereunder by Tenant;
2. the furnishing of an additional/new security deposit by Tenant
in the amount of three (3) times the then current monthly Base
Rental.
B. "Adequate assurance of future performance" by Tenant and/or any
assignee of Tenant pursuant to Bankruptcy Code Section 365 will
include (but not be limited to) payment of an additional/new
Security Deposit in the amount of three (3) times the then current
monthly Base Rental payable hereunder.
C. Any person or entity to which this Lease is assigned pursuant to the
provisions of the Bankruptcy Code, shall be deemed without further
act or deed to have assumed all of the obligations of Tenant arising
under this Lease on and after the effective date of such assignment.
Any such assignee shall, upon demand by Landlord, execute and
deliver to Landlord an instrument confirming such assumption of
liability.
D. Notwithstanding anything in this Lease to the contrary, all amounts
payable by Tenant to or on behalf of the Landlord under this Lease,
whether or not expressly denominated as "Rent," shall constitute
"rent" for the purposes of Section 502(b) (6) of the Bankruptcy
Code.
E. If this Lease is assigned to any person or entity pursuant to the
provisions of the Bankruptcy Code, any and all monies or other
considerations payable or otherwise to be delivered to Landlord
(including Base Rental and other Rent hereunder), shall be and
remain the exclusive property of Landlord and shall not constitute
property of Tenant or of the bankruptcy estate of Tenant. Any and
all monies or other considerations constituting Landlord's property
under the preceding sentence not paid or delivered to Landlord shall
be held in trust by Tenant or Tenant's bankruptcy estate for the
benefit of Landlord and shall be promptly paid to or turned over to
Landlord.
F. If Tenant assumes this Lease and proposes to assign the same
pursuant to the provisions of the Bankruptcy Code to any person or
entity who shall have made a bona fide offer to accept an assignment
of this Lease on terms acceptable to the Tenant, then notice of such
proposed offer/assignment, setting forth: (1) the name and address
of such person or entity, (2) all of the terms and conditions of
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such offer, and (3) the adequate assurance to be provided Landlord
to assure such person's or entity's future performance under the
Lease, shall be given to Landlord by Tenant no later than twenty
(20) days after receipt by Tenant, but in any event no later than
ten (10) days prior to the date that Tenant shall make application
to a court of competent jurisdiction for authority and approval to
enter into such assumption and assignment, and Landlord shall
thereupon have the prior right and option, to be exercised by notice
to Tenant given at any time prior to the effective date of such
proposed assignment, to accept an assignment of this Lease upon the
same terms and conditions and for the same consideration, if any, as
the bona fide offer made by such persons or entity, less any
brokerage commission which may be payable out of the consideration
to be paid by such person for the assignment of this Lease.
G. To the extent permitted by law, Landlord and Tenant agree that this
Lease is a contract under which applicable law excuses Landlord from
accepting performance from (or rendering performance to) any person
or entity other than Tenant within the meaning of Sections 365(c)
and 365(e) (2) of the Bankruptcy Code.
XXVII. WAIVER OF JURY TRIAL.
Landlord and Tenant hereby waive any right to a trial by jury in any
action or proceeding based upon, or related to, the subject matter of this
Lease. This waiver is knowingly, intentionally, and voluntarily made by Tenant,
and Tenant acknowledges that neither Landlord nor any person acting on behalf of
Landlord has made any representations of fact to induce this waiver of trial by
jury or in any way to modify or nullify its effect. Tenant further acknowledges
that it has been represented (or has had the opportunity to be represented) in
the signing of this Lease and in the making of this waiver by independent legal
counsel, selected of its own free will, and that it has had the opportunity to
discuss this waiver with counsel.
XXVIII. RELOCATION.
Landlord, at its expense at any time before or during the Lease Term,
shall be entitled to cause Tenant to relocate from the Premises to space
containing approximately the same Rentable Area as the Premises (the "Relocation
Space") within the Building or adjacent buildings within the same Project at any
time upon sixty (60) days' prior written notice to Tenant provided that in no
event shall the Relocation Space have both of the following characteristics: (i)
be located on one or more of the first four (4) floors of the Building and (ii)
have a direct view of the Building's parking structure. Such a relocation shall
not affect this Lease except that from and after the date of such relocation,
"Premises" shall refer to the Relocation Space into which Tenant has been moved,
rather than the original Premises as herein defined, and the Base Rental shall
be adjusted so that immediately following such relocation the Base Rental for
the Relocation Space per annum on a per square foot of Rentable Area basis shall
be the same as the Base Rental per annum immediately prior to such relocation
for the original Premises on a per square foot of Rentable Area basis, provided
that the total monthly Base Rental for the Relocation Space shall in no event
exceed the Base Rental for the Premises. Tenant's Pro Rata Share shall also be
adjusted in accordance with the formula set forth in this Lease.
XXIX. HOLDING OVER.
In the event of holding over by Tenant after expiration or other
termination of this Lease or in the event Tenant continues to occupy the
Premises after the termination of Tenant's right of possession pursuant to
Articles XXII and XXIII hereof, occupancy of the Premises subsequent to such
termination or expiration shall be that of a tenancy at sufferance and in no
event for month-to-month or year-to-year. But Tenant shall, throughout the
entire holdover period, be subject to all the terms and provisions of this Lease
and shall pay for its use and occupancy an amount (on a per month basis without
reduction for any partial months during any such holdover) equal to twice the
sum of the Base Rental and Additional Base Rental due for the period immediately
preceding such holding over, provided that in no event shall Base Rental and
Additional Base Rental during the holdover period be less than the fair market
rental for the Premises. No holding over by Tenant or payments of money by
Tenant to Landlord after the expiration of the Lease Term shall be construed to
extend the Lease Term or prevent Landlord from recovery of immediate possession
of the Premises by summary proceedings or
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otherwise. In addition to the obligation to pay the amounts set forth above
during any such holdover period, Tenant also shall be liable to Landlord for all
damage, including any consequential damage, which Landlord may suffer by reason
of any holding over by Tenant, and Tenant shall indemnify Landlord against any
and all claims made by any other tenant or prospective tenant against Landlord
for delay by Landlord in delivering possession of the Premises to such other
tenant or prospective tenant.
XXX. SUBORDINATION TO MORTGAGES; ESTOPPEL CERTIFICATE.
Tenant accepts this Lease subject and subordinate to any mortgage, deed of
trust, ground lease or other lien presently existing or hereafter arising upon
the Premises, or upon the Building and/or the Property and to any renewals,
modifications, refinancings and extensions thereof (any such mortgage, deed of
trust, lease or other lien being hereinafter referred to as a "Mortgage", and
the person or entity having the benefit of same being referred to hereinafter as
a "Mortgagee"), but Tenant agrees that any such Mortgagee shall have the right
at any time to subordinate such Mortgage to this Lease on such terms and subject
to such conditions as such Mortgagee may deem appropriate in its discretion.
This clause shall be self-operative and no further instrument of subordination
shall be required. However, Landlord is hereby irrevocably vested with full
power and authority to subordinate this Lease to any Mortgage, and Tenant agrees
upon demand to execute such further instruments subordinating this Lease,
acknowledging the subordination of this Lease or attorning to the holder of any
such Mortgage as Landlord may request. The terms of this Lease are subject to
approval by the Landlord's existing lender(s) and any lender(s) who, at the time
of the execution of this Lease, have committed or are considering committing to
Landlord to make a loan secured by all or any portion of the Property, and such
approval is a condition precedent to Landlord's obligations hereunder. In the
event that Tenant should fail to execute any subordination or other agreement
required by this Article promptly as requested, Tenant hereby irrevocably
constitutes Landlord as its attorney-in-fact to execute such instrument in
Tenant's name, place and stead, it being agreed that such power is one coupled
with an interest in Landlord and is accordingly irrevocable. If any person shall
succeed to all or part of Landlord's interests in the Premises whether by
purchase, foreclosure, deed in lieu of foreclosure, power of sale, termination
of lease or otherwise, and if and as so requested or required by such
successor-in-interest, Tenant shall, without charge, attorn to such
successor-in-interest. Tenant agrees that it will from time to time upon request
by Landlord and, within five (5) days of the date of such request, execute and
deliver to such persons as Landlord shall request an estoppel certificate or
other similar statement in recordable form certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same is in full force and effect as so modified), stating the dates to
which Rent and other charges payable under this Lease have been paid, stating
that Landlord is not in default hereunder (or if Tenant alleges a default
stating the nature of such alleged default) and further stating such other
matters as Landlord shall reasonably require.
XXXI. ATTORNEYS' FEES.
In the event that Landlord should retain counsel and/or institute any suit
against Tenant for violation of or to enforce any of the covenants or conditions
of this Lease, or should Tenant institute any suit against Landlord for
violation of any of the covenants or conditions of this Lease, or should either
party intervene in any suit in which the other is a party to enforce or protect
its interest or rights hereunder, the prevailing party in any such suit shall be
entitled to all of its costs, expenses and reasonable fees of its attorney(s)
(if and to the extent permitted by law) in connection therewith.
XXXII. NOTICE.
Whenever any demand, request, approval, consent or notice ("Notice") shall
or may be given to either of the parties by the other, each such Notice shall be
in writing and shall be sent by registered or certified mail with return receipt
requested, or sent by overnight courier service (such as Federal Express) at the
respective addresses of the parties for notices as set forth in Section I.A.10.
of this Lease, provided that if Tenant has vacated the Premises or is in default
of this Lease Landlord may serve Notice by any manner permitted by law. Any
Notice under this Lease delivered by registered or certified mail shall be
deemed to have been given, delivered, received and effective on the earlier of
(a) the third day following the day on which the same shall have been mailed
with sufficient postage prepaid or (b) the delivery date
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indicated on the return receipt. Notice sent by overnight courier service shall
be deemed given, delivered, received and effective upon the day after such
Notice is delivered to or picked up by the overnight courier service. Either
party may, at any time, change its Notice Address by giving the other party
Notice stating the change and setting forth the new Notice Address.
XXXIII. LANDLORD'S LIEN.
In addition to any statutory lien for rent in Landlord's favor, Landlord
(the secured party for purposes hereof) shall have and Tenant (the debtor for
purposes hereof) hereby grants to Landlord, an express contract lien and a
continuing security interest to secure the payment of all Rent due hereunder
from Tenant, upon all goods, wares, equipment, fixtures, furniture, inventory,
accounts, contract rights, chattel paper and other personal property of Tenant
(and any transferees or other occupants of the Premises) presently or hereafter
situated on the Premises and upon all proceeds of any insurance which may accrue
to Tenant by reason of damage or destruction of any such property. In the event
of a default under this Lease, Landlord shall have, in addition to any other
remedies provided herein or by law, all rights and remedies under the Uniform
Commercial Code of the state in which the Premises is located, including without
limitation the right to sell the property described in this paragraph at public
or private sale upon ten (10) days' notice to Tenant, which notice Tenant hereby
agrees is adequate and reasonable. Tenant hereby agrees to execute such other
instruments necessary or desirable in Landlord's discretion to perfect the
security interest hereby created. Any statutory lien for rent is not hereby
waived, the express contractual lien herein granted being in addition and
supplementary thereto. Landlord and Tenant agree that this Lease and the
security interest granted herein serve as a financing statement, and a copy or
photographic or other reproduction of this Paragraph of this Lease may be filed
of record by Landlord and have the same force and effect as the original. Tenant
warrants and represents that the collateral subject to the security interest
granted herein is not purchased or used by Tenant for personal, family or
household purposes. Tenant further warrants and represents to Landlord that the
lien granted herein constitutes a first and superior lien and that Tenant will
not allow the placing of any other lien upon any of the property described in
this Article without the prior written consent of Landlord.
XXXIV. EXCEPTED RIGHTS.
This Lease does not grant any rights to light or air over or about the
Building. Landlord specifically excepts and reserves to itself the use of any
roofs, the exterior portions of the Premises, all rights to the land and
improvements below the improved floor level of the Premises, the improvements
and air rights above the Premises and the improvements and air rights located
outside the demising walls of the Premises, and such areas within the Premises
as are required for installation of utility lines and other installations
required to serve any occupants of the Building and the right to maintain and
repair the same, and no rights with respect thereto are conferred upon Tenant
unless otherwise specifically provided herein. Landlord further reserves to
itself the right from time to time: (a) to change the Building's name or street
address; (b) to install, fix and maintain signs on the exterior and interior of
the Building; (c) to designate and approve window coverings; (d) to make any
decorations, alterations, additions, improvements to the Building, or any part
thereof (including the Premises) which Landlord shall desire, or deem
necessary for the safety, protection, preservation or improvement of the
Building, or as Landlord may be required to do by law; (e) to have access to the
Premises to perform its duties and obligations and to exercise its rights under
this Lease; (f) to retain at all times and to use pass-keys to all locks within
and into the Premises; (g) to approve the weight, size, or location of heavy
equipment, or articles in and about the Premises; (h) to close or restrict
access to the Building at all times other than Normal Business Hours subject to
Tenant's right to admittance at all times under such regulations as Landlord may
prescribe from time to time, or to close (temporarily or permanently) any of the
entrances to the Building; (i) to change the arrangement and/or location of
entrances of passageways, doors and doorways, corridors, elevators, stairs,
toilets and public parts of the Building; (j) if Tenant has vacated the Premises
during the last six (6) months of the Lease Term, to perform additions,
alterations and improvements to the Premises in connection with a reletting or
anticipated reletting thereof without being responsible or liable for the value
or preservation of any then existing improvements to the Premises; and (k) to
grant to anyone the exclusive right to conduct any business or undertaking in
the Building. Landlord, in accordance with Article XII hereof, shall have the
right to enter the Premises in connection with the exercise of any of the rights
set forth herein and such entry into the Premises and the performance of any
work
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therein shall not constitute a constructive eviction or entitle Tenant to any
abatement or reduction of Rent by reason thereof.
XXXV. SURRENDER OF PREMISES.
At the expiration or earlier termination of this Lease or Tenant's right
of possession hereunder, Tenant shall remove all Tenant's Property from the
Premises, remove all Required Removables designated by Landlord and quit and
surrender the Premises to Landlord, broom clean, and in good order, condition
and repair, ordinary wear and tear excepted. If Tenant fails to remove any of
Tenant's Property within one (1) day after the termination of this Lease or
Tenant's right to possession hereunder, Landlord, at Tenant's sole cost and
expense, shall be entitled to remove and/or store such Tenant's Property and
Landlord shall in no event be responsible for the value, preservation or
safekeeping thereof. Tenant shall pay Landlord, upon demand, any and all
expenses caused by such removal and all storage charges against such property so
long as the same shall be in the possession of Landlord or under the control of
Landlord. In addition, if Tenant fails to remove any Tenant's Property from the
Premises or storage, as the case may be, within ten (10) days after written
notice from Landlord, Landlord, at its option, may deem all or any part of such
Tenant's Property to have been abandoned by Tenant and title thereof shall
immediately pass to Landlord.
XXXVI. MISCELLANEOUS.
A. If any term or provision of this Lease, or the application thereof
to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those
as to which it is held invalid or unenforceable, shall not be
affected thereby, and each term and provision of this Lease shall be
valid and enforced to the fullest extent permitted by law. This
Lease represents the result of negotiations between Landlord and
Tenant, each of which has been (or has had opportunity to be)
represented by counsel of its own selection, and neither of which
has acted under duress or compulsion, whether legal, economic or
otherwise. Consequently, Landlord and Tenant agree that the language
in all parts of the Lease shall in all cases be construed as a whole
according to its fair meaning and neither strictly for nor against
Landlord or Tenant.
B. Tenant agrees not to record this Lease or any memorandum hereof
without Landlord's prior written consent.
C. This Lease and the rights and obligations of the parties hereto
shall be interpreted, construed, and enforced in accordance with the
laws of the state in which the Building is located.
D. Events of "Force Majeure" shall include strikes, riots, acts of God,
shortages of labor or materials, war, governmental law, regulations
or restrictions and any other cause whatsoever that is beyond the
control of Landlord. Whenever a period of time is herein prescribed
for the taking of any action by Landlord, Landlord shall not be
liable or responsible for, and there shall be excluded from the
computation of such period of time, any delays due to events of
Force Majeure.
E. Landlord shall have the right to transfer and assign, in whole or in
part, all of its rights and obligations hereunder and in the
Building and Property referred to herein, and in such event and upon
such transfer Landlord shall be released from any further
obligations hereunder, and Tenant agrees to look solely to such
successor in interest of Landlord for the performance of such
obligations.
F. Tenant hereby represents to Landlord that it has dealt with no
brokers in connection with this Lease. Tenant agrees to indemnify
and hold Landlord and the Landlord Related Parties harmless from all
claims of any brokers claiming to have represented Tenant in
connection with this Lease. Landlord agrees to indemnify and hold
Tenant and the Tenant Related Parties harmless from all claims of
any brokers claiming to have represented Landlord in connection with
this Lease.
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G. If there is more than one Tenant, or if the Tenant is comprised of
more than one person or entity, the obligations hereunder imposed
upon Tenant shall be joint and several obligations of all such
parties. All notices, payments, and agreements given or made by,
with or to any one of such persons or entities shall be deemed to
have been given or made by, with or to all of them.
H. In the event Tenant is a corporation (including any form of
professional association), partnership (general or limited), or
other form of organization other than an individual (each such
entity is individually referred to herein as an "Organizational
Entity"), then Tenant hereby covenants, warrants and represents: (1)
that such individual is duly authorized to execute or attest and
deliver this Lease on behalf of Tenant in accordance with the
organizational documents of Tenant; (2) that this Lease is binding
upon Tenant; (3) that Tenant is duly organized and legally existing
in the state of its organization, and is qualified to do business in
the state in which the Premises is located; and (4) that the
execution and delivery of this Lease by Tenant will not result in
any breach of, or constitute a default under any mortgage, deed of
trust, lease, loan, credit agreement, partnership agreement or other
contract or instrument to which Tenant is a party or by which Tenant
may be bound. If Tenant is an Organizational Entity, upon request,
Tenant will, prior to the Commencement Date, deliver to Landlord
true and correct copies of all organizational documents of Tenant,
including, without limitation, copies of an appropriate resolution
or consent of Tenant's board of directors or other appropriate
governing body of Tenant authorizing or ratifying the execution and
delivery of this Lease, which resolution or consent will be duly
certified to Landlord's satisfaction by an appropriate individual
with authority to certify such documents, such as the secretary or
assistant secretary or the managing general partner of Tenant.
I. Tenant acknowledges that the financial capability of Tenant to
perform its obligations hereunder is material to Landlord and that
Landlord would not enter into this Lease but for its belief, based
on its review of Tenant's financial statements, that Tenant is
capable of performing such financial obligations. Tenant hereby
represents, warrants and certifies to Landlord that its financial
statements previously furnished to Landlord were at the time given
true and correct in all material respects and that there have been
no material subsequent changes thereto as of the date of this Lease.
At any time during the Lease Term, Tenant shall provide Landlord,
upon ten (10) days' prior written notice from Landlord, with a
current financial statement and financial statements of the two (2)
years prior to the current financial statement year and such other
information as Landlord or its Mortgagee may request in order to
create a "business profile" of Tenant and determine Tenant's ability
to fulfill its obligations under this Lease. Such statement shall be
prepared in accordance with generally accepted accounting principles
and, if such is the normal practice of Tenant, shall be audited by
an independent certified public accountant.
J. Except as expressly otherwise herein provided, with respect to all
required acts of Tenant, time is of the essence of this Lease. This
Lease shall create the relationship of Landlord and Tenant between
the parties hereto.
K. This Lease and the covenants and conditions herein contained shall
inure to the benefit of and be binding upon Landlord and Tenant and
their respective permitted successors and assigns.
L. Notwithstanding anything to the contrary contained in this Lease,
the expiration of the Lease Term, whether by lapse of time or
otherwise, shall not relieve Tenant from Tenant's obligations
accruing prior to the expiration of the Lease Term, and such
obligations shall survive any such expiration or other termination
of the Lease Term.
M. The headings and titles to the paragraphs of this Lease are for
convenience only and shall have no effect upon the construction or
interpretation of any part hereof.
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N. LANDLORD HAS DELIVERED A COPY OF THIS LEASE TO TENANT FOR TENANT'S
REVIEW ONLY, AND THE DELIVERY HEREOF DOES NOT CONSTITUTE AN OFFER TO
TENANT OR OPTION. THIS LEASE SHALL NOT BE EFFECTIVE UNTIL AN
ORIGINAL OF THIS LEASE EXECUTED BY BOTH LANDLORD AND TENANT AND AN
ORIGINAL GUARANTY, IF ANY, EXECUTED BY EACH GUARANTOR IS DELIVERED
TO AND ACCEPTED BY LANDLORD, AND THIS LEASE HAS BEEN APPROVED BY
LANDLORD'S MORTGAGEES, IF REQUIRED.
O. Quiet Enjoyment. Tenant shall, and may peacefully have, hold, and
enjoy the Premises, subject to the other terms of this Lease
(including, without limitation, Article XXX hereof), provided that
Tenant pays the Rent herein recited to be paid by Tenant and
performs all of Tenant's covenants and agreements herein contained.
This covenant and any and all other covenants of Landlord shall be
binding upon Landlord and its successors only during its or their
respective periods of ownership of the Landlord's interest
hereunder.
XXXVII. ENTIRE AGREEMENT.
This Lease agreement, including the following Exhibits:
Exhibit A - Outline and Location of Premises
Exhibit A-2 - Outline and Location of Property
Exhibit B - Rules and Regulations
Exhibit C - Commencement Letter (INTENTIONALLY OMITTED)
Exhibit D - Work Letter Agreement (INTENTIONALLY OMITTED)
Exhibit E - Additional Terms (INTENTIONALLY OMITTED)
Exhibit F - Parking Agreement
Exhibit G - Guaranty of Lease
constitutes the entire agreement between the parties hereto with respect
to the subject matter of this Lease and supersedes all prior agreements
and understandings between the parties related to the Premises, including
all lease proposals, letters of intent and similar documents. TENANT
EXPRESSLY ACKNOWLEDGES AND AGREES THAT LANDLORD HAS NOT MADE AND IS NOT
MAKING, AND TENANT, IN EXECUTING AND DELIVERING THIS LEASE, IS NOT RELYING
UPON, ANY WARRANTIES, REPRESENTATIONS, PROMISES OR STATEMENTS, EXCEPT TO
THE EXTENT THAT THE SAME ARE EXPRESSLY SET FORTH IN THIS LEASE. ALL
UNDERSTANDINGS AND AGREEMENTS HERETOFORE MADE BETWEEN THE PARTIES ARE
MERGED IN THIS LEASE WHICH ALONE FULLY AND COMPLETELY EXPRESSES THE
AGREEMENT OF THE PARTIES, NEITHER PARTY RELYING UPON ANY STATEMENT OR
REPRESENTATION NOT EMBODIED IN THIS LEASE. THIS LEASE MAY BE MODIFIED ONLY
BY A WRITTEN AGREEMENT SIGNED BY LANDLORD AND TENANT. LANDLORD AND TENANT
EXPRESSLY AGREE THAT THERE ARE AND SHALL BE NO IMPLIED WARRANTIES OF
MERCHANTABILITY, HABITABILITY, SUITABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR OF ANY OTHER KIND ARISING OUT OF THIS LEASE, ALL OF WHICH ARE
HEREBY WAIVED BY TENANT, AND THAT THERE ARE NO WARRANTIES WHICH EXTEND
BEYOND THOSE EXPRESSLY SET FORTH IN THIS LEASE.
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the
day and year first above written.
LANDLORD:
EOP-2010 IRVINE, L.L.C, A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST
DATED JUNE 5, 1997 AND KNOWN AS SHELI Z.
ROSENBERG TRUST NO. 2010
By: EOP Operating Limited Partnership,a
Delaware limited partnership, its sole member
By: Equity Office Properties Trust, a
Maryland real estate investment trust,
its managing general partner
By: /s/ Peter H. Adams
-------------------------------------
Name: Peter H. Adams
Title: Senior Vice President
TENANT:
PHOBO.COM,INC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
-----------------------------------------
Name: Fred H. Lerner
Title: President
By: /s/ Fred H. Lerner
-----------------------------------------
Name: Fred H. Lerner
Title: Secretary
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EXHIBIT A
PREMISES
This Exhibit is attached to and made a part of the Lease dated the MARCH
5, 1999, by and between EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY
COMPANY, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS SHELI Z.
ROSENBERG TRUST NO. 2010 ("Landlord"), and PHOBO.COM, INC., A DELAWARE
CORPORATION ("Tenant") for space in the Building located at 2010 Main Street,
Irvine, California.
[PREMISES PLAN]
<PAGE>
EXHIBIT A-2
OUTLINE AND LOCATION OF PROPERTY
This Exhibit is attached to and made a part of the Lease dated the MARCH
5, 1999, by and between EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY
COMPANY, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS SHELI Z.
ROSENBERG TRUST NO. 2010 ("LANDLORD"), AND PHOBO.COM, INC., A DELAWARE
CORPORATION ("Tenant") for space in the Building located at 2010 Main Street,
Irvine, California.
[OUTLINE AND LOCATION OF PROPERTY MAP]
<PAGE>
EXHIBIT B
BUILDING RULES AND REGULATIONS
The following rules and regulations shall apply, where applicable, to the
Premises, the Building, the parking garage associated therewith (if any), the
Property and the appurtenances thereto:
1. Sidewalks, doorways, vestibules, halls, stairways and other similar areas
shall not be obstructed by Tenant or used by Tenant for any purpose other
than ingress and egress to and from the Premises. No rubbish, litter,
trash, or material of any nature shall be placed, emptied, or thrown in
those areas. At no time shall Tenant permit Tenant's employees to loiter
in common areas or elsewhere in or about the Building or Property.
2. Plumbing fixtures and appliances shall be used only for the purposes for
which designed, and no sweepings, rubbish, rags or other unsuitable
material shall be thrown or placed therein. Damage resulting to any such
fixtures or appliances from misuse by Tenant or its agents, employees or
invitees, shall be paid for by Tenant, and Landlord shall not in any case
be responsible therefor.
3. No signs, advertisements or notices shall be painted or affixed on or to
any windows, doors or other parts of the Building, except those of such
color, size, style and in such places as shall be first approved in
writing by Landlord. No nails, hooks or screws shall be driven or inserted
into any part of the Premises or Building except by the Building
maintenance personnel, nor shall any part of the Building be defaced by
Tenant.
4. Landlord may provide and maintain in the first floor (main lobby) of the
Building an alphabetical directory board listing all tenants, and no other
directory shall be permitted unless previously consented to by Landlord in
writing.
5. Tenant shall not place any additional lock or locks on any door in the
Premises or Building without Landlord's prior written consent. A
reasonable number of keys to the locks on the doors in the Premises shall
be furnished by Landlord to Tenant at the cost of Tenant, and Tenant shall
not have any duplicate keys made. All keys shall be returned to Landlord
at the expiration or earlier termination of this Lease.
6. All contractors, contractor's representatives, and installation
technicians performing work in the Building shall be subject to Landlord's
prior approval and shall be required to comply with Landlord's standard
rules, regulations, policies and procedures, as the same may be revised
from time to time. Tenant shall be solely responsible for complying with
all applicable laws, codes and ordinances pursuant to which said work
shall be performed.
7. Movement in or out of the Building of furniture or office equipment, or
dispatch or receipt by Tenant of any merchandise or materials which
require the use of elevators, stairways, lobby areas, or loading dock
areas, shall be restricted to hours designated by Landlord. Tenant must
seek Landlord's prior approval by providing in writing a detailed listing
of any such activity. If approved by Landlord, such activity shall be
under the supervision of Landlord and performed in the manner stated by
Landlord. Landlord may prohibit any article, equipment or any other item
from being brought into the Building. Tenant is to assume all risk for
damage to articles moved and injury to any persons resulting from such
activity. If any equipment, property, and/or personnel of Landlord or of
any other tenant is damaged or injured as a result of or in connection
with such activity, Tenant shall be solely liable for any and all damage
or loss resulting therefrom.
8. Landlord shall have the power to prescribe the weight and position of
safes and other heavy equipment or items, which in all cases shall not in
the opinion of Landlord exceed acceptable floor loading and weight
distribution requirements. All damage done to the Building by the
installation, maintenance, operation, existence or removal of any of
Tenant's Property shall be repaired at the expense of Tenant.
9. Corridor doors, when not in use, shall be kept closed.
<PAGE>
10. Tenant shall not: (1) make or permit any improper, objectionable or
unpleasant noises or odors in the Building, or otherwise interfere in any
way with other tenants or persons having business with them; (2) solicit
business or distribute, or cause to be distributed, in any portion of the
Building any handbills, promotional materials or other advertising; or (3)
conduct or permit any other activities in the Building that might
constitute a nuisance.
11. No animals, except seeing eye dogs, shall be brought into or kept in, on
or about the Premises.
12. No inflammable, explosive or dangerous fluid or substance shall be used or
kept by Tenant in the Premises or Building. Tenant shall not, without
Landlord's prior written consent, use, store, install, spill, remove,
release or dispose of within or about the Premises or any other portion of
the Property, any asbestos-containing materials or any solid, liquid or
gaseous material now or hereafter considered toxic or hazardous under the
provisions of 42 U.S.C. Section 9601 et seq. or any other applicable
environmental law which may now or hereafter be in effect. If Landlord
does give written consent to Tenant pursuant to the foregoing sentence,
Tenant shall comply with all applicable laws, rules and regulations
pertaining to and governing such use by Tenant, and shall remain liable
for all costs of cleanup or removal in connection therewith.
13. Tenant shall not use or occupy the Premises in any manner or for any
purpose which would injure the reputation or impair the present or future
value of the Premises or the Building; without limiting the foregoing,
Tenant shall not use or permit the Premises or any portion thereof to be
used for lodging, sleeping or for any illegal purpose.
14. Tenant shall not take any action which would violate Landlord's labor
contracts affecting the Building or which would cause any work stoppage,
picketing, labor disruption or dispute, or any interference with the
business of Landlord or any other tenant or occupant of the Building or
with the rights and privileges of any person lawfully in the Building.
Tenant shall take any actions necessary to resolve any such work stoppage,
picketing, labor disruption, dispute or interference and shall have
pickets removed and, at the request of Landlord, immediately terminate at
any time any construction work being performed in the Premises giving rise
to such labor problems, until such time as Landlord shall have given its
written consent for such work to resume. Tenant shall have no claim for
damages of any nature against Landlord or any of the Landlord Related
Parties in connection therewith, nor shall the Commencement Date of the
Lease Term be extended as a result thereof.
15. Tenant shall utilize the termite and pest extermination service designated
by Landlord to control termites and pests in the Premises. Except as
included in Basic Costs, Tenant shall bear the cost and expense of such
extermination services.
16. Tenant shall not install, operate or maintain in the Premises or in any
other area of the Building, any electrical equipment which does not bear
the U/L (Underwriters Laboratories) seal of approval, or which would
overload the electrical system or any part thereof beyond its capacity for
proper, efficient and safe operation as determined by Landlord, taking
into consideration the overall electrical system and the present and
future requirements therefor in the Building. Tenant shall not furnish any
cooling or heating to the Premises, including, without limitation, the use
of any electronic or gas heating devices, without Landlord's prior written
consent. Tenant shall not use more than its proportionate share of
telephone lines available to service the Building.
17. Tenant shall not operate or permit to be operated on the Premises any coin
or token operated vending machine or similar device (including, without
limitation, telephones, lockers, toilets, scales, amusement devices and
machines for sale of beverages, foods, candy, cigarettes or other goods),
except for those vending machines or similar devices which are for the
sole and exclusive use of Tenant's employees, and then only if such
operation does not violate the lease of any other tenant of the Building.
18. Bicycles and other vehicles are not permitted inside or on the walkways
outside the Building, except in those areas specifically designated by
Landlord for such purposes.
19. Landlord may from time to time adopt appropriate systems and procedures
for the security or safety of the Building, its occupants, entry and use,
or its contents. Tenant,
<PAGE>
Tenant's agents, employees, contractors, guests and invitees shall comply
with Landlord's reasonable requirements relative thereto.
20. Landlord shall have the right to prohibit the use of the name of the
Building or any other publicity by Tenant that in Landlord's opinion may
tend to impair the reputation of the Building or its desirability for
Landlord or other tenants. Upon written notice from Landlord, Tenant will
refrain from and/or discontinue such publicity immediately.
21. Tenant shall carry out Tenant's permitted repair, maintenance,
alterations, and improvements in the Premises only during times agreed to
in advance by Landlord and in a manner which will not interfere with the
rights of other tenants in the Building.
22. Canvassing, soliciting, and peddling in or about the Building is
prohibited. Tenant shall cooperate and use its best efforts to prevent the
same.
23. At no time shall Tenant permit or shall Tenant's agents, employees,
contractors, guests, or invitees smoke in any common area of the Building,
unless such common area has been declared a designated smoking area by
Landlord, or to allow any smoke from the Premises to emanate into the
common areas or any other tenant's premises. Landlord shall have the right
at any time to designate the Building as a non-smoking building.
24. Tenant shall observe Landlord's rules with respect to maintaining standard
window coverings at all windows in the Premises so that the Building
presents a uniform exterior appearance. Tenant shall ensure that to the
extent reasonably practicable, window coverings are closed on all windows
in the Premises while they are exposed to the direct rays of the sun.
25. All deliveries to or from the Premises shall be made only at such times,
in the areas and through the entrances and exits designated for such
purposes by Landlord. Tenant shall not permit the process of receiving
deliveries to or from the Premises outside of said areas or in a manner
which may interfere with the use by any other tenant of its premises or of
any common areas, any pedestrian use of such area, or any use which is
inconsistent with good business practice.
26. The work of cleaning personnel shall not be hindered by Tenant after 5:30
P.M., and such cleaning work may be done at any time when the offices are
vacant. Windows, doors and fixtures may be cleaned at any time. Tenant
shall provide adequate waste and rubbish receptacles necessary to prevent
unreasonable hardship to Landlord regarding cleaning service.
<PAGE>
EXHIBIT C
COMMENCEMENT LETTER
INTENTIONALLY OMITTED
<PAGE>
EXHIBIT D
WORK LETTER
INTENTIONALLY OMITTED
<PAGE>
EXHIBIT E
ADDITIONAL TERMS
INTENTIONALLY OMITTED
<PAGE>
EXHIBIT F
PARKING AGREEMENT
This Exhibit is attached to and made a part of the Lease dated March 5,
1999, by and between EOP-2010 IRVINE, L.L.C., a Delaware limited liability
company, as beneficiary of land trust dated June 5, 1997 and known as Sheli Z.
Rosenberg Trust No. 2010 ("Landlord"), and PHOBO.COM, INC., a Delaware
corporation ("Tenant") for space in the Building located at 2010 Main Street,
Irvine, California.
1. The parties acknowledge that they are contemporaneously herewith entering
into a certain lease dated March 5, 1999 (the "Lease") for the premises
known as Suite 570 (the "Premises") located in the building known as 2010
Main Plaza (the "Building"). In the event of any conflict between the
Lease and this Parking Agreement, the latter shall control.
2. Landlord hereby grants to Tenant and persons designated by Tenant a
license to use ten (10) unreserved parking spaces in the Building parking
facilities. The term of such license shall commence on the Commencement
Date under the Lease and shall continue until the earlier to occur of the
Termination Date under the Lease, or termination of the Lease or Tenant's
abandonment of the Premises thereunder. During the term of this license,
Tenant shall pay Landlord the monthly charges established from time to
time by Landlord for parking in the Building parking facilities, payable
in advance, with Tenant's payment of monthly Base Rental. The initial
charge for such parking spaces is $55.00 per unreserved parking space, per
month. No deductions from the monthly charge shall be made for days on
which the Building parking facilities are not used by Tenant. Tenant may,
from time to time request additional parking spaces, and if Landlord shall
provide the same, such parking spaces shall be provided and used on a
month-to-month basis, and otherwise on the foregoing terms and provisions,
and at such monthly parking charges as Landlord shall establish from time
to time.
3. Tenant shall at all times comply with all applicable ordinances, rules,
regulations, codes, laws, statutes and requirements of all federal, state,
county and municipal governmental bodies or their subdivisions respecting
the use of the Building parking facilities. Landlord reserves the right to
adopt, modify and enforce reasonable rules ("Rules") governing the use of
the Building parking facilities from time to time including any key-card,
sticker or other identification or entrance system and hours of operation.
The Rules set forth herein are currently in effect. Landlord may refuse to
permit any person who violates such Rules to park in the Building parking
facilities, and any violation of the Rules shall subject the car to
removal from the Building parking facilities.
4. Tenant may validate visitor parking by such method or methods as Landlord
may approve, at the validation rate from time to time generally applicable
to visitor parking. Unless specified to the contrary above, the parking
spaces hereunder shall be provided on a unreserved "first-come,
first-served" basis. Tenant acknowledges that Landlord has or may arrange
for the Building parking facilities to be operated by an independent
contractor, not affiliated with Landlord. In such event, Tenant
acknowledges that Landlord shall have no liability for claims arising
through acts or omissions of such independent contractor, if such
contractor is reputable. Landlord shall have no liability whatsoever for
any damage to building or any other items located in the Building parking
facilities, nor for any personal injuries or death arising out of any
matter relating to the Building parking facilities, and in all events,
tenant agrees to look first to its insurance carrier and to require that
Tenant's employees look first to their respective insurance carriers for
payment of any losses sustained in connection with any use of the Building
parking facilities. Tenant hereby waives on behalf of its insurance
carriers all rights of subrogation against Landlord or Landlord's agents.
Landlord reserves the right to assign specific parking spaces, and to
reserve parking spaces for visitors, small cars, handicapped persons and
for other tenants, guests of tenants or other parties which assignment and
reservation of spaces may be relocated as determined by Landlord from time
to time, and Tenant and persons designated by Tenant hereunder shall not
park in any such assigned or reserved parking spaces. Landlord also
reserves the right to close all or any portion of the Building parking
facilities in order to make repairs or perform maintenance services, or to
alter, modify, re-stripe or renovate the Building parking facilities, or
if required by casualty, strike, condemnation, act of God,
<PAGE>
governmental law or requirement or other reason beyond Landlord's
reasonable control. In such event, Landlord shall refund any prepaid
parking rent hereunder, prorated on a per diem basis. If, for any other
reason, Tenant or persons properly designated by Tenant, shall be denied
access to the Building parking facilities, and Tenant or such persons
shall have complied with this Parking Agreement and this Parking Agreement
shall be in effect, Landlord's liability shall be limited to such parking
charges (excluding tickets for parking violations) incurred by Tenant or
such persons in utilizing alternative parking, which amount Landlord shall
pay upon presentation or documentation supporting Tenant's claims in
connection therewith.
5. If Tenant shall default under this Parking Agreement, Landlord shall have
the right to remove from the Building parking facilities any vehicles
hereunder which shall have been involved or shall have been owned or
driven by parties involved in causing such default, without liability
therefore whatsoever. In addition, if Tenant shall default under this
Parking Agreement, Landlord shall have the right to cancel this Parking
Agreement on ten (10) days' written notice, unless within such ten (10)
day period, Tenant cures such default. If Tenant defaults with respect to
the same term or condition under this Parking Agreement more than three
times during any twelve (12) month period, and Landlord notifies Tenant
thereof promptly after each such default, the next default of such term or
condition during the succeeding twelve (12) month period, shall, at
Landlord's election, constitute an incurable default. Such cancellation
right shall be cumulative and in addition to any other rights or remedies
available to Landlord at law or equity, or provided under the Lease (all
of which rights and remedies under the Lease are hereby incorporated
herein, as though fully set forth). Any default by Tenant under the Lease
shall be a default under this Parking Agreement, and any default under
this Parking Agreement shall be a default under the Lease.
RULES
(i) Building parking facilities hours shall be 6:00 a.m. to 8:00 p.m.,
however, Tenant shall have access to the parking facilities on a 24
hour basis, 7 days a week. Tenant shall not store or permit its
employees to store any automobiles in the Building parking
facilities without the prior written consent of Landlord. Except for
emergency repairs, Tenant and its employees shall not perform any
work on any automobiles while located in the Building parking
facilities, or on the Property or Project. If it is necessary for
Tenant or its employees to leave an automobile in the Building
parking facilities or on the Property or Project overnight, Tenant
shall provide Landlord with prior notice thereof designating the
license plate number and model of such automobile.
(ii) Cars must be parked entirely within the stall lines painted on the
floor, and only small cars may be parked in areas reserved for small
cars.
(iii) All directional signs and arrows must be observed,
(iv) The speed limit shall be 5 miles per hour.
(v) Parking spaces reserved for handicapped parking must be used only by
vehicles properly designated.
(vi) Parking is prohibited in all areas not expressly designated for
parking, including without limitation:
(a) Areas not striped for parking
(b) aisles
(c) where "no parking" signs are posted
(d) ramps
(e) loading zones
(vii) Parking stickers, key cards or any other devices or forms of
identification or entry supplied by Landlord shall remain the
property of Landlord. Such devices must be displayed as requested
and may not be mutilated in any manner. The serial number of the
parking identification device may not be obliterated. Devices are
not transferable and any device in the possession of an unauthorized
holder will be void.
<PAGE>
(viii) Monthly fees shall be payable in advance prior to the first day of
each month. Failure to do so will automatically cancel parking
privileges and a charge at the prevailing daily parking rate will be
due. No deductions or allowances from the monthly rate will be made
for days on which the Building parking facilities is not used by
Tenant or its designees.
(ix) Building parking facilities managers or attendants are not
authorized to make or allow any exceptions to these Rules.
(x) Every parker is required to park and lock his/her own car.
(xi) Loss or theft of parking identification, key cards or other such
devices must be reported to Landlord and to any parking facilities
manager immediately. Any parking devices reported lost or stolen
found on any authorized car will be confiscated and the illegal
holder will be subject to prosecution. Lost or stolen devices found
by Tenant or its employees must be reported to the office of the
garage immediately.
(xii) Washing, waxing, cleaning or servicing of any vehicle by the
customer and/or his agents is prohibited. Parking spaces may be used
only for parking automobiles.
(xiii)By signing this Parking Agreement, Tenant agrees to acquaint all
persons to whom Tenant assigns parking spaces with these Rules.
6. NO LIABILITY. TENANT ACKNOWLEDGES AND AGREES THAT, TO THE FULLEST EXTENT
PERMITTED BY LAW, LANDLORD SHALL NOT BE RESPONSIBLE FOR ANY LOSS OR DAMAGE
TO TENANT OR TENANT'S PROPERTY (INCLUDING, WITHOUT LIMITATIONS, ANY LOSS
OR DAMAGE TO TENANT'S AUTOMOBILE OR THE CONTENTS THEREOF DUE TO THEFT,
VANDALISM OR ACCIDENT) ARISING FROM OR RELATED TO TENANT'S USE OF THE
BUILDING PARKING FACILITIES OR EXERCISE OF ANY RIGHTS UNDER THIS PARKING
AGREEMENT, WHETHER OR NOT SUCH LOSS OR DAMAGE RESULTS FROM LANDLORD'S
ACTIVE NEGLIGENCE OR NEGLIGENT OMISSION. THE LIMITATION ON LANDLORD'S
LIABILITY UNDER THE PRECEDING SENTENCE SHALL NOT APPLY HOWEVER TO LOSS OR
DAMAGE ARISING DIRECTLY FROM LANDLORD'S WILLFUL MISCONDUCT.
7. Release of Liability. Without limiting the provisions of Paragraph 6
above, Tenant hereby voluntarily releases, discharges, waives and
relinquishes any and all actions or causes of action for personal injury
or property damage occurring to Tenant arising as a result of parking in
the Building parking facilities, or any activities incidental thereto,
wherever or however the same may occur, and further agrees that Tenant
will not prosecute any claim for personal injury or property damage
against Landlord or any of its officers, agents, servants or employees for
any said causes of action. It is the intention of Tenant by this
instrument, to exempt and relieve Landlord from liability for personal
injury or property damage caused by negligence.
8. The provisions of Article XXIV of the Lease are hereby incorporated by
reference as if fully recited.
Tenant acknowledges that Tenant has read the provisions of this Parking
Agreement, has been fully and completely advised of the potential dangers
incidental to parking in the Building parking facilities and is fully aware of
the legal consequences of signing this instrument.
<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have executed this Exhibit in
multiple original counterparts as of the day and year first above written.
LANDLORD:
EOP-2010 IRVINE, L.L.C, A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST
DATED JUNE 5, 1997 AND KNOWN AS SHELI Z.
ROSENBERG TRUST NO. 2010
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its sole member
By: Equity Office Properties Trust, a
Maryland real estate investment trust,
its managing general partner
By: /s/ Peter H. Adams
-------------------------------------
Name: Peter H. Adams
Title: Senior Vice President
TENANT:
PHOBO.COM,INC., a,Delaware corporation
By: /s/ Fred H. Lerner
---------------------------------------------
Name: Fred H. Lerner
Title: President
By: /s/ Fred H. Lerner
---------------------------------------------
Name: Fred H. Lerner
Title: Secretary
<PAGE>
EXHIBIT G
GUARANTY OF LEASE
GUARANTY OF LEASE DATED MARCH 5 , 1999, BY AND BETWEEN EOP-2010 IRVINE,
L.L.C., A DELAWARE LIMITED LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST DATED
JUNE 5, 1997 AND KNOWN AS SHELI Z, ROSENBERG TRUST NO, 2010 ("LANDLORD") AND
PHOBO.COM, INC., A DELAWARE CORPORATION ("TENANT").
FOR VALUE RECEIVED and in consideration for and as an inducement to
Landlord to lease certain real property to Tenant, pursuant to a lease (the
"Lease") of even date herewith, the undersigned does hereby unconditionally and
irrevocably guarantee to Landlord the punctual payment of all Rent, (as such
term is defined in the Lease) payable by Tenant under the Lease throughout the
term of the Lease and any and all renewals and extensions thereof in accordance
with and subject to the provisions of the Lease, and the full performance and
observance of all other terms, covenants, conditions and agreements therein
provided to be performed and observed by Tenant under the terms of the Lease,
for which the undersigned shall be jointly and severally liable with Tenant. If
any default on the part of Tenant shall occur under the Lease, the undersigned
does hereby covenant and agree to pay to Landlord in each and every instance
such sum or sums of money and to perform each and every covenant, condition and
agreement under the Lease as Tenant is and shall become liable for or obligated
to pay or perform under the Lease, together with the costs reasonably incurred
by Landlord in connection therewith, including without limitation reasonable
attorneys' fees. Such payments of Rent and other sums shall be made monthly or
at such other intervals as the same shall or may become payable under the Lease,
including any accelerations thereof, all without requiring any notice from
Landlord (other than any notice required by the Lease) of such non-payment or
non performance, all of which the undersigned hereby expressly waives.
The maintenance of any action or proceeding by Landlord to recover any sum
or sums that may be or become due under the Lease and to secure the performance
of any of the other terms, covenants and conditions of the Lease shall not
preclude Landlord from thereafter instituting and maintaining subsequent actions
or proceedings for any subsequent default or defaults of Tenant under the Lease.
The undersigned does hereby consent that without affecting the liability of the
undersigned under this Guaranty and without notice to the undersigned, time may
be given by Landlord to Tenant for payment of Rent and such other sums and
performance of said other terms, covenants and conditions, or any of them, and
such time extended and indulgence granted, from time to time, or Tenant may be
dispossessed or Landlord may avail itself of or exercise any or all of the
rights and remedies against Tenant provided by law or by the Lease, and may
proceed either against Tenant alone or jointly against Tenant and the
undersigned or against the undersigned alone without first prosecuting or
exhausting any remedy or claim against Tenant. The undersigned does hereby
further consent to any subsequent change, modification or amendment of the Lease
in any of its terms, covenants or conditions, or in the Rent payable thereunder,
or in the premises demised thereby, or in the term thereof, and to any
assignment or assignments of the Lease, and to any subletting or sublettings of
the premises demised by the Lease, and to any renewals or extensions thereof,
all of which may be made without notice to or consent of the undersigned and
without in any manner releasing or relieving the undersigned from liability
under this Guaranty.
The undersigned does hereby agree that the bankruptcy of Tenant shall have
no effect on the obligations of the undersigned hereunder. The undersigned does
hereby further agree that in respect of any payments made by the undersigned
hereunder, the undersigned shall not have any rights based on suretyship,
subrogation or otherwise to stand in the place of Landlord so as to compete with
Landlord as a creditor of Tenant, unless and until all claims of Landlord under
the Lease shall have been fully paid and satisfied.
Neither this Guaranty nor any of the provisions hereof can be modified,
waived or terminated, except by a written instrument signed by Landlord. The
provisions of this Guaranty shall apply to, bind and inure to the benefit of the
undersigned and Landlord and their respective heirs, legal representatives,
successors and assigns. The undersigned, if there be more than one, shall be
jointly and severally liable hereunder, and for purposes of such several
liability the word "undersigned" wherever used herein shall be construed to
refer to each of the undersigned parties separately, all in the same manner and
with the same effect as if each of them had signed separate instruments, and
this Guaranty shall not be revoked or impaired as
<PAGE>
to any of such parties by the death or another party or by revocation or release
of any obligations hereunder of any other party. This Guaranty shall be governed
by and construed in accordance with the internal laws of the state where the
premises demised by the Lease are located. For the purpose solely of litigating
any dispute under this Guaranty, the undersigned submits to the jurisdiction of
the courts of said state.
IN WITNESS WHEREOF, the undersigned has/have executed this Guaranty as of
the date of the Lease.
GUARANTOR(S):
/s/ Fred H. Lerner
---------------------------------------------
Name: Fred H. Lerner
Social Security Number
<PAGE>
NOTARY ACKNOWLEDGMENT
(Guarantor)
State of California )
County of Orange )
On February 26, 1999 before me, Gena Y. Jones personally appeared Fred H.
Lerner, personally known to me - OR - proved to me on the basis of satisfactory
evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
[SEAL]
GENA Y. JONES
COMM.# 1058240
Notary Public-California WITNESS my hand and official seal.
ORANGE COUNTY
My Comm. Expires MAY 7, 1999
/s/ Gena Y. Jones
----------------------------------
Notary Public
My Commission Expires:__________________________
________________________________________________________________________________
OPTIONAL SECTION
CAPACITY CLAIMED BY SIGNER
Though statute does not require the Notary to fill in the data below,
doing so may prove invaluable to persons relying on the document.
(check one)
___________ INDIVIDUAL
___________ CORPORATE OFFICER(S)
TITLE(S)_________________________
_________________________________
___________ PARTNER(S) _______ LIMITED
_______ GENERAL
___________ ATTORNEY-IN-FACT
___________ TRUSTEE(S)
___________ GUARDIAN/CONSERVATOR
___________ OTHER:________________________
SIGNER IS REPRESENTING:
Name of Person(s) or Entity(ies)
______________________________________________
______________________________________________
________________________________________________________________________________
OPTIONAL SECTION
THIS CERTIFICATE MUST BE TITLE OR TYPE OF DOCUMENT:
ATTACHED TO THE DOCUMENT Guaranty of Lease
DESCRIBED AT RIGHT: NUMBER OF PAGES_______________________
DATE OF DOCUMENT______________________
SIGNER(S) OTHER THAN NAMED ABOVE:
______________________________________
______________________________________
______________________________________
______________________________________
Though the data requested here is not required by law, it could prevent
fraudulent reattachment of this form.
<PAGE>
FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this "Amendment") is made and entered into
as of the 16th day of February, 2000, by and between EOP-2010 IRVINE, L.L.C., A
DELAWARE LIMITED LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST DATED JUNE 5,
1997 AND KNOWN AS STANLEY M. STEVENS TRUST NO. 2010 ("Landlord") and PHOBO.COM,
INC., A DELAWARE CORPORATION ("Tenant").
WITNESSETH
A. WHEREAS, Landlord and Tenant are parties to that certain lease dated the
5th day of March, 1999 (the "Lease"), for space currently containing
approximately 2,347 rentable square feet of space (the "Original
Premises") described as Suite No. 570 on the 5th floor of the building
commonly known as 2010 Main Plaza and the address of which is 2010 Main
Street, Irvine, California (the "Building"); and
B. WHEREAS, Tenant has requested that additional space containing
approximately 1,472 rentable square feet described as Suite No. 580 on the
5th floor of the Building shown on Exhibit A hereto (the "Expansion
Space") be added to the Original Premises and that the Lease be
appropriately amended and Landlord is willing to do the same on the terms
and conditions set forth below;
C. WHEREAS, the Lease by its terms shall expire on March 31, 2000 ("Prior
Termination Date"), and the parties desire to extend the term of the
Lease, all on the terms and conditions set forth below;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
I. EXPANSION. Effective as of the Expansion Effective Date (as hereinafter
defined), the Premises, as defined in the Lease, is increased from 2,347
rentable square feet on the 5th floor to 3,819 rentable square feet on the
5th floor by the addition of the Expansion Space, and from and after the
Expansion Effective Date, the Original Premises and the Expansion Space,
collectively, shall be deemed the Premises, as defined in the Lease. The
Lease Term for the Expansion Space shall commence on the Expansion
Effective Date and end on the Extended Termination Date (as hereinafter
defined). The Expansion Space is subject to all the terms and conditions
of the Lease except as expressly modified herein and except that Tenant
shall not be entitled to receive any allowances, abatements or other
financial concessions granted with respect to the Original Premises unless
such concessions are expressly provided for herein with respect to the
Expansion Space.
A. The Expansion Effective Date shall be February 16, 2000.
B. The Expansion Effective Date shall be delayed to the extent that
Landlord fails to deliver possession of the Expansion Space for any
reason, including but not limited to, holding over by prior
occupants. Any such delay in the Expansion Effective Date shall not
subject Landlord to any liability for any loss or damage resulting
therefrom. If the Expansion Effective Date is delayed, the Extended
Termination Date (as hereinafter defined) shall not be similarly
extended.
II. EXTENSION. The Lease Term is extended for a period of 12 months and shall
expire on March 31, 2001 ("Extended Termination Date"), unless sooner
terminated in accordance with the terms of the Lease. That portion of the
Lease Term commencing the day immediately following the Prior Termination
Date ("Extension Date") and ending on the Extended Termination Date shall
be referred to herein as the "Extended Term".
III. MONTHLY BASE RENTAL.
A. ORIGINAL PREMISES THROUGH PRIOR TERMINATION DATE. The Base Rental,
Additional Base Rental and all other charges under the Lease shall
be payable as provided therein with respect to the Original Premises
through and including the Prior Termination Date.
B. ORIGINAL PREMISES FROM AND AFTER EXTENSION DATE. As of the Extension
Date, the schedule of monthly installments of Base Rental payable
with respect to the Original Premises during the Extended Term is
the following:
<PAGE>
Tenant shall pay Landlord the sum of $76,042.80 as Base Rental for
the Original Premises during the Extended Term in 12 monthly
installments as follows:
1. 12 equal installments of $6,336.90 each payable on or before
the first day of each month during the period beginning April
1, 2000 and ending March 31, 2001.
All such Base Rental shall be payable by Tenant in accordance with
the terms of Article IV of the Lease.
C. EXPANSION SPACE FROM EXPANSION EFFECTIVE DATE THROUGH EXTENDED
TERMINATION DATE. As of the Expansion Effective Date, the schedule
of monthly installments of Base Rental payable with respect to the
Expansion Space for the balance of the original Lease Term and the
Extended Term is the following:
Tenant shall pay Landlord the sum of $53,521.92 as Base Rental for
the balance of the original Lease Term and the Extended Term in 14
monthly installments as follows:
1. 1 installment of $1,854.72 (i.e. $132.48 per diem x 14 days)
payable on or before the first day of each month during the
period beginning February 16, 2000 and ending February 29,
2000.
2. 13 equal installments of $3,974.40 each payable on or before
the first day of each month during the period beginning March
1, 2000 and ending March 31, 2001.
All such Base Rental shall be payable by Tenant in accordance with
the terms of Article IV of the Lease.
IV. ADDITIONAL SECURITY DEPOSIT. Upon Tenant's execution hereof, Tenant shall
pay $4,371.84 to Landlord which is added to and becomes part of the
Security Deposit, if any, held by Landlord as provided under the Lease as
security for payment of Rent and the performance of other terms and
conditions of the Lease by Tenant. Accordingly, simultaneous with the
execution hereof, the Security Deposit is increased from $7,357.85 to
$11,729.69.
V. TENANT'S PRO RATA SHARE. For the period commencing with the Expansion
Effective Date and ending on the Extended Termination Date, Tenant's Pro
Rata Share for the Expansion Space is 0.5241%.
VI. BASIC COSTS.
A. ORIGINAL PREMISES FOR THE EXTENDED TERM. For the period commencing
with the Extension Date and ending on the Extended Termination Date,
Tenant shall pay for Tenant's Pro Rata Share of Basic Costs
applicable to the Original Premises in accordance with the terms of
the Lease, provided, however, during such period, the Base Year for
the computation of Tenant's Pro Rata Share of Basic Costs applicable
to the Original Premises is amended from 1999 to 2000.
B. Expansion Space From Expansion Effective Date Through Extended
Termination Date. For the period commencing with the Expansion
Effective Date and ending on the Extended Termination Date, Tenant
shall pay for Tenant's Pro Rata Share of Basic Costs applicable to
the Expansion Space in accordance with the terms of the Lease,
provided, however, during such period, the Base Year for the
computation of Tenant's Pro Rata Share of Basic Costs applicable to
the Expansion Space is 2000.
VII. IMPROVEMENTS TO EXPANSION SPACE.
A. CONDITION OF ORIGINAL PREMISES AND EXPANSION SPACE. Tenant
acknowledges that it is in possession of the Original Premises and
that it has inspected the Expansion Space and agrees to accept both
the Original Premises and the Expansion Space "as is" without any
agreements, representations, understandings or obligations on the
part of Landlord to perform any alterations, repairs or
improvements, except as may be expressly provided otherwise in this
Amendment.
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<PAGE>
B. RESPONSIBILITY FOR IMPROVEMENTS TO EXPANSION SPACE. Landlord at its
sole cost and expense (subject to the terms and provisions set forth
below) shall perform improvements to the Expansion Space in
accordance with Schedule 1 attached hereto and made a part hereof,
using Building Standard methods, materials and finishes. The
improvements to be performed by Landlord in accordance with Schedule
1 are hereinafter referred to as the "Landlord's Work." Landlord
shall enter into a direct contract for the Landlord's Work with a
general contractor selected by Landlord. In addition, Landlord shall
have the right to select and/or approve of any subcontractors used
in connection with the Landlord's Work. Landlord's supervision or
performance of any work for or on behalf of Tenant shall not be
deemed a representation by Landlord that such work complies with
applicable insurance requirements, building codes, ordinances, laws
or regulations, or that the improvements constructed in accordance
with the Plans and any revisions thereto will be adequate for
Tenant's use.
C. CHANGES IN SCHEDULE 1 FOR EXPANSION SPACE. If Tenant shall request
any revisions to Schedule 1, Landlord shall have such revisions
prepared at Tenant's sole cost and expense and Tenant shall
reimburse Landlord for the cost of preparing any such revisions to
Schedule 1 upon demand. Promptly upon completion of the revisions,
Landlord shall notify Tenant in writing of the increased cost in the
Landlord's Work, if any, resulting from such revisions to Schedule
1. Tenant shall, within 1 Business Day, notify Landlord in writing
whether it desires to proceed with such revisions. In the absence of
such written authorization, Landlord shall have the option to
continue work on the Expansion Space disregarding the requested
revision. Tenant shall be responsible for any delay in completion of
the Expansion Space resulting from any revision to Schedule 1. In
the event such revisions result in an increase in the cost of
Landlord's Work, such increased costs shall be payable by Tenant
upon demand. Notwithstanding anything herein to the contrary, all
revisions to Schedule 1 shall be subject to the approval of
Landlord.
VIII. EARLY ACCESS TO EXPANSION SPACE. During any period that Tenant shall be
permitted to enter the Expansion Space prior to the Expansion Effective
Date (e.g., to perform alterations or improvements), Tenant shall comply
with all terms and provisions of the Lease, except those provisions
requiring payment of Base Rental or Additional Base Rental as to the
Expansion Space. If Tenant takes possession of the Expansion Space prior
to the Expansion Effective Date for any reason whatsoever (other than the
performance of work in the Expansion Space with Landlord's prior
approval), such possession shall be subject to all the terms and
conditions of the Lease and this Amendment, and Tenant shall pay Base
Rental and Additional Base Rental as applicable to the Expansion Space to
Landlord on a per diem basis for each day of occupancy prior to the
Expansion Effective Date.
IX. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
of the date hereof (unless different effective date(s) is/are specifically
referenced in this Section), the Lease shall be amended in the following
additional respects:
A. PARKING. The Parking Agreement attached to the Lease as Exhibit F
shall be amended to reflect that effective as of the Extension Date
and continuing until the Extended Termination Date, and subject to
the terms and conditions of the Lease as amended hereby, Tenant
agrees to lease from Landlord and Landlord agrees to lease to
Tenant, and Tenant shall pay for, whether or not Tenant uses, a
total of 13 parking spaces (the "Original Premises Spaces") in the
Building parking facilities, for use by Tenant and/or its employees
applicable to the Original Premises. Of the 13 Original Premises
Spaces allotted to Tenant, all 13 shall be unreserved spaces at the
rate of $55.00 per unreserved space per month and none shall be
reserved spaces.
Effective as of the Expansion Effective Date and continuing until
the Extended Termination Date, and subject to the terms and
conditions of the Lease as amended hereby, Tenant agrees to lease
from Landlord and Landlord agrees to lease to Tenant, and Tenant
shall pay for, whether or not Tenant uses, a total of 10 additional
parking spaces (the "Suite 580 Spaces") in the Building parking
facilities, for use by Tenant and/or its employees applicable to the
Expansion Space. All such Suite 580 Spaces shall be unreserved
spaces at the rate of $55.00 per space per month.
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<PAGE>
The use of all such Spaces shall otherwise be in accordance with the
terms of the Lease, including, without limitation, the terms of the
Parking Agreement attached to the Lease as Exhibit F.
B. NOTICE ADDRESSES. Paragraph 1.A.10 of the Lease is hereby amended to
reflect that Landlord's notice address and the place for payment of
Rent shall be as follows:
EOP-2010 IRVINE, L.L.C., A DELAWARE
LIMITED LIABILITY COMPANY, AS BENEFICIARY OF
LAND TRUST DATED JUNE 5, 1997 AND KNOWN
AS STANLEY M. STEVENS TRUST NO. 2010
c/o Equity Office Properties
2010 Main Street
Suite No. 350
Irvine, California 92614
Attention: Building Manager
With a copy to:
Equity Office Properties
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Attention: Regional Counsel - Pacific Region
Payments of Rent only shall be made payable to the order of:
Equity Office Properties
at the following address:
EOP Operating Limited Partnership
DBA 2010 Main Plaza
Department # 8799
Los Angeles, California 90084-8799
C. RIGHT OF FIRST OFFER.
1. Tenant shall have the one time right of first offer (the
"Right of First Offer") with respect to the 6,821 rentable
square feet described as Suite 400 on the 4th floor of the
Building shown on the demising plan attached hereto as Exhibit
B (the "Offering Space"), which Right of First Offer shall be
exercised as follows: commencing on the Extension Date, at any
time after Landlord has determined that the existing tenant in
the Offering Space will not extend or renew the term of its
lease for the Offering Space (but prior to leasing such
Offering Space to a party other than the existing tenant),
Landlord shall advise Tenant (the "Advice") of the terms under
which Landlord is prepared to lease the Offering Space to
Tenant for the remainder of the Extended Term, which terms
shall reflect the Prevailing Market (hereinafter defined) rate
for such Offering Space as reasonably determined by Landlord.
Tenant may lease such Offering Space in its entirety only,
under such terms, by delivering written notice of exercise to
Landlord ("Notice of Exercise") within 5 days after the date
of the Advice, except that Tenant shall have no such Right of
First Offer and Landlord need not provide Tenant with an
Advice, if:
a. Tenant is in default under the Lease as amended hereby
at the time Landlord would otherwise deliver the Advice;
or
b. the Premises, or any portion thereof, is sublet at the
time Landlord would otherwise deliver the Advice; or
c. the Lease as amended hereby has been assigned prior to
the date Landlord would otherwise deliver the Advice; or
d. Tenant is not occupying the Premises on the date
Landlord would otherwise deliver the Advice; or
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<PAGE>
e. the Offering Space is not intended for the exclusive use
of Tenant during the Extended Term; or
f. the existing tenant in the Offering Space is interested
in extending or renewing its lease for the Offering
Space or entering into a new lease for such Offering
Space.
2. a. The term for the Offering Space shall be for a minimum
of 36 months and shall commence upon the commencement
date stated in the Advice and thereupon such Offering
Space shall be considered a part of the Premises,
provided that all of the terms stated in the Advice
shall govern Tenant's leasing of the Offering Space and
only to the extent that they do not conflict with the
Advice, the terms and conditions of the Lease as amended
hereby shall apply to the Offering Space.
Notwithstanding the foregoing, if Tenant exercises its
Acceleration Option (as set forth in Section IX.D.
hereof) with respect to the Original Premises and the
Expansion Space, then in such event and upon such
termination of the Lease as amended hereby with respect
to the Original Premises and the Expansion Space, the
Offering Space shall then be deemed the Premises and
shall be subject to all the terms and conditions of the
Lease as amended hereby.
b. Tenant shall pay Base Rental and Additional Base Rental
for the Offering Space in accordance with the terms and
conditions of the Advice, which terms and conditions
shall reflect the Prevailing Market rate for the
Offering Space as determined in Landlord's reasonable
judgment.
c. The Offering Space (including improvements and
personalty, if any) shall be accepted by Tenant in its
condition and as-built configuration existing on the
earlier of the date Tenant takes possession of the
Offering Space or as of the date the term for such
Offering Space commences, unless the Advice specifies
any work to be performed by Landlord in the Offering
Space, in which case Landlord shall perform such work in
the Offering Space.
3. The rights of Tenant hereunder with respect to the Offering
Space shall terminate on the earlier to occur of: (i) Tenant's
failure to exercise its Right of First Offer within the 5 day
period provided in Paragraph IX.C.1 above, and (ii) the date
Landlord would have provided Tenant an Advice if Tenant had
not been in violation of one or more of the conditions set
forth in Paragraph IX.C.1 above.
4. a. If Tenant exercises its Right of First Offer, Landlord
shall prepare an amendment (the "Offering Amendment") adding
the Offering Space to the Premises on the terms set forth in
the Advice and reflecting the changes in the Base Rental,
Rentable Area of the Premises, Tenant's Pro Rata Share and
other appropriate terms.
5. b. A copy of the Offering Amendment shall be (i) sent to
Tenant within a reasonable time after receipt of the Notice of
Exercise executed by Tenant, and (ii) executed by Tenant and
returned to Landlord within ten (10) days thereafter. An
otherwise valid exercise of the Right of First Offer shall, at
Landlord's option, be fully effective whether or not the
Offering Amendment is executed.For purposes hereof, Prevailing
Market rate shall mean the annual rental rate per square foot
for space comparable to the Offering Space in the Building and
office buildings comparable to the Building in the John Wayne
Airport area of Newport Beach and Irvine, California under
leases and renewal and expansion amendments being entered into
at or about the time that Prevailing Market is being
determined giving appropriate consideration to tenant
concessions, brokerage commissions, tenant improvement
allowances, and the method of allocating operating expenses
and taxes. Notwithstanding the foregoing, space leased under
any of the following circumstances shall not be considered to
be comparable for purposes hereof: (i) the lease term is for
less than the lease term of the offering space, (ii) the space
is encumbered by the option rights of another tenant,
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<PAGE>
or (iii) the space has a lack of windows and/or an awkward or
unusual shape or configuration. The foregoing is not intended
to be an exclusive list of space that will not be considered
to be comparable.
6. Notwithstanding anything herein to the contrary, Tenant's
Right of First Offer is subject and subordinate to the rights
(whether such rights are designated as a renewal, extension,
right of first offer, right of first refusal, expansion option
or otherwise) of any tenant of the Building existing on the
date hereof.
D. ACCELERATION RIGHT. If, and only if, Tenant properly exercises its
Right of First Offer with respect to the Offering Space as set forth
in Section IX.C. above, Tenant shall have the right to accelerate
the Extended Termination Date ("Acceleration Option") with respect
to the Original Premises and the Expansion Space only from March 31,
2001 to the day that is the day prior to the commencement date with
respect to the Offering Space (the "Accelerated Expiration Date") as
determined in Section IX.C. above, if:
1. Tenant is not in default under the Lease as amended hereby at
the date Tenant provides Landlord with an Acceleration Notice
(hereinafter defined);
2. no part of the Premises is sublet for a term extending past
the Accelerated Expiration Date;
3. the Lease as amended hereby has not been assigned;
4. Landlord receives notice of acceleration ("Acceleration
Notice") not less than 90 days prior to the Accelerated
Expiration Date;
5. Tenant shall remain liable for all Base Rental, Additional
Rent and other sums due under the Lease as amended hereby up
to and including the Accelerated Expiration Date even though
billings for such may occur subsequent to the Accelerated
Expiration Date.
If Tenant, subsequent to providing Landlord with an Acceleration
Notice, defaults in any of the provisions of the Lease, as amended
hereby, (including, without limitation, a failure to take possession
of the Offering Space), Landlord, at its option, may (i) declare
Tenant's exercise of the Acceleration Option to be null and void, or
(ii) continue to honor Tenant's exercise of its Acceleration Option,
in which case, Tenant shall remain liable for the payment of all
Base Rental, Additional Rent and other sums due under the Lease as
amended hereby on the Original Premises and the Expansion Space up
to and including the Accelerated Expiration Date even though
billings for such may occur subsequent to the Accelerated Expiration
Date. Tenant's exercise of the Acceleration Option shall not affect
Tenant's lease of the Offering Space, which shall continue as
contemplated in Section IX.C above.
X. MISCELLANEOUS.
A. This Amendment sets forth the entire agreement between the parties
with respect to the matters set forth herein. There have been no
additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement,
improvement allowance, leasehold improvements, or other work to the
Premises, or any similar economic incentives that may have been
provided Tenant in connection with entering into the Lease, unless
specifically set forth in this Amendment.
B. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
C. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
D. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
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<PAGE>
E. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "Landlord Related Parties") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "Tenant Related Parties") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
G. This Amendment shall be of no force and effect unless and until
accepted by Fred H. Lerner, guarantor of the Lease ("Guarantor")
pursuant to Guaranty of Lease dated March 5, 1999 ("Guaranty"), who
by signing below agrees that the Guaranty shall apply to the Lease
as amended herein.
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<PAGE>
IN WITNESS WHEREOF, Landlord, Tenant, and Guarantor have duly executed
this Amendment as of the day and year first above written.
LANDLORD:
EOP-2010 IRVINE, L.L.C, A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST
DATED JUNE 5, 1997 AND KNOWN AS STANLEY M.
STEVENS TRUST NO. 2010
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its sole member
By: Equity Office Properties Trust, a Maryland
real estate investment trust, its managing
general partner
By: /s/ Robert E. Dezzutti
--------------------------------------
Name: Robert E. Dezzutti
Title: Vice President
TENANT:
PHOBO.COM, INC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
----------------------------------------------
Name: Fred H. Lerner
Title: President CEO
By: /s/ Randi A. Albertson
----------------------------------------------
Name: Randi A. Albertson
Title: VP CFO
GUARANTOR:
/s/ Fred H. Lerner
--------------------------------------------------
FRED H. LERNER, personally
Social Security No.:
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<PAGE>
EXHIBIT A
Attach Floor Plan
Showing Expansion Space
[FLOOR PLAN]
EXHIBIT A
<PAGE>
SCHEDULE 1
DESCRIPTION OF LANDLORD'S WORK
Landlord shall repaint the interior painted walls throughout the Expansion
Space using Building Standard methods, materials and finishes.
SCHEDULE 1
<PAGE>
EXHIBIT B
Attach Floor Plan
Showing Offering Space
[FLOOR PLAN]
EXHIBIT B
<PAGE>
SECOND AMENDMENT TO LEASE AND FIRST AMENDMENT TO GUARANTY
THIS SECOND AMENDMENT TO LEASE AND FIRST AMENDMENT TO GUARANTY (this
"Amendment") is made and entered into as of the 13th day of April, 2000, by and
between EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED LIABILITY COMPANY, AS
BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS STANLEY M. STEVENS
TRUST NO. 2010 ("Landlord"), and PHOBO.COM, INC., A DELAWARE CORPORATION
("Tenant").
WITNESSETH
A. WHEREAS, Landlord and Tenant are parties to that certain lease dated the
5th day of March, 1999 for space currently containing approximately 3,819
rentable square feet (the "Original Premises") described as Suite Nos. 570
and 580 on the 5th floor of the building commonly known as 2010 Main Plaza
and the address of which is 2010 Main Street, Irvine, California (the
"Building"), which lease has been previously amended by First Amendment to
Lease dated February 16, 2000 ("First Amendment") (collectively, the
"Lease"); and
B. WHEREAS, Tenant and Landlord agree to relocate Tenant from the Original
Premises to 6,821 rentable square feet of space described as Suite No. 400
on the 4th floor of the Building shown on Exhibit A attached hereto (the
"Substitution Space"); and
C. WHEREAS, the Lease by its terms shall expire on March 31, 2001 ("Prior
Extended Termination Date"), and the parties desire to extend the Term,
all on the terms and conditions hereinafter set forth; and
D. WHEREAS, pursuant to that certain guaranty of lease dated as of March 5,
1999 (the "Guaranty"), Fred H. Lerner ("Guarantor") guaranteed Tenant's
obligations under the Lease, as amended, and Landlord and Guarantor desire
to amend the Guaranty on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
I. SUBSTITUTION.
A. Effective as of the Substitution Effective Date (hereinafter
defined), the Premises is hereby increased from 3,819 rentable
square feet, described as Suite Nos. 570 and 580 on the 5th floor of
the Building, to 6,821 rentable square feet, described as Suite No.
400 on the 4th floor of the Building, by substituting the
Substitution Space for the Original Premises.
B. The Term for the Substitution Space shall commence on the
Substitution Effective Date and, unless sooner terminated pursuant
to the terms of the Lease, shall end on the Second Extended
Termination Date (as hereinafter defined). The Substitution Space is
subject to all the terms and conditions of the Lease except as
expressly modified herein and except that Tenant shall not be
entitled to receive any allowances, abatements or other financial
concessions granted with respect to the Original Premises unless
such concessions are expressly provided for herein with respect to
the Substitution Space. Effective as of the Substitution Effective
Date, the Lease shall be terminated with respect to the Original
Premises, and, unless otherwise specified, "Premises" shall mean the
Substitution Space. Tenant shall vacate the Original Premises as of
the Substitution Effective Date (such date that Tenant is required
to vacate the Original Premises being referred to herein as the
"Original Premises Vacation Date") and return the same to Landlord
in "broom clean" condition and otherwise in accordance with the
terms and conditions of the Lease. Notwithstanding anything to the
contrary contained herein, if the Original Premises Vacation Date is
subsequent to the Substitution Effective Date (such period
commencing on the Substitution Effective Date and ending on the
Original Premises Vacation Date is referred to herein as the
"Vacation Period"), then, during the Vacation Period, Tenant shall
comply with all terms and provisions of the Lease with respect to
the Original Premises as though the Original Premises were still
deemed part of the Premises hereunder, provided that Tenant's
obligation for payment of Base
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Rental or Additional Base Rental shall be determined in accordance
with Section IX hereof.
II. SUBSTITUTION EFFECTIVE DATE.
A. The "Substitution Effective Date" shall be the later to occur of (i)
June 1, 2000 (the "Target Substitution Effective Date"), and (ii)
the date upon which the Landlord Work (hereinafter defined) in the
Substitution Space has been substantially completed; provided
however, that if Landlord shall be delayed in substantially
completing the Landlord Work in the Substitution Space as a result
of the occurrence of any of the following (a "Delay"):
1. Tenant's failure to furnish information or to respond to any
request by Landlord for any approval or information within any
time period prescribed or, if no time period is prescribed,
then within 2 Business Days of such request; or
2. Tenant's insistence on materials, finishes or installations
that have long lead times after having first been informed by
Landlord that such materials, finishes or installations will
cause a Delay; or
3. Changes in any plans and specification; or
4. The performance or non-performance by a person or entity
employed by Tenant in the completion of any work (all such
work and such persons or entities being subject to the prior
approval of Landlord); or
5. Any request by Tenant that Landlord delay the completion of
any of the Landlord Work; or
6. Any breach or default by Tenant in the performance of Tenant's
obligations under this Amendment or the Lease; or
7. Any delay resulting from Tenant's having taken possession of
the Substitution Space for any reason prior to substantial
completion of the Landlord Work; or
8. Any other delay chargeable to Tenant, its agents, employees or
independent contractors;
then, for purposes of determining the Substitution Effective Date, the
date of substantial completion shall be deemed to be the day that the
Landlord Work would have been substantially completed absent any such
Delay(s). The Substitution Space shall be deemed to be substantially
completed on the date that Landlord reasonably determines that all of the
Landlord Work has been performed (or would have been performed absent any
Delay[s]), other than any details of construction, mechanical adjustment
or any other matter, the nonperformance of which does not materially
interfere with Tenant's use of the Substitution Space. The adjustment of
the Substitution Effective Date and, accordingly, the postponement of
Tenant's obligation to pay Rent on the Substitution Space shall be
Tenant's sole remedy and shall constitute full settlement of all claims
that Tenant might otherwise have against Landlord by reason of the
Substitution Space not being ready for occupancy by Tenant on the Target
Substitution Effective Date. During any period that the Substitution
Effective Date is postponed and Tenant's obligation to pay Rent for the
Substitution Space is correspondingly postponed, Tenant shall continue to
be obligated to pay Rent for the Original Premises in accordance with the
terms of the Lease.
B. In addition to the postponement, if any, of the Substitution
Effective Date as a result of the applicability of Section II.A. of
this Amendment, the Substitution Effective Date shall be delayed to
the extent that Landlord fails to deliver possession of the
Substitution Space for any other reason (other than Delays by
Tenant), including, but not limited to, holding over by prior
occupants. Any such delay in the Substitution Effective Date shall
not subject Landlord to any liability for any loss or damage
resulting therefrom. If the Substitution Effective Date is delayed,
the Second Extended Termination Date (as hereinafter defined) shall
not be similarly extended.
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<PAGE>
III. EXTENSION. The Term is extended for a period of 26 months and shall expire
on May 31, 2003 ("Second Extended Termination Date"), unless sooner
terminated in accordance with the terms of the Lease. That portion of the
Term commencing the day immediately following the Prior Extended
Termination Date ("Second Extension Date") and ending on the Second
Extended Termination Date shall be referred to herein as the "Second
Extended Term".
IV. MONTHLY BASE RENTAL. Commencing on the Substitution Effective Date through
the Second Extended Termination Date, the schedule of monthly installments
of Base Rental contained in the Lease is hereby revised as follows:
Tenant shall pay Landlord the sum of $663,001.20 as Base Rental for the
Substitution Space in 36 equal installments of $18,416.70 each payable on
or before the first day of each month during the period beginning June 1,
2000 and ending May 31, 2003.
All such Base Rental shall be payable by Tenant in accordance with the
terms of Article IV of the Lease.
Landlord and Tenant acknowledge that the foregoing schedule is based on
the assumption that the Substitution Effective Date is the Target
Substitution Effective Date. If the Substitution Effective Date is later
than the Target Substitution Effective Date, (i) the schedule set forth
above with respect to the payment of any installments of Base Rental for
the Substitution Space shall be appropriately adjusted on a per diem basis
to reflect the actual Substitution Effective Date and the actual
Substitution Effective Date shall be set forth in a confirmation letter to
be prepared by Landlord.
V. TENANT'S PRO RATA SHARE. For the period commencing with the Substitution
Effective Date and ending on the Second Extended Termination Date,
Tenant's Pro Rata Share for the Premises is 2.4284%.
VI. BASIC COSTS. For the period commencing with the Substitution Effective
Date and ending on the Second Extended Termination Date, Tenant shall pay
for Tenant's Pro Rata Share of Basic Costs applicable to the Premises in
accordance with the terms of the Lease, provided, however, during such
period, the Base Year for the computation of Tenant's Pro Rata Share of
Basic Costs applicable to the Premises is 2000.
VII. IMPROVEMENTS TO SUBSTITUTION SPACE.
A. CONDITION OF SUBSTITUTION SPACE. Tenant has inspected the
Substitution Space and agrees to accept the same "as is" without any
agreements, representations, understandings or obligations on the
part of Landlord to perform any alterations, repairs or
improvements, except as may be expressly provided otherwise in this
Amendment.
B. RESPONSIBILITY FOR IMPROVEMENTS TO SUBSTITUTION SPACE. Landlord at
its sole cost and expense (subject to the terms and provisions set
forth below) shall perform improvements to the Substitution Space in
accordance with the work list (the "Work List") attached hereto as
Schedule 1 and made a part hereof, using Building Standard methods,
materials and finishes. The improvements to be performed by Landlord
in accordance with Schedule 1 are hereinafter referred to as the
"Landlord Work." Landlord shall enter into a direct contract for the
Landlord Work with a general contractor selected by Landlord. In
addition, Landlord shall have the right to select and/or approve of
any subcontractors used in connection with the Landlord Work.
Landlord's supervision or performance of any work for or on behalf
of Tenant shall not be deemed a representation by Landlord that such
work complies with applicable insurance requirements, building
codes, ordinances, laws or regulations, or that the improvements
constructed in accordance with Schedule 1 and any revisions thereto
will be adequate for Tenant's use.
C. CHANGES IN SCHEDULE 1 FOR SUBSTITUTION SPACE. If Tenant shall
request any revisions to Schedule 1, Landlord shall have such
revisions prepared at Tenant's sole cost and expense and Tenant
shall reimburse Landlord for the cost of preparing any such
revisions to Schedule 1 upon demand. Promptly upon completion of the
revisions, Landlord shall notify Tenant in writing of the increased
cost in the Landlord Work, if any, resulting from such revisions to
Schedule 1. Tenant shall, within 1 Business Day, notify Landlord in
writing whether it desires to proceed with such revisions. In the
absence of such written
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<PAGE>
authorization, Landlord shall have the option to continue work on
the Substitution Space disregarding the requested revisions. Tenant
shall be responsible for any Delay in completion of the Substitution
Space resulting from any revisions to Schedule 1. In the event such
revisions result in an increase in the cost of the Landlord Work,
such increased cost shall be payable by Tenant upon demand.
Notwithstanding anything herein to the contrary, all revisions to
Schedule 1 shall be subject to the approval of Landlord.
VIII. EARLY ACCESS TO SUBSTITUTION SPACE. During any period that Tenant shall be
permitted to enter the Substitution Space prior to the Substitution
Effective Date (e.g., to perform alterations or improvements), if any,
Tenant shall comply with all terms and provisions of the Lease, except
those provisions requiring payment of Base Rental or Additional Base
Rental as to the Substitution Space. If Tenant takes possession of the
Substitution Space prior to the Substitution Effective Date for any reason
whatsoever (other than the performance of work in the Substitution Space
with Landlord's prior approval), such possession shall be subject to all
the terms and conditions of the Lease and this Amendment, and Tenant shall
pay Base Rental and Additional Base Rental as applicable to the
Substitution Space to Landlord on a per diem basis for each day of
occupancy prior to the Substitution Effective Date.
IX. HOLDING OVER. In the event Tenant continues to occupy the Original
Premises after the Original Premises Vacation Date, occupancy of the
Original Premises subsequent to the Original Premises Vacation Date shall
be that of a tenancy at sufferance and in no event for month-to-month or
year-to-year, but Tenant shall, throughout the entire holdover period, be
subject to all the terms and provisions of the Lease and shall pay for its
use and occupancy an amount (on a per month basis without reduction for
any partial months during any such holdover) equal to twice the sum of the
Base Rental and Additional Base Rental due for the period immediately
preceding such holding over, provided that in no event shall Base Rental
and Additional Base Rental during the holdover period be less than the
fair market rental for the Original Premises. No holding over by Tenant in
the Original Premises or payments of money by Tenant to Landlord after the
Original Premises Vacation Date shall be construed to prevent Landlord
from recovery of immediate possession of the Original Premises by summary
proceedings or otherwise. In addition to the obligation to pay the amounts
set forth above during any such holdover period, Tenant also shall be
liable to Landlord for all damage, including any consequential damage,
which Landlord may suffer by reason of any holding over by Tenant in the
Original Premises, and Tenant shall indemnify Landlord against any and all
claims made by any other tenant or prospective tenant against Landlord for
delay by Landlord in delivering possession of the Original Premises to
such other tenant or prospective tenant.
X. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
of the date hereof (unless different effective date(s) is/are specifically
referenced in this Section), the Lease shall be amended in the following
additional respects:
A. PARKING. Effective as of the Substitution Effective Date, Section
IX.A. of the First Amendment shall be deleted in its entirety and
shall be deemed null and void and shall be of no further force and
effect. Accordingly, effective as of the Substitution Effective Date
and continuing until the Second Extended Termination Date, and
subject to the terms and conditions of the Lease as amended hereby,
Exhibit F of the Lease, as amended, shall be further amended to
reflect that Tenant agrees to lease from Landlord and Landlord
agrees to lease to Tenant, and Tenant shall pay for, whether or not
Tenant uses, a total of 42 parking spaces (the "Spaces") in the
Building parking facilities, for use by Tenant and/or its employees
applicable to the Substitution Space. Of the 42 Spaces allotted to
Tenant, 41 shall be unreserved Spaces at the rate of $55.00 per
unreserved Space per month and 1 shall be a reserved Space at the
rate pf $55.00 per reserved Space per month.
The use of all such Spaces shall otherwise be in accordance with the
terms of the Lease, including, without limitation, the terms of the
Parking Agreement attached to the Lease as Exhibit F.
B. DELETION OF RIGHT OF FIRST OFFER. Effective as of the Substitution
Effective Date, Section IX.C. of the First Amendment is hereby
deleted in its entirety and shall be of no further force and effect.
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<PAGE>
C. DELETION OF ACCELERATION RIGHT. Effective as of the Substitution
Effective Date, Section IX.D. of the First Amendment is hereby
deleted in its entirety and shall be of no further force and effect.
XI. MISCELLANEOUS.
A. This Amendment sets forth the entire agreement between the parties
with respect to the matters set forth herein. There have been no
additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement,
improvement allowance, leasehold improvements, or other work to the
Substitution Space, or any similar economic incentives that may have
been provided Tenant in connection with entering into the Lease,
unless specifically set forth in this Amendment.
B. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
C. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
D. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
E. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "Landlord Related Parties") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "Tenant Related Parties") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
G. This Amendment shall be of no force and effect unless and until
accepted by the Guarantor who by signing below shall agree that the
Guaranty shall apply to the Lease as amended herein.
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<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
EOP-2010 IRVINE, L.L.C, A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND
TRUST DATED JUNE 5, 1997 AND KNOWN AS STANLEY M.
STEVENS TRUST NO. 2010
By: EOP Operating Limited Partnership,a
Delaware limited partnership, its sole
member
By: Equity Office Properties Trust, a
Maryland real estate investment trust,its
managing general partner
BY: /s/ Peter H. Adams
--------------------------------------
Name: Peter H. Adams
Title: Senior Vice President
TENANT:
PHOBO.COM,INC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
----------------------------------------------
Name: Fred H. Lerner
Title: President/CEO
By: ______________________________________________
Name: ________________________________________
Title: _______________________________________
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<PAGE>
The undersigned Guarantor consents to this Amendment as of the day and
year first above written, and acknowledges that the Guaranty is hereby amended
by adding the following to the end of the first paragraph of the Guaranty:
"Notwithstanding the foregoing, the maximum liability of Guarantor under
this Guaranty shall be the sum of: (a) $110,000.00 ("Maximum Amount"),
plus (b) any court costs and reasonable attorneys' fees reasonably
incurred by Landlord in connection with enforcing this Guaranty. In
addition, provided Landlord has not asserted any claim against Tenant
under the Lease or the undersigned for payment under this Guaranty prior
to the effective date of any reduction in the Maximum Amount, the Maximum
Amount shall reduce to $73,333.33 effective as of the 1st anniversary of
the Substitution Effective Date and $36,666.66 effective as of the 2nd
anniversary of the Substitution Effective Date. All amounts received by
Landlord from any party (other than Guarantor) in payment of any amounts
due under the Lease shall be applied first to amounts due under the Lease
that are not guaranteed by this Guaranty. In addition, if Landlord
receives anything of value other than cash in payment of amounts due under
the Lease, then such value shall also be applied first to amounts due
under the Lease that are not guaranteed by this Guaranty. In the event
Tenant has an initial public offering establishing a net worth of Tenant
equal to or greater than $8,000,000, then in such event, upon written
verification to Landlord in form and substance satisfactory to Landlord in
its reasonable discretion, and provided Tenant is not then in default
under the Lease, this Guaranty shall be terminated and be of no further
force and effect."
GUARANTOR:
/s/ Fred H. Lerner
--------------------------------------
FRED H. LERNER, personally
Social Security No.:
The undersigned represents and
warrants that she is the spouse of the
above Guarantor and as such spouse,
she has read this Amendment and
consents to the liability imposed by
the Guaranty, as amended herein.
SPOUSE
/s/ Carol A. Lerner
--------------------------------------
Name: Carol A. Lerner
SSN:
-7-
<PAGE>
EXHIBIT A
SUBSTITUTION SPACE
Suite No.: 400
Rentable Area of Substitution Space: 6,821 rentable square feet
[SUBSTITUTION SPACE PLAN]
EXHIBIT A
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<PAGE>
SCHEDULE 1
WORK LIST
Landlord, at its sole cost and expense (subject to the terms and
provisions of Section VII of this Amendment) shall perform improvements to the
Substitution Space in accordance with the following Work List using Building
standard methods, materials and finishes:
WORK LIST
1. Demo all low walls within the Substitution Space;
2. Cap off electricity and phone, which were previously located in the
demolished low walls described above, within the Substitution Space;
3. Remove all wall covering on walls affected by the low wall demo;
4. Paint all painted surfaces within the Substitution Space, including
areas where wall covering has been removed;
5. Replace existing carpeting and rubber base, as well as carpet the
large storage room, within the Substitution Space;
6. Add phone and electricity in any cubicle areas within the
Substitution Space where none currently exists; and
7. Replace VCT flooring in kitchen area.
This Schedule 1 shall not be deemed applicable to any other additional space
added to the Premises at any time or from time to time, whether by any options
under the Lease or otherwise, or to any portion of the Premises or any additions
to the Premises in the event of a renewal or extension of the Lease Term,
whether by any options under the Lease or otherwise, unless expressly so
provided in an amendment or supplement to the Lease.
SCHEDULE 1
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<PAGE>
THIRD AMENDMENT
THIS THIRD AMENDMENT (the "Amendment") is made and entered into as of the
1st day of Oct, 2001, by and between EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS
STANLEY M. STEVENS TRUST NO. 2010 ("Landlord") and RITZ INTERACTIVE, INC., A
DELAWARE CORPORATION ("Tenant").
WITNESSETH
A. WHEREAS, Landlord (formerly known as EOP-2010 IRVINE, L.L.C., a Delaware
limited liability company, as beneficiary of land trust dated June 5, 1997
and known as Sheli Z. Rosenberg Trust No. 2010) and Tenant (formerly known
as Phobo.com, Inc., a Delaware corporation) are parties to that certain
lease dated the 5th day of March, 1999, which lease has been previously
amended by First Amendment to Lease dated February 16, 2000, Second
Amendment to Lease and First Amendment to Guaranty dated April 13, 2000,
and Commencement Letter dated June 1, 2000 (collectively, the "Lease") for
space currently containing approximately 6,821 rentable square feet
described as Suite No. 400 on the 4th floor (the "Premises") of the
building commonly known as 2010 Main Plaza and the address of which is
2010 Main Street, Irvine, California (the "Building"); and
B. WHEREAS, Tenant and Landlord mutually desire that the Lease be amended on
and subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
1. AMENDMENT. Landlord and Tenant agree that the Lease shall be amended in
accordance with the following terms and conditions:
1. TENANT. Retroactively effective as of July 13, 2001, the Tenant
shall be known as RITZ INTERACTIVE, INC., A DELAWARE CORPORATION.
All references in the Lease to Tenant shall refer to RITZ
INTERACTIVE, INC., A DELAWARE CORPORATION as if RITZ INTERACTIVE,
INC., A DELAWARE CORPORATION were originally stated as the Tenant
therein.
2. MISCELLANEOUS.
A. This Amendment sets forth the entire agreement between the
parties with respect to the matters set forth herein. There
have been no additional oral or written representations or
agreements. Under no circumstances shall Tenant be entitled to
any Rent abatement, improvement allowance, leasehold
improvements, or other work to the Premises, or any similar
economic incentives that may have been provided Tenant in
connection with entering into the Lease, unless specifically
set forth in this Amendment.
B. Except as herein modified or amended, the provisions,
conditions and terms of the Lease shall remain unchanged and
in full force and effect.
C. In the case of any inconsistency between the provisions of the
Lease and this Amendment, the provisions of this Amendment
shall govern and control.
D. Submission of this Amendment by Landlord is not an offer to
enter into this Amendment but rather is a solicitation for
such an offer by Tenant. Landlord shall not be bound by this
Amendment until Landlord has executed and delivered the same
to Tenant.
E. The capitalized terms used in this Amendment shall have the
same definitions as set forth in the Lease to the extent that
such capitalized terms are defined therein and not redefined
in this Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt
with no broker in connection with this Amendment. Tenant
agrees to indemnify and hold Landlord, its members,
principals, beneficiaries, partners, officers, directors,
employees, mortgagee(s) and agents, and the respective
principals and
<PAGE>
members of any such agents (collectively, the "Landlord
Related Parties") harmless from all claims of any brokers
claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord
has dealt with no broker in connection with this Amendment.
Landlord agrees to indemnify and hold Tenant, its members,
principals, beneficiaries, partners, officers, directors,
employees, and agents, and the respective principals and
members of any such agents (collectively, the "Tenant Related
Parties") harmless from all claims of any brokers claiming to
have represented Landlord in connection with this Amendment.
G. This Amendment shall be of no force and effect unless and
until accepted by any guarantors of the Lease, who by signing
below shall agree that their guarantee shall apply to the
Lease as amended herein, unless such requirement is waived by
Landlord in writing.
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
EOP-2010 IRVINE, L.L.C., A DELAWARE LIMITED
LIABILITY COMPANY, AS BENEFICIARY OF LAND TRUST
DATED JUNE 5, 1997 AND KNOWN AS STANLEY M.
STEVENS TRUST NO. 2010
By: EOP Operating Limited Partnership, a
Delaware limited partnership, its sole member
By: Equity Office Properties Trust, a
Maryland real estate investment trust, its
general partner
By: /s/ Robert E. Dezzutti
---------------------------
Name: Robert E. Dezzutti
Title: Senior Vice President
TENANT:
RITZ INTERACTIVE INC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
---------------------------
Name: Fred H. Lerner
Title: President
GUARANTOR:
FRED H. LERNER
/s/ FRED H. LERNER
-------------------------
FRED H. LERNER
Soc. Sec. No.
2
<PAGE>
FOURTH AMENDMENT
THIS FOURTH AMENDMENT (the "Amendment") is made and entered into as of the
10th day of February, 2003, by and between CA-2010 IRVINE LIMITED PARTNERSHIP,
A DELAWARE LIMITED PARTNERSHIP, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997
AND KNOWN AS STANLEY M. STEVENS TRUST NO. 2010 ("Landlord"), and RITZ
INTERACTIVE, INC., A DELAWARE CORPORATION ("Tenant").
RECITALS
A. Landlord (as successor in conversion to EOP-2010 IRVINE, L.L.C., a
Delaware limited liability company, as beneficiary of land trust dated
June 5, 1997 and known as Stanley M. Stevens Trust No. 2010) and Tenant
(formerly known as Phobo.com, Inc., a Delaware corporation) are parties to
that certain lease dated March 5, 1999, which lease has been previously
amended by First Amendment to Lease dated February 16, 2000, Second
Amendment to Lease and First Amendment to Guaranty dated April 13, 2000,
Third Amendment dated October 1, 2001 and a Commencement Letter dated June
1, 2000 (collectively, the "Lease"). Pursuant to the Lease, Landlord has
leased to Tenant space currently containing approximately 6,821 rentable
square feet (the "Premises") described as Suite No. 400 on the 4th floor
of the building commonly known as 2010 Main Plaza located at 2010 Main
Street, Irvine, California (the "Building").
B. The Lease Term by its terms shall expire on May 31, 2003 ("Second Prior
Termination Date"), and the parties desire to extend the Lease Term, all
on the following terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Landlord and Tenant agree as
follows:
I. EXTENSION. The Lease Term is hereby extended for a period of 62 months and
shall expire on July 31, 2008 ("Third Extended Termination Date"), unless
sooner terminated in accordance with the terms of the Lease. That portion
of the Lease Term commencing the day immediately following the Second
Prior Termination Date ("Third Extension Date") and ending on the Third
Extended Termination Date shall be referred to herein as the "Third
Extended Term".
II. MONTHLY BASE RENTAL. As of the Third Extension Date, the schedule of
Monthly Base Rental payable with respect to the Premises during the Third
Extended Term is the following:
ANNUAL RATE ANNUAL MONTHLY
PERIOD PER SQUARE FOOT BASE RENTAL BASE RENTAL
------ --------------- ----------- -----------
6/1/03-7/31/08 $25.20 $171,889.20 $14,324.10
Notwithstanding the above schedule of Monthly Base Rental to the contrary,
as long as Tenant is not in default, Tenant shall be entitled to an
abatement of 2 full calendar months of Monthly Base Rental in the
aggregate amount of $28,648.20 (i.e. $14,324.10 per month) (the "Abated
Monthly Base Rental") for the period commencing on July 1, 2003 and ending
on August 31, 2003 (the "Abatement Period"). The payment by Tenant of the
Abated Monthly Base Rental in the event of a default shall not limit or
affect any of Landlord's other rights, pursuant to the Lease or at Law or
in equity. Only Monthly Base Rental shall be abated during the Abatement
Period and all other Additional Base Rental and other costs and charges
specified in the Lease shall remain as due and payable pursuant to the
provisions of the Lease.
All such Monthly Base Rental shall be payable by Tenant in accordance with
the terms of the Lease.
III. ADDITIONAL SECURITY DEPOSIT. Upon Tenant's execution hereof, Tenant shall
pay Landlord the sum of $11,729.69 which is added to and becomes part of
the Security Deposit held Landlord as provided under Article VI of the
Lease as security for payment
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<PAGE>
of Rent and the performance of the other terms and conditions of the Lease
by Tenant. Accordingly, simultaneous with the execution hereof, the
Security Deposit is increased from $11,729.69 to $23,459.38.
IV. BASIC COSTS. For the period commencing on the Third Extension Date and
ending on the Third Extended Termination Date, Tenant shall pay for
Tenant's Pro Rata Share of Basic Costs in accordance with the terms of the
Lease, provided, however, during such period, the Base Year for the
computation of Tenant's Pro Rata Share of Basic Costs is amended from 2000
to 2003.
V. IMPROVEMENTS TO PREMISES.
A. CONDITION OF PREMISES. Tenant is in possession of the Premises and
accepts the same "as is" without any agreements, representations,
understandings or obligations on the part of Landlord to perform any
alterations, repairs or improvements, except as may be expressly
provided otherwise in this Amendment.
B. RESPONSIBILITY FOR IMPROVEMENTS TO PREMISES. Landlord shall perform
improvements to the Premises in accordance with the Work Letter
attached hereto as EXHIBIT A.
VI. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
of the date of this Amendment (unless different effective date(s) is/are
specifically referenced in this Section), the Lease shall be amended in
the following additional respects:
A. RENEWAL OPTION.
1. Grant of Option; Conditions. Tenant shall have the right to
extend the Lease Term (the "Renewal Option") for one
additional period of 5 years commencing on the day following
the Third Termination Date of the Third Extended Term and
ending on the 5th anniversary of the Third Termination Date
(the "Renewal Term"), if:
a. Landlord receives notice of exercise ("Initial Renewal
Notice") not less than 6 full calendar months prior to
the expiration of the initial Term and not more than 12
full calendar months prior to the expiration of the
Third Extended Term; and
b. Tenant is not in default under the Lease beyond any
applicable cure periods at the time that Tenant delivers
its Initial Renewal Notice or at the time Tenant
delivers its Binding Notice (as defined below); and
c. No more than 25% of the Premises is sublet at the time
that Tenant delivers its Initial Renewal Notice or at
the time Tenant delivers its Binding Notice; and
d. The Lease has not been assigned (excluding permitted
transfers) prior to the date that Tenant delivers its
Initial Renewal Notice or prior to the date Tenant
delivers its Binding Notice.
2. Terms Applicable to Premises During Renewal Term.
a. The initial Monthly Base Rental rate per rentable square
foot for the Premises during the Renewal Term shall
equal the Prevailing Market (hereinafter defined) rate
per rentable square foot for the Premises. Monthly Base
Rental attributable to the Premises shall be payable in
monthly installments in accordance with the terms and
conditions of Article IV of the Lease.
b. Tenant shall pay Additional Base Rental (i.e. Basic
Costs) for the Premises during the Renewal Term in
accordance with Article IV of the Lease, and the manner
and method in which Tenant reimburses Landlord for
Tenant's share of Basic Costs and the Base Year, if any,
applicable to such matter, shall be some of the factors
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<PAGE>
considered in determining the Prevailing Market rate for
the Renewal Term.
3. Procedure for Determining Prevailing Market. Within 30 days
after receipt of Tenant's Initial Renewal Notice, Landlord
shall advise Tenant of the applicable Monthly Base Rental rate
for the Premises for the Renewal Term. Tenant, within 15 days
after the date on which Landlord advises Tenant of the
applicable Monthly Base Rental rate for the Renewal Term,
shall either (i) give Landlord final binding written notice
("Binding Notice") of Tenant's exercise of its Renewal Option,
or (ii) if Tenant disagrees with Landlord's determination,
provide Landlord with written notice of rejection (the
"Rejection Notice"). If Tenant fails to provide Landlord with
either a Binding Notice or Rejection Notice within such 15 day
period, Tenant's Renewal Option shall be null and void and of
no further force and effect. If Tenant provides Landlord with
a Binding Notice, Landlord and Tenant shall enter into the
Renewal Amendment (as defined below) upon the terms and
conditions set forth herein. If Tenant provides Landlord with
a Rejection Notice, Landlord and Tenant shall work together in
good faith to agree upon the Prevailing Market rate for the
Premises during the Renewal Term. When Landlord and Tenant
have agreed upon the Prevailing Market rate for the Premises,
such agreement shall be reflected in a written agreement
between Landlord and Tenant, whether in a letter or otherwise,
and Landlord and Tenant shall enter into the Renewal Amendment
in accordance with the terms and conditions hereof.
Notwithstanding the foregoing, if Landlord and Tenant are
unable to agree upon the Prevailing Market rate for the
Premises within 30 days after the date Tenant provides
Landlord with the Rejection Notice, Tenant's Renewal Option
shall be deemed to be null and void and of no force and
effect.
4. Renewal Amendment. If Tenant is entitled to and properly
exercises its Renewal Option, Landlord shall prepare an
amendment (the "Renewal Amendment") to reflect changes in the
Monthly Base Rental, Lease Term, Termination Date and other
appropriate terms. The Renewal Amendment shall be sent to
Tenant within a reasonable time after Landlord's receipt of
the Binding Notice or other written agreement by Landlord and
Tenant regarding the Prevailing Market rate, and Tenant shall
execute and return the Renewal Amendment to Landlord within 15
days after Tenant's receipt of same, but, upon final agreement
by Landlord and Tenant of the Prevailing Market rate
applicable during the Renewal Term as described herein, an
otherwise valid exercise of the Renewal Option shall be fully
effective whether or not the Renewal Amendment is executed.
5. Definition of Prevailing Market. For purposes of this Renewal
Option, "Prevailing Market" shall mean the arms length fair
market annual rental rate per rentable square foot under
renewal leases, new leases and amendments entered into on or
about the date on which the Prevailing Market is being
determined hereunder for space comparable to the Premises in
the Building and office buildings comparable to the Building
in the Irvine, Costa Mesa, Santa Ana areas of the John Wayne
Airport area , marketplace. The determination of Prevailing
Market shall take into account any material economic
differences between the terms of the Lease and any comparison
lease or amendment, such as rent abatements, commissions,
construction costs and other concessions and the manner, if
any, in which the landlord under any such lease is reimbursed
for operating expenses and taxes. The determination of
Prevailing Market shall also take into consideration any
reasonably anticipated changes in the Prevailing Market rate
from the time such Prevailing Market rate is being determined
and the time such Prevailing Market rate will become effective
under the Lease.
B. HVAC. Effective as of the Third Extension Date, the following shall
be added to the end of Article VII.A.2 of the Lease:
3
<PAGE>
"Tenant shall be entitled to receive 25 hours of free-after hours
HVAC per calendar year, which hours shall not be cumulative or
compounded."
C. PARKING. Effective as of the Third Extension Date and ending on the
Third Extended Termination Date, and subject to the terms and
conditions of the Lease as amended hereby, Exhibit F of the Lease,
as amended, shall be further amended to reflect that Tenant agrees
to lease from Landlord and Landlord agrees to lease to Tenant, and
Tenant shall pay for, whether or not Tenant uses, a minimum of 10
and a maximum of 27 unreserved parking spaces, but shall lease 1
reserved parking spaces (collectively, the "Parking Spaces") in the
Building parking facilities, for use by Tenant and/or its employees
applicable to the Premises. Notwithstanding the foregoing, upon
Tenant's written request and subject to Landlord's availability,
Tenant may request additional parking spaces during the Third
Extended Term. Tenant shall pay to Landlord $35.00 per month per
unreserved parking space and $65.00 per month per reserved parking
space. The use of such Parking Spaces shall otherwise be in
accordance with the terms of the Lease, including, without
limitation, the terms of the Parking Agreement attached to the Lease
as Exhibit F.
D. GUARANTY OF LEASE. Effective as of the Third Extension Date and
provided Tenant is not in default of the Lease, the Guaranty of
Lease set forth in Exhibit G of the Lease, as amended, shall be
deleted in its entirety and of no further force or effect.
E. HOLDING OVER. Effective as of the Third Extension Date and provided
Tenant is not in default of the Lease, "twice the sum of the Base
Rental and Additional Base Rental" set forth in the 2nd sentence of
Article XXIX shall be deleted and "150% of the sum of the Monthly
Base Rental and Additional Base Rental" shall be substituted
therefor.
VII. MISCELLANEOUS.
A. This Amendment and the attached exhibits, which are hereby
incorporated into and made a part of this Amendment, set forth the
entire agreement between the parties with respect to the matters set
forth herein. There have been no additional oral or written
representations or agreements. Under no circumstances shall Tenant
be entitled to any Rent abatement, improvement allowance, leasehold
improvements, or other work to the Premises, or any similar economic
incentives that may have been provided Tenant in connection with
entering into the Lease, unless specifically set forth in this
Amendment.
B. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
C. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
D. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
E. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt with no
broker other than Insignia in connection with this Amendment. Tenant
agrees to indemnify and hold Landlord, its members, principals,
beneficiaries, partners, officers, directors, employees,
mortgagee(s) and agents, and the respective principals and members
of any such agents (collectively, the "Landlord Related Parties")
harmless from all claims of any brokers claiming to have represented
Tenant in connection with this Amendment. Landlord hereby represents
to Tenant that Landlord has dealt with no broker in connection with
this Amendment. Landlord agrees to indemnify and hold Tenant, its
members, principals, beneficiaries, partners, officers, directors,
employees, and agents, and the respective principals and members of
any such
4
<PAGE>
agents (collectively, the "Tenant Related Parties") harmless from
all claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
G. Each signatory of this Amendment represents hereby that he or she
has the authority to execute and deliver the same on behalf of the
party hereto for which such signatory is acting.
H. At Landlord's option, this Amendment shall be of no force and effect
unless and until accepted by any guarantors of the Lease, who by
signing below shall agree that their guaranty shall apply to the
Lease as amended herein, unless such requirement is waived by
Landlord in writing.
[SIGNATURES ARE ON FOLLOWING PAGE]
5
<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP, AS BENEFICIARY OF LAND TRUST DATED
JUNE 5, 1997 AND KNOWN AS STANLEY M. STEVENS TRUST
NO. 2010
By: EOM GP, L.L.C., a Delaware limited liability
company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company, its non-
member manager
By: /s/ Frank R. Campbell
-------------------------
Name: Frank R. Campbell
Title: Vice President
TENANT:
RITZ INTERACTIVE, LNC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
-------------------------
Name: Fred H. Lerner
Title: President
6
<PAGE>
EXHIBIT A
WORK LETTER
This Exhibit is attached to and made a part of the Amendment by and
betweenCA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE LIMITED PARTNERSHIP, AS
BENEFICIARY OF LAND TRUST DATED JUNE 5,1997 AND KNOWN AS STANLEY M. STEVENS
TRUST NO. 2010 ("Landlord") and RITZ INTERACTIVE, INC., A DELAWARE CORPORATION
("Tenant") for space in the Building located at 2010 Main Street, Irvine,
California.
As used in this Workletter, the "Premises" shall be deemed to mean the Premises,
as initially defined in the attached Amendment.
1. This Work Letter shall set forth the obligations of Landlord and Tenant
with respect to the improvements to be performed in the Premises for
Tenant's use. All improvements described in this Work Letter to be
constructed in and upon the Premises by Landlord are hereinafter referred
to as the "Landlord Work." It is agreed that construction of the Landlord
Work will be completed at Tenant's sole cost and expense, subject to the
Allowance (as defined below). Landlord shall enter into a direct contract
for the Landlord Work with a general contractor selected by Landlord. In
addition, Landlord shall have the right to select and/or approve of any
subcontractors used in connection with the Landlord Work.
2. Tenant shall be solely responsible for the timely preparation and
submission to Landlord of the final architectural, electrical and
mechanical construction drawings, plans and specifications (called
"Plans") necessary to construct the Landlord Work, which plans shall be
subject to approval by Landlord and Landlord's architect and engineers and
shall comply with their requirements to avoid aesthetic or other conflicts
with the design and function of the balance of the Building. Tenant shall
be responsible for all elements of the design of Tenant's plans
(including, without limitation, compliance with law, functionality of
design, the structural integrity of the design, the configuration of the
Premises and the placement of Tenant's furniture, appliances and
equipment), and Landlord's approval of Tenant's plans shall in no event
relieve Tenant of the responsibility for such design. If requested by
Tenant, Landlord's architect will prepare the Plans necessary for such
construction at Tenant's cost. Whether or not the layout and Plans are
prepared with the help (in whole or in part) of Landlord's architect,
Tenant agrees to remain solely responsible for the timely preparation and
submission of the Plans and for all elements of the design of such Plans
and for all costs related thereto. Tenant has assured itself by direct
communication with the architect and engineers (Landlord's or its own, as
the case may be) that the final approved Plans can be delivered to
Landlord on or before 10 Business Days following the date of full mutual
execution of the Amendment to which this Exhibit is attached (the "Plans
Due Date"), provided that Tenant promptly furnishes complete information
concerning its requirements to said architect and engineers as and when
requested by them. Tenant covenants and agrees to cause said final,
approved Plans to be delivered to Landlord on or before said Plans Due
Date and to devote such time as may be necessary in consultation with said
architect and engineers to enable them to complete and submit the Plans
within the required time limit. Time is of the essence in respect of
preparation and submission of Plans by Tenant. If the Plans are not fully
completed and approved by the Plans Due Date, Tenant shall be responsible
for one day of Tenant delay (as defined in the Amendment to which this
Exhibit is attached) for each day during the period beginning on the day
following the Plans Due Date and ending on the date completed Plans are
approved. (The word "architect" as used in this Exhibit shall include an
interior designer or space planner.)
3. If Landlord's estimate and/or the actual cost of construction shall exceed
the Allowance, Landlord, prior to commencing any construction of Landlord
Work, shall submit to Tenant a written estimate setting forth the
anticipated cost of the Landlord Work, including but not limited to labor
and materials, contractor's fees and permit fees. Within 3 Business Days
thereafter, Tenant shall either notify Landlord in writing of its approval
of the cost estimate, or specify its objections thereto and any desired
changes to the proposed Landlord Work. If Tenant notifies Landlord of such
objections and desired changes, Tenant shall work with Landlord to reach a
mutually acceptable alternative cost estimate.
7
<PAGE>
4. If Landlord's estimate and/or the actual cost of construction shall exceed
the Allowance, if any (such amounts exceeding the Allowance being herein
referred to as the "Excess Costs"), Tenant shall pay to Landlord such
Excess Costs, plus any applicable state sales or use tax thereon, upon
demand. The statements of costs submitted to Landlord by Landlord's
contractors shall be conclusive for purposes of determining the actual
cost of the items described therein. The amounts payable by Tenant
hereunder constitute Rent payable pursuant to the Lease, and the failure
to timely pay same constitutes an event of default under the Lease.
5. If Tenant shall request any change, addition or alteration in any of the
Plans after approval by Landlord, Landlord shall have such revisions to
the drawings prepared, and Tenant shall reimburse Landlord for the cost
thereof, plus any applicable state sales or use tax thereon, upon demand.
Promptly upon completion of the revisions, Landlord shall notify Tenant in
writing of the increased cost which will be chargeable to Tenant by reason
of such change, addition or deletion. Tenant, within one Business Day,
shall notify Landlord in writing whether it desires to proceed with such
change, addition or deletion. In the absence of such written
authorization, Landlord shall have the option to continue work on the
Premises disregarding the requested change, addition or alteration, or
Landlord may elect to discontinue work on the Premises until it receives
notice of Tenant's decision, in which event Tenant shall be responsible
for any Tenant Delay in completion of the Premises resulting therefrom. If
such revisions result in a higher estimate of the cost of construction
and/or higher actual construction costs which exceed the Allowance, such
increased estimate or costs shall be deemed Excess Costs pursuant to
Paragraph 4 hereof and Tenant shall pay such Excess Costs, plus any
applicable state sales or use tax thereon, upon demand.
6. Following approval of the Plans and the payment by Tenant of the required
portion of the Excess Costs, if any, Landlord shall cause the Landlord
Work to be constructed substantially in accordance with the approved
Plans. Landlord shall notify Tenant of substantial completion of the
Landlord Work.
7. Landlord, provided Tenant is not in default, agrees to provide Tenant with
an allowance (the "Allowance") in an amount not to exceed $68,210.00
(i.e., $10.00 per rentable square foot of the Premises) to be applied
toward the cost of the Landlord Work in the Premises. If the Allowance
shall not be sufficient to complete the Landlord Work, Tenant shall pay
the Excess Costs, plus any applicable state sales or use tax thereon, as
prescribed in Paragraph 4 above. Any portion of the Allowance which
exceeds the cost of the Landlord Work or is otherwise remaining after
December 31, 2004, ("Unused Allowance") shall accrue to the sole benefit
of Landlord, it being agreed that Tenant shall not be entitled to any
credit, offset, abatement or payment with respect thereto. Notwithstanding
the foregoing, commencing as of September 1, 2003 and terminating as of
May 31, 2004, upon written request of Tenant, Landlord shall to the extent
of any Unused Allowance, (a) apply up to $8,526.25 (i.e. $1.25 per
rentable square foot of the Premises) of the Unused Allowance against the
installments of Monthly Base Rental and Additional Base Rental due under
the Lease commencing on September 1, 2003 and (b) apply up to $20,463.00
(i.e. $3.00 per rentable square foot of the Premises) of the Unused
Allowance for any costs and expenses incurred by Tenant in connection with
the purchase, lease or improvement of any built-in and/or movable
furniture, equipment, trade fixtures, phone and data cabling, phone
systems and/or signage (collectively, "Equipment Allowance"). Landlord
shall disburse the Equipment Allowance, or applicable portion thereof, to
Tenant within forty-five (45) days after the Landlord's receipt of paid
invoices from Tenant with respect to the Equipment in question. Landlord
shall be entitled to deduct from the Allowance a construction management
fee for Landlord's oversight of the Landlord Work in an amount equal to 3%
of the total cost of the Landlord Work.
8. Tenant acknowledges that the Landlord Work may be performed by Landlord in
the Premises during Normal Business Hours subsequent to the Third
Extension Date. Landlord and Tenant agree to cooperate with each other in
order to enable the Landlord Work to be performed in a timely manner and
with as little inconvenience to the operation of Tenant's business as is
reasonably possible. Notwithstanding anything herein to the contrary, any
delay in the completion of the Landlord Work or inconvenience suffered by
Tenant during the performance of the Landlord Work shall not delay the
Third Extension Date nor shall it subject Landlord to any liability for
any loss or damage resulting therefrom or entitle Tenant to any credit,
abatement or adjustment of
8
<PAGE>
Rent or other sums payable under the Lease.
9. This Exhibit shall not be deemed applicable to any additional space added
to the Premises at any time or from time to time, whether by any options
under the Lease or otherwise, or to any portion of the original Premises
or any additions to the Premises in the event of a renewal or extension of
the original Term of the Lease, whether by any options under the Lease or
otherwise, unless expressly so provided in the Lease or any amendment or
supplement to the Lease.
9
<PAGE>
FIFTH AMENDMENT
THIS FIFTH AMENDMENT ("Amendment") is made as of this 11th day of November
2003, by and between CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP, AS BENEFICIARY OF LAND TRUST DATED JUNE 5, 1997 AND KNOWN AS
STANLEY M. STEVENS, TRUST NO. 2010 ("Landlord") and RITZ INTERACTIVE, INC., A
DELAWARE CORPORATION ("Tenant").
RECITALS:
A. Landlord (as successor by conversion to EOP-2010 Irvine, L.L.C., a
Delaware limited liability company, as beneficiary of land trust dated
June 5, 1997 and known as Stanley M. Stevens Trust No. 2010) and Tenant
(formerly know as Phobo.Com, a Delaware corporation) are parties to that
certain lease dated March 5, 1999, which lease has been previously amended
by First Amendment to Lease dated February 16, 2000, Second Amendment to
Lease and First Amendment to Guaranty dated April 13, 2000, Third
Amendment dated October 1, 2001, Fourth Amendment dated February 10, 2003
and Commencement Letters dated April 13, 2000 and June 1, 2000
(collectively, the "Lease"). Pursuant to the Lease, Landlord has leased to
Tenant space currently containing approximately 6,821 rentable square feet
(the "Premises") described as Suite No. 400 on the 4th floor of the
building commonly known as 2010 Main Plaza located at 2010 Main Street,
Irvine, California (the "Building").
B. Landlord and Tenant desire to enter into this Amendment for the purpose of
adding storage space to the Lease and otherwise supplementing the Lease as
hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency whereof being acknowledged, Landlord and Tenant agree as follows:
I. ADDITION OF STORAGE SPACE.
A. Landlord leases to Tenant and Tenant accepts the space containing
approximately 209 square feet described as Storage Cage #22 on the
basement floor of the Building, as shown on EXHIBIT A attached
hereto (the "Storage Space"), for the term (the "Storage Term")
commencing on November 10, 2003 ("Storage Commencement Date") and
ending on December 9, 2003 ("Storage Expiration Date"). The Storage
Term shall automatically renew for consecutive periods of one (1)
month each until terminated by either party with at least 30 days'
advance written notice of termination delivered to the other party.
Any such termination shall be effective as of the termination date
specified in such notice. Notwithstanding anything to the contrary
contained herein, if the Lease or Tenant's right to possession of
the Premises thereunder terminates prior to the Storage Expiration
Date, as same may be extended herein, then the Storage Expiration
Date shall be such earlier termination date.
B. The Storage Space shall be used by Tenant for the storage of
equipment, inventory or other non-perishable items normally used in
Tenant's business, and for no other purpose whatsoever. Tenant
agrees to keep the Storage Space in a neat and orderly fashion and
to keep all stored items in cartons, file cabinets or other suitable
containers. Landlord shall have the right to designate the location
within the Storage Space of any items to be placed therein. All
items stored in the Storage Space shall be elevated at least 6
inches above the floor on wooden pallets, and shall be at least 18
inches below the bottom of all sprinklers located in the ceiling of
the Storage Space, if any. Tenant shall not store anything in the
Storage Space which is unsafe or which otherwise may create a
hazardous condition, or which may increase Landlord's insurance
rates, or cause a cancellation or modification of Landlord's
insurance coverage. Without limitation, Tenant shall not store any
flammable, combustible or explosive fluid, chemical or substance nor
any perishable food or beverage products, except with Landlord's
prior written approval. Landlord reserves the right to adopt and
enforce reasonable rules and regulations governing the use of the
Storage Space from time to time. Upon expiration or earlier
termination of Tenant's rights to the Storage Space, Tenant shall
completely vacate and surrender the Storage Space to Landlord in the
condition in which it was delivered to Tenant, ordinary wear and
tear
1
<PAGE>
excepted, broom-clean and empty of all personalty and other items
placed therein by or on behalf of Tenant.
C. Tenant shall pay rent for the Storage Space ("Storage Base Rent") in
the sum of $261.25 per month, plus applicable sale and use taxes,
each payable in advance on or before the first day of each month of
the Storage Term. Any partial month shall be appropriately prorated.
All Storage Base Rent shall be payable in the same manner that Base
Rental is payable under the Lease.
All Storage Base Rent shall be payable in the same manner that Base
Rental is payable under the Lease.
D. All terms and provisions of the Lease shall be applicable to the
Storage Space, including, without limitation, Article XV (Indemnity
and Waiver of Claims) and Article XVI (Tenant's Insurance), except
that Landlord need not supply air-cooling, heat, water, janitorial
service, cleaning, passenger or freight elevator service, window
washing or electricity to the Storage Space and Tenant shall not be
entitled to any work allowances, rent credits, expansion rights or
renewal rights with respect to the Storage Space unless such
concessions or rights are specifically provided for herein with
respect to the Storage Space. Landlord shall not be liable for any
theft or damage to any items or materials stored in the Storage
Space, it being understood that Tenant is using the Storage Space at
its own risk. Any default by Tenant under this Storage Space
provision remaining uncured for a period extending beyond the
expiration of any applicable cure period described in the "default"
section of the Lease shall be a default under the Lease, it being
agreed that the provisions of the Lease with respect to Tenant
defaults shall apply to any default by Tenant hereunder. The Storage
Space shall not be included in the determination of Tenant's Pro
Rata Share under the Lease nor shall Tenant be required to pay Basic
Costs in connection with the Storage Space.
E. Tenant agrees to accept the Storage Space in its condition and
"as-built" configuration existing on the earlier of the date Tenant
takes possession of the Storage Space or the Storage Commencement
Date.
F. At any time and from time to time, Landlord shall have the right to
relocate the Storage Space to a new location which shall be no
smaller than the square footage of the Storage Space. Landlord shall
pay the direct, out-of-pocket, reasonable expenses of such
relocation.
G. Storage Base Rent is deemed Rent under the Lease.
H. If Tenant assigns the Lease or sublets all or any part of the
Premises, Landlord, at its option, may terminate Tenant's rights to
the Storage Space effective as of 30 days after notice to Tenant.
Additionally, notwithstanding anything set forth in Article XII
(Assignment and Subletting) of the Lease to the contrary, Tenant
shall not, without the prior written consent of Landlord, which
consent may be withheld in Landlord's sole discretion, assign,
sublease, transfer or encumber the Storage Space or grant any
license, concession or other right of occupancy or permit the use of
the Storage Space by any party other than Tenant.
II. MISCELLANEOUS.
A. This Amendment sets forth the entire agreement between the parties
with respect to the matters set forth herein. There have been no
additional oral or written representations or agreements. Under no
circumstances shall Tenant be entitled to any Rent abatement,
improvement allowance, leasehold improvements, or other work to the
Premises, or any similar economic incentives that may have been
provided Tenant in connection with entering into the Lease, unless
specifically set forth in this Amendment.
B. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
C. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
2
<PAGE>
D. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
E. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
F. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "Landlord Related Parties") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "Tenant Related Parties") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
Equity Office Properties Management Corp. ("EOPMC") is an affiliate
of Landlord and represents only the Landlord in this transaction.
Any assistance rendered by any agent or employee of EOPMC in
connection with this Amendment or any subsequent amendment or
modification hereto has been or will be made as an accommodation to
Tenant solely in furtherance of consummating the transaction on
behalf of Landlord, and not as agent for Tenant.
G. Each signatory of this Amendment represents hereby that he or she
has the authority to execute and deliver the same on behalf of the
party hereto for which such signatory is acting.
[SIGNATURES ON FOLLOWING PAGE]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
LANDLORD:
CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP
By: EOM GP, L.L.C., a Delaware limited liability
company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company, its non-
member manager
By: Robert E. Dezzutti
-----------------------------------
Name: Robert E. Dezzutti
Title: SENIOR VICE PRESIDENT
TENANT:
RITZ INTERACTIVE, INC.,A DELAWARE CORPORATION
By: /s/ Fred Lerner
----------------------
Name: FRED LERNER
Title: PRESIDENT & CEO
4
<PAGE>
EXHIBIT A
OUTLINE AND LOCATION OF STORAGE SPACE
[OUTLINE AND LOCATION OF STORAGE SPACE PLAN]
5
<PAGE>
SIXTH AMENDMENT
THIS SIXTH AMENDMENT (THE "AMENDMENT") is made and entered into as of February
14, 2005 by and between CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") and RITZ INTERACTIVE, INC., A DELAWARE CORPORATION
("Tenant").
RECITALS
A. Landlord (as successor by conversion to EOP-2010 Irvine, L.L.C., a
Delaware limited liability company, as beneficiary of land trust dated
June 5,1997 and known as Stanley M. Stebens Trust No. 2010) and Tenant
(formerly known as Phobo.com, a Delaware corporation) are parties to that
certain lease dated March 5, 1999, which lease has been previously amended
by First Amendment to Lease dated February 16, 2000, Second Amendment to
Lease and First Amendment to Guaranty dated April 13, 2000, Third
Amendment dated October 1, 2001, Fourth Amendment dated February 10, 2003
("Fourth Amendment") and Fifth Amendment dated November 11, 2003
(collectively, the "LEASE"). Pursuant to the Lease, Landlord has leased to
Tenant space currently containing approximately 6,821 rentable square feet
(the "PREMISES") described as Suite No. 400 on the 4lh floor of the
building commonly known as 2010 Main Plaza located at 2010 Main Street,
Irvine, California (the "BUILDING").
B. Tenant and Landlord mutually desire that the Lease be amended on and
subject to the following terms and conditions.
NOW, THEREFORE, in consideration of the above recitals which by this
reference are incorporated herein, the mutual covenants and conditions contained
herein and other valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Landlord and Tenant agree as follows:
1. AMENDMENT. Effective as of the date hereof (unless different effective
date(s) is/are specifically referenced in this Section), Landlord and
Tenant agree that the Lease shall be amended in accordance with the
following terms and conditions:
1.01. Pursuant to the Fourth Amendment, Exhibit A, (Work Letter),
paragraph 7 is hereby deleted in its entirety and replaced with the
following:
"7. Landlord, provided Tenant is not in default, agrees to provide
Tenant with an allowance (the "Allowance") in an amount not to
exceed $68,210.00 (i.e., $10.00 per rentable square foot of the
Premises) to be applied toward the cost of the Landlord Work in the
Premises. If the Allowance shall not be sufficient to complete the
Landlord Work, Tenant shall pay the Excess Costs, plus any
applicable state sales or use tax thereon, as prescribed in
Paragraph 4 above. If Tenant does not submit a request for payment
of the entire Allowance to Landlord in accordance with the
provisions contained in this Exhibit between the months of January
1, 2006 and February 28, 2006, ("Unused Allowance") any unused
amount shall accrue to the sole benefit of Landlord, it being
understood that Tenant shall not be entitled to any credit,
abatement or other concession in connection therewith.
Notwithstanding the foregoing, commencing as of September 1, 2003
and terminating as of May 31, 2004, upon written request of Tenant,
Landlord shall to the extent of any Unused Allowance, (a) apply up
to $8,526.25 (i.e. $1.25 per rentable square foot of the Premises)
of the Unused Allowance against the installments of Monthly Base
Rental and Additional Base Rental due under the Lease commencing on
September 1, 2003 and (b) apply up to $20,463.00 (i.e. $3.00 per
rentable square foot of the Premises) of the Unused Allowance for
any costs and expenses incurred by Tenant in connection with the
purchase, lease or improvement of any built-in and/or movable
furniture, equipment, trade fixtures, phone and data cabling, phone
systems and/or signage (collectively, "Equipment Allowance").
Landlord shall disburse the Equipment Allowance, or applicable
portion thereof, to Tenant within forty-five (45) days after the
Landlord's receipt of paid invoices from Tenant with respect to the
Equipment in question. Landlord shall be entitled to deduct from
the Allowance a construction management fee for
<PAGE>
Landlord's oversight of the Landlord Work in an amount equal to
3% of the total cost of the Landlord Work. Except as modified
herein, the terms of Exhibit A shall remain in full force and
effect."
2. MISCELLANEOUS.
2.01. This Amendment and the attached exhibits, which are hereby
incorporated into and made a part of this Amendment, set forth the
entire agreement between the parties with respect to the matters set
forth herein. There have been no additional oral or written
representations or agreements. Under no circumstances shall Tenant
be entitled to any Rent abatement, improvement allowance, leasehold
improvements, or other work to the Premises, or any similar economic
incentives that may have been provided Tenant in connection with
entering into the Lease, unless specifically set forth in this
Amendment. Tenant agrees that neither Tenant nor its agents or any
other parties acting on behalf of Tenant shall disclose any matters
set forth in this Amendment or disseminate or distribute any
information concerning the terms, details or conditions hereof to
any person, firm or entity without obtaining the express written
consent of Landlord.
2.02. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
2.03. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
2.04. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
2.05. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
2.06. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "LANDLORD RELATED PARTIES") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "TENANT RELATED PARTIES") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
Equity Office Properties Management Corp. ("EOPMC") is an affiliate
of Landlord and represents only the Landlord in this transaction.
Any assistance rendered by any agent or employee of EOPMC in
connection with this Amendment or any subsequent amendment or
modification hereto has been or will be made as an accommodation to
Tenant solely in furtherance of consummating the transaction on
behalf of Landlord, and not as agent for Tenant.
2.07. Each signatory of this Amendment represents hereby that he or she
has the authority to execute and deliver the same on behalf of the
party hereto for which such signatory is acting.
[SIGNATURES ARE ON FOLLOWING PAGE]
<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP
By: EOM GP, L.L.C., a Delaware limited liability
company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company, its non-
member manager
By: /s/ Frank R. Campbell
-------------------------
Name: Frank R. Campbell
Title: Vice President
TENANT:
RITZ INTERACTIVE, A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
-----------------------
Name: Fred H. Lerner
Title: President
<PAGE>
SEVENTH AMENDMENT
(STORAGE SPACE SUPPLEMENT)
THIS SEVENTH AMENDMENT (the "AMENDMENT") is made and entered into as of 1/15,
2005, by and between CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE LIMITED
PARTNERSHIP ("Landlord") and RITZ INTERACTIVE, INC., A DELAWARE CORPORATION
("Tenant").
RECITALS:
A. Landlord (as successor by conversion to EOP-2010 Irvine, L.L.C., a
Delaware limited liability company, as beneficiary of land trust dated
June 5, 1997 and known as Stanley M. Stebens Trust No. 2010) and Tenant
(formerly known as Phobo.com, a Delaware corporation) are parties to that
certain lease dated March 5, 1999, which lease has been previously amended
by First Amendment to Lease dated February 16, 2000, Second Amendment to
Lease and First Amendment to Guaranty dated April 13, 2000, Third
Amendment dated October 1, 2001, Fourth Amendment dated February 10, 2003
("Fourth Amendment"), Fifth Amendment dated November 11, 2003 and Sixth
Amendment dated _______________(collectively, the "LEASE"). Pursuant to
the Lease, Landlord has leased to Tenant space currently containing
approximately 6,821 rentable square feet (the "PREMISES") described as
Suite No. 400 on the 4th floor of the building commonly known as 2010 Main
Plaza located at 2010 Main Street, Irvine, California (the "BUILDING").
B. Landlord and Tenant desire to enter into this Amendment for the purpose of
adding storage space to the Lease and otherwise supplementing the Lease as
hereinafter set forth.
NOW, THEREFORE, in consideration of the above recitals which by this
reference are incorporated herein, the mutual covenants and conditions contained
herein and other valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Landlord and Tenant agree as follows:
1. ADDITION OF STORAGE SPACE.
1.01. Landlord leases to Tenant and Tenant accepts the spaces comprised of
bins (i) 288 rentable square feet ("STORAGE SPACE #11") and (ii) 219
rentable square feet ("STORAGE SPACE #9") on the basement floor of
the Building, as shown on EXHIBIT A attached hereto (collectively,
the "STORAGE SPACES"), for the term (the "STORAGE TERM") commencing
January 15, 2005 ("STORAGE SPACES COMMENCEMENT DATE") and ending one
month February 14, 2005 ("STORAGE SPACES EXPIRATION DATE"). The
Storage Term shall automatically renew for consecutive periods of
one month each until terminated by either party with at least 30
days' advance written notice of termination delivered to the other
party. Any such termination shall be effective as of the termination
date specified in such notice. Notwithstanding anything to the
contrary contained herein, if the Lease or Tenant's right to
possession of the Premises thereunder terminates prior to the
Storage Expiration Date, as same may be extended herein, then the
Storage Expiration Date shall be such earlier termination date.
1.02. The Storage Spaces shall be used by Tenant for the storage of
equipment, inventory or other non-perishable items normally used in
Tenant's business, and for no other purpose whatsoever. Tenant
agrees to keep the Storage Space in a neat and orderly fashion and
to keep all stored items in cartons, file cabinets or other suitable
containers. Landlord shall have the right to designate the location
within the Storage Space of any items to be placed therein. All
items stored in the Storage Space shall be elevated at least 6
inches above the floor on wooden pallets, and shall be at least 18
inches below the bottom of all sprinklers located in the ceiling of
the Storage Spaces, if any. Tenant shall not store anything in the
Storage Spaces which is unsafe or which otherwise may create a
hazardous condition, or which may increase Landlord's insurance
rates, or cause a cancellation or modification of Landlord's
insurance coverage. Without limitation, Tenant shall not store any
flammable, combustible or explosive fluid, chemical or substance nor
any perishable food or beverage products, except with Landlord's
prior written approval. Landlord reserves the right to adopt and
enforce reasonable rules and regulations governing the use of the
Storage Spaces from time to time.
1
<PAGE>
Upon expiration or earlier termination of Tenant's rights to the
Storage Spaces, Tenant shall completely vacate and surrender the
Storage Spaces to Landlord in the condition in which it was
delivered to Tenant, ordinary wear and tear excepted, broom-clean
and empty of all personalty and other items placed therein by or on
behalf of Tenant.
1.03. Tenant shall pay rent for the Storage Space #11 ("STORAGE SPACE #11
BASE RENT") in the sum of $360.00 and Storage Space #9 in the sum of
$273.75 ("STORAGE SPACE #9 BASE RENT"), plus applicable sale and use
taxes, each payable in advance on or before the first day of each
month of the Storage Term. Any partial month shall be appropriately
prorated. All Storage Space #5 Base Rent and Storage Space #9 Base
Rent shall be payable in the same manner that Base Rent is payable
under the Lease.
1.04. All terms and provisions of the Lease shall be applicable to the
Storage Spaces, including, without limitation, Article XV (Indemnity
and Waiver of Claims) and Article XVI (Tenant's Insurance), except
that Landlord need not supply air-cooling, heat, water, janitorial
service, cleaning, passenger or freight elevator service, window
washing or electricity to the Storage Spaces and Tenant shall not be
entitled to any work allowances, rent credits, expansion rights or
renewal rights with respect to the Storage Spaces unless such
concessions or rights are specifically provided for herein with
respect to the Storage Spaces. Landlord shall not be liable for any
theft or damage to any items or materials stored in the Storage
Spaces, it being understood that Tenant is using the Storage Spaces
at its own risk. Any default by Tenant under this Storage Spaces
provision remaining uncured for a period extending beyond the
expiration of any applicable cure period described in the "default"
section of the Lease shall be a default under the Lease, it being
agreed that the provisions of the Lease with respect to Tenant
defaults shall apply to any default by Tenant hereunder. The Storage
Spaces shall not be included in the determination of Tenant's Pro
Rata Share under the Lease nor shall Tenant be required to pay
Expenses in connection with the Storage Spaces.
1.05. Tenant agrees to accept the Storage Spaces in its condition and
"as-built" configuration existing on the earlier of the date Tenant
takes possession of the Storage Spaces or the Storage Spaces
Commencement Date.
1.06. At any time and from time to time, Landlord shall have the right to
relocate the Storage Spaces to a new location which shall be no
smaller than the square footage of the Storage Spaces. Landlord
shall pay the direct, out-of-pocket, reasonable expenses of such
relocation.
1.07. Storage Space #5 and #9 Base Rent is deemed Rent under the Lease.
1.08. If Tenant assigns the Lease or sublets all or any part of the
Premises, Landlord, at its option, may terminate Tenant's rights to
the Storage Spaces effective as of 30 days after notice to Tenant.
Additionally, notwithstanding anything set forth in Section 11 of
the Lease to the contrary, Tenant shall not, without the prior
written consent of Landlord, which consent may be withheld in
Landlord's sole discretion, assign, sublease, transfer or encumber
the Storage Spaces or grant any license, concession or other right
of occupancy or permit the use of the Storage Spaces by any party
other than Tenant.
2. MISCELLANEOUS.
2.01. This Amendment and the attached exhibits, which are hereby
incorporated into and made a part of this Amendment, set forth the
entire agreement between the parties with respect to the matters set
forth herein. There have been no additional oral or written
representations or agreements. Under no circumstances shall Tenant
be entitled to any Rent abatement, improvement allowance, leasehold
improvements, or other work to the Premises, or any similar economic
incentives that may have been provided Tenant in connection with
entering into the Lease, unless specifically set forth in this
Amendment. Tenant agrees that neither Tenant nor its agents or any
other parties acting on behalf of Tenant shall disclose any matters
set forth in this Amendment or disseminate or distribute any
information concerning the terms, details or conditions hereof to
any person, firm or entity without obtaining the express written
consent of Landlord.
2
<PAGE>
2.02. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
2.03. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
2.04. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
2.05. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
2.06. Tenant hereby represents to Landlord that Tenant has dealt with no
broker in connection with this Amendment. Tenant agrees to indemnify
and hold Landlord, its members, principals, beneficiaries, partners,
officers, directors, employees, mortgagee(s) and agents, and the
respective principals and members of any such agents (collectively,
the "LANDLORD RELATED PARTIES") harmless from all claims of any
brokers claiming to have represented Tenant in connection with this
Amendment. Landlord hereby represents to Tenant that Landlord has
dealt with no broker in connection with this Amendment. Landlord
agrees to indemnify and hold Tenant, its members, principals,
beneficiaries, partners, officers, directors, employees, and agents,
and the respective principals and members of any such agents
(collectively, the "TENANT RELATED PARTIES") harmless from all
claims of any brokers claiming to have represented Landlord in
connection with this Amendment.
Equity Office Properties Management Corp. ("EOPMC") is an affiliate
of Landlord and represents only the Landlord in this transaction.
Any assistance rendered by any agent or employee of EOPMC in
connection with this Amendment or any subsequent amendment or
modification hereto has been or will be made as an accommodation to
Tenant solely in furtherance of consummating the transaction on
behalf of Landlord, and not as agent for Tenant.
2.07. Each signatory of this Amendment represents hereby that he or she
has the authority to execute and deliver the same on behalf of the
party hereto for which such signatory is acting.
[SIGNATURES ON FOLLOWING PAGE]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the date first above written.
LANDLORD:
CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP
By: EOM GP, L.L.C., a Delaware limited liability
company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company, its non-
member manager
By: /s/ Frank R. Campbell
-----------------------
Name: Frank R. Campbell
Title: Vice President
TENANT:
RITZ INTERACTIVE, INC., A DELAWARE CORPORATION
By: /s/ Fred H. Lerner
-----------------------
Name: Fred H. Lerner
Title: President & CEO
4
<PAGE>
EXHIBIT A
OUTLINE AND LOCATION OF STORAGE SPACE
[OUTLINE AND LOCATION OF STORAGE SPACE PLAN]
5
<PAGE>
EIGHTH AMENDMENT
THIS EIGHTH AMENDMENT (the "AMENDMENT") is made and entered into as of
August 23, 2005, by and between CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP ("LANDLORD") and RITZ INTERACTIVE, INC., A DELAWARE
CORPORATION ("TENANT").
RECITALS
A. Landlord (as successor by conversion to EOP-2010 Irvine, L.L.C., a
Delaware limited liability company, as beneficiary of land trust dated
June 5, 1997 and known as Stanley M. Stevens Trust No. 2010) and Tenant
(formerly known as Phobo.com, a Delaware corporation) are parties to that
certain lease dated March 5, 1999, which lease has been previously amended
by First Amendment to Lease dated February 16, 2000, Second Amendment to
Lease and First Amendment to Guaranty dated April 13, 2000, Third
Amendment dated October 1, 2001, Fourth Amendment dated February 10, 2003
("Fourth Amendment"), Fifth Amendment dated November 11, 2003, Sixth
Amendment dated February 14, 2005 ("Sixth Amendment") and Seventh
Amendment dated January 15, 2005 (collectively, the "LEASE"). Pursuant to
the Lease, Landlord has leased to Tenant space currently containing
approximately 6,821 rentable square feet (the "ORIGINAL PREMISES")
described as Suite No. 400 on the 4th floor of the building commonly known
as 2010 Main Plaza located at 2010 Main Street, Irvine, California (the
"BUILDING").
B. Tenant has requested that additional space containing approximately 2,536
rentable square feet described as Suite No. 410 on the 4th floor of the
Building shown on EXHIBIT A hereto (the "SUITE 410 EXPANSION SPACE") be
added to the Original Premises and that the Lease be appropriately amended
and Landlord is willing to do the same on the following terms and
conditions.
NOW, THEREFORE, in consideration of the above recitals which by this
reference are incorporated herein, the mutual covenants and conditions contained
herein and other valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Landlord and Tenant agree as follows:
1. SUITE 410 EXPANSION AND EFFECTIVE DATE.
1.01. Effective as of June 15, 2006 (the "SUITE 410 EXPANSION EFFECTIVE
DATE"), the Premises, as defined in the Lease, is increased from
6,821 rentable square feet on the 4th floor to 9,357 rentable square
feet on the 4th floor by the addition of the Suite 410 Expansion
Space, and from and after the Suite 410 Expansion Effective Date,
the Original Premises and the Suite 410 Expansion Space,
collectively, shall be deemed the Premises, as defined in the Lease.
The Lease Term for the Suite 410 Expansion Space shall commence on
the Suite 410 Expansion Effective Date and end on the Third Extended
Termination Date (i.e., July 31, 2008). The Suite 410 Expansion
Space is subject to all the terms and conditions of the Lease except
as expressly modified herein and except that Tenant shall not be
entitled to receive any allowances, abatements or other financial
concessions granted with respect to the Original Premises unless
such concessions are expressly provided for herein with respect to
the Suite 410 Expansion Space.
1.02. Tenant is currently in possession of the Suite 410 Expansion Space,
as subtenant, pursuant to the terms of a certain sublease agreement
(the "Sublease") between Tenant, as subtenant, and PEOPLESOFT USA,
INC., a Delaware corporation (the "Sublandlord"), as sublandlord,
which sublease agreement, and the underlying primary tease between
Landlord and Sublandlord, are scheduled to expire, by their
respective terms, as of the day immediately preceding the Suite 410
Expansion Effective Date described above. Accordingly, Tenant agrees
that the Suite 410 Expansion Space is in good order and satisfactory
condition.
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<PAGE>
2. BASE RENTAL. In addition to Tenant's obligation to pay Base Rental for the
Original Premises, Tenant shall pay Landlord Base Rental for the Suite 410
Expansion Space as follows:
ANNUAL RATE PER
MONTHS OF TERM OR PERIOD SQUARE FOOT MONTHLY BASE RENTAL
------------------------ --------------- -------------------
6/15/06-6/14/07 $31.80 $6,720.40
6/15/07-7/31/08 $32.40 $6,847.20
All such Base Rental shall be payable by Tenant in accordance with the
terms of the Lease.
3. ADDITIONAL SECURITY DEPOSIT. Upon Tenant's execution hereof, Tenant shall
pay Landlord the sum of $4,330.91 which is added to and becomes part of
the Security Deposit held by Landlord as provided under Article VI of the
Lease as security for payment of Rent and the performance of the other
terms and conditions of the Lease by Tenant. Accordingly, simultaneous
with the execution hereof, the Security Deposit is increased from
$23,459.38 to $27,790.29. Tenant hereby waives any and all rights under
and benefits of Section 1950.7 of the California Civil Code, or any
similar or successor Laws now or hereinafter in effect.
4. TENANT'S PRO RATA SHARE. For the period commencing with the Suite 410
Expansion Effective Date and ending on the Third Extended Termination
Date, Tenant's Pro Rata Share for the Suite 410 Expansion Space is
0.9029%.
5. BASIC COSTS. For the period commencing with the Suite 410 Expansion
Effective Date and ending on the Third Extended Termination Date, Tenant
shall pay for Tenant's Pro Rata Share of Basic Costs applicable to the
Suite 410 Expansion Space in accordance with the terms of the Lease,
provided, however, during such period, the Base Year for the computation
of Tenant's Pro Rata Share of Basic Costs applicable to the Suite 410
Expansion Space is 2006.
6. IMPROVEMENTS TO SUITE 410 EXPANSION SPACE.
6.01. CONDITION OF SUITE 410 EXPANSION SPACE. Tenant has inspected the
Suite 410 Expansion Space and agrees to accept the same "as is"
without any agreements, representations, understandings or
obligations on the part of Landlord to perform any alterations,
repairs or improvements.
6.02. RESPONSIBILITY FOR IMPROVEMENTS TO EXPANSION SPACE. Any
construction, alterations or improvements to the Suite 410 Expansion
Space shall be performed by Tenant at its sole cost and expense
using contractors selected by Tenant and approved by Landlord and
shall be governed in all respects by the terms of the Lease. In any
and all events, the Suite 410 Expansion Effective Date shall not be
postponed or delayed if the initial improvements to the Suite 410
Expansion Space are incomplete on the Suite 410 Expansion Effective
Date for any reason whatsoever. Any delay in the completion of
initial improvements to the Expansion Space shall not subject
Landlord to any liability for any loss or damage resulting
therefrom.
7. EARLY ACCESS TO SUITE 410 EXPANSION SPACE. Tenant is currently in
possession of the Suite 410 Expansion Space, as subtenant, pursuant to the
terms of a certain sublease agreement (the "Sublease") between Tenant, as
subtenant, and PEOPLESOFT USA, INC., a Delaware corporation (the
"Sublandlord"), as sublandlord, which sublease agreement, and the
underlying primary lease between Landlord and Sublandlord, are scheduled
to expire, by their respective terms, as of the day immediately preceding
the Suite 410 Expansion Effective Date described in this Amendment.
Accordingly, subject to terms of Section 6.01 above, the Suite 410
Expansion Space is accepted by Tenant in "as is" condition and
configuration and that the Suite 410 Expansion Space is in good order and
satisfactory condition.
8. OTHER PERTINENT PROVISIONS. Landlord and Tenant agree that, effective as
of the date of this Amendment (unless different effective date(s) is/are
specifically referenced in this Section), the Lease shall be amended in
the following additional respects:
8.01. PARKING. Effective as of the Suite 410 Expansion Effective and
ending on the Third Extended Termination Date, and subject to the
terms and conditions of the
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<PAGE>
Lease as amended hereby, Exhibit F of the Lease, as amended, shall
be further amended to reflect that Tenant agrees to lease from
Landlord and Landlord agrees to lease to Tenant, a minimum of 5, but
no more than 10, unreserved parking spaces (collectively, the "Suite
410 Parking Spaces") in the Building parking facilities, for use by
Tenant and/or its employees applicable to the Suite 410 Expansion
Space. Tenant shall pay to Landlord the prevailing market charges
for the Suite 410 Parking Spaces. Notwithstanding the foregoing,
upon Tenant's written request and subject to Landlord's
availability, Tenant may request additional parking spaces during
the Third Extended Term. Tenant shall pay to Landlord the then
prevailing charges for the additional unreserved parking spaces and
reserved parking spaces. The use of such Suite 410 Parking Spaces
shall otherwise be in accordance with the terms of the Lease,
including, without limitation, the terms of the Parking Agreement
attached to the Lease as Exhibit F.
8.02. RENEWAL OPTION. Effective as of the Suite 410 Expansion Effective
Date, the Renewal Option set forth in Section VI.A of the Fourth
Amendment shall apply to the Suite 410 Expansion Space.
8.03. LANDLORD'S NOTICE ADDRESS. Effective as of the date hereof,
Landlord's Notice Address shall be as follows:
CA-2010 Irvine Limited Partnership
c/o Equity Office Management, L.L.C.
2010 Main Street
Suite #1250
Irvine, CA 92614
Attn: Property Manager
A copy of any notices to Landlord shall be sent to Equity Office,
One Market, 600 Spear Tower, San Francisco, CA 94105, Attn: Los
Angeles Regional Counsel.
8.04. REMAINING ALLOWANCE. Landlord and Tenant acknowledge and agree that,
pursuant to Paragraph 7 of Exhibit A (Work Letter) of the Fourth
Amendment (as amended by the Sixth Amendment), Tenant was entitled
to an allowance equal to $68,210.00 (the "Allowance"). Landlord and
Tenant further acknowledge and agree that Tenant has not used the
full amount of the Allowance and the sum of $39,220.75 (the
"Remaining Allowance") remains as of the date hereof. Accordingly,
provided Tenant is not in default and subject to Article X.B. of the
Lease, Tenant may apply the Remaining Allowance towards improvements
to the Suite 410 Expansion Space. Notwithstanding anything in the
Lease, as amended, if Tenant does not submit a request for payment
of the entire Allowance or the Remaining Allowance to Landlord
between the months of January 1, 2006 and February 28, 2006, any
unused amount shall accrue to the sole benefit of Landlord, it being
agreed that Tenant shall not be entitled to any credit, offset,
abatement or payment with respect thereto.
9. MISCELLANEOUS.
9.01. This Amendment and the attached exhibits, which are hereby
incorporated into and made a part of this Amendment, set forth the
entire agreement between the parties with respect to the matters set
forth herein. There have been no additional oral or written
representations or agreements. Under no circumstances shall Tenant
be entitled to any Rent abatement, improvement allowance, leasehold
improvements, or other work to the Premises, or any similar economic
incentives that may have been provided Tenant in connection with
entering into the Lease, unless specifically set forth in this
Amendment. Tenant agrees that neither Tenant nor its agents or any
other parties acting on behalf of Tenant shall disclose any matters
set, forth in this Amendment or disseminate or distribute any
information concerning the terms, details or conditions hereof to
any person, firm or entity without obtaining the express written
consent of Landlord.
9.02. Except as herein modified or amended, the provisions, conditions and
terms of the Lease shall remain unchanged and in full force and
effect.
9.03. In the case of any inconsistency between the provisions of the Lease
and this Amendment, the provisions of this Amendment shall govern
and control.
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<PAGE>
9.04. Submission of this Amendment by Landlord is not an offer to enter
into this Amendment but rather is a solicitation for such an offer
by Tenant. Landlord shall not be bound by this Amendment until
Landlord has executed and delivered the same to Tenant.
9.05. The capitalized terms used in this Amendment shall have the same
definitions as set forth in the Lease to the extent that such
capitalized terms are defined therein and not redefined in this
Amendment.
9.06. Tenant hereby represents to Landlord that Tenant has dealt with no
broker other than Studley Inc. in connection with this Amendment.
Tenant agrees to indemnify and hold Landlord, its trustees, members,
principals, beneficiaries, partners, officers, directors, employees,
mortgagee(s) and agents, and the respective principals and members
of any such agents (collectively, the "LANDLORD RELATED PARTIES")
harmless from all claims of any brokers claiming to have represented
Tenant in connection with this Amendment. Landlord hereby represents
to Tenant that Landlord has dealt with no broker in connection with
this Amendment. Landlord agrees to indemnify and hold Tenant, its
trustees, members, principals, beneficiaries, partners, officers,
directors, employees, and agents, and the respective principals and
members of any such agents (collectively, the "TENANT RELATED
PARTIES") harmless from all claims of any brokers claiming to have
represented Landlord in connection with this Amendment.
Equity Office Properties Management Corp. ("EOPMC") is an affiliate
of Landlord and represents only the Landlord in this transaction.
Any assistance rendered by any agent or employee of EOPMC in
connection with this Amendment or any subsequent amendment or
modification hereto has been or will be made as an accommodation to
Tenant solely in furtherance of consummating the transaction on
behalf of Landlord, and not as agent for Tenant.
9.07. Each signatory of this Amendment represents hereby that he or she
has the authority to execute and deliver the same on behalf of the
party hereto for which such signatory is acting.
9.08. Tenant hereby waives any and all rights under and benefits of
subsection 1 of Section 1932, Sections 1941 and 1942 (Repairs and
Alterations), 1932(2) and 1933(4) (Casualty), and 1950.7 (Security
Deposit) of the California Civil Code, and Section 1265.130
(Condemnation) of the California Code of Civil Procedure, or any
similar or successor Laws now or hereinafter in effect.
[SIGNATURES ARE ON FOLLOWING PAGE]
4
<PAGE>
IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Amendment
as of the day and year first above written.
LANDLORD:
CA-2010 IRVINE LIMITED PARTNERSHIP, A DELAWARE
LIMITED PARTNERSHIP
By: EOM GP, L.L.C., a Delaware limited
liability company, its general partner
By: Equity Office Management, L.L.C., a
Delaware limited liability company, its
non-member manager
By: /s/ Mark Valentine
-------------------------------------
Name: Mark Valentine
Title: Managing Director - Leasing
TENANT:
RITZ INTERACTIVE, INC., A DELAWARE CORPORATION
By: /s/ Fred Lerner
-------------------------------
Name: FRED LERNER
Title: CEO
5
<PAGE>
EXHIBIT A
OUTLINE AND LOCATION OF SUITE 410 EXPANSION SPACE
[FLOOR PLAN]
6