WATERIDGE
OFFICE LEASE
W9/WLA REAL ESTATE LIMITED PARTNERSHIP
a Delaware limited partnership,
as Landlord,
and
STYLECLICK.COM, INC.
a California corporation,
as Tenant
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TABLE OF CONTENTS
Page
SUMMARY OF BASIC LEASE INFORMATION..........................................iii
OFFICE LEASE .................................................................1
ARTICLE 1 BUILDING COMPLEX, BUILDING AND PREMISES.....................1
ARTICLE 2 LEASE TERM..................................................1
ARTICLE 3 BASE RENT...................................................2
ARTICLE 4 ADDITIONAL RENT.............................................2
ARTICLE 5 USE OF PREMISES.............................................7
ARTICLE 6 SERVICES AND UTILITIES......................................8
ARTICLE 7 REPAIRS....................................................10
ARTICLE 8 ADDITIONS AND ALTERATIONS..................................10
ARTICLE 9 COVENANT AGAINST LIENS.....................................11
ARTICLE 10 INSURANCE..................................................11
ARTICLE 11 DAMAGE AND DESTRUCTION.....................................13
ARTICLE 12 CONDEMNATION...............................................14
ARTICLE 13 COVENANT OF QUIET ENJOYMENT................................15
ARTICLE 14 ASSIGNMENT AND SUBLETTING..................................15
ARTICLE 15 SURRENDER OF PREMISES; REMOVAL OF TRADE FIXTURES..........18
ARTICLE 16 HOLDING OVER...............................................18
ARTICLE 17 ESTOPPEL CERTIFICATES......................................19
ARTICLE 18 SUBORDINATION..............................................19
ARTICLE 19 DEFAULTS; REMEDIES.........................................20
ARTICLE 20 [INTENTIONALLY DELETED]....................................22
ARTICLE 21 SIGNS......................................................22
ARTICLE 22 COMPLIANCE WITH LAW........................................23
ARTICLE 23 ENTRY BY LANDLORD..........................................23
ARTICLE 24 TENANT PARKING.............................................23
ARTICLE 25 MISCELLANEOUS PROVISIONS...................................24
EXHIBITS:
A FLOOR PLAN OF PREMISES
B RULES AND REGULATIONS
C AMENDMENT TO LEASE
D TENANT WORK LETTER
E ESTOPPEL CERTIFICATE
EXTENSION OPTION RIDER
LETTER OF CREDIT RIDER
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WATERIDGE
SUMMARY OF BASIC LEASE INFORMATION
This Summary of Basic Lease Information (the "Summary") is hereby
incorporated by reference into and made a part of the attached Office Lease.
Each reference in the Office Lease to any term of this Summary shall have the
meaning as set forth in this Summary for such term. In the event of a conflict
between the terms of this Summary and the Office Lease, the terms of the Office
Lease shall prevail. Any initially capitalized terms used herein and not
otherwise defined herein shall have the meaning as set forth in the Office
Lease.
TERMS OF LEASE
(References are to
the Office Lease) DESCRIPTION
1. Dated as of: May 30, 2000.
2. Landlord: W9/WLA REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
3. Address of Landlord c/o Legacy Partners Commercial, Inc.
(Section 25.14): 5120 West Goldleaf Circle
Suite 110
Los Angeles, California 90056
Attn: Property Manager
with a copy to:
c/o Legacy Partners Commercial, Inc.
30 Executive Park, Suite 100
Irvine, CA 92614
Attn: Alan DeFrancis
4. Tenant: STYLECLICK.COM, INC.,
a California corporation
5. Address of Tenant 3861 Sepulveda Boulevard
(Section 25.14): Culver City, California 90230
Attn: Barry Hall
(Prior to Lease Commencement Date)
and
5105 West Goldleaf Circle
Los Angeles, California 90056
Attention: Office Manager
(After Lease Commencement Date)
6. Premises (Article 1):
6.1 Premises: Approximately 23,503 rentable square
feet of space comprising the entire
rentable area of the first (1st) and
second (2nd) floors of the Building
(as defined below), as set forth in
Exhibit A attached hereto.
6.2 Building: The Premises are located in the
"Building" whose address is 5105 West
Goldleaf Circle, Los Angeles,
California 90056
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7. Term (Article 2).
7.1 Lease Term: Five (5) years and two (2) months.
7.2 Lease Commencement Date: The earlier of (i) the date Tenant
commences business operations in the
Premises, and (ii) July 1, 2000.
7.3 Lease Expiration Date: The date which is five (5) years and
two (2) months after the Lease
Commencement Date.
7.4 Lease Amendment: Subject to Article 2 of the Office
Lease, Landlord and Tenant may confirm
the Lease Commencement Date and the
Lease Expiration Date in an Amendment
to Lease (Exhibit C).
8. Base Rent (Article 3):
Monthly Installment Monthly Base
Month of the Annual Base Rent of Base Rent Rental Rate per
Lease Term Rentable Square Foot
1 - 2 $0.00 $0.00 $0.00
3 - 12 $634,581.00 $52,881.75 $2.25
13 - 24 $659,964.24 $54,997.02 $2.34
25 - 36 $685,347.48 $57,112.29 $2.43
37 - 48 $713,551.08 $59,462.59 $2.53
49 - 60 $741,754.68 $61,812.89 $2.63
61 - 62 $772,778.64 $64,398.22 $2.74
9. Additional Rent (Article 4).
9.1 Base Year: Calendar year 2000.
9.2 Tenant's Share of
Direct Expenses: 100%.
10. Security Deposit: None
11. Number of Parking
Passes (Article 24): Fifty-nine (59) unreserved parking
passes (i.e., 2.5 unreserved parking
passes for each 1,000 rentable square
feet of the Premises). The monthly
parking charges for such parking passes
shall be at the prevailing rate therefor
charged from time to time as set forth
in Article 24 of the Office Lease.
12. Brokers (Section 25.19): The Seeley Company and
Cushman Realty Corporation
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WATERIDGE
OFFICE LEASE
This Office Lease, which includes the preceding Summary attached hereto and
incorporated herein by this reference (the Office Lease and Summary to be known
sometimes collectively hereafter as the "Lease"), dated as of the date set forth
in Section 1 of the Summary, is made by and between W9/WLA REAL ESTATE LIMITED
PARTNERSHIP, a Delaware limited partnership ("Landlord") and STYLECLICK.COM,
INC., a California corporation ("Tenant").
ARTICLE 1
BUILDING COMPLEX, BUILDING AND PREMISES
1.1 Building Complex, Building and Premises. Upon and subject to the terms
set forth in this Lease, Landlord hereby leases to Tenant and Tenant hereby
leases from Landlord the premises set forth in Section 6.1 of the Summary (the
"Premises"), which Premises are located in the Building defined in Section 6.2
of the Summary. The outline of the Premises is set forth in Exhibit A attached
hereto. The Building, which is part of a multiple-building office building
complex commonly known as Wateridge and located at 5100, 5105, 5110 and 5120
West Goldleaf Circle, and 5035 West Slauson Avenue, Los Angeles, California
90056, the other buildings in such complex, the surface and covered parking
facilities located within such complex (the "Building Complex Parking Area"),
any outside plaza areas, land and other improvements surrounding the Building
and such other buildings, and the land upon which all of the foregoing are
situated, are herein sometimes collectively referred to herein as the "Building
Complex" or "Real Property." Tenant acknowledges that Landlord has made no
representation or warranty regarding the condition of the Real Property except
as specifically set forth in this Lease or the Tenant Work Letter. Tenant is
hereby granted the right to the nonexclusive use of the public or common areas
located on the Real Property; provided, however, that the manner in which such
public and common areas are maintained and operated shall be at the reasonable
discretion of Landlord and the use thereof shall be subject to the rules,
regulations and restrictions attached hereto as Exhibit B (the "Rules and
Regulations"), as the same may be reasonably modified by Landlord from time to
time. Landlord reserves the right to make alterations or additions to or to
change the location of elements of the Real Property and the common areas
thereof.
1.2 Condition of Premises. Except as expressly set forth in this Lease and
in the Tenant Work Letter attached hereto as Exhibit D, Landlord shall not be
obligated to provide or pay for any improvements, work or services related to
the improvement, remodeling or refurbishment of the Premises, and Tenant shall
accept the Premises in its "AS IS" condition on the Lease Commencement Date.
1.3 Rentable Square Feet. The parties hereby stipulate that the Premises
and Building contain the rentable square feet set forth in Section 6.1 of the
Summary, and such square footage amount is not subject to adjustment or
remeasurement by Landlord or Tenant. Accordingly, there shall be no adjustment
in the Base Rent or other amounts set forth in this Lease which are determined
based upon the rentable square feet of the Premises or Building
ARTICLE 2
LEASE TERM
The terms and provisions of this Lease shall be effective as of the date of
this Lease. The term of this Lease (the "Lease Term") shall be as set forth in
Section 7.1 of the Summary and shall commence on the date (the "Lease
Commencement Date") set forth in Section 7.2 of the Summary, and shall terminate
on the date (the "Lease Expiration Date") set forth in Section 7.3 of the
Summary, unless this Lease is sooner terminated as hereinafter provided. For
purposes of this Lease, the term "Lease Year" shall mean each consecutive twelve
(12) month period during the Lease Term; provided, however, that the first Lease
Year shall commence on the Lease Commencement Date and the last Lease Year shall
end on the Lease Expiration Date. In the event that the Lease Commencement Date
is a date which is other than the anticipated Lease Commencement Date set forth
in Section 7.2(ii) of the Summary, within a reasonable period of time after the
date Tenant takes possession of the Premises Landlord shall deliver to Tenant an
Amendment to Lease in the form attached hereto as Exhibit C, setting forth the
Lease Commencement Date, the Lease Expiration Date and the date upon which
Tenant commenced paying Rent, and Tenant shall execute and return such Amendment
to Lease to Landlord within five (5) days after Tenant's receipt thereof. In the
event that Landlord does not deliver such Amendment to Lease to Tenant, the
Lease Commencement Date shall be deemed to be the anticipated Lease Commencement
Date set forth in Section 7.2(ii) of the Summary.
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ARTICLE 3
BASE RENT
Tenant shall pay, without notice or demand, to Landlord at the management
office of the Building Complex, or, at Landlord's option, such other place as
Landlord may from time to time designate in writing, in currency or a check for
currency which, at the time of payment, is legal tender for private or public
debts in the United States of America, base rent ( "Base Rent") as set forth in
Section 8 of the Summary, payable in equal monthly installments as set forth in
Section 8 of the Summary in advance on or before the first day of each and every
calendar month during the Lease Term, without any setoff or deduction
whatsoever. The Base Rent for the third (3rd) full calendar month of the Lease
Term shall be paid at the time of Tenant's execution of this Lease. If any
rental payment date (including the Lease Commencement Date) falls on a day of a
calendar month other than the first day of such calendar month or if any Rent
payment is for a period which is shorter than one calendar month (such as during
the last month of the Lease Term), the Rent for any fractional calendar month
shall be the proportionate amount of a full calendar month's rental based on the
proportion that the number of days in such fractional month bears to the number
of days in the calendar month during which such fractional month occurs. All
other payments or adjustments required to be made under the terms of this Lease
that require proration on a time basis shall be prorated on the same basis.
ARTICLE 4
ADDITIONAL RENT
4.1 Additional Rent. In addition to paying the Base Rent specified in
Article 3 of this Lease, subject to Section 4.3.5 below, Tenant shall pay as
additional rent "Tenant's Share" of the annual "Direct Expenses," as those terms
are defined in Section 4.2.6 and 4.2.2 of this Lease, respectively, which are
allocated to Building pursuant to Section 4.3.4 below and which are in excess of
the amount of Direct Expenses applicable to the "Base Year," as that term is
defined in Section 4.2.1 of this Lease which are allocated to Building pursuant
to Section 4.3.4 below. Such additional rent, together with any and all other
amounts payable by Tenant to Landlord, as additional rent or otherwise, pursuant
to the terms of this Lease (other than the Base Rent), shall be hereinafter
collectively referred to as the "Additional Rent." The Base Rent and Additional
Rent are herein collectively referred to as the "Rent." All amounts due under
this Article 4 as Additional Rent shall be payable in the same manner, time and
place as the Base Rent, except as otherwise expressly set forth in this
Article 4. Without limitation on other obligations of Tenant which shall survive
the expiration of the Lease Term, the obligations of Tenant to pay the
Additional Rent provided for in this Article 4 shall survive the expiration of
the Lease Term.
4.2 Definitions. As used in this Article 4, the following terms shall have
the meanings hereinafter set forth:
4.2.1 "Base Year" shall mean the year set forth in Section 9.1 of the
Summary.
4.2.2 "Direct Expenses" shall mean "Operating Expenses" and "Tax
Expenses."
4.2.3 "Expense Year" shall mean each calendar year in which any
portion of the Lease Term falls, through and including the calendar year in
which the Lease Term expires; provided, that Landlord, upon notice to
Tenant, may change the Expense Year from time to time to any twelve (12)
consecutive month period, and, in the event of any such change, Tenant's
Share of the Direct Expenses shall be equitably adjusted for any Expense
Year involved in any such change.
4.2.4 "Operating Expenses" shall mean all expenses, costs and amounts
of every kind and nature which Landlord shall pay or incur during any
Expense Year because of or in connection with the ownership, management,
maintenance, repair, replacement, restoration or operation of the Real
Property, including, without limitation, any amounts paid or incurred for:
(i) the cost of supplying all utilities (including, without limitation, any
telephone risers or intra building network cabling), the cost of janitorial
service, alarm and security service, window cleaning, and trash removal,
the cost of operating, maintaining, repairing, replacing, renovating and
managing the utility systems, mechanical systems, sanitary and storm
drainage systems, and escalator and elevator systems, and the cost of
supplies, tools, and equipment and maintenance and service contracts in
connection therewith; (ii) the cost of licenses, certificates, permits and
inspections and the cost of contesting the validity or applicability of any
governmental enactments which may affect Operating Expenses, and the costs
incurred in connection with the implementation and operation of a
transportation system management program or similar program; (iii) the cost
of insurance carried by Landlord in connection with the Real Property, in
such amounts as Landlord may reasonably determine, or as may be required by
any mortgagees, or the lessor of any underlying or ground lease affecting
the Real Property; (iv) the cost of landscaping, relamping, supplies,
tools, equipment (including equipment rental agreements) and materials, and
all fees, charges and other costs, including management fees (or amounts in
lieu thereof), consulting fees, legal fees and accounting fees, incurred in
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connection with the management, operation, administration, maintenance and
repair of the Real Property; (v) the cost of parking area repair,
restoration and maintenance, including, but not limited to, resurfacing,
repainting, restriping, and cleaning; (vi) wages, salaries and other
compensation and benefits of all persons engaged in the operation,
management, maintenance or security of the Real Property (including an
equitable share of the total compensation paid to the Portfolio Vice
President responsible for the Building Complex calculated as percentage
with the numerator as one (1) and the denominator as the total number of
buildings for which the Portfolio Vice President is responsible), and
employer's Social Security taxes, unemployment taxes or insurance, and any
other taxes which may be levied on such wages, salaries, compensation and
benefits; (vii) payments under any easement, license, operating agreement,
declaration, restrictive covenant, or instrument pertaining to the sharing
of costs by the Real Property; (viii) amortization (including interest on
the unamortized cost at a rate equal to the floating commercial loan rate
announced from time to time by Bank of America, a national banking
association, or its successor, as its prime rate, plus 2% per annum (the
"Interest Rate")) of the cost of acquiring or the rental expense of
personal property used in the maintenance, operation and repair of the Real
Property; (ix) the cost (including rent) of Landlord's property management
office for the Real Property and all utilities, supplies and materials used
in connection therewith; and (x) the cost of any capital alterations,
capital additions, or capital improvements made to the Real Property or any
portion thereof (A) which relate to the operation, repair, maintenance and
replacement of all systems, equipment or facilities which serve the Real
Property in the whole or in part (including replacement of wall and floor
coverings, ceiling tiles and fixtures in lobbies, corridors, restrooms and
other common or public areas or facilities, maintenance and replacement of
curbs, walkways and parking areas, and repairs to roofs and re-roofing of
improvements), (B) which are intended as a labor-saving device or to effect
other economies in the operation or maintenance of the Real Property, or
any portion thereof, or (C) that are required under any governmental law or
regulation that is then being enforced by a federal, state or local
governmental agency; provided, however, that each such permitted capital
expenditure shall be amortized (including interest on the unamortized cost
at the Interest Rate in effect at the time such expenditure is placed in
service) over its useful life as Landlord shall reasonably determine in
accordance with standard real estate accounting practices. If Landlord is
not furnishing any particular work or service (the cost of which, if
performed or provided by Landlord, would be included in Operating Expenses)
to a tenant who has undertaken to perform such work or service in lieu of
the performance thereof by Landlord, Operating Expenses shall be deemed to
be increased by an amount equal to the additional Operating Expenses which
would reasonably have been incurred during such period by Landlord if it
had at its own expense furnished such work or service to such tenant. If
the buildings in the Building Complex are less than ninety-five percent
(95%) occupied during all or a portion of any Expense Year (including the
Base Year), Landlord shall make an appropriate adjustment to the variable
components of Operating Expenses for such Expense Year (including the Base
Year) as reasonably determined by Landlord employing sound accounting and
management principles, to determine the amount of Operating Expenses that
would have been paid had such buildings been ninety-five percent (95%)
occupied, and the amount so determined shall be deemed to have been the
amount of Operating Expenses for such Expense Year. Landlord shall have the
right, from time to time, to equitably allocate and prorate some or all of
the Operating Expenses among different tenants and/or different buildings
of the Building Complex and/or on a building-by-building basis (the "Cost
Pools"). Such Cost Pools may include, without limitation, the office space
tenants and retail space tenants of the buildings in the Building Complex.
Notwithstanding anything to the contrary set forth in this Article 4, when
calculating Direct Expenses for the Base Year, Operating Expenses shall
exclude market-wide labor-rate increases due to extraordinary
circumstances, including, but not limited to, boycotts and strikes, and
utility rate increases due to extraordinary circumstances including, but
not limited to, conservation surcharges, boycotts, embargoes or other
shortages, and costs relating to capital improvements or expenditures.
Notwithstanding the foregoing, for purposes of this Lease, Operating
Expenses shall not, however, include: (A) interest, amortization, or other
payments or charges payable by Landlord with respect to any loans secured
by a deed of trust or mortgage on the Real Property; (B) ground lease
payments; (C) Tenant leasing fees, commissions or other brokerage
commission relating thereto (with respect to all tenants of the Real
Property); (D) legal, auditing, consulting and other professional fees
(other than those legal, auditing, consulting or other professional fees
necessarily incurred in connection with the normal and routine maintenance
and operation of the Real Property) paid or incurred in connection with
financing, refinancing, sales, acquisitions, zoning proceedings, disputes
with present or prospective tenants or other occupants of the Real Property
or other extraordinary transactions, occurrences or events; (E) the cost of
providing any service directly to and paid directly by any tenant; (F) any
costs expressly excluded from Operating Expenses elsewhere in this Lease;
(G) expenses for repair or replacement paid by proceeds of insurance,
condemnation awards, or covered by warranties or guaranties (to the extent
such warranties or guaranties are honored by the warrantor or guarantor);
(H) costs, including permit, license and inspection costs, incurred in
renovating or otherwise improving, decorating, or redecorating rentable
space (including vacant rentable space) for tenants or other occupants in
the Building Complex; (I) penalties and interest for late payment or
failure to file returns when due, including, without limitation, taxes,
insurance, equipment leases, and other past due amounts; (J) costs arising
from Landlord's charitable or political contributions; or (K) costs
incurred due to the violation by Landlord of the terms and conditions of
any lease of space in the Building Complex; (L) salaries or other
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compensation paid to employees of Landlord above the level of Portfolio
Vice President; (M) the cost of repairs necessitated by the gross
negligence of Landlord, its agents, employees or contractors; (N) costs
incurred due to a deliberate violation by Landlord of any laws and
ordinances; (O) cost of replacements or other work occasioned by fire,
windstorm, earthquake or other casualty (except to the extent not covered
by insurance proceeds), or the exercise by governmental authorities of the
right of eminent domain; (P) depreciation, except as provided in clause
Section 4.2.4(x) above, and except on materials, tools, supplies and
vendor-type equipment purchased by Landlord to enable Landlord to supply
services Landlord might otherwise contract for with a third party, where
such depreciation, amortization and interest payments would otherwise have
been included in the charge for such third party's services, all as
determined in accordance with standard real estate accounting practices and
when depreciation or amortization is permitted or required, the item shall
be amortized over its reasonably anticipated useful life in accordance with
standard real estate accounting practices; and (Q) expenses for capital
improvements made to the Real Property other than as expressly provided in
Sections 4.2.4 (viii) and (x) above.
4.2.5 "Tax Expenses" shall mean all federal, state, county, or local
governmental or municipal taxes, fees, charges or other impositions of
every kind and nature, whether general, special, ordinary or extraordinary
(including, without limitation, real estate taxes, general and special
assessments, transit taxes or charges, business or license taxes or fees,
annual or periodic license or use fees, open space charges, housing fund
assessments, leasehold taxes or taxes based upon the receipt of rent,
including gross receipts or sales taxes applicable to the receipt of rent,
personal property taxes imposed upon the fixtures, machinery, equipment,
apparatus, systems and equipment, appurtenances, furniture and other
personal property used in connection with the Building Complex), which
Landlord shall pay or incur during any Expense Year (without regard to any
different fiscal year used by such governmental or municipal authority)
because of or in connection with the ownership, leasing and operation of
the Real Property or Landlord's interest therein. For purposes of this
Lease, Tax Expenses shall be calculated as if the tenant improvements in
the Building Complex were fully constructed and the Building Complex and
all tenant improvements in the Building Complex were fully assessed for
real estate tax purposes.
4.2.5.1 Tax Expenses shall include, without limitation:
(i) any assessment, tax, fee, levy or charge in addition to,
or in substitution, partially or totally, of any assessment, tax,
fee, levy or charge previously included within the definition of
real property tax, it being acknowledged by Tenant and Landlord
that Proposition 13 was adopted by the voters of the State of
California in the June 1978 election ("Proposition 13") and that
assessments, taxes, fees, levies and charges may be imposed by
governmental agencies for such services as fire protection,
street, sidewalk and road maintenance, conservation, refuse
removal and for other governmental services formerly provided
without charge to property owners or occupants, and, in further
recognition of the decrease in the level and quality of
governmental services and amenities as a result of Proposition
13, Tax Expenses shall also include any governmental or private
assessments or the Building Complex's contribution towards a
governmental or private cost-sharing agreement for the purpose of
augmenting or improving the quality of services and amenities
normally provided by governmental agencies. It is the intention
of Tenant and Landlord that all such new and increased
assessments, taxes, fees, levies, and charges and all similar
assessments, taxes, fees, levies and charges be included within
the definition of Tax Expenses for purposes of this Lease;
(ii) any assessment, tax, fee, levy, or charge allocable to
or measured by the area of the Premises or the Rent payable
hereunder, including, without limitation, any gross income tax
with respect to the receipt of such Rent, or upon or with respect
to the possession, leasing, operating, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises,
or any portion thereof;
(iii) any assessment, tax, fee, levy or charge, upon this
transaction or any document to which Tenant is a party, creating
or transferring an interest or an estate in the Premises;
(iv) any possessory taxes charged or levied in lieu of real
estate taxes; and
(v) any expenses incurred by Landlord in attempting to
protest, reduce or minimize Tax Expenses.
4.2.5.2 In no event shall Tax Expenses for any Expense Year be
less than the component of Tax Expenses comprising a portion of the
Base Year.
4.2.5.3 Notwithstanding anything to the contrary contained in
this Section 4.2.5, there shall be excluded from Tax Expenses (i) all
excess profits taxes, franchise taxes, gift taxes, capital stock
taxes, inheritance and succession taxes, estate taxes, federal and
state income taxes, and other taxes to the extent applicable to
Landlord's general or net income (as opposed to rents, receipts or
income attributable to operations at the Building Complex), and (ii)
any items paid by Tenant under Section 4.4 of this Lease.
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4.2.6 "Tenant's Share" shall mean the percentage set forth in
Section 9.2 of the Summary. Tenant's Share was calculated by dividing the
number of rentable square feet of the Premises by the total rentable square
feet in the Building.
4.3 Calculation and Payment of Additional Rent.
4.3.1 Calculation of Excess. If for any Expense Year ending or
commencing within the Lease Term, Tenant's Share of Direct Expenses for
such Expense Year exceeds Tenant's Share of the Direct Expenses for the
Base Year, then Tenant shall pay to Landlord, in the manner set forth in
Section 4.3.2, below, and as Additional Rent, an amount equal to the excess
(the "Excess").
4.3.2 Statement of Actual Direct Expenses and Payment by Tenant.
Following the end of each Expense Year, Landlord shall give to Tenant a
statement (the "Statement"), which shall state the Direct Expenses incurred
or accrued for such preceding Expense Year, and which shall indicate the
amount, if any, of any Excess. Upon receipt of the Statement for each
Expense Year ending during the Lease Term, if an Excess is present, Tenant
shall pay, with its next installment of Base Rent due, but in no event
later than thirty (30) days after receipt of such Statement, the full
amount of the Excess for such Expense Year, less the amounts, if any, paid
during such Expense Year as "Estimated Excess," as that term is defined in
Section 4.3.3, below. The failure of Landlord to timely furnish the
Statement for any Expense Year shall not prejudice Landlord from enforcing
its rights under this Article 4. Even though the Lease Term has expired and
Tenant has vacated the Premises, when the final determination is made of
Tenant's Share of the Direct Expenses for the Expense Year in which this
Lease terminates, taking into consideration that the Lease Expiration Date
may have occurred prior to the final day of the applicable Expense Year, if
an Excess is present, Tenant shall immediately pay to Landlord an amount as
calculated pursuant to the provisions of Section 4.3.1 of this Lease. The
provisions of this Section 4.3.2 shall survive the expiration or earlier
termination of the Lease Term.
4.3.3 Statement of Estimated Direct Expenses. In addition, Landlord
shall give Tenant a yearly expense estimate statement (the "Estimate
Statement") which shall set forth Landlord's reasonable estimate (the
"Estimate") of what the total amount of Direct Expenses for the
then-current Expense Year shall be and the estimated Excess (the "Estimated
Excess") as calculated by comparing Tenant's Share of Direct Expenses for
such then-current Expense Year, which shall be based upon the Estimate, to
Tenant's Share of Direct Expenses for the Base Year, which Estimate
Statement may be revised and reissued by Landlord from time to time. The
failure of Landlord to timely furnish the Estimate Statement for any
Expense Year shall not preclude Landlord from enforcing its rights to
collect any Estimated Excess under this Article 4. If pursuant to the
Estimate Statement (or a revision thereof) an Estimated Excess is
calculated for the then-current Expense Year, Tenant shall pay, with its
next installment of Base Rent due, but in no event later than thirty (30)
days after receipt of such Estimate Statement, a fraction of the Estimated
Excess (or the increase in the Estimated Excess if pursuant to a revised
Estimate Statement) for the then-current Expense Year (reduced by any
amounts paid pursuant to the last sentence of this Section 4.3.3). Such
fraction shall have as its numerator the number of months which have
elapsed in such current Expense Year to the month of such payment, both
months inclusive, and shall have twelve (12) as its denominator. Until a
new Estimate Statement is furnished, Tenant shall pay monthly, with the
monthly Base Rent installments, an amount equal to one-twelfth (1/12) of
the total Estimated Excess set forth in the previous Estimate Statement
delivered by Landlord to Tenant.
4.3.4 Allocation of Direct Expenses to Building. The parties
acknowledge that the Building is a part of a multi-building project, and
that the costs and expenses incurred in connection with the Real Property
(i.e. the Direct Expenses) are determined annually for the Real Property as
a whole, but then allocated by Landlord among (i) the Building and (ii) the
other Buildings in the Building Complex, for purposes of determining the
Direct Expenses payable by the tenants of the Building Complex. In making
such allocation of Direct Expenses for purposes of determining the Direct
Expenses payable by Tenant for the Building, Direct Expenses shall be
allocated as follows: the portion of the Direct Expenses allocated to the
Building shall consist of (A) all Direct Expenses which are attributable
solely to the Building, and (B) an equitable portion of the Direct Expenses
attributable to the Real Property as a whole and not attributable solely to
the Building.
4.3.5 No Payment for First Year. Notwithstanding the foregoing
provisions of this Article 4 to the contrary, Tenant shall not be obligated
to pay any Direct Expenses for the first (1st) year of the initial Lease
Term.
4.4 Taxes and Other Charges for Which Tenant Is Directly Responsible.
Tenant shall reimburse Landlord, as Additional Rent, within ten (10) days after
demand, for any and all taxes required to be paid by Landlord (except to the
extent included in Tax Expenses by Landlord), excluding state, local and federal
personal or corporate income taxes measured by the net income of Landlord from
all sources and estate and inheritance taxes, whether or not now customary or
within the contemplation of the parties hereto, when:
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4.4.1 said taxes are measured by or reasonably attributable to the
cost or value of Tenant's equipment, furniture, fixtures and other personal
property located in the Premises, or by the cost or value of any leasehold
improvements made in or to the Premises by or for Tenant, to the extent the
cost or value of such leasehold improvements exceeds the cost or value of a
building standard build-out as determined by Landlord regardless of whether
title to such improvements shall be vested in Tenant or Landlord;
4.4.2 said taxes are assessed upon or with respect to the possession,
leasing, operation, management, maintenance, alteration, repair, use or
occupancy by Tenant of the Premises or any portion of the Building Complex;
or
4.4.3 said taxes are assessed upon this transaction or any document to
which Tenant is a party creating or transferring an interest or an estate
in the Premises.
4.5 Late Charges. If any installment of Rent or any other sum due from
Tenant shall not be received by Landlord or Landlord's designee by the due date
therefor, then Tenant shall pay to Landlord a late charge equal to five percent
(5%) of the amount due plus any attorneys' fees incurred by Landlord by reason
of Tenant's failure to pay Rent and/or other charges when due hereunder. The
late charge shall be deemed Additional Rent and the right to require it shall be
in addition to all of Landlord's other rights and remedies hereunder, at law
and/or in equity and shall not be construed as liquidated damages or as limiting
Landlord's remedies in any manner. In addition to the late charge described
above, any Rent or other amounts owing hereunder which are not paid by the date
they are due shall thereafter bear interest until paid at a rate equal to the
lesser of (i) the Interest Rate set forth in Section 4.2.4 above, or (ii) the
highest rate permitted by applicable law.
4.6 Audit Rights. In the event Tenant disputes the amount of the Direct
Expenses set forth in the Statement for the particular Expense Year delivered by
Landlord to Tenant pursuant to Section 4.3.2 above, Tenant shall have the right,
at Tenant's cost, after reasonable notice to Landlord, to have Tenant's
authorized employees inspect and photocopy, at Landlord's office in California
during normal business hours, Landlord's books, records and supporting documents
concerning the Direct Expenses set forth in such Statement; provided, however,
Tenant shall have no right to conduct such inspection, have an audit performed
by the Accountant as described below, or object to or otherwise dispute the
amount of the Direct Expenses set forth in any such Statement, unless Tenant
notifies Landlord of such objection and dispute, completes such inspection, and
has the Accountant commence and complete such audit within two (2) years
immediately following Landlord's delivery of the particular Statement in
question (the "Review Period"); provided, further, that notwithstanding any such
timely objection, dispute, inspection, and/or audit, and as a condition
precedent to Tenant's exercise of its right of objection, dispute, inspection
and/or audit as set forth in this Section 4.6, Tenant shall not be permitted to
withhold payment of, and Tenant shall timely pay to Landlord, the full amounts
as required by the provisions of this Article 4 in accordance with such
Statement. However, such payment may be made under protest pending the outcome
of any audit which may be performed by the Accountant as described below. In
connection with any such inspection by Tenant, Landlord and Tenant shall
reasonably cooperate with each other so that such inspection can be performed
pursuant to a mutually acceptable schedule, in an expeditious manner and without
undue interference with Landlord's operation and management of the Real
Property. If after such inspection and/or request for documentation, Tenant
still disputes the amount of the Direct Expenses set forth in the Statement,
Tenant shall have the right, within the Review Period, to cause an independent
certified public accountant (which is not paid on a commission or contingency
basis) mutually approved by Landlord and Tenant (the "Accountant") to complete
an audit of Landlord's books and records to determine the proper amount of the
Direct Expenses incurred and amounts payable by Tenant for the Expense Year
which is the subject of such Statement. Such audit by the Accountant shall be
final and binding upon Landlord and Tenant. If Landlord and Tenant cannot
mutually agree as to the identity of the Accountant within thirty (30) days
after Tenant notifies Landlord that Tenant desires an audit to be performed,
then the Accountant shall be of the "Big 5" accounting firms (which is not paid
on a commission or contingency basis), as selected by Tenant and reasonably
approved by Landlord. If such audit reveals that Landlord has over-charged
Tenant, then within thirty (30) days after the results of such audit are made
available to Landlord, Landlord shall reimburse to Tenant the amount of such
over-charge. If the audit reveals that the Tenant was under-charged, then within
thirty (30) days after the results of such audit are made available to Tenant,
Tenant shall reimburse to Landlord the amount of such under-charge. Tenant
agrees to pay the cost of such audit unless it is subsequently determined that
Landlord's original Statement which was the subject of such audit was in error
to Tenant's disadvantage by four percent (4%) or more of the total Direct
Expenses which was the subject of such audit. The payment by Tenant of any
amounts pursuant to this Article 4 shall not preclude Tenant from questioning,
during the Review Period, the correctness of the particular Statement in
question provided by Landlord, but the failure of Tenant to object thereto,
conduct and complete its inspection and have the Accountant conduct the audit as
described above prior to the expiration of the Review Period for such Statement
shall be conclusively deemed Tenant's approval of the Statement in question and
the amount of Direct Expenses shown thereon.
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ARTICLE 5
USE OF PREMISES
5.1 Use. Tenant shall use the Premises solely for general office purposes
(including up to 25% of the Premises for use as a studio for still photography
to the extent permitted by applicable laws), all consistent with the character
of the Building Complex as a first-class office building project. Tenant shall
not use or permit the Premises to be used for any other purpose or purposes
whatsoever. Tenant shall not allow occupancy density of use of the Premises
which is greater than the average density of the other office tenants of the
Building Complex. Tenant further covenants and agrees that it shall not use, or
suffer or permit any person or persons to use, the Premises or any part thereof
for any use or purpose contrary to the Rules and Regulations, or in violation of
the laws of the United States of America, the State of California, or the
ordinances, regulations or requirements of the local municipal or county
governing body or other lawful authorities having jurisdiction over the Building
Complex (including laws pertaining to Hazardous Materials, as defined below).
Tenant shall comply with the Rules and Regulations. Landlord shall not be
responsible to Tenant for the nonperformance of any of such Rules and
Regulations by or otherwise with respect to the acts or omissions of any other
tenants or occupants of the Building Complex. Tenant shall comply with all
recorded covenants, conditions, and restrictions now or hereafter affecting the
Real Property.
5.2 Hazardous Materials.
5.2.1 Prohibition on Use. Tenant shall not use or allow another person
or entity to use any part of the Premises for the storage, use, treatment,
manufacture or sale of Hazardous Materials. Landlord acknowledges, however,
that Tenant will maintain products in the Premises which are incidental to
the operation of its offices, such as photocopy supplies, secretarial
supplies and limited janitorial supplies, which products contain chemicals
which are categorized as Hazardous Materials. Landlord agrees that the use
of such products in the Premises in compliance with all applicable laws and
in the manner in which such products are designed to be used shall not be a
violation by Tenant of this Section 5.2.1.
5.2.2 Indemnity. Tenant agrees to indemnify, defend, protect and hold
Landlord and the Landlord Parties (as defined in Section 10.1 below)
harmless from and against any and all claims, actions, administrative
proceedings (including informal proceedings), judgments, damages, punitive
damages, penalties, fines, costs, liabilities, interest or losses,
including reasonable attorneys' fees and expenses, consultant fees, and
expert fees, together with all other costs and expenses of any kind or
nature, that arise during or after the Lease Term directly or indirectly
from or in connection with the presence, suspected presence, release or
suspected release of any Hazardous Materials in or into the air, soil,
surface water or groundwater at, on, about, under or within the Premises or
Real Property or any portion thereof, caused by Tenant, its assignees or
subtenants and/or their respective agents, employees, contractors,
licensees or invitees (collectively, "Tenant Affiliates").
5.2.3 Remedial Work. In the event any investigation or monitoring of
site conditions or any clean-up, containment, restoration, removal or other
remedial work (collectively, the "Remedial Work") is required under any
applicable federal, state or local laws or by any judicial order, or by any
governmental entity as the result of operations or activities upon, or any
use or occupancy of any portion of the Premises by Tenant or Tenant
Affiliates, Tenant shall perform or cause to be performed the Remedial Work
in compliance with such laws or order. All Remedial Work shall be performed
by one or more contractors, selected by Tenant and approved in advance in
writing by Landlord. All costs and expenses of such Remedial Work shall be
paid by Tenant, including, without limitation, the charges of such
contractor(s), the consulting engineers, and Landlord's reasonable
attorneys' fees and costs incurred in connection with monitoring or review
of such Remedial Work.
5.2.4 Definition of Hazardous Materials. As used herein, the term
"Hazardous Materials" means any hazardous or toxic substance, material or
waste which is or becomes regulated by any local governmental authority,
the State of California or the United States Government, including, without
limitation, any material or substance which is (i) defined or listed as a
"hazardous waste," "extremely hazardous waste," "restricted hazardous
waste," "hazardous substance" or "hazardous material" under any applicable
federal, state or local law or administrative code promulgated thereunder,
(ii) petroleum, or (iii) asbestos.
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ARTICLE 6
SERVICES AND UTILITIES
6.1 Standard Tenant Services. Landlord shall provide the following services
on all days during the Lease Term, unless otherwise stated below.
6.1.1 Subject to all governmental rules, regulations and guidelines
applicable thereto, Landlord shall provide heating, ventilation and air
conditioning ("HVAC") when necessary for normal comfort for normal office
use in the Premises, from Monday through Friday, during the period from
7:00 a.m. to 6:00 p.m., and on Saturdays during the period from 8:00 a.m.
to 12:00 p.m. (collectively, the "Building Hours"), except for nationally
and locally recognized holidays as designated by Landlord (collectively,
the "Holidays").
Landlord shall provide adequate electrical wiring and facilities and power
for normal general office use as determined by Landlord. Tenant shall bear the
cost of replacement of lamps, starters and ballasts for non-Building standard
lighting fixtures within the Premises.
Landlord shall provide city water from the regular Building outlets for
drinking, lavatory and toilet purposes.
Landlord shall provide janitorial services five (5) days per week, except
the date of observation of the Holidays, in and about the Premises.
Landlord shall provide nonexclusive automatic elevator service at all
times.
6.2 Overstandard Tenant Use. Tenant shall not, without Landlord's prior
written consent, use heat-generating machines, machines other than normal
fractional horsepower office machines, or equipment or lighting other than
building standard lights in the Premises, which may affect the temperature
otherwise maintained by the air conditioning system or increase the water
normally furnished for the Premises by Landlord pursuant to the terms of
Section 6.1 of this Lease. If Tenant uses water or HVAC in excess of that
supplied by Landlord pursuant to Section 6.1 of this Lease, or if Tenant's
consumption of electricity shall exceed an average of three (3) watts per usable
square foot of the Premises, connected load, calculated on a monthly basis
during the Building Hours set forth in Section 6.1.1 above, then Tenant shall
pay to Landlord, within ten (10) days after billing, the cost of such excess
consumption, the cost of the installation, operation, and maintenance of
equipment which is installed in order to supply such excess consumption, and the
cost of the increased wear and tear on existing equipment caused by such excess
consumption; and Landlord may install devices to separately meter any increased
use and in such event Tenant shall pay the increased cost directly to Landlord,
within ten (10) days after demand, including the cost of such additional
metering devices. If Tenant desires to use HVAC during hours other than the
Building Hours, (i) Tenant shall give Landlord such prior notice, as Landlord
shall from time to time establish as appropriate, of Tenant's desired use,
(ii) Landlord shall supply such after-hours HVAC to Tenant at Landlord's actual
cost (including reasonable depreciation and wear and tear on equipment) of
providing same, plus a ten percent (10%) administration fee to cover
administrative and accounting costs, and (iii) Tenant shall pay such cost within
ten (10) days after billing.
6.3 Interruption of Use. Tenant agrees that Landlord shall not be liable
for damages, by abatement of Rent or otherwise, for failure to furnish or delay
in furnishing any service (including telephone and telecommunication services),
or for any diminution in the quality or quantity thereof, when such failure or
delay or diminution is occasioned, in whole or in part, by repairs,
replacements, or improvements, by any strike, lockout or other labor trouble, by
inability to secure electricity, gas, water, or other fuel at the Building after
reasonable effort to do so, by any accident or casualty whatsoever, by act or
default of Tenant or other parties, or by any other cause beyond Landlord's
reasonable control; and such failures or delays or diminution shall never be
deemed to constitute an eviction or disturbance of Tenant's use and possession
of the Premises or relieve Tenant from paying Rent or performing any of its
obligations under this Lease. Furthermore, Landlord shall not be liable under
any circumstances for a loss of, or injury to, property or for injury to, or
interference with, Tenant's business, including, without limitation, loss of
profits, however occurring, through or in connection with or incidental to a
failure to furnish any of the services or utilities as set forth in this
Article 6.
6.4 Additional Services. Landlord shall also have the exclusive right, but
not the obligation, to provide any additional services which may be required by
Tenant, including, without limitation, locksmithing, additional janitorial
service, and additional repairs and maintenance, provided that Tenant shall pay
to Landlord, within ten (10) days after billing, the sum of all costs to
Landlord of such additional services plus an administration fee. Charges for any
utilities or service for which Tenant is required to pay from time to time
hereunder, shall be deemed Additional Rent hereunder and shall be billed on a
monthly basis.
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ARTICLE 7
REPAIRS
7.1 Tenant's Repairs. Subject to Landlord's repair obligations in
Section 7.2 and 11.1 below, Tenant shall, at Tenant's own expense, keep the
Premises, including all improvements, fixtures and furnishings therein, in good
order, repair and condition at all times during the Lease Term, which repair
obligations shall include, without limitation, the obligation to promptly and
adequately repair all damage to the Premises and replace or repair all damaged
or broken fixtures and appurtenances; provided however, that, at Landlord's
option, or if Tenant fails to make such repairs, Landlord may, but need not,
make such repairs and replacements, and Tenant shall pay Landlord the cost
thereof, including a percentage of the cost thereof (to be uniformly established
for the Building) sufficient to reimburse Landlord for all overhead, general
conditions, fees and other costs or expenses arising from Landlord's involvement
with such repairs and replacements forthwith upon being billed for same.
7.2 Landlord's Repairs. Anything contained in Section 7.1 above to the
contrary notwithstanding, and subject to Articles 11 and 12 of this Lease,
Landlord shall repair and maintain the structural portions of the Building and
the basic plumbing, heating, ventilating, air conditioning and electrical
systems serving the Building and not located in the Premises in a manner
consistent with the maintenance standards of other comparable office buildings
in the vicinity of the Building; provided, however, if such maintenance and
repairs are caused in part or in whole by the act, neglect, fault of or omission
of any duty by Tenant, its agents, contractors, employees, licenses or invitees,
Tenant shall pay to Landlord, as additional rent, the reasonable cost of such
maintenance and repairs. Landlord shall not be liable to Tenant for any failure
to make any such repairs, or to perform any maintenance hereunder, and there
shall be no abatement of Rent and no liability of Landlord by reason of any
injury to or interference with Tenant's business arising from the making of a
failure to make any repairs, alterations or improvements in or to any portion of
the Premises or Building Complex or in or to fixtures, appurtenances and
equipment therein. Tenant hereby waives and releases its right to make repairs
at Landlord's expense under Section 1941 and 1942 of the California Civil Code,
or under any similar law, statute, or ordinance now or hereafter in effect.
ARTICLE 8
ADDITIONS AND ALTERATIONS
8.1 Landlord's Consent to Alterations. Tenant may not make any
improvements, alterations, additions or changes to the Premises (collectively,
the "Alterations") without first procuring the prior written consent of Landlord
to such Alterations, which consent shall be requested by Tenant not less than
thirty (30) days prior to the commencement thereof, and which consent shall not
be unreasonably withheld by Landlord; provided, however, Landlord may withhold
its consent in its sole and absolute discretion with respect to any Alterations
which (i) may affect the structural components of the Building, or the
Building's mechanical, electrical, heating, ventilating, air-conditioning, or
life safety systems, or (ii) are visible from outside the Premises. The
construction of the initial improvements to the Premises shall be governed by
the terms of the Tenant Work Letter, attached hereto as Exhibit D, and not the
terms of this Article 8.
8.2 Manner of Construction. Landlord may impose, as a condition of its
consent to any and all Alterations or repairs of the Premises or about the
Premises, such requirements as Landlord in its discretion may deem desirable,
including, but not limited to, the requirement that Tenant utilize for such
purposes only contractors, materials, mechanics and materialmen reasonably
approved by Landlord. Tenant shall construct such Alterations and perform such
repairs in conformance with any and all applicable rules and regulations of any
federal, state, county or municipal code or ordinance and pursuant to a valid
building permit, issued by the City of Los Angeles in conformance with
Landlord's construction rules and regulations. All work with respect to any
Alterations must be done in a good and workmanlike manner and diligently
prosecuted to completion to the end that the Premises shall at all times be a
complete unit except during the period of work. In performing the work of any
such Alterations, Tenant shall have the work performed in such manner as not to
obstruct access to the Building or Building Complex or the common areas by any
other tenant of the Building Complex, and as not to obstruct the business of
Landlord or other tenants in the Building Complex, or interfere with the labor
force working in the Building Complex. If Tenant makes any Alterations, Tenant
agrees to carry "Builder's All Risk" insurance in an amount approved by Landlord
covering the construction of such Alterations, and such other insurance as
Landlord may require, it being understood and agreed that all of such
Alterations shall be insured by Tenant pursuant to Article 10 of this Lease
immediately upon completion thereof. In addition, with respect to any
Alterations which cost in excess of $50,000.00, Landlord may, in its discretion,
require Tenant (if Tenant has previously been in default under this Lease) or
any subtenant or assignee of Tenant to obtain a lien and completion bond or some
alternate form of security satisfactory to Landlord in an amount sufficient to
ensure the lien-free completion of such Alterations and naming Landlord as a
co-obligee. Upon completion of any Alterations, Tenant shall (i) cause a timely
Notice of Completion to be recorded in the office of the Recorder of Los Angeles
County in accordance with the terms of Section 3093 of the Civil Code of the
State of California or any successor statute, (ii) deliver to the Building
Complex management office a reproducible copy of the "as built" drawings of the
Alterations, and (iii) deliver to Landlord evidence of payment, contractors'
affidavits and full and final waivers of all liens for labor, services or
materials.
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8.3 Payment for Alterations. If Tenant orders any Alterations or repair
work directly from Landlord, Tenant shall pay to Landlord, within ten (10) days
after demand, all reasonable charges for such work, including a percentage of
the cost of such work (such percentage to be established on a uniform basis for
the Building and shall not exceed ten percent (10%) of such cost) sufficient to
compensate Landlord for all overhead, general conditions, fees and other costs
and expenses arising from Landlord's involvement with such work. If Tenant does
not order any work directly from Landlord, Tenant shall reimburse Landlord,
within ten (10) days after demand, for Landlord's reasonable out-of-pocket costs
and expenses incurred in connection with Landlord's review of such work, plus a
Landlord administrative fee not to exceed five percent (5%) of the total cost of
such work, which fee shall be applicable only to Alterations constructed after
the construction of initial Tenant Improvements (as such term is defined in the
Tenant Work Letter, attached hereto as Exhibit D) to the Premises.
8.4 Landlord's Property. All Alterations, improvements and fixtures which
may be installed or placed in or about the Premises, and all signs installed in,
on or about the Premises, from time to time, shall be at the sole cost of Tenant
and shall be and become the property of Landlord. Notwithstanding the following,
Landlord may, by written notice to Tenant prior to the end of the Lease Term,
require Tenant at Tenant's expense to remove any Alterations from the Premises
and repair any damage to the Premises and Building caused by such removal. If
Tenant fails to complete such removal prior and/or to repair any damage caused
by the removal of any Alterations by the end of the Lease Term, Landlord may do
so and may charge the cost thereof to Tenant.
ARTICLE 9
COVENANT AGAINST LIENS
Tenant has no authority or power to cause or permit any lien or encumbrance
of any kind whatsoever, whether created by act of Tenant, operation of law or
otherwise, to attach to or be placed upon the Real Property or any portion
thereof, and any and all liens and encumbrances created by Tenant shall attach
to Tenant's interest only. Landlord shall have the right at all times to post
and keep posted on the Premises any notice which it deems necessary for
protection from such liens. Tenant covenants and agrees not to suffer or permit
any lien of mechanics or materialmen or others to be placed against the Real
Property or any portion thereof, with respect to work or services claimed to
have been performed for or materials claimed to have been furnished to Tenant or
the Premises, and, in case of any such lien attaching or notice of any lien,
Tenant covenants and agrees to cause it to be immediately released and removed
of record. Notwithstanding anything to the contrary set forth in this Lease, in
the event that such lien is not released and removed on or before the date
occurring five (5) days after notice of such lien is delivered by Landlord to
Tenant, Landlord, at its sole option, may immediately take all action necessary
to release and remove such lien, without any duty to investigate the validity
thereof, and all sums, costs and expenses, including reasonable attorneys' fees
and costs, incurred by Landlord in connection with such lien shall be deemed
Additional Rent under this Lease and shall immediately be due and payable by
Tenant.
ARTICLE 10
INSURANCE
10.1 Indemnification and Waiver. Tenant hereby assumes all risk of damage
to property and injury to persons in, on or about the Premises from any cause
whatsoever, and agrees that, to the extent not prohibited by law, Landlord, its
partners and subpartners, and their respective officers, directors,
shareholders, agents, property managers, employees and independent contractors
(collectively, the "Landlord Parties") shall not be liable for, and are hereby
released from any responsibility for, any damage either to person or property or
resulting from the loss of use thereof, which damage is sustained by Tenant or
by other persons claiming through Tenant. Tenant shall indemnify, defend,
protect and hold harmless the Landlord Parties from and against any and all
loss, cost, damage, expense, claims and liability, including without limitation
court costs and reasonable attorneys' fees (collectively "Claims") incurred in
connection with or arising from any cause in, on or about the Premises, and/or
any acts, omissions or negligence of Tenant or of any person claiming by,
through or under Tenant, or of the contractors, agents, employees, licensees or
invitees of Tenant or any such person in, on or about the Real Property,
provided that the terms of the foregoing indemnity shall not apply to: (i) any
Claims to the extent resulting from the gross negligence or willful misconduct
of Landlord or the Landlord Parties and not insured (or required to be insured)
by Tenant under this Lease; or (ii) any loss of or damage to Landlord's property
to the extent Landlord has waived such loss or damage pursuant to Section 10.4
below. Tenant's agreement to indemnify Landlord pursuant to this Section 10.1 is
not intended and shall not relieve any insurance carrier of its obligations
under policies required to be carried by Tenant pursuant to the provision of
this Lease. The provisions of this Section 10.1 shall survive the expiration or
sooner termination of this Lease with respect to any Claims occurring prior to
such expiration or termination.
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10.2 Landlord's Insurance. Landlord shall procure and maintain, during the
Lease Term, fire and extended coverage insurance (all risk form) on the Building
(excluding at Landlord's option, the items Tenant is required to insure pursuant
to Section 10.3.2) in the amount of the full replacement cost of the Building.
In addition, Landlord shall carry commercial general liability insurance in
amounts reasonably determined by Landlord. The cost of such insurance shall be
included as part of the Operating Expenses. Tenant shall, at Tenant's expense,
comply with all insurance company requirements pertaining to the use of the
Premises. If Tenant's conduct or use of the Premises causes any increase in the
premium for any insurance policies carried by Landlord, then Tenant shall
reimburse Landlord for any such increase. Tenant, at Tenant's expense, shall
comply with all rules, orders, regulations or requirements of the American
Insurance Association (formerly the National Board of Fire Underwriters) and
with any similar body.
10.3 Tenant's Insurance. Tenant shall maintain the following coverages in
the following amounts at all times following the date (the "Insurance Start
Date") which is the earlier of (i) Tenant's entry into the Premises to perform
any work therein, or (ii) the Lease Commencement Date, and continuing thereafter
throughout the Lease Term:
10.3.1 Commercial General Liability Insurance covering the insured
against claims of bodily injury, personal injury and property damage
arising out of Tenant's operations, assumed liabilities or use of the
Premises, including a Commercial General Liability endorsement covering the
insuring provisions of this Lease and the performance by Tenant of the
indemnity agreements set forth in Section 10.1 of this Lease, for limits of
liability not less than: (i) Bodily Injury and Property Damage Liability -
$5,000,000 each occurrence and $5,000,000 annual aggregate, and (ii)
Personal Injury Liability - $5,000,000 each occurrence and $5,000,000
annual aggregate.
10.3.2 Physical Damage Insurance covering (i) all office furniture,
trade fixtures, office equipment, merchandise and all other items of
Tenant's property on the Premises installed by, for, or at the expense of
Tenant, (ii) the "Tenant Improvements," as that term is defined in the
Tenant Work Letter, and (iii) all Alterations and other improvements and
additions in and to the Premises. Such insurance shall be written on an
"all risks" of physical loss or damage basis, for the guaranteed
replacement cost value new without deduction for depreciation of the
covered items and in amounts that meet any co-insurance clauses of the
policies of insurance and shall include a vandalism and malicious mischief
endorsement, sprinkler leakage coverage and earthquake sprinkler leakage
coverage.
10.3.3 Business interruption, loss-of-income and extra-expense
insurance in such amounts as will reimburse Tenant for direct or indirect
loss of earnings attributable to all perils commonly insured against by
prudent tenants or attributable to prevention of access to the Premises or
to the Building as a result of such perils.
10.3.4 Form of Policies. The minimum limits of policies of insurance
required of Tenant under this Lease shall in no event limit the liability
of Tenant under this Lease. Such insurance shall: (i) name Landlord, and
any other party it so specifies, as an additional insured; (ii)
specifically cover the liability assumed by Tenant under this Lease,
including, but not limited to, Tenant's obligations under Section 10.1 of
this Lease; (iii) be issued by an insurance company having a rating of not
less than A-VIII in Best's Insurance Guide or which is otherwise acceptable
to Landlord and licensed (or qualified) to do business in the State of
California; (iv) be primary insurance as to all claims thereunder and
provide that any insurance carried by Landlord is excess and is
non-contributing with any insurance requirement of Tenant; (v) provide that
said insurance shall not be canceled or coverage changed unless thirty (30)
days' prior written notice shall have been given to Landlord and any
mortgagee of Landlord; and (vi) contain a cross-liability endorsement or
severability of interest clause acceptable to Landlord. Tenant shall
deliver said policy or policies or certificates thereof to Landlord on or
before the Insurance Start Date and at least ten (10) business days before
the expiration dates thereof.
10.4 Subrogation. Landlord and Tenant agree to have their respective
insurance companies issuing property damage insurance waive any rights of
subrogation that such companies may have against Landlord or Tenant, as the case
may be. Landlord and Tenant hereby waive any right that either may have against
the other on account of any loss or damage to their respective property to the
extent such loss or damage is insured under property damage insurance policies
carried by the waiving party under this Lease (or would have been covered had
the waiving party maintained such insurance as so required under this Lease). If
either party fails to carry the amounts and types of insurance required to be
carried by it pursuant to this Article 10, in addition to any remedies the other
party may have under this Lease, such failure shall be deemed to be a covenant
and agreement by such party to self-insure with respect to the type and amount
of insurance which such party so failed to carry, with full waiver of
subrogation with respect thereto.
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10.5 Additional Insurance Obligations. Tenant shall carry and maintain
during the entire Lease Term, at Tenant's sole cost and expense, increased
amounts of the insurance required to be carried by Tenant pursuant to this
Article 10, and such other reasonable types of insurance coverage and in such
reasonable amounts covering the Premises and Tenant's operations therein, as may
be reasonably requested by Landlord, but in no event shall such increased
amounts of insurance or such other reasonable types of insurance be in excess of
that required by landlords of buildings comparable to the Building and located
in the vicinity of the Building Complex.
ARTICLE 11
DAMAGE AND DESTRUCTION
11.1 Repair of Damage to Premises by Landlord. Tenant shall promptly notify
Landlord of any damage to the Premises resulting from fire or any other casualty
or any condition existing in the Premises as a result of a fire or other
casualty that would give rise to the terms of this Article 11. If the Premises
or any common areas of the Building Complex serving or providing access to the
Premises shall be damaged by fire or other casualty or be subject to a condition
existing as a result of a fire or other casualty, Landlord shall promptly and
diligently, subject to reasonable delays for insurance adjustment or other
matters beyond Landlord's reasonable control, and subject to all other terms of
this Article 11, restore the base, shell, and core of the Premises and such
common areas to substantially the same condition as existed prior to the
casualty, except for modifications required by zoning and building codes and
other laws or by the holder of a mortgage on the Building Complex (or any
portion thereof) or any other modifications to the common areas deemed desirable
by Landlord, provided that access to the Premises and any common restrooms
serving the Premises shall not be materially impaired. Notwithstanding any other
provision of this Lease, upon the occurrence of any damage to the Premises,
Tenant shall assign to Landlord (or to any party designated by Landlord) all
insurance proceeds payable to Tenant under Tenant's insurance required under
Section 10.3.2(ii) and 10.3.2(iii) of this Lease, and Landlord shall repair any
injury or damage to the Tenant Improvements and Alterations installed in the
Premises and shall return such Tenant Improvements and Alterations to their
original condition; provided that if the cost of such repair by Landlord exceeds
the amount of insurance proceeds received by Landlord from Tenant's insurance
carrier, as assigned by Tenant, the cost of such repairs shall be paid by Tenant
to Landlord prior to Landlord's repair of the damage. In connection with such
repairs and replacements, Tenant shall, prior to the commencement of
construction, submit to Landlord, for Landlord's review and approval, all plans,
specifications and working drawings relating thereto, and Landlord shall select
the contractors to perform such improvement work. Landlord shall not be liable
for any inconvenience or annoyance to Tenant or its visitors, or injury to
Tenant's business resulting in any way from such damage or the repair thereof;
provided however, that if such fire or other casualty shall have damaged the
Premises or common areas necessary to Tenant's occupancy, and if such damage is
not the result of the negligence or willful misconduct of Tenant or Tenant's
agents, employees, contractors, licensees or invitees, Landlord shall allow
Tenant a proportionate abatement of Base Rent, and Tenant's Share of Direct
Expenses during the time and to the extent the Premises are unfit for occupancy
for the purposes permitted under this Lease, and not occupied by Tenant as a
result thereof.
11.2 Landlord's Option to Repair. Notwithstanding the terms of Section 11.1
of this Lease, Landlord may elect not to rebuild and/or restore the Premises
and/or Building and/or any other portion of the Building Complex and instead
terminate this Lease by notifying Tenant in writing of such termination within
sixty (60) days after the date of damage, such notice to include a termination
date giving Tenant sixty (60) days to vacate the Premises, but Landlord may so
elect only if the Building Complex shall be damaged by fire or other casualty or
cause or be subject to a condition existing as a result of such a fire or other
casualty or cause, whether or not the Premises are affected, and one or more of
the following conditions is present: (i) repairs cannot reasonably be completed
within one hundred eighty (180) days of the date of damage (when such repairs
are made without the payment of overtime or other premiums); (ii) the holder of
any mortgage on the Real Property or ground lessor with respect to the Real
Property shall require that the insurance proceeds or any portion thereof be
used to retire the mortgage debt, or shall terminate the ground lease, as the
case may be; or (iii) the damage or condition arising as a result of such damage
is not fully covered, except for deductible amounts, by Landlord's insurance
policies. In addition, if the Premises, the Building or any portion of the
Building Complex is destroyed or damaged to any substantial extent during the
last twelve (12) months of the Lease Term, then notwithstanding anything
contained in this Article 11, Landlord shall have the option to terminate this
Lease by giving written notice to Tenant of the exercise of such option within
thirty (30) days after such damage or destruction, in which event this Lease
shall cease and terminate as of the date of such notice. Upon such termination
of this Lease pursuant to this Section 11.2, Tenant shall pay the Base Rent and
Additional Rent, properly apportioned up to such date of damage (subject to any
abatement as provided in Section 11.1 above), and both parties hereto shall
thereafter be freed and discharged of all further obligations hereunder, except
as provided for in provisions of this Lease which by their terms survive the
expiration or earlier termination of this Lease Term.
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11.3 Waiver of Statutory Provisions. The provisions of this Lease,
including this Article 11, constitute an express agreement between Landlord and
Tenant with respect to any and all damage to, or destruction of, all or any part
of the Real Property, and any statute or regulation of the State of California,
including, without limitation, Section 1932(2) and 1933(4) of the California
Civil Code, with respect to any rights or obligations concerning damage or
destruction in the absence of an express agreement between the parties, and any
other statute or regulation, now or hereafter in effect, shall have no
application to this Lease or any damage or destruction to all or any part of the
Real Property.
ARTICLE 12
CONDEMNATION
If ten percent (10%) or more of the Premises or Building Complex shall be
taken by power of eminent domain or condemned by any competent authority for any
public or quasi-public use or purpose, or if Landlord shall grant a deed or
other instrument in lieu of such taking by eminent domain or condemnation,
Landlord shall have the option to terminate this Lease upon ninety (90) days'
notice to Tenant, provided such notice is given no later than one hundred eighty
(180) days after the date of such taking, condemnation, reconfiguration,
vacation, deed or other instrument. If more than twenty-five percent (25%) of
the rentable square feet of the Premises is taken, or if access to the Premises
is substantially impaired as a result of any taking of all or any portion of the
Building Complex, Tenant shall have the option to terminate this Lease upon
ninety (90) days' notice to Landlord, provided such notice is given no later
than one hundred eighty (180) days after the date of such taking. Landlord shall
be entitled to receive the entire award or payment in connection therewith,
except that Tenant shall have the right to file any separate claim available to
Tenant for any taking of Tenant's personal property and fixtures belonging to
Tenant and removable by Tenant upon expiration of the Lease Term pursuant to the
terms of this Lease, and for moving and relocation expenses and loss of
goodwill, so long as such claim does not diminish the award available to
Landlord, its ground lessor with respect to the Real Property or its mortgagee,
and such claim is payable separately to Tenant. All Rent shall be apportioned as
of the date of such termination, or the date of such taking, whichever shall
first occur. If any part of the Premises shall be taken, and this Lease shall
not be so terminated, the Base Rent and Tenant's Share of Direct Expenses shall
be proportionately abated. Tenant hereby waives any and all rights it might
otherwise have pursuant to Section 1265.130 of the California Code of Civil
Procedure.
ARTICLE 13
COVENANT OF QUIET ENJOYMENT
Landlord covenants that Tenant, on paying the Rent, charges for services
and other payments herein reserved and on keeping, observing and performing all
the other terms, covenants, conditions, provisions and agreements herein
contained on the part of Tenant to be kept, observed and performed, shall,
during the Lease Term, peaceably and quietly have, hold and enjoy the Premises
subject to the terms, covenants, conditions, provisions and agreements hereof
without interference by any persons lawfully claiming by or through Landlord.
The foregoing covenant is in lieu of any other covenant express or implied.
ARTICLE 14
ASSIGNMENT AND SUBLETTING
14.1 Transfers. Tenant shall not, without the prior written consent of
Landlord, assign, mortgage, pledge, hypothecate, encumber, or permit any lien to
attach to, or otherwise transfer, this Lease or any interest hereunder, permit
any assignment or other such foregoing transfer of this Lease or any interest
hereunder by operation of law, sublet the Premises or any part thereof, or
permit the use of the Premises by any persons other than Tenant and its
employees (all of the foregoing are hereinafter sometimes referred to
collectively as "Transfers" and any person to whom any Transfer is made or
sought to be made is hereinafter sometimes referred to as a "Transferee"). If
Tenant shall desire Landlord's consent to any Transfer, Tenant shall notify
Landlord in writing, which notice (the "Transfer Notice") shall include (i) the
proposed effective date of the Transfer, which shall not be less than forty-five
(45) days nor more than one hundred eighty (180) days after the date of delivery
of the Transfer Notice, (ii) a description of the portion of the Premises to be
transferred (the "Subject Space"), (iii) all of the terms of the proposed
Transfer and the consideration therefor, including a calculation of the
"Transfer Premium," as that term is defined in Section 14.3, below, in
connection with such Transfer, the name and address of the proposed Transferee,
and a copy of all existing and/or proposed documentation pertaining to the
proposed Transfer, including all existing operative documents to be executed to
evidence such Transfer or the agreements incidental or related to such Transfer,
(iv) current financial statements of the proposed Transferee certified by an
officer, partner or owner thereof, and (v) such other information as Landlord
may reasonably require. Any Transfer made without Landlord's prior written
consent shall, at Landlord's option, be null, void and of no effect, and shall,
at Landlord's option, constitute a default by Tenant under Section 19.1.7 of
this Lease. Whether or not Landlord consents to any proposed Transfer, Tenant
shall pay Landlord's review and processing fees, as well as any reasonable legal
fees incurred by Landlord, within thirty (30) days after written request by
Landlord.
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14.2 Landlord's Consent. Subject to Landlord's rights in Section 14.4
below, Landlord shall not unreasonably withhold or delay its consent to any
proposed Transfer of the Subject Space to the Transferee on the terms specified
in the Transfer Notice. The parties hereby agree that it shall be deemed to be
reasonable under this Lease and under any applicable law for Landlord to
withhold consent to any proposed Transfer where one or more of the following
apply, without limitation as to other reasonable grounds for withholding
consent:
14.2.1 The Transferee is of a character or reputation or engaged in a
business which is not consistent with the quality of the Building Complex;
14.2.2 The Transferee's intended use of the Subject Space is not
permitted under this Lease;
14.2.3 The Transferee is a governmental entity or agency;
14.2.4 The Transferee is not a party of reasonable financial worth
and/or financial stability in light of the responsibilities involved under
the Lease on the date consent is requested;
14.2.5 The proposed Transfer would cause Landlord to be in violation
of another lease or agreement to which Landlord is a party, or would give
an occupant of the Building Complex a right to cancel its lease; or
14.2.6 Either the proposed Transferee, or any person or entity which
directly or indirectly, controls, is controlled by, or is under common
control with, the proposed Transferee, (i) occupies space in the Building
Complex at the time of the request for consent, (ii) is negotiating with
Landlord to lease space in the Building Complex at such time, or (iii) has
negotiated with Landlord during the six (6)-month period immediately
preceding the Transfer Notice.
If Landlord consents to any Transfer pursuant to the terms of this
Section 14.2 (and does not exercise any recapture rights Landlord may have under
Section 14.4 of this Lease), Tenant may within six (6) months after Landlord's
consent, but not later than the expiration of said six-month period, enter into
such Transfer of the Premises or portion thereof, upon substantially the same
terms and conditions as are set forth in the Transfer Notice furnished by Tenant
to Landlord pursuant to Section 14.1 of this Lease, provided that if there are
any changes in the terms and conditions from those specified in the Transfer
Notice (i) such that Landlord would initially have been entitled to refuse its
consent to such Transfer under this Section 14.2, or (ii) which would cause the
proposed Transfer to be more favorable to the Transferee than the terms set
forth in Tenant's original Transfer Notice, Tenant shall again submit the
Transfer to Landlord for its approval and other action under this Article 14.
14.3 Transfer Premium. If Landlord consents to a Transfer, as a condition
thereto which the parties hereby agree is reasonable, Tenant shall pay to
Landlord fifty percent (50%) of the "Transfer Premium," as that term is defined
in this Section 14.3, received by Tenant from such Transferee. "Transfer
Premium" shall mean all rent, additional rent or other consideration payable by
such Transferee in connection with the Transfer which is in excess of the Rent
payable by Tenant under this Lease during the term of the Transfer, on a per
rentable square foot basis if less than all of the Premises is transferred,
after deducting the reasonable expenses incurred by Tenant for (i) any changes,
alterations and improvements to the Premises in connection with the Transfer,
and (ii) any brokerage commissions in connection with the Transfer. "Transfer
Premium" shall also include, but not be limited to, key money and bonus money
paid by Transferee to Tenant in connection with such Transfer, and any payment
in excess of fair market value for services rendered by Tenant to Transferee or
for assets, fixtures, inventory, equipment, or furniture transferred by Tenant
to Transferee in connection with such Transfer.
14.4 Landlord's Option as to Subject Space. Notwithstanding anything to the
contrary contained in this Article 14, in the event Tenant contemplates an
assignment or subletting of all or a portion of the Premises, Tenant shall give
Landlord notice (the "Intention to Transfer Notice") of such contemplated
assignment or subletting (whether or not the terms of the contemplated
assignment or subletting have been determined). The Intention to Transfer Notice
shall specify the portion of and amount of rentable square feet of the Premises
which Tenant intends to assign or sublet (the "Contemplated Transfer Space"),
the contemplated date of commencement of the contemplated assignment or
subletting (the "Contemplated Effective Date"), and the contemplated length of
the term of such contemplated subletting or assignment, and shall specify that
such Intention to Transfer Notice is delivered to Landlord pursuant to this
Section 14.4 in order to allow Landlord to elect to recapture the Contemplated
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Transfer Space for the term set forth in the Intention to Transfer Notice.
Thereafter, Landlord shall have the option, by giving written notice to Tenant
within thirty (30) days after receipt of any Intention to Transfer Notice, to
recapture the Contemplated Transfer Space; provided, however, if Landlord
delivers such recapture notice to Tenant, Tenant shall have the right to rescind
and withdraw its Intention to Transfer Notice, in which event, Landlord's
exercise of its right to recapture shall be ineffective, but Tenant shall not be
permitted to enter into a Transfer with respect to the Contemplated Transfer
Space without first serving Landlord a subsequent Intention to Transfer Notice
therefor pursuant to the provisions of this Section 14.4. If Tenant does not so
timely rescind, then such recapture by Landlord shall cancel and terminate this
Lease with respect to such Contemplated Transfer Space as of the Contemplated
Effective Date until the last day of the term of the contemplated assignment or
subletting as set forth in the Intention to Transfer Notice. In the event of a
recapture by Landlord, if this Lease shall be canceled with respect to less than
the entire Premises, the Rent reserved herein shall be prorated on the basis of
the number of rentable square feet retained by Tenant in proportion to the
number of rentable square feet contained in the Premises, and this Lease as so
amended shall continue thereafter in full force and effect, and upon request of
either party, the parties shall execute written confirmation of the same. If
Landlord declines, or fails to elect in a timely manner, to recapture such
Contemplated Transfer Space under this Section 14.4, then, subject to the other
terms of this Article 14, for a period of six (6) months (the "Six Month
Period") commencing on the last day of such thirty (30) day period, Landlord
shall not have any right to recapture the Contemplated Transfer Space with
respect to any assignment or subletting made during the Six Month Period,
provided that any such assignment or subletting is substantially on the terms
set forth in the Intention to Transfer Notice, and provided further that any
such assignment or subletting shall be subject to the remaining terms of this
Article 14. If such an assignment or subletting is not so consummated within the
Six Month Period (or if an assignment or subletting is so consummated, then upon
the expiration of the term of any assignment or subletting of such Contemplated
Transfer Space consummated within such Six Month Period), Tenant shall again be
required to submit a new Intention to Transfer Notice to Landlord with respect
any contemplated assignment or subletting, as provided above in this
Section 14.4.
14.5 Effect of Transfer. If Landlord consents to a Transfer, (i) the terms
and conditions of this Lease shall in no way be deemed to have been waived or
modified, (ii) such consent shall not be deemed consent to any further Transfer
by either Tenant or a Transferee, (iii) Tenant shall deliver to Landlord,
promptly after execution, an original executed copy of all documentation
pertaining to the Transfer in form reasonably acceptable to Landlord, (iv)
Tenant shall furnish upon Landlord's request a complete statement, certified by
an independent certified public accountant, or Tenant's chief financial officer,
setting forth in detail the computation of any Transfer Premium Tenant has
derived and shall derive from such Transfer, and (v) no Transfer relating to
this Lease or agreement entered into with respect thereto, whether with or
without Landlord's consent, shall relieve Tenant or any guarantor of the Lease
from liability under this Lease. Landlord or its authorized representatives
shall have the right at all reasonable times to audit the books, records and
papers of Tenant relating to any Transfer, and shall have the right to make
copies thereof. If the Transfer Premium with respect to any Transfer shall be
found understated, Tenant shall, within thirty (30) days after demand, pay the
deficiency and Landlord's costs of such audit.
14.6 Additional Transfers. For purposes of this Lease, subject to
Section 14.7 below, the term "Transfer" shall also include (i) if Tenant is a
partnership, the withdrawal or change, voluntary, involuntary or by operation of
law, of fifty percent (50%) or more of the partners, or transfer of twenty-five
percent or more of partnership interests, within a twelve (12)-month period, or
the dissolution of the partnership without immediate reconstitution thereof, and
(ii) if Tenant is a closely held corporation (i.e., whose stock is not publicly
held and not traded through an exchange or over the counter), (A) the
dissolution, merger, consolidation or other reorganization of Tenant, or (B) the
sale or other transfer of more than an aggregate of fifty percent (50%) of the
voting shares of Tenant (other than to immediate family members by reason of
gift or death), within a twelve (12)-month period, or (C) the sale, mortgage,
hypothecation or pledge of more than an aggregate of fifty percent (50%) of the
value of the unencumbered assets of Tenant within a twelve (12) month period.
14.7 Affiliated Companies/Restructuring of Business Organization. The
assignment or subletting by Tenant of all or any portion of this Lease or the
Premises to (i) a parent or subsidiary of Tenant, or (ii) any person or entity
which controls, is controlled by or under common control with Tenant, or
(iii) any entity which purchases all or substantially all of the assets of
Tenant, or (iv) any entity into which Tenant is merged or consolidated (all such
persons or entities described in (i), (ii), (iii) and (iv) being sometimes
hereinafter referred to as "Affiliates") shall not be deemed a Transfer under
this Article 14 and thus shall not be subject to the provisions of Sections 14.3
and 14.4 above, provided that:
14.7.1 Any such Affiliate was not formed as a subterfuge to avoid the
obligations of this Article 14;
14.7.2 Tenant gives Landlord prior notice of any such assignment or
sublease to an Affiliate;
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14.7.3 The successor of Tenant and Tenant have as of the effective
date of any such assignment or sublease a tangible net worth, in the
aggregate, computed in accordance with generally accepted accounting
principles (but excluding goodwill as an asset), which is sufficient to
meet the obligations of Tenant under this Lease;
14.7.4 Any such assignment or sublease shall be subject to all of the
terms and provisions of this Lease, and such assignee or sublessee shall
assume, in a written document reasonably satisfactory to Landlord and
delivered to Landlord upon or prior to the effective date of such
assignment or sublease, all the obligations of Tenant under this Lease
(provided, however, no such written assignment shall be required where only
stock (and no assets) are transferred in connection with any transaction
described in the foregoing provisions of this Section 14.7); and
14.7.5 Tenant and any guarantor shall remain fully liable for all
obligations to be performed by Tenant under this Lease.
14.8 Permitted Subleases. Notwithstanding the foregoing provisions of this
Article 14 to the contrary, Tenant shall have the right to sublease, in the
aggregate, up to twenty-five percent (25%) of the rentable square feet of the
Premises to any person or entity which is a client or customer of Tenant or
which is providing service for Tenant or Tenant's clients, without having to
obtain Landlord's prior consent and without being subject to Landlord's
recapture right in Section 14.4 above or Landlord's right to receive any
Transfer Premium in Section 14.3 above, so long as (i) Tenant provides Landlord
notice of such sublease, the identity of the sublessee and terms of the sublease
at least ten (10) business days prior to the effective date of the sublease,
(ii) such sublease shall be subject and subordinate to, and the sublessee agrees
in writing delivered to Landlord prior to the effective date of the sublease to
be bound by, all of the terms and provisions of this Lease, (iii) there shall be
no separate demising walls or separate entrance doors for the portion of the
subleased Premises, (iv) the term of such sublease shall be no longer than one
(1) year, and (v) such sublease or relationship was not created or entered into
as a subterfuge to avoid the obligations set forth in this Article 14.
ARTICLE 15
SURRENDER OF PREMISES;
REMOVAL OF TRADE FIXTURES
15.1 Surrender of Premises. No act or thing done by Landlord or any agent
or employee of Landlord during the Lease Term shall be deemed to constitute an
acceptance by Landlord of a surrender of the Premises unless such intent is
specifically acknowledged in a writing signed by Landlord. The delivery of keys
to the Premises to Landlord or any agent or employee of Landlord shall not
constitute a surrender of the Premises or effect a termination of this Lease,
whether or not the keys are thereafter retained by Landlord, and notwithstanding
such delivery Tenant shall be entitled to the return of such keys at any
reasonable time upon request until this Lease shall have been terminated. The
voluntary or other surrender of this Lease by Tenant, whether accepted by
Landlord or not, or a mutual termination hereof, shall not work a merger, and at
the option of Landlord shall operate as an assignment to Landlord of all
subleases or subtenancies affecting the Premises.
15.2 Removal of Tenant Property by Tenant. All articles of personal
property and all business and trade fixtures, machinery and equipment, furniture
and movable partitions owned by Tenant or installed by Tenant at its expense in
the Premises, which items are not a part of the tenant improvements installed in
the Premises, shall remain the property of Tenant, and may be removed by Tenant
at any time during the Lease Term as long as Tenant is not in default under this
Lease with any applicable cure period having expired. Upon the expiration of the
Lease Term, or upon any earlier termination of this Lease, Tenant shall, subject
to the provisions of this Article 15, quit and surrender possession of the
Premises to Landlord in as good order and condition as when Tenant took
possession and as thereafter improved by Landlord and/or Tenant, reasonable wear
and tear and repairs which are specifically made the responsibility of Landlord
hereunder excepted. Upon such expiration or termination, Tenant shall, without
expense to Landlord, remove or cause to be removed from the Premises all debris
and rubbish, and such items of furniture, equipment, free-standing cabinet work,
and other articles of personal property owned by Tenant or installed or placed
by Tenant at its expense in the Premises, and such similar articles of any other
persons claiming under Tenant, as Landlord may, in its sole discretion, require
to be removed, and Tenant shall repair at its own expense all damage to the
Premises and Building resulting from such removal.
ARTICLE 16
HOLDING OVER
If Tenant holds over after the expiration of the Lease Term, with or
without the express or implied consent of Landlord, such tenancy shall be from
month-to-month only, and shall not constitute a renewal hereof or an extension
for any further term, and in such case Base Rent shall be payable at a monthly
rate equal to: (A) for the first two (2) months of the holdover, one hundred
fifty percent (150%) of the greater of (i) the Base Rent applicable during the
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last rental period of the Lease Term under this Lease or (ii) the fair market
rental rate for the Premises as of the commencement of such holdover period; and
(B) for the remainder of the holdover period, two hundred percent (200%) of the
greater of (i) the Base Rent applicable during the last rental period of the
Lease Term under this Lease or (ii) the fair market rental rate for the Premises
as of the third (3rd) month of such holdover period. Such month-to-month tenancy
shall be subject to every other applicable term, covenant and agreement
contained herein. Nothing contained in this Article 16 shall be construed as
consent by Landlord to any holding over by Tenant, and Landlord expressly
reserves the right to require Tenant to surrender possession of the Premises to
Landlord as provided in this Lease upon the expiration or other termination of
this Lease. The provisions of this Article 16 shall not be deemed to limit or
constitute a waiver of any other rights or remedies of Landlord provided herein
or at law. Tenant acknowledges that if Tenant holds over without Landlord's
consent, such holding over may compromise or otherwise affect Landlord's ability
to enter into new leases with prospective tenants regarding the Premises.
Therefore, if Tenant fails to surrender the Premises upon the termination or
expiration of this Lease, in addition to any other liabilities to Landlord
accruing therefrom, Tenant shall protect, defend, indemnify and hold Landlord
harmless from and against all Claims resulting from such failure, including,
without limiting the generality of the foregoing, any claims made by any
succeeding tenant founded upon such failure to surrender, and any losses
suffered by Landlord, including lost profits, resulting from such failure to
surrender.
ARTICLE 17
ESTOPPEL CERTIFICATES
Within ten (10) days following a request in writing by Landlord, Tenant
shall execute and deliver to Landlord an estoppel certificate which, as
submitted by Landlord, shall be substantially in the form of Exhibit E, attached
hereto (or such other form as may be required by any prospective mortgagee or
purchaser of the Building Complex or any portion thereof), indicating therein
any exceptions thereto that may exist at that time, and shall also contain any
other information reasonably requested by Landlord or Landlord's mortgagee or
prospective mortgagee or purchasers. Tenant shall execute and deliver whatever
other instruments may be reasonably required for such purposes. At any time
during the Lease Term, Landlord may require Tenant to provide Landlord with a
current financial statement and financial statements of the two (2) years prior
to the current financial statement year. Such statements 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. Failure of Tenant to timely execute and deliver such estoppel
certificate or other instruments shall constitute an acceptance of the Premises
and an acknowledgment by Tenant that statements included in the estoppel
certificate are true and correct, without exception.
ARTICLE 18
SUBORDINATION
This Lease shall be subject and subordinate to any ground or underlying
leases of the Real Property and to the lien of any mortgages or trust deeds, now
or hereafter in force against the Real Property, if any, and to all renewals,
extensions, modifications, consolidations and replacements thereof, and to all
advances made or hereafter to be made upon the security of such mortgages or
trust deeds, unless the holders of such mortgages or trust deeds, or the lessors
under such ground lease or underlying leases, require in writing that this Lease
be superior thereto. A condition precedent to the subordination of this Lease to
any future ground or underlying lease or to the lien of any future mortgage or
deed of trust is that Landlord shall obtain for the benefit of Tenant a
commercially reasonable subordination, non-disturbance and attornment agreement
from the lessor or lender of such future instrument. Tenant covenants and agrees
in the event any proceedings are brought for the foreclosure of any such
mortgage or deed in lieu thereof, to attorn, without any deductions or set-offs
whatsoever, to the purchaser upon any such foreclosure sale or deed in lieu
thereof if so requested to do so by such purchaser, and to recognize such
purchaser as the lessor under this Lease. Tenant shall, within five (5) days of
request by Landlord, execute such further instruments or assurances as Landlord
may reasonably deem necessary to evidence or confirm the subordination or
superiority of this Lease to any such mortgages, trust deeds, ground leases or
underlying leases provided that any such subordination agreement contains a
nondisturbance agreement as set forth above. Tenant waives the provisions of any
current or future statute, rule or law which may give or purport to give Tenant
any right or election to terminate or otherwise adversely affect this Lease and
the obligations of the Tenant hereunder in the event of any foreclosure
proceeding or sale.
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ARTICLE 19
DEFAULTS; REMEDIES
19.1 Defaults. All covenants and agreements to be kept or performed by
Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and
expense and without any reduction of Rent. The occurrence of any of the
following shall constitute a default of this Lease by Tenant:
19.1.1 Any failure by Tenant to pay any Rent or any other charge
required to be paid under this Lease, or any part thereof, when due, where
such failure continues for three (3) business days after notice thereof
from Landlord; provided however, that any such notice shall be in lieu of,
and not in addition to, any notice required under California Code of Civil
Procedure Section 1161 or any similar or successor law; or
19.1.2 Any failure by Tenant to observe or perform any other
provision, covenant or condition of this Lease to be observed or performed
by Tenant where such failure continues for thirty (30) days after written
notice thereof from Landlord to Tenant; provided however, that any such
notice shall be in lieu of, and not in addition to, any notice required
under California Code of Civil Procedure Section 1161 or any similar or
successor law; and provided further that if the nature of such default is
such that the same cannot reasonably be cured within a thirty (30) day
period, Tenant shall not be deemed to be in default if it diligently
commences such cure within such period and thereafter diligently proceeds
to rectify and cure said default, as soon as possible.
19.2 Remedies Upon Default. Upon the occurrence of such default by Tenant,
Landlord shall have, in addition to any other remedies available to Landlord at
law or in equity, the option to pursue any one or more of the following
remedies, each and all of which shall be cumulative and nonexclusive, without
any notice or demand whatsoever.
19.2.1 Terminate this Lease, in which event Tenant shall immediately
surrender the Premises to Landlord, and if Tenant fails to do so, Landlord
may, without prejudice to any other remedy which it may have for possession
or arrearages in rent, enter upon and take possession of the Premises and
expel or remove Tenant and any other person who may be occupying the
Premises or any part thereof, without being liable for prosecution or any
claim or damages therefor; and Landlord may recover from Tenant the
following:
(i) The worth at the time of award of any unpaid rent which has
been earned at the time of such termination; plus
(ii) 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 rental loss that Tenant
proves could have been reasonably avoided; plus
(iii) 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 rental loss that Tenant proves could have
been reasonably avoided; plus
(iv) Any other amount necessary to compensate Landlord for all
the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease or which in the ordinary course of things
would be likely to result therefrom, specifically including but not
limited to, brokerage commissions and advertising expenses incurred,
expenses of remodeling the Premises or any portion thereof for a new
tenant, whether for the same or a different use, and any special
concessions made to obtain a new tenant; and
(v) At Landlord's election, such other amounts in addition to or
in lieu of the foregoing as may be permitted from time to time by
applicable law.
The term "rent" as used in this Section 19.2 shall be deemed to be and to mean
all sums of every nature required to be paid by Tenant pursuant to the terms of
this Lease, whether to Landlord or to others. As used in Section 19.2.1(i) and
(ii), above, the "worth at the time of award" shall be computed by allowing
interest at the Interest Rate set forth in Section 4.2.4 of this Lease, but in
no case greater than the maximum amount of such interest permitted by law. As
used in Section 19.2.1(iii) above, the "worth at the time of award" shall be
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award plus one percent (1%).
19.2.2 Landlord shall have the remedy described in California Civil
Code Section 1951.4 (lessor may continue lease in effect after lessee's
breach and abandonment and recover rent as it becomes due, if lessee has
the right to sublet or assign, subject only to reasonable limitations).
Accordingly, if Landlord does not elect to terminate this Lease on account
of any default by Tenant, Landlord may, from time to time, without
terminating this Lease, enforce all of its rights and remedies under this
Lease, including the right to recover all rent as it becomes due.
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19.2.3 Landlord may, but shall not be obligated to, make any such
payment or perform or otherwise cure any such obligation, provision,
covenant or condition on Tenant's part to be observed or performed (and may
enter the Premises for such purposes). In the event of Tenant's failure to
perform any of its obligations or covenants under this Lease, and such
failure to perform poses a material risk of injury or harm to persons or
damage to or loss of property, then Landlord shall have the right to cure
or otherwise perform such covenant or obligation at any time after such
failure to perform by Tenant, whether or not any such notice or cure period
set forth in Section 19.1 above has expired. Any such actions undertaken by
Landlord pursuant to the foregoing provisions of this Section 19.2.3 shall
not be deemed a waiver of Landlord's rights and remedies as a result of
Tenant's failure to perform and shall not release Tenant from any of its
obligations under this Lease.
19.3 Payment by Tenant. Tenant shall pay to Landlord, within fifteen (15)
days after delivery by Landlord to Tenant of statements therefor: (i) sums equal
to expenditures reasonably made and obligations incurred by Landlord in
connection with Landlord's performance or cure of any of Tenant's obligations
pursuant to the provisions of Section 19.2.3 above; and (ii) sums equal to all
expenditures made and obligations incurred by Landlord in collecting or
attempting to collect the Rent or in enforcing or attempting to enforce any
rights of Landlord under this Lease or pursuant to law, including, without
limitation, all legal fees and other amounts so expended. Tenant's obligations
under this Section 19.3 shall survive the expiration or sooner termination of
the Lease Term.
19.4 Subleases of Tenant. Whether or not Landlord elects to terminate this
Lease on account of any default by Tenant, as set forth in this Article 19,
following any such default by Tenant, Landlord shall have the right to terminate
any and all subleases, licenses, concessions or other consensual arrangements
for possession entered into by Tenant and affecting the Premises or may, in
Landlord's sole discretion, succeed to Tenant's interest in such subleases,
licenses, concessions or arrangements. In the event of Landlord's election to
succeed to Tenant's interest in any such subleases, licenses, concessions or
arrangements, Tenant shall, as of the date of notice by Landlord of such
election, have no further right to or interest in the rent or other
consideration receivable thereunder.
19.5 Waiver of Default. No waiver by Landlord of any violation or breach by
Tenant of any of the terms, provisions and covenants herein contained shall be
deemed or construed to constitute a waiver of any other or later violation or
breach by Tenant of the same or any other of the terms, provisions, and
covenants herein contained. Forbearance by Landlord in enforcement of one or
more of the remedies herein provided upon a default by Tenant shall not be
deemed or construed to constitute a waiver of such default. The acceptance of
any Rent hereunder by Landlord following the occurrence of any default, whether
or not known to Landlord, shall not be deemed a waiver of any such default,
except only a default in the payment of the Rent so accepted.
19.6 Efforts to Relet. For the purposes of this Article 19, Tenant's right
to possession shall not be deemed to have been terminated by efforts of Landlord
to relet the Premises, by its acts of maintenance or preservation with respect
to the Premises, or by appointment of a receiver to protect Landlord's interests
hereunder. The foregoing enumeration is not exhaustive, but merely illustrative
of acts which may be performed by Landlord without terminating Tenant's right to
possession.
ARTICLE 20
[INTENTIONALLY DELETED]
ARTICLE 21
SIGNS
21.1 Full Floor Tenants. Subject to Landlord's prior written approval, in
its reasonable discretion, and provided all signs are in keeping with the
quality, design and style of the Building Complex, Tenant, at its sole cost and
expense, may install identification signage anywhere in the Premises including
in the elevator lobbies of the Building, provided that such signs must not be
visible from the exterior of the Building.
21.2 Prohibited Signage and Other Items. Any signs, notices, logos,
pictures, names or advertisements which are installed and that have not been
separately approved by Landlord may be removed without notice by Landlord at the
sole expense of Tenant. Except as provided in Section 21.3 below, Tenant may not
install any signs on the exterior or roof of the Building or the common areas of
the Real Property. Any signs, window coverings, or blinds (even if the same are
located behind the Landlord approved window coverings for the Building), or
other items visible from the exterior of the Premises or Building are subject to
the prior written approval of Landlord, in its sole discretion.
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21.3 Building Exterior Sign. Subject to Tenant obtaining the approval of
all applicable governmental entities and Tenant's compliance with all applicable
governmental laws and ordinances and the terms of this Section 21.3, Tenant
shall have the right to install, at Tenant's cost, one (1) sign displaying
Tenant's logo and Tenant's name, "StyleClick.com" (or such other trade name used
by Tenant in a majority of its other locations, to the extent such other trade
names are not offensive to Landlord in Landlord's reasonable discretion) (the
"Building Exterior Sign") on either the top of or at the eyebrow level of the
exterior of the Building on the side of the Building facing Goldleaf Circle
Drive. The exact location of the Building Exterior Sign shall be designated by
Landlord. The graphics, materials, color, design, lettering, lighting, size,
specifications, and manner of affixing the Building Exterior Sign shall be
subject to Landlord's approval. Tenant shall pay for all costs and expenses
related to the Building Exterior Sign, including, without limitation, costs of
the design, construction, installation, maintenance, insurance, utilities,
repair and replacement of the Building Exterior Sign. Tenant shall install and
maintain the Building Exterior Sign in compliance with all laws and subject to
the applicable provisions of Articles 8 and 9 above
21.3.1 Transferability. The rights to the Building Exterior Sign are
personal to the original Tenant executing this Lease and may not be transferred
or assigned by the original Tenant or used by anyone else. In addition, at
Landlord's option, Tenant shall no longer have the right to the Building
Exterior Sign if after the Lease Commencement Date, the original Tenant fails to
occupy at least seventy-five percent (75%) of the Premises.
21.3.2 Maintenance/Removal. Should the Building Exterior Sign require
maintenance, repairs or replacement as determined in Landlord's reasonable
judgment, Landlord shall have the right to provide written notice thereof to
Tenant and Tenant shall cause such repairs, replacement and/or maintenance to be
performed within fifteen (15) days after receipt of such notice from Landlord,
at Tenant's sole cost and expense; provided, however, if such repairs,
replacement and/or maintenance are reasonably expected to require longer than
fifteen (15) days to perform, Tenant shall commence such repairs, replacement
and/or maintenance within such fifteen (15) day period and shall diligently
prosecute such repairs, replacement and maintenance to completion. Should Tenant
fail to perform such maintenance, repairs or replacement within the periods
described in the immediately preceding sentence, Landlord shall have the right
to cause such work to be performed and to charge Tenant as Additional Rent for
the costs of such work. Upon the expiration or earlier termination of this Lease
or the loss of Tenant's rights to the Building Exterior Sign, Tenant shall, at
Tenant's sole cost and expense, cause the Building Exterior Sign to be removed,
and Tenant shall repair all damage (including discoloration of the Building
exterior) occasioned thereby and restore the affected areas to their original
condition prior to the installation of Building Exterior Sign. If Tenant fails
to remove such sign and repair and restore the affected areas as provided in the
immediately preceding sentence prior to the expiration or earlier termination of
this Lease, then Landlord may perform such work, and all costs and expenses
incurred by Landlord in so performing such work shall be reimbursed by Tenant to
Landlord within twenty (20) days after Tenant's receipt of invoice therefor. The
immediately preceding sentence shall survive the expiration or earlier
termination of this Lease. Tenant shall be responsible for maintaining insurance
on the Building Exterior Sign as part of the insurance required to be carried by
Tenant pursuant to Article 10 above.
ARTICLE 22
COMPLIANCE WITH LAW
Tenant shall not do anything or suffer anything to be done in or about the
Premises which will in any way conflict with any law, statute, ordinance or
other governmental rule, regulation or requirement now in force or which may
hereafter be enacted or promulgated. At its sole cost and expense, Tenant shall
promptly comply with all such governmental measures (including those pertaining
to Hazardous Materials), other than the making of structural changes to the
Building or changes to the Building's base, shell and core systems
(collectively, the "Excluded Changes"), except to the extent such Excluded
Changes are required due to Tenant's alterations to or manner of use of the
Premises. In addition, Tenant shall fully comply with all present or future
programs intended to manage parking, transportation or traffic in and around the
Building, and in connection therewith, Tenant shall take responsible action for
the transportation planning and management of all employees located at the
Premises by working directly with Landlord, any governmental transportation
management organization or any other transportation-related committees or
entities. The judgment of any court of competent jurisdiction or the admission
of Tenant in any judicial action, regardless of whether Landlord is a party
thereto, that Tenant has violated any of said governmental measures, shall be
conclusive of that fact as between Landlord and Tenant.
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ARTICLE 23
ENTRY BY LANDLORD
Landlord reserves the right at all reasonable times and upon reasonable
notice to the Tenant to enter the Premises to: (i) inspect them; (ii) show the
Premises to prospective purchasers, mortgagees or ground or underlying lessors,
or, during the last twelve (12) months of the Lease Term, prospective tenants;
(iii) post notices of nonresponsibility; or (iv) alter, improve or repair the
Premises or the Building if necessary to comply with current building codes or
other applicable laws, or for structural alterations, repairs or improvements to
the Building, or as Landlord may otherwise reasonably desire or deem necessary.
Notwithstanding anything to the contrary contained in this Article 23, Landlord
may enter the Premises at any time, without notice to Tenant, to perform
janitorial and other services required of Landlord. Any such entries shall be
without the abatement of Rent and shall include the right to take such
reasonable steps as required to accomplish the stated purposes; provided,
however, that any such entry shall be accomplished as expeditiously as
reasonably possible and in a manner so as to cause as little interference to
Tenant as reasonably possible. Tenant hereby waives any claims for damages or
for any injuries or inconvenience to or interference with Tenant's business,
lost profits, any loss of occupancy or quiet enjoyment of the Premises, and any
other loss occasioned by Landlord's entry into the Premises. For each of the
above purposes, Landlord shall at all times have a key with which to unlock all
the doors in the Premises, excluding Tenant's vaults, safes and special security
areas designated in advance by Tenant. In an emergency, Landlord shall have the
right to use any means that Landlord may deem proper to open the doors in and to
the Premises. Any entry into the Premises by Landlord in the manner hereinbefore
described shall not be deemed to be a forcible or unlawful entry into, or a
detainer of, the Premises, or an actual or constructive eviction of Tenant from
any portion of the Premises.
ARTICLE 24
TENANT PARKING
Tenant shall rent throughout the Lease Term the number of unreserved
parking passes set forth in Section 11 of the Summary, in location in the
Building Complex Parking Area as designated by Landlord from time to time.
During the Lease Term, Tenant shall have the right, from time to time, upon
thirty (30) days advance written notice from Tenant to Landlord, to increase or
decrease the number of unreserved parking passes which Tenant shall lease, but
in no event shall Tenant at anytime lease less than the number set forth in
Section 11 of the Summary, or more than an aggregate of eighty-two (82)
unreserved parking passes. Tenant shall pay to Landlord for the use of such
parking passes, on a monthly basis, the prevailing rate charged from time to
time by Landlord or Landlord's parking operator for parking passes in the
Building Complex Parking Area where such parking passes are located (the current
parking rate is $50.00 per month per unreserved parking pass), plus all
applicable parking taxes; provided, however, the prevailing rate charged by
Landlord or Landlord's parking operator for such parking passes shall not exceed
the rates charged by other landlords or parking operators of comparable
first-class buildings with parking facilities of comparable size in the Culver
City area which charge for parking. Tenant's continued right to use the parking
spaces is conditioned upon Tenant abiding by all rules and regulations which are
prescribed from time to time for the orderly operation and use of the Building
Complex Parking Area and upon Tenant's cooperation in seeing that Tenant's
employees and visitors also comply with such rules and regulations. In addition,
Landlord may assign any parking spaces and/or make all or a portion of such
spaces reserved or institute an attendant-assisted tandem parking program and/or
valet parking program if Landlord determines in its sole discretion that such is
necessary or desirable for orderly and efficient parking. Landlord specifically
reserves the right, from time to time, to change the size, configuration,
design, layout, location and all other aspects of the Building Complex Parking
Area, and Tenant acknowledges and agrees that Landlord, from time to time, may,
without incurring any liability to Tenant and without any abatement of Rent
under this Lease temporarily close-off or restrict access to the Building
Complex Parking Area, or temporarily relocate Tenant's parking spaces to other
parking structures and/or surface parking areas within a reasonable distance
from the Building Complex Parking Area, for purposes of permitting or
facilitating any such construction, alteration or improvements or to accommodate
or facilitate renovation, alteration, construction or other modification of
other improvements or structures located on the Real Property. Landlord may
delegate its responsibilities hereunder to a parking operator in which case such
parking operator shall have all the rights of control attributed hereby to
Landlord. The parking rates charged by Landlord for Tenant's parking passes
shall be exclusive of any parking tax or other charges imposed by governmental
authorities in connection with the use of such parking, which taxes and/or
charges shall be paid directly by Tenant or the parking users, or, if directly
imposed against Landlord, Tenant shall reimburse Landlord for all such taxes
and/or charges within ten (10) days after Tenant's receipt of the invoice from
Landlord. Landlord shall provide validation stamps for visitor parking in the
Building Complex Parking Area which Tenant may purchase such validation stamps,
from Tenant's own funds, at the prevailing rate charged for such validation
stamps plus all applicable parking taxes.
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ARTICLE 25
MISCELLANEOUS PROVISIONS
25.1 Binding Effect. Each of the provisions of this Lease shall extend to
and shall, as the case may require, bind or inure to the benefit not only of
Landlord and of Tenant, but also of their respective successors or assigns,
provided this clause shall not permit any assignment by Tenant contrary to the
provisions of Article 14 of this Lease.
25.2 No Air Rights. No rights to any view or to light or air over any
property, whether belonging to Landlord or any other person, are granted to
Tenant by this Lease. If at any time any windows of the Premises are temporarily
darkened or the light or view therefrom is obstructed by reason of any repairs,
improvements, maintenance or cleaning in or about the Building, the same shall
be without liability to Landlord and without any reduction or diminution of
Tenant's obligations under this Lease.
25.3 Modification of Lease. Should any current or prospective mortgagee or
ground lessor for the Building Complex require a modification or modifications
of this Lease, which modification or modifications will not cause an increased
cost or expense to Tenant or in any other way materially and adversely change
the rights and obligations of Tenant hereunder, then and in such event, Tenant
agrees that this Lease may be so modified and agrees to execute whatever
documents are required therefor and deliver the same to Landlord within ten (10)
days following the request therefor. Should Landlord or any such prospective
mortgagee or ground lessor require execution of a short form of Lease for
recording, containing, among other customary provisions, the names of the
parties, a description of the Premises and the Lease Term, Tenant agrees to
execute such short form of Lease and to deliver the same to Landlord within ten
(10) days following the request therefor.
25.4 Transfer of Landlord's Interest. Tenant acknowledges that Landlord has
the right to transfer all or any portion of its interest in the Real Property
and in this Lease, and Tenant agrees that in the event of any such transfer and
a transfer of the Security Deposit, Landlord shall automatically be released
from all liabilities and obligations under this Lease arising after the
effective date of such transfer provided the transferee agrees in writing to
assume such future liabilities and obligations, and Tenant agrees to look solely
to such transferee for the performance of Landlord's obligations hereunder
arising after the date of transfer. Tenant further acknowledges that Landlord
may assign its interest in this Lease to the holder of any mortgage or deed of
trust as additional security, but agrees that such an assignment shall not
release Landlord from its obligations hereunder and that Tenant shall continue
to look to Landlord for the performance of its obligations hereunder.
25.5 Prohibition Against Recording. Except as provided in Section 25.3 of
this Lease, neither this Lease, nor any memorandum, affidavit or other writing
with respect thereto, shall be recorded by Tenant or by anyone acting through,
under or on behalf of Tenant, and the recording thereof in violation of this
provision shall make this Lease null and void at Landlord's election.
25.6 Captions. The captions of Articles and Section are for convenience
only and shall not be deemed to limit, construe, affect or alter the meaning of
such Articles and Sections.
25.7 Relationship of Parties. Nothing contained in this Lease shall be
deemed or construed by the parties hereto or by any third party to create the
relationship of principal and agent, partnership, joint venturer or any
association between Landlord and Tenant, it being expressly understood and
agreed that neither the method of computation of Rent nor any act of the parties
hereto shall be deemed to create any relationship between Landlord and Tenant
other than the relationship of landlord and tenant.
25.8 Time of Essence. Time is of the essence of this Lease and each of its
provisions.
25.9 Partial Invalidity. If any term, provision or condition contained in
this Lease shall, to any extent, be invalid or unenforceable, the remainder of
this Lease, or the application of such term, provision or condition to persons
or circumstances other than those with respect to which it is invalid or
unenforceable, shall not be affected thereby, and each and every other term,
provision and condition of this Lease shall be valid and enforceable to the
fullest extent possible permitted by law.
25.10 Landlord Exculpation. It is expressly understood and agreed that
notwithstanding anything in this Lease to the contrary, and notwithstanding any
applicable law to the contrary, the liability of Landlord and the Landlord
Parties hereunder (including any successor landlord) and any recourse by Tenant
against Landlord or the Landlord Parties (including any successor landlord)
shall be limited solely and exclusively to an amount which is equal to the
interest of Landlord in the Building Complex, and neither Landlord, nor any of
the Landlord Parties shall have any personal liability therefor, and Tenant
hereby expressly waives and releases such personal liability on behalf of itself
and all persons claiming by, through or under Tenant.
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25.11 Entire Agreement. It is understood and acknowledged that there are no
oral agreements between the parties hereto affecting this Lease and this Lease
supersedes and cancels any and all previous negotiations, arrangements,
brochures, agreements and understandings, if any, between the parties hereto or
displayed by Landlord to Tenant with respect to the subject matter thereof, and
none thereof shall be used to interpret or construe this Lease. This Lease, the
exhibits and schedules attached hereto, and any side letter or separate
agreement executed by Landlord and Tenant in connection with this Lease and
dated of even date herewith contain all of the terms, covenants, conditions,
warranties and agreements of the parties relating in any manner to the rental,
use and occupancy of the Premises, shall be considered to be the only agreement
between the parties hereto and their representatives and agents, and none of the
terms, covenants, conditions or provisions of this Lease can be modified,
deleted or added to except in writing signed by the parties hereto.
25.12 Right to Lease. Landlord reserves the absolute right to effect such
other tenancies in the Building Complex as Landlord in the exercise of its sole
business judgment shall determine to best promote the interests of the Building
Complex. Tenant does not rely on the fact, nor does Landlord represent, that any
specific tenant or type or number of tenants shall, during the Lease Term,
occupy any space in the Building Complex.
25.13 Force Majeure. Any prevention, delay or stoppage due to strikes,
lockouts, labor disputes, acts of God, inability to obtain services, labor, or
materials or reasonable substitutes therefor, governmental actions, civil
commotions, fire or other casualty, and other causes beyond the reasonable
control of the party obligated to perform (collectively, the "Force Majeure"),
except with respect to the obligations imposed with regard to Rent and other
charges to be paid by Tenant pursuant to this Lease, and except as to Tenant's
obligations under Exhibit D, notwithstanding anything to the contrary contained
in this Lease, shall excuse the performance of such party for a period equal to
any such prevention, delay or stoppage and, therefore, if this Lease specifies a
time period for performance of an obligation of either party, that time period
shall be extended by the period of any delay in such party's performance caused
by a Force Majeure.
25.14 Notices. All notices, demands, statements, approvals or
communications (collectively, "Notices") given or required to be given by either
party to the other hereunder shall be in writing, shall be sent by United States
certified or registered mail, postage prepaid, return receipt requested, or
delivered personally (i) to Tenant at the appropriate address set forth in
Section 5 of the Summary, or to such other place as Tenant may from time to time
designate in a Notice to Landlord; or (ii) to Landlord at the addresses set
forth in Section 3 of the Summary, or to such other firm or to such other place
as Landlord may from time to time designate in a Notice to Tenant. Any Notice
will be deemed given on the date which is two (2) business days after it is
mailed as provided in this Section 25.14 or upon the date personal delivery is
made. If Tenant is notified of the identity and address of Landlord's mortgagee
or ground or underlying lessor, Tenant shall give to such mortgagee or ground or
underlying lessor written notice of any default by Landlord under the terms of
this Lease by registered or certified mail, and such mortgagee or ground or
underlying lessor shall be given a reasonable opportunity to cure such default
prior to Tenant's exercising any remedy available to Tenant.
25.15 Joint and Several. If there is more than one Tenant, the obligations
imposed upon Tenant under this Lease shall be joint and several.
25.16 Authority. If Tenant is a corporation or partnership, each individual
executing this Lease on behalf of Tenant hereby represents and warrants that
Tenant is a duly formed and existing entity qualified to do business in
California and that Tenant has full right and authority to execute and deliver
this Lease and that each person signing on behalf of Tenant is authorized to do
so.
25.17 Governing Law. This Lease shall be construed and enforced in
accordance with the laws of the State of California.
25.18 Submission of Lease. Submission of this instrument for examination or
signature by Tenant does not constitute a reservation of or an option for lease,
and it is not effective as a lease or otherwise until execution and delivery by
both Landlord and Tenant.
25.19 Brokers. Landlord and Tenant hereby warrant to each other that they
have had no dealings with any real estate broker or agent in connection with the
negotiation of this Lease, excepting only the real estate brokers or agents
specified in Section 12 of the Summary and Landlord's designated representative
(the "Brokers"), and that they know of no other real estate broker or agent who
is entitled to a commission in connection with this Lease. Landlord shall pay
the brokerage commissions owing to the Brokers in connection with the
transaction contemplated by this Lease pursuant to the terms of a separate
written agreement between Landlord and the Brokers. Each party agrees to
indemnify, defend, protect and hold the other party harmless from and against
any and all Claims with respect to any leasing commission or equivalent
compensation alleged to be owing on account of the indemnifying party's dealings
with any real estate broker or agent other than the Brokers. The terms of this
Section 25.19 shall survive the expiration or earlier termination of the Lease
Term.
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25.20 Independent Covenants. This Lease shall be construed as though the
covenants herein between Landlord and Tenant are independent and not dependent
and Tenant hereby expressly waives the benefit of any statute to the contrary
and agrees that if Landlord fails to perform its obligations set forth herein,
Tenant shall not be entitled to make any repairs or perform any acts hereunder
at Landlord's expense or to any setoff of the Rent or other amounts owing
hereunder against Landlord; provided, however, that the foregoing shall in no
way impair the right of Tenant to commence a separate action against Landlord
for any violation by Landlord of the provisions hereof so long as notice is
first given to Landlord and any holder of a mortgage or deed of trust covering
the Building, Real Property or any portion thereof, of whose address Tenant has
theretofore been notified, and an opportunity is granted to Landlord and such
holder to correct such violations as provided above.
25.21 Building Name and Signage. Landlord shall have the right at any time
to designate and/or change the name of the Building Complex or any building in
the Building Complex, and to install, affix and maintain any and all signs on
the exterior and on the interior of the Building Complex or any building in the
Building Complex, as Landlord may, in Landlord's sole discretion, desire;
provided, however, Landlord shall not change the name of the Building or install
any tenant identification signs in the Building during the time that Tenant
retains its right to the Exterior Building Sign. Tenant shall not use the name
of the Building Complex or any building in the Building Complex (other than the
Building while Tenant's Building Exterior Sign is located on the Building), or
use pictures or illustrations of the Building Complex, the Building or any other
building in the Building Complex, in advertising or other publicity, without the
prior written consent of Landlord.
25.22 Successors. Except as otherwise expressly provided herein, the
obligations of this Lease shall bind and benefit the successors and assigns of
the parties hereto; provided, however, that no assignment, sublease or other
transfer in violation of the provisions of Article 14 shall operate to vest any
rights in any putative assignee, subtenant or transferee of Tenant.
25.23 Landlord Renovations. It is specifically understood and agreed that
Landlord has made no representation or warranty to Tenant and has no obligation
to alter, remodel, improve, renovate, repair or decorate the Premises, Building,
Building Complex or any part thereof and that no representations respecting the
condition of the Premises or the Building Complex have been made by Landlord to
Tenant except as specifically set forth herein or in the Tenant Work Letter.
However, Tenant acknowledges that Landlord may during the Lease Term renovate,
improve, alter, or modify (collectively, the "Renovations") the Building,
Premises, and/or Real Property, including without limitation the Building
Complex Parking Area, common areas, systems and equipment, roof, and structural
portions of the same, which Renovations may include, without limitation,
(i) modifying the common areas and tenant spaces to comply with applicable laws
and regulations, including regulations relating to the physically disabled,
seismic conditions, and building safety and security, (ii) installing new floor
covering, lighting, and wall coverings in the common areas, and in connection
with any Renovations, Landlord may, among other things, erect scaffolding or
other necessary structures in the Building or Building Complex, limit or
eliminate access to portions of the Real Property, including portions of the
common areas, or perform work in the Building or Building Complex, which work
may create noise, dust or leave debris in the Building Complex, (iii) renovation
of the main entry to the Building Complex and the main Building lobby area,
(iv) renovation of the elevator, lobbies, elevator doors and frames, and
(v) installations, repairs or maintenance of telephone risers. Tenant hereby
agrees that such Renovations and Landlord's actions in connection with such
Renovations shall in no way constitute a constructive eviction of Tenant nor
entitle Tenant to any abatement of Rent. Landlord shall have no responsibility
or for any reason be liable to Tenant for any direct or indirect injury to or
interference with Tenant's business arising from the Renovations, nor shall
Tenant be entitled to any compensation or damages from Landlord for loss of the
use of the whole or any part of the Premises or of Tenant's personal property or
improvements resulting from the Renovations or Landlord's actions in connection
with such Renovations, or for any inconvenience or annoyance occasioned by such
Renovations or Landlord's actions in connection with such Renovations; provided,
however, Landlord agrees, in performing such Renovations, to use commercially
reasonable efforts not to unreasonably interfere with Tenant's access or use of
the Premises.
25.24 Confidentiality. Tenant acknowledges that the content of this Lease
and any related documents are confidential information. Tenant shall keep such
confidential information strictly confidential and shall not disclose such
confidential information to any person or entity other than Tenant's financial,
legal, accounting, real estate and space planning consultants, respectively, or
as otherwise required by law.
25.25 Landlord's Title. Landlord's title is and always shall be paramount
to the title of Tenant. Nothing herein contained shall empower Tenant to do any
act which can, shall or may encumber the title of Landlord.
24
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25.26 No Waiver. No waiver of any provision of this Lease shall be implied
by any failure of a party to enforce any remedy on account of the violation of
such provision, even if such violation shall continue or be repeated
subsequently, any waiver by a party of any provision of this Lease may only be
in writing, and no express waiver shall affect any provision other than the one
specified in such waiver and that one only for the time and in the manner
specifically stated. No receipt of monies by Landlord from Tenant after the
termination of this Lease shall in any way alter the length of the Lease Term or
of Tenant's right of possession hereunder or after the giving of any notice
shall reinstate, continue or extend the Lease Term or affect any notice given
Tenant prior to the receipt of such monies, it being agreed that after the
service of notice or the commencement of a suit or after final judgment for
possession of the Premises, Landlord may receive and collect any Rent due, and
the payment of said Rent shall not waive or affect said notice, suit or
judgment.
25.27 Jury Trial; Attorneys' Fees. IF EITHER PARTY COMMENCES LITIGATION
AGAINST THE OTHER FOR THE SPECIFIC PERFORMANCE OF THIS LEASE, FOR DAMAGES FOR
THE BREACH HEREOF OR OTHERWISE FOR ENFORCEMENT OF ANY REMEDY HEREUNDER, THE
PARTIES HERETO AGREE TO AND HEREBY DO WAIVE ANY RIGHT TO A TRIAL BY JURY. In the
event of any such commencement of litigation, the prevailing party shall be
entitled to recover from the other party such costs and reasonable attorneys'
fees as may have been incurred, including any and all costs incurred in
enforcing, perfecting and executing such judgment.
25.28 Intentionally Deleted.
25.29 Satellite Dish.
25.29.1 Landlord hereby agrees that Tenant shall have the nonexclusive
right at Tenant's sole cost and expense (but without any additional Base
Rent payable to Landlord) and subject to the provisions of this Section
25.29, to install up to three (3) satellite dishes, each of which shall not
exceed two (2) feet in diameter (individually and collectively a "Satellite
Dish") on the roof of the Building in a location designated by Landlord. In
addition, Tenant shall have the right, to install such connection
equipment, such as conduits, cables, risers, feeders and materials
(collectively, the "Connecting Equipment") in the shafts, ducts, conduits,
chases, utility closets and other facilities of the Building as is
reasonably necessary to connect the Satellite Dish to Tenant's other
machinery and equipment in the Premises, subject however, to the provisions
of Section 25.29.2, below. Tenant shall also have the right of access,
consistent with Section 25.29.4, below, to the areas where any such
Connecting Equipment is located for the purposes of maintaining, repairing,
testing and replacing the same.
25.29.2 The installation of the Satellite Dish and related Connecting
Equipment (hereby referred to together and/or separately as the "Satellite
Equipment") shall be performed in accordance with and subject to the
provisions of Article 8 of this Lease (unless Tenant elects to have such
Satellite Equipment installed during the installation of the initial Tenant
Improvements, in which event, Landlord shall install same pursuant to the
applicable provisions of the Tenant Work Letter, and the cost of
acquisition and installation of the Satellite Equipment to be paid by
Tenant may be deducted from the Tenant Improvement Allowance). The
Satellite Equipment shall be treated for all purposes of this Lease as if
the same were Tenant's property. For the purposes of determining Tenant's
obligations with respect to its use of the roof of the Building herein
provided, the portion of the roof of the Building affected by the Satellite
Equipment shall be deemed to be a portion of Tenant's Premises except as to
Tenant's obligations to pay Base Rent and Direct Expenses; consequently,
all of the provisions of this Lease with respect to Tenant's obligations
hereunder shall apply to the installation, use and maintenance of the
Satellite Equipment, including without limitation, provisions relating to
compliance with requirements as to insurance, indemnity, repairs and
maintenance, and compliance with laws. Landlord shall have no obligation
with regard to the affected portion of the roof or the Satellite Equipment
except as provided in this Section 25.29.
25.29.3 It is expressly understood that Landlord retains the right to
grant third parties the right to utilize any portion of the roof not
utilized by Tenant and to use the portion of the roof on which the
Satellite Equipment is located for any purpose whatsoever, provided in each
event that Tenant shall have reasonable access to, and Landlord shall not
unduly interfere with the use of, the Satellite Equipment.
25.29.4 Tenant shall install, use, maintain and repair the Satellite
Equipment so as not to damage or interfere with the operation of the
Building or the Systems and Equipment or any other communications or
similar equipment located on the roof of the Building; and Tenant hereby
agrees to indemnify, defend and hold Landlord harmless from and against any
and all claims, costs, damages, expenses and liabilities (including
attorney's fees) arising out of Tenant's failure to comply with the
provisions of this Section 25.29.4.
25.29.5 Landlord shall not have any obligations with respect to the
Satellite Equipment or compliance with any requirements relating thereto
(except as specifically provided by this Lease) nor shall Landlord be
responsible for any damage that may be caused to the Satellite Equipment
except to the extent (i) caused by the gross negligence or willful
misconduct of Landlord or Landlord's agents, employees or contractors, and
(ii) not insured or required to be insured by Tenant under this Lease.
Landlord makes no representation that the Satellite Equipment will be able
to receive or transmit communication signals without interference or
disturbance and Tenant agrees that Landlord shall not be liable to Tenant
therefor.
25
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25.29.6 Tenant, at Tenant's sole cost and expense, shall install such
fencing and other protective equipment on or about the Satellite Equipment
as shall be required by applicable laws.
25.29.7 Tenant shall (i) be solely responsible for any damage caused
as a result of the Satellite Equipment (except to the extent such damage is
to property not owned or leased by Tenant and is covered by insurance
obtained by Landlord as part of Direct Expenses and as to which Landlord's
waiver of subrogation in Section 10.4 is applicable), (ii) promptly pay any
tax, license or permit fees charged pursuant to any requirements in
connection with the installation, maintenance or use of the Satellite
Equipment and comply with all precautions and safeguards recommended by all
governmental authorities, and (iii) make necessary repairs, replacements to
or maintenance of the Satellite Equipment.
25.29.8 If any of the conditions set forth in this Section 25.29 are
not complied with by Tenant, then without limiting Landlord's rights and
remedies it may otherwise have under this Lease, Tenant shall, upon written
notice from Landlord, have the option either to (i) reposition the
Satellite Equipment to a location designated by Landlord if Landlord elects
to permit such repositioning, and make such repairs and restorations as
required under Section 25.29.9 below, or (ii) correct such noncompliance
within thirty (30) days after receipt of notice. If Tenant fails to correct
noncompliance within such thirty (30) day period, then Tenant shall
immediately discontinue its use of the Satellite Equipment and remove the
same.
25.29.9 Upon the expiration of the Lease Term or upon any earlier
termination of this Lease, Tenant shall, subject to the control of and
direction from Landlord, remove the Satellite Equipment, repair any damage
caused thereby, and restore the roof and other facilities of the Building
to their condition existing prior to the installation of the Satellite
Equipment, reasonable wear and tear not caused by the Satellite Equipment
excepted.
25.29.10 Tenant's rights under this Section 25.29 shall be personal to
the original Tenant executing this Lease and any assignee to which Tenant's
entire interest in this Lease has been assigned pursuant to Article 14, and
may only be utilized by the original Tenant or such assignee (and may not
be exercised or utilized by any subtenant or other transferee of the
original Tenant's interest in this Lease or the Premises).
26
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IN WITNESS WHEREOF, Landlord and Tenant have caused their duly authorized
representatives to execute this Lease as of the day and date first above
written.
"Landlord" W9/WLA REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
By:Legacy Partners Commercial, Inc.,
a Texas corporation,
as manager and agent for Landlord
By: /s/ MACK LANEY
-----------------------------------
Name: Mack Laney
Its: COO
"Tenant" STYLECLICK.COM, INC.,
a California corporation
By: /s/ BARRY HALL
--------------------------------------
Name: Barry Hall
Its: CFO
By: /s/ MAURIZIO VECCHIONE
--------------------------------------
Name: Maurizio Vecchione
Its: CEO
*** If Tenant is a CORPORATION, the authorized officers must sign on behalf of
the corporation and indicate the capacity in which they are signing. The Lease
must be executed by the president or vice president and the secretary or
assistant secretary, unless the bylaws or a resolution of the board of directors
shall otherwise provide, in which event, the bylaws or a certified copy of the
resolution, as the case may be, must be attached to this Lease.
27
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EXHIBIT A-1
WATERIDGE
1st FLOOR PLAN OF PREMISES
EXHIBIT A-1
1
<PAGE>
EXHIBIT A-2
WATERIDGE
2nd FLOOR PLAN OF PREMISES
EXHIBIT A-2
1
<PAGE>
EXHIBIT B
WATERIDGE
RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the following Rules and
Regulations. Landlord shall not be responsible to Tenant for the nonperformance
of any of said Rules and Regulations by or otherwise with respect to the acts or
omissions of any other tenants or occupants of the Building Complex.
1. Tenant shall not alter any lock or install any new or additional locks
or bolts on any doors or windows of the Premises without obtaining Landlord's
prior written consent. Tenant shall bear the cost of any lock changes or repairs
required by Tenant. Two keys will be furnished by Landlord for the Premises, and
any additional keys required by Tenant must be obtained from Landlord at a
reasonable cost to be established by Landlord.
2. All doors opening to public corridors shall be kept closed at all times
except for normal ingress and egress to the Premises, unless electrical hold
backs have been installed.
3. Landlord reserves the right to close and keep locked all entrance and
exit doors of the Building. Tenant, its employees and agents must be sure that
the doors to the Building are securely closed and locked when leaving the
Premises if it is after the normal hours of business for the Building. Any
tenant, its employees, agents or any other persons entering or leaving the
Building at any time when it is so locked, or any time when it is considered to
be after normal business hours for the Building or Building Complex may be
required to sign the Building register when so doing. Access to the Building may
be refused unless the person seeking access has proper identification or has a
previously arranged pass for access. Landlord and his agents shall in no case be
liable for damages for any error with regard to the admission to or exclusion
from the Building or Building Complex of any person. In case of invasion, mob,
riot, public excitement, or other commotion, Landlord reserves the right to
prevent access to the Building and/or Building Complex during the continuance of
same by any means it deems appropriate for the safety and protection of life and
property.
4. Landlord shall have the right to prescribe the weight, size and position
of all safes and other heavy property brought into the Building. Safes and other
heavy objects shall, if considered necessary by Landlord, stand on supports of
such thickness as is necessary to properly distribute the weight. Landlord will
not be responsible for loss of or damage to any such safe or property in any
case. All damage done to any part of the Building and/or Building Complex, its
contents, occupants or visitors by moving or maintaining any such safe or other
property shall be the sole responsibility of Tenant and any expense of said
damage or injury shall be borne by Tenant.
5. No furniture, freight, packages, supplies, or equipment may be brought
into or removed from the Building, except upon prior notice to and approval by
Landlord, and in such manner, and between such hours as shall be designated by
Landlord.
6. Landlord shall have the right to control and operate the public portions
of the Building and Building Complex, the public facilities, the heating and air
conditioning, and any other facilities furnished for the common use of tenants,
in such manner as is customary for comparable building projects in the vicinity
of the Building Complex.
7. The requirements of Tenant will be attended to only upon application at
the management office of the Building Complex or at such office location
designated by Landlord. Employees of Landlord shall not perform any work or do
anything outside their regular duties unless under special instructions from
Landlord.
8. Tenant shall not disturb, solicit, or canvass any occupant of the
Building Complex and shall cooperate with Landlord or Landlord's agents to
prevent same.
9. The toilet rooms, urinals, wash bowls and other apparatus shall not be
used for any purpose other than that for which they were constructed, and no
foreign substance of any kind whatsoever shall be thrown therein. The expense of
any breakage, stoppage or damage resulting from the violation of this rule shall
be borne by the tenant who, or whose employees or agents, shall have caused it.
10. Tenant shall not overload the floor of the Premises, nor mark, drive
nails or screws, or drill into the partitions, woodwork or plaster or in any way
deface the Premises or any part thereof without Landlord's consent first had and
obtained.
EXHIBIT B
1
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11. Except for vending machines intended for the sole use of Tenant's
employees and invitees, no vending machine or machines of any description other
than fractional horsepower office machines shall be installed, maintained or
operated upon the Premises without the written consent of Landlord.
12. Tenant shall not use any method of heating or air conditioning other
than that which may be supplied by Landlord, without the prior written consent
of Landlord.
13. Tenant shall not use or keep in or on the Premises or the Building
Complex any kerosene, gasoline or other inflammable or combustible fluid or
material. Tenant shall not use, keep or permit to be used or kept, any foul or
noxious gas or substance in or on the Premises, or permit or allow the Premises
to be occupied or used in a manner offensive or objectionable to Landlord or
other occupants of the Building Complex by reason of noise, odors, or
vibrations, or interfere in any way with other tenants or those having business
therein.
14. Tenant shall not bring into or keep within the Building Complex or the
Premises any animals, birds, bicycles or other vehicles.
15. No cooking shall be done or permitted by any tenant on the Premises,
nor shall the Premises be used for the storage of merchandise, for lodging or
for any unlawful purposes. Notwithstanding the foregoing, Underwriters'
laboratory-approved equipment and microwave ovens may be used in the Premises
for heating food and brewing coffee, tea, hot chocolate and similar beverages,
provided that such use is in accordance with all applicable federal, state and
city laws, codes, ordinances, rules and regulations, and does not cause odors
which are objectionable to Landlord and other Tenants.
16. Landlord will approve where and how telephone and telegraph wires are
to be introduced to the Premises. No boring or cutting for wires shall be
allowed without the consent of Landlord. The location of telephone, call boxes
and other office equipment affixed to the Premises shall be subject to the
approval of Landlord.
17. Landlord reserves the right to exclude or expel from the Building
and/or Building Complex any person who, in the judgment of Landlord, is
intoxicated or under the influence of liquor or drugs, or who shall in any
manner do any act in violation of any of these Rules and Regulations.
18. Tenant, its employees and agents shall not loiter in the entrances or
corridors, nor in any way obstruct the sidewalks, lobby, halls, stairways or
elevators, and shall use the same only as a means of ingress and egress for the
Premises.
19. Tenant shall not waste electricity, water or air conditioning and
agrees to cooperate fully with Landlord to ensure the most effective operation
of the Building's heating and air conditioning system, and shall refrain from
attempting to adjust any controls.
20. Tenant shall store all its trash and garbage within the interior of the
Premises. No material shall be placed in the trash boxes or receptacles if such
material is of such nature that it may not be disposed of in the ordinary and
customary manner of removing and disposing of trash and garbage in the city in
which the Building is located without violation of any law or ordinance
governing such disposal. All trash, garbage and refuse disposal shall be made
only through entry-ways and elevators provided for such purposes at such times
as Landlord shall designate.
21. Tenant shall comply with all safety, fire protection and evacuation
procedures and regulations established by Landlord or any governmental agency.
22. Tenant shall assume any and all responsibility for protecting the
Premises from theft, robbery and pilferage, which includes keeping doors locked
and other means of entry to the Premises closed, when the Premises are not
occupied.
23. No awnings or other projection shall be attached to the outside walls
of the Building without the prior written consent of Landlord. No curtains,
blinds, shades or screens shall be attached to or hung in, or used in connection
with, any window or door of the Premises without the prior written consent of
Landlord. The sashes, sash doors, skylights, windows, and doors that reflect or
admit light and air into the halls, passageways or other public places in the
Building shall not be covered or obstructed by Tenant, nor shall any bottles,
parcels or other articles be placed on the windowsills. All electrical ceiling
fixtures hung in offices or spaces along the perimeter of the Building must be
fluorescent and/or of a quality, type, design and bulb color approved by
Landlord.
24. The washing and/or detailing of or, the installation of windshields,
radios, telephones in or general work on, automobiles shall not be allowed on
the Real Property.
EXHIBIT B
2
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25. The term "personal goods or services vendors" as used herein means
persons who periodically enter the Building of which the Premises are a part for
the purpose of selling goods or services to a tenant, other than goods or
services which are used by the Tenant only for the purpose of conducting its
business in the Premises. "Personal goods or services" include, but are not
limited to, drinking water and other beverages, food, barbering services and
shoeshining services. Landlord reserves the right to prohibit personal goods and
services vendors from access to the Building except upon Landlord's prior
written consent and upon such reasonable terms and conditions, including, but
not limited to, the payment of a reasonable fee and provision for insurance
coverage, as are related to the safety, care and cleanliness of the Building,
the preservation of good order thereon, and the relief of any financial or other
burden on Landlord or other tenants occasioned by the presence of such vendors
or the sale by them of personal goods or services to Tenant or its employees.
Under no circumstance shall the personal goods or services vendors display their
products in a public or common area, including corridors and elevator lobbies.
If necessary for the accomplishment of these purposes, Landlord may exclude a
particular vendor entirely or limit the number of vendors who may be present at
any one time in the Building.
26. Tenant must comply with requests by the Landlord concerning the
informing of their employees of items of importance to the Landlord.
27. Tenant shall comply with any non-smoking ordinance adopted by any
applicable governmental authority.
28. Landlord may waive any one or more of these Rules and Regulations for
the benefit of any particular tenant or tenants, but no such waiver by Landlord
shall be construed as a waiver of such Rules and Regulations in favor of any
other tenant or tenants, nor prevent Landlord from thereafter enforcing any such
Rules or Regulations against any or all tenants of the Building Complex.
Landlord reserves the right at any time to change or rescind any one or more of
these Rules and Regulations, or to make such other and further reasonable Rules
and Regulations as in Landlord's judgment may from time to time be necessary for
the management, safety, care and cleanliness of the Premises and Building
Complex, and for the preservation of good order therein, as well as for the
convenience of other occupants and tenants therein. Landlord shall not be
responsible to Tenant or to any other person for the nonobservance of the Rules
and Regulations by another tenant or other person. Tenant shall be deemed to
have read these Rules and Regulations and to have agreed to abide by them as a
condition of its occupancy of the Premises.
EXHIBIT B
3
<PAGE>
EXHIBIT C
WATERIDGE
AMENDMENT TO LEASE
This AMENDMENT TO LEASE ("Amendment") is made and entered into effective as
of _________________, ____, by and between W9/WLA REAL ESTATE LIMITED
PARTNERSHIP, a Delaware limited partnership ("Landlord"), and STYLECLICK.COM,
INC., a California corporation ("Tenant").
R E C I T A L S :
A. Landlord and Tenant entered into that certain Office Lease dated as of
May ____, 2000 (the "Lease") pursuant to which Landlord leased to Tenant and
Tenant leased from Landlord certain "Premises", as described in the Lease, known
as Suite 100 of the Building located at 5105 West Gold Leaf Circle, Los Angeles,
California 90056.
B. Except as otherwise set forth herein, all capitalized terms used in this
Amendment shall have the same meaning given such terms in the Lease.
C. Landlord and Tenant desire to amend the Lease to confirm the
commencement and expiration dates of the Lease Term, as hereinafter provided.
NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual
covenants contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Confirmation of Dates. The parties hereby confirm that (a) the Premises
are ready for occupancy and Landlord has performed all work required to be
performed by Landlord pursuant to the Tenant Work Letter attached to the Lease,
(b) the Lease Term for the Lease commenced as of ____________________ (the
"Lease Commencement Date") for a term of __________ years ending on
_______________________ (the "Lease Expiration Date") (unless sooner terminated
or extended as provided in the Lease) and (c) in accordance with the Lease, Rent
commenced to accrue on _______________________________.
2. No Further Modification. Except as set forth in this Amendment, all of
the terms and provisions of the Lease shall remain unmodified and in full force
and effect.
IN WITNESS WHEREOF, this Amendment has been executed as of the day and year
first above written.
"Landlord" W9/WLA REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
By:Legacy Partners Commercial, Inc.,
a Texas corporation,
as manager and agent for Landlord
By:
-----------------------------------
Name:
Its:
"Tenant" STYLECLICK.COM, INC.,
a California corporation
By:
--------------------------------------
Name:
Its:
By:
--------------------------------------
Name:
Its:
EXHIBIT C
1
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EXHIBIT D
WATERIDGE
TENANT WORK LETTER
This Tenant Work Letter ("Tenant Work Letter") shall set forth the terms
and conditions relating to the construction of improvements for the Premises.
All references in this Tenant Work Letter to "the Lease" shall mean the relevant
portions of the Lease to which this Tenant Work Letter is attached as Exhibit D.
SECTION 1
GENERAL CONSTRUCTION OF THE PREMISES
Landlord shall deliver the base, shell, and core (i) of the Premises and
(ii) of the floor of the Building on which the Premises is located
(collectively, the "Base, Shell, and Core") in its current as-is condition
existing as of the date of the Lease, and Landlord shall not be obligated to
make any other alterations or improvements to the Premises or the Building.
Tenant shall thereafter install in the Premises certain "Tenant Improvements"
(as defined below) pursuant to the provisions of this Tenant Work Letter.
SECTION 2
TENANT IMPROVEMENTS
2.1 Tenant Improvement Allowance. Tenant shall be entitled to a one-time
tenant improvement allowance (the "Tenant Improvement Allowance") in the amount
of up to, but not exceeding $282,036.00 (i.e., $12.00 per rentable square foot
of the Premises), for the costs relating to the initial design and construction
of Tenant's improvements which are permanently affixed to the Premises (the
"Tenant Improvements"). In no event shall Landlord be obligated to make
disbursements pursuant to this Tenant Work Letter in a total amount which
exceeds the Tenant Improvement Allowance. Tenant shall not be entitled to
receive any cash payment or credit against Rent or otherwise for any portion of
the Tenant Improvement Allowance which is not used to pay for the Tenant
Improvement Allowance Items (as such term is defined below).
2.2 Disbursement of the Tenant Improvement Allowance.
2.2.1 Tenant Improvement Allowance Items. Except as otherwise set
forth in this Tenant Work Letter, the Tenant Improvement Allowance shall be
disbursed by Landlord (each of which disbursement shall be made pursuant to
Landlord's disbursement process set forth below), only for the following
items and costs (collectively, the "Tenant Improvement Allowance Items"):
2.2.1.1 Payment of the fees of the "Architect" and the
"Engineers," as those terms are defined in Section 3.1 of this Tenant
Work Letter, and payment of the fees incurred by, and the cost of
documents and materials supplied by, Landlord and Landlord's
consultants in connection with the preparation and review of the
"Construction Drawings," as that term is defined in Section 3.1 of
this Tenant Work Letter;
2.2.1.2 The payment of plan check, permit and license fees
relating to construction of the Tenant Improvements;
2.2.1.3 The cost of construction of the Tenant Improvements,
including, without limitation, contractors' fees and general
conditions, testing and inspection costs, costs of utilities, trash
removal, parking and hoists, and the costs of after-hours freight
elevator usage;
2.2.1.4 The cost of voice and data cabling for the Premises (but
Landlord's contribution for such costs shall in no event exceed $3.00
per rentable square foot of the Premises);
2.2.1.5 The cost of any changes in the Base, Shell and Core when
such changes are required by the Construction Drawings (including if
such changes are due to the fact that such work is prepared on an
unoccupied basis), such cost to include all direct architectural
and/or engineering fees and expenses incurred in connection therewith;
2.2.1.6 The cost of any changes to the Construction Drawings or
Tenant Improvements required by applicable laws and building codes
(collectively, "Code");
2.2.1.7 Sales and use taxes and Title 24 fees;
EXHIBIT D
1
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2.2.1.8 Landlord's "Coordination Fee," as that term is defined in
Section 4.3.2 of this Tenant Work Letter; and
2.2.1.9 All other costs to be expended by Landlord in connection
with the construction of the Tenant Improvements.
2.2.2 Disbursement of Tenant Improvement Allowance. During the
construction of the Tenant Improvements, Landlord shall make monthly
disbursements of the Tenant Improvement Allowance for Tenant Improvement
Allowance Items for the benefit of Tenant and shall authorize the release
of monies for the benefit of Tenant as follows:
2.2.2.1 Monthly Disbursements. On or before the first (1st) day
of each calendar month during the construction of the Tenant
Improvements (or such other date as Landlord may designate), Tenant
shall deliver to Landlord: (i) a request for payment of the
"Contractor," as that term is defined in Section 4.1 below, approved
by Tenant, in a form to be provided by Landlord, showing the schedule,
by trade, of percentage of completion of the Tenant Improvements in
the Premises, detailing the portion of the work completed and the
portion not completed; (ii) invoices from all of "Tenant's Agents," as
that term is defined in Section 4.1.2 below, for labor rendered and
materials delivered to the Premises; (iii) executed mechanic's lien
releases from all of Tenant's Agents which shall comply with the
appropriate provisions, as reasonably determined by Landlord, of
California Civil Code Section 3262(d); and (iv) all other information
reasonably requested by Landlord. Tenant's request for payment shall
be deemed Tenant's acceptance and approval of the work furnished
and/or the materials supplied as set forth in Tenant's payment
request. On or before the first (1st) day of the following calendar
month, Landlord shall deliver a check to Tenant made jointly payable
to Contractor and Tenant in payment of the lesser of (A) the amounts
so requested by Tenant, as set forth in this Section 2.2.2.1, above,
less a ten percent (10%) retention (the aggregate amount of such
retentions to be known as the "Final Retention") and (B) the balance
of any remaining available portion of the Tenant Improvement Allowance
(not including the Final Retention), provided that Landlord does not
dispute any request for payment based on non-compliance of any work
with the "Approved Working Drawings", as that term is defined in
Section 3.4 below, or due to any substandard work, or for any other
reason. Landlord's payment of such amounts shall not be deemed
Landlord's approval or acceptance of the work furnished or materials
supplied as set forth in Tenant's payment request.
2.2.2.2 Final Retention. Subject to the provisions of this Tenant
Work Letter, a check for the Final Retention payable jointly to Tenant
and Contractor shall be delivered by Landlord to Tenant following the
completion of construction of the Premises, provided that (i) Tenant
delivers to Landlord properly executed mechanics lien releases in
compliance with both California Civil Code Section 3262(d)(2) and
either Section 3262(d)(3) or Section 3262(d)(4), and (ii) Landlord has
determined that no substandard work exists which adversely affects the
mechanical, electrical, plumbing, heating, ventilating and air
conditioning, life-safety or other systems of the Building, the
curtain wall of the Building, the structure or exterior appearance of
the Building, or any other tenant's use of such other tenant's leased
premises in the Building.
2.2.2.3 Other Terms. Landlord shall only be obligated to make
disbursements from the Tenant Improvement Allowance to the extent
costs are incurred by Tenant for Tenant Improvement Allowance Items.
2.3 Standard Tenant Improvement Package. Landlord has established
specifications (the "Specifications") for the Building standard components to be
used in the construction of the Tenant Improvements in the Premises
(collectively, the "Standard Improvement Package"), which Specifications have
been received by Tenant. The Tenant Improvements shall comply with the
Specifications for all Tenant Improvement components which have been pre-stocked
by Landlord. With respect to all other Tenant Improvement components, Tenant
shall utilize materials and finishes which are not of lesser quality than the
Specifications. Landlord may make changes to the Specifications for the Standard
Improvement Package from time to time.
SECTION 3
CONSTRUCTION DRAWINGS
3.1 Selection of Architect/Construction Drawings. Tenant shall retain an
architect/space planner (the "Architect") approved by Landlord, which approval
shall not be unreasonably withheld, to prepare the Construction Drawings. Tenant
shall retain engineering consultants designated by Landlord (the "Engineers") to
prepare all plans and engineering working drawings relating to the structural,
mechanical, electrical, plumbing, HVAC, lifesafety, and sprinkler work in the
Premises. The plans and drawings to be prepared by Architect and the Engineers
hereunder shall be known collectively as the "Construction Drawings." All
Construction Drawings shall comply with the drawing format and specifications
determined by Landlord, and shall be subject to Landlord's approval. Tenant and
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Architect shall verify, in the field, the dimensions and conditions as shown on
the relevant portions of the base building plans, and Tenant and Architect shall
be solely responsible for the same, and Landlord shall have no responsibility in
connection therewith. Landlord's review of the Construction Drawings as set
forth in this Section 3, shall be for its sole purpose and shall not imply
Landlord's review of the same, or obligate Landlord to review the same, for
quality, design, Code compliance or other like matters. Accordingly,
notwithstanding that any Construction Drawings are reviewed by Landlord or its
space planner, architect, engineers and consultants, and notwithstanding any
advice or assistance which may be rendered to Tenant by Landlord or Landlord's
space planner, architect, engineers, and consultants, Landlord shall have no
liability whatsoever in connection therewith and shall not be responsible for
any omissions or errors contained in the Construction Drawings.
3.2 Final Space Plan. Promptly after the execution of the Lease, Tenant and
Architect shall prepare the final space plan for Tenant Improvements in the
Premises (the "Final Space Plan"), which Final Space Plan shall include a layout
and designation of all offices, rooms and other partitioning, their intended
use, and equipment to be contained therein, and shall deliver the Final Space
Plan to Landlord for Landlord's approval which approval or disapproval shall be
made by Landlord within five (5) business days after Landlord's receipt thereof.
In the event Landlord fails to make such approval or disapproval within the
foregoing time frame, Tenant shall provide Landlord notice of such failure and
Landlord shall have three (3) business days after receipt of such notice to
approve or disapprove the Final Space Plan. In the event Landlord fails to make
such approval or disapproval within three (3) business days after receipt of
such second notice, the Final Space Plan shall be deemed approved by Landlord.
3.3 Final Working Drawings. Promptly following approval of the Final Space
Plan, Tenant, Architect and the Engineers shall complete the architectural and
engineering drawings for the Premises, and Architect shall compile a fully
coordinated set of architectural, structural, mechanical, electrical and
plumbing working drawings in a form which is complete to allow subcontractors to
bid on the work and to obtain all applicable permits (collectively, the "Final
Working Drawings"), and shall submit the same to Landlord for Landlord's
approval which approval or disapproval shall be made by Landlord within five (5)
business days after Landlord's receipt thereof. In the event Landlord fails to
make such approval or disapproval within the foregoing time frame, Tenant shall
provide Landlord notice of such failure and Landlord shall have three (3)
business days after receipt of such notice to approve or disapprove the Final
Working Drawings. In the event Landlord fails to make such approval or
disapproval within three (3) business days after receipt of such second notice,
the Final Working Drawings shall be deemed approved by Landlord.
3.4 Approved Working Drawings. Promptly following approval of the Final
Working Drawings, Tenant shall submit the Final Working Drawings approved by
Landlord (the "Approved Working Drawings") to the applicable local governmental
agency for all applicable building permits necessary to allow "Contractor," as
that term is defined in Section 4.1 of this Tenant Work Letter, to commence and
fully complete the construction of the Tenant Improvements (collectively, the
"Permits"), and, in connection therewith, Tenant shall coordinate with Landlord
in order to allow Landlord, at Landlord's option, to take part in all phases of
the permitting process, and shall supply Landlord, as soon as possible, with all
plan check numbers and dates of submittal. Notwithstanding the foregoing, Tenant
hereby agrees that neither Landlord nor Landlord's consultants shall be
responsible for obtaining any building permit or certificate of occupancy for
the Premises and that the obtaining of the same shall be Tenant's
responsibility; provided, however, that Landlord shall, in any event, cooperate
with Tenant in executing permit applications and performing other ministerial
acts reasonably necessary to enable Tenant to obtain any such permit or
certificate of occupancy. No changes, modifications or alterations in the
Approved Working Drawings may be made without the prior written consent of
Landlord, which consent shall not be unreasonably withheld.
3.5 Time Deadlines. Tenant shall cooperate with Architect, the Engineer,
and Landlord to complete all phases of the Construction Drawings and the
permitting process and to receive the permits, and with Contractor, for approval
of the "Cost Proposal," as that term is defined in Section 4.2, below, as soon
as possible after the execution of the Lease, and, in that regard, Tenant shall
meet with Landlord on a weekly basis to discuss Tenant's progress in connection
with the same. The applicable dates for approval of items, plans and drawings as
described in this Section 3, Section 4, below, and in this Tenant Work Letter
are collectively referred to herein as the "Time Deadlines". Tenant agrees to
comply with the Time Deadlines.
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1 Tenant's Selection of Contractor and Tenant's Agents.
4.1.1 Contractor. A contractor, under the supervision of and selected
by Tenant, shall construct the Tenant Improvements (the "Contractor"). The
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Contractor shall be selected by Tenant from one (1) of the contractors
listed on Schedule 1 attached hereto in accordance with an "open book"
competitive bidding procedure pursuant to which the general contractor's
fees, overhead and general conditions will be bid, as described below. Each
such contractor shall be notified in the bidding package of the time
schedule for construction of the Tenant Improvements. Tenant shall provide
copies of such bids to Landlord and Tenant shall select one (1) of the
bidding contractors as the Contractor and notify Landlord of such
selection.
4.1.2 Tenant's Agents. All subcontractors, laborers, materialmen, and
suppliers used by Tenant (such subcontractors, laborers, materialmen, and
suppliers, and the Contractor to be known collectively as "Tenant's
Agents") must be approved in writing by Landlord, which approval shall not
be unreasonably withheld or delayed; provided that, in any event, Tenant
must contract with Landlord's base building subcontractors for any
mechanical, electrical, plumbing, life safety, structural, heating,
ventilation, and air-conditioning work in the Premises. If requested by
Landlord, Tenant's Agents shall all be union labor in compliance with the
master labor agreements existing between trade unions and the local chapter
of the Associated General Contractors of America.
4.2 Construction of Tenant Improvements by Tenant's Agents.
4.2.1 Construction Contract; Cost Budget. Prior to Tenant's execution
of the construction contract and general conditions with Contractor (the
"Contract"), Tenant shall submit the Contract to Landlord for its approval,
which approval shall not be unreasonably withheld or delayed. Prior to the
commencement of the construction of the Tenant Improvements, and after
Tenant has accepted all bids for the Tenant Improvements, Tenant shall
provide Landlord with a detailed breakdown, by trade, of the final costs to
be incurred, or which have been incurred, as set forth more particularly in
Sections 2.2.1.1 through 2.2.1.9 above, in connection with the design and
construction of the Tenant Improvements to be performed by or at the
direction of Tenant or the Contractor (which costs form a basis for the
amount of the Contract, if any (the "Final Costs"). Prior to the
commencement of construction of the Tenant Improvements, Tenant shall
supply Landlord with cash in an amount (the "Over-Allowance Amount") by
which the Final Costs exceed the Tenant Improvement Allowance (less any
portion thereof already disbursed by Landlord, or in the process of being
disbursed by Landlord, on or before the commencement of construction of the
Tenant Improvements). The Over-Allowance Amount shall be disbursed by
Landlord prior to the disbursement of any of the then remaining portion of
the Tenant Improvement Allowance, and such disbursement shall be pursuant
to the same procedure as the Tenant Improvement Allowance. In the event
that, after the Final Costs have been delivered by Landlord to Tenant, the
costs relating to the design and construction of the Tenant Improvements
shall change, any additional costs necessary to such design and
construction in excess of the Final Costs shall, to the extent they exceed
the remaining balance of the Tenant Improvement Allowance, be paid by
Tenant to Landlord immediately as an addition to the Over-Allowance Amount
and, in any event, prior to the commencement of the construction of such
changes, or, at Landlord's option, Tenant shall make payments for such
additional costs out of its own funds, but Tenant shall continue to provide
Landlord with the documents described in Sections 2.2.2.1 (i), (ii), (iii)
and (iv) above, for Landlord's approval, prior to Tenant paying such costs.
4.2.2 Tenant's Agents.
4.2.2.1 Landlord's General Conditions for Tenant's Agents and
Tenant Improvement Work. Tenant's and Tenant's Agents' construction of
the Tenant Improvements shall comply with the following: (i) the
Tenant Improvements shall be constructed in strict accordance with the
Approved Working Drawings; (ii) Tenant and Tenant's Agents shall not,
in any way, interfere with, obstruct, or delay, the work of Landlord's
base building contractor and subcontractors with respect to the Base,
Shell and Core or any other work in the Building; (iii) Tenant's
Agents shall submit schedules of all work relating to the Tenant's
Improvements to Contractor and Contractor shall, within five (5)
business days of receipt thereof, inform Tenant's Agents of any
changes which are necessary thereto, and Tenant's Agents shall adhere
to such corrected schedule; and (iv) Tenant shall abide by all rules
made by Landlord's Building contractor or Landlord's Building manager
with respect to the use of freight, loading dock and service
elevators, storage of materials, coordination of work with the
contractors of other tenants, and any other matter in connection with
this Tenant Work Letter, including, without limitation, the
construction of the Tenant Improvements.
4.2.2.2 Coordination Fee. Tenant shall pay a logistical
coordination fee (the "Coordination Fee") to Landlord in an amount
equal to the product of (i) three and one-half percent (3.5%), and
(ii) the sum of the Tenant Improvement Allowance, the Over-Allowance
Amount, as such amount may be increased hereunder, and any other
amounts expended by Tenant in connection with the design and
construction of the Tenant Improvements, which Coordination Fee shall
be for services relating to the coordination of the construction of
the Tenant Improvements pursuant to this Tenant Work Letter.
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4.2.2.3 Indemnity. Tenant's indemnity of Landlord as set forth in
the Lease shall also apply with respect to any and all costs, losses,
damages, injuries and liabilities related in any way to any act or
omission of Tenant or Tenant's Agents, or anyone directly or
indirectly employed by any of them, or in connection with Tenant's
non-payment of any amount arising out of the Tenant Improvements
and/or Tenant's disapproval of all or any portion of any request for
payment. Such indemnity by Tenant, as set forth in the Lease, shall
also apply with respect to any and all costs, losses, damages,
injuries and liabilities related in any way to Landlord's performance
of any ministerial acts reasonably necessary (i) to permit Tenant to
complete the Tenant Improvements, and (ii) to enable Tenant to obtain
any building permit or certificate of occupancy for the Premises.
4.2.2.4 Insurance Requirements.
4.2.2.4.1 General Coverages. All of Tenant's Agents shall
carry worker's compensation insurance covering all of their
respective employees, and shall also carry public liability
insurance, including property damage, all with limits, in form
and with companies as are required to be carried by Tenant as set
forth in the Lease.
4.2.2.4.2 Special Coverages. Tenant shall carry "Builder's
All Risk" insurance in an amount approved by Landlord covering
the construction of the Tenant Improvements, and such other
insurance as Landlord may reasonably require, it being understood
and agreed that the Tenant Improvements shall be insured by
Tenant pursuant to the Lease immediately upon completion thereof.
Such insurance shall be in amounts and shall include such
extended coverage endorsements as may be reasonably required by
Landlord, and in form and with companies as are required to be
carried by Tenant as set forth in the Lease.
4.2.2.4.3 General Terms. Certificates for all insurance
carried pursuant to this Section 4.2.2.4 shall be delivered to
Landlord before the commencement of construction of the Tenant
Improvements and before the Contractor's equipment is moved onto
the site. All such policies of insurance must contain a provision
that the company writing said policy will give Landlord thirty
(30) days prior written notice of any cancellation or lapse of
the effective date or any reduction in the amounts of such
insurance. In the event that the Tenant Improvements are damaged
by any cause during the course of the construction thereof,
Tenant shall immediately repair the same at Tenant's sole cost
and expense. All policies carried under this Section 4.2.2.4
shall insure Landlord and Tenant, as their interests may appear,
as well as Contractor and Tenant's Agents, and shall name as
additional insureds Landlord's Property Manager, Landlord's Asset
Manager, and all mortgagees and ground lessors of the Building.
All insurance, except Workers' Compensation, maintained by
Tenant's Agents shall preclude subrogation claims by the insurer
against anyone insured thereunder. Such insurance shall provide
that it is primary insurance as respects the owner and that any
other insurance maintained by owner is excess and noncontributing
with the insurance required hereunder. The requirements for the
foregoing insurance shall not derogate from the provisions for
indemnification of Landlord by Tenant under Section 4.2.2.3 of
this Tenant Work Letter.
4.2.2.5 Governmental Compliance. The Tenant Improvements shall
comply in all respects with the following: (i) the Code and other
state, federal, city or quasi-governmental laws, codes, ordinances and
regulations, as each may apply according to the rulings of the
controlling public official, agent or other person; (ii) applicable
standards of the American Insurance Association (formerly, the
National Board of Fire Underwriters) and the National Electrical Code;
and (iii) building material manufacturer's specifications.
4.2.2.6 Inspection by Landlord. Landlord shall have the right to
inspect the Tenant Improvements at all times, provided however, that
Landlord's failure to inspect the Tenant Improvements shall in no
event constitute a waiver of any of Landlord's rights hereunder nor
shall Landlord's inspection of the Tenant Improvements constitute
Landlord's approval of the same. Should Landlord disapprove any
portion of the Tenant Improvements, Landlord shall notify Tenant in
writing of such disapproval promptly and shall specify the items
reasonably disapproved. Any defects or deviations in, and/or
disapproval by Landlord of, the Tenant Improvements shall be rectified
by Tenant at no expense to Landlord, provided however, that in the
event Landlord determines that a defect or deviation exists or
disapproves of any matter in connection with any portion of the Tenant
Improvements and such defect, deviation or matter might adversely
affect the mechanical, electrical, plumbing, heating, ventilating and
air conditioning or life-safety systems of the Building, the structure
or exterior appearance of the Building or any other tenant's use of
such other tenant's leased premises, Landlord may, take such action as
Landlord deems necessary, at Tenant's expense and without incurring
any liability on Landlord's part, to correct any such defect,
deviation and/or matter, including, without limitation, causing the
cessation of performance of the construction of the Tenant
Improvements until such time as the defect, deviation and/or matter is
corrected to Landlord's satisfaction.
4.2.2.7 Meetings. Commencing upon the execution of the Lease,
Tenant shall hold weekly meetings at a reasonable time, with the
Architect and the Contractor regarding the progress of the preparation
EXHIBIT D
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of Construction Drawings and the construction of the Tenant
Improvements, which meetings shall be held at a location designated by
Landlord, and Landlord and/or its agents shall receive prior notice
of, and shall have the right to attend, all such meetings, and, upon
Landlord's request, certain of Tenant's Agents shall attend such
meetings. In addition, minutes shall be taken at all such meetings, a
copy of which minutes shall be promptly delivered to Landlord. One
such meeting each month shall include the review of Contractor's
current request for payment.
4.2.2.8 Notice of Completion; Copy of "As Built" Plans. Within
ten (10) days after completion of construction of the Tenant
Improvements, Tenant shall cause a Notice of Completion to be recorded
in the office of the Recorder of the County in which the Building is
located in accordance with Section 3093 of the Civil Code of the State
of California or any successor statute, and shall furnish a copy
thereof to Landlord upon such recordation. If Tenant fails to do so,
Landlord may execute and file the same on behalf of Tenant as Tenant's
agent for such purpose, at Tenant's sole cost and expense. At the
conclusion of construction, (i) Tenant shall cause the Architect and
Contractor (A) to update the Approved Working Drawings as necessary to
reflect all changes made to the Approved Working Drawings during the
course of construction, (B) to certify to the best of their knowledge
that the "record-set" of as-built drawings are true and correct, which
certification shall survive the expiration or termination of the
Lease, and (C) to deliver to Landlord two (2) sets of sepias of such
as-built drawings within ninety (90) days following issuance of a
certificate of occupancy for the Premises, and (ii) Tenant shall
deliver to Landlord a copy of all warranties, guaranties, and
operating manuals and information relating to the improvements,
equipment, and systems in the Premises.
4.2.2.9 Coordination by Tenant's Agents with Landlord. Upon
Tenant's delivery of the Contract to Landlord under Section 4.2.1 of
this Tenant Work Letter, Tenant shall furnish Landlord with a schedule
setting forth the projected date of the completion of the Tenant
Improvements and showing the critical time deadlines for each phase,
item or trade relating to the construction of the Tenant Improvements.
SECTION 5
MISCELLANEOUS
5.1 Tenant's Representative. Tenant has designated Barry Hall as its sole
representative with respect to the matters set forth in this Tenant Work Letter,
who shall have full authority and responsibility to act on behalf of the Tenant
as required in this Tenant Work Letter.
5.2 Landlord's Representative. Landlord has designated Mary Roberts as its
sole representative with respect to the matters set forth in this Tenant Work
Letter, who, until further notice to Tenant, shall have full authority and
responsibility to act on behalf of the Landlord as required in this Tenant Work
Letter.
5.3 Time of the Essence in This Tenant Work Letter. Unless otherwise
indicated, all references herein to a "number of days" shall mean and refer to
calendar days. In all instances where Tenant is required to approve or deliver
an item, if no written notice of approval is given or the item is not delivered
within the stated time period, at Landlord's sole option, at the end of said
period the item shall automatically be deemed approved or delivered by Tenant
and the next succeeding time period shall commence.
5.4 Tenant's Lease Default. Notwithstanding any provision to the contrary
contained in the Lease, if an event of default by Tenant as described in
Section 19.1 of the Lease or any default by Tenant under this Tenant Work Letter
has occurred at any time on or before the substantial completion of the
Premises, then (i) in addition to all other rights and remedies granted to
Landlord pursuant to the Lease, Landlord shall have the right to withhold
payment of all or any portion of the Tenant Improvement Allowance and/or
Landlord may cause Contractor to cease the construction of the Premises (in
which case, Tenant shall be responsible for any delay in the substantial
completion of the Premises caused by such work stoppage), and (ii) all other
obligations of Landlord under the terms of this Tenant Work Letter shall be
forgiven until such time as such default is cured pursuant to the terms of the
Lease.
EXHIBIT D
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SCHEDULE 1
LIST OF CONTRACTORS
1. Corporate Contractors
2. SRC
3. _______________________
SCHEDULE 1
1
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EXHIBIT E
WATERIDGE
FORM OF TENANT'S ESTOPPEL CERTIFICATE
The undersigned, as Tenant under that certain Office Lease (the "Lease")
made and entered into as of _________________, 20__ and between
_________________________________, a ________________________ as Landlord, and
the undersigned as Tenant, for Premises on the ___________ floor(s) of the
Building located at _________________________, Los Angeles, California hereby
certifies as follows:
1. Attached hereto as Exhibit A is a true and correct copy of the Lease and
all amendments and modifications thereto. The documents contained in Exhibit A
represent the entire agreement between the parties as to the Premises.
2. The undersigned has commenced occupancy of the Premises described in the
Lease, currently occupies the Premises, and the Lease Term commenced on
_________.
3. The Lease is in full force and effect and has not been modified,
supplemented or amended in any way except as provided in Exhibit A.
4. Tenant has not transferred, assigned, or sublet any portion of the
Premises nor entered into any license or concession agreements with respect
thereto except as follows:
5. Tenant shall not modify the documents contained in Exhibit A or prepay
any amounts owing under the Lease to Landlord in excess of thirty (30) days
without the prior written consent of Landlord's mortgagee.
6. Base Rent became payable on _______________.
7. The Lease Term expires on _________________.
8. All conditions of the Lease to be performed by Landlord necessary to the
enforceability of the Lease have been satisfied and Landlord is not in default
thereunder.
9. No rental has been paid in advance and no security has been deposited
with Landlord except as provided in the Lease.
10. As of the date hereof, there are no existing defenses or offsets that
the undersigned has, which preclude enforcement of the Lease by Landlord.
11. All monthly installments of Base Rent, all Additional Rent and all
monthly installments of estimated Additional Rent have been paid when due
through _________________. The current monthly installment of Base Rent is
$__________.
12. The undersigned acknowledges that this Estoppel certificate may be
delivered to Landlord's prospective mortgagee, or a prospective purchaser, and
acknowledges that it recognizes that if same is done, said mortgagee,
prospective mortgagee, or prospective purchaser will be relying upon the
statements contained herein in making the loan or acquiring the property of
which the Premises are a part, and in accepting an assignment of the Lease as
collateral security, and that receipt by it of this certificate is a condition
of making of the loan or acquisition of such property.
13. If Tenant is a corporation or partnership, each individual executing
this Estoppel Certificate on behalf of Tenant hereby represents and warrants
that Tenant is a duly formed and existing entity qualified to do business in
California and that Tenant has full right and authority to execute and deliver
this Estoppel Certificate and that each person signing on behalf of Tenant is
authorized to do so.
Executed at __________________ on the _____ day of ______________, 20___.
"Tenant"
--------------------------------------------------,
a
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By:
----------------------------------------------
Name:
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Its:
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EXHIBIT E
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EXTENSION OPTION RIDER
This Extension Option Rider ("Extension Rider") is made and entered into by
and between W9/WLA REAL ESTATE LIMITED PARTNERSHIP, a Delaware limited liability
partnership ("Landlord"), and STYLECLICK.COM, INC., a California corporation
("Tenant"), and is dated as of the date of the Office Lease ("Lease") by and
between Landlord and Tenant to which this Extension Rider is attached. The
agreements set forth in this Extension Rider shall have the same force and
effect as if set forth in the Lease. To the extent the terms of this Extension
Rider are inconsistent with the terms of the Lease, the terms of this Extension
Rider shall control.
1. Option Right. Landlord hereby grants Tenant one (1) option to extend the
Lease Term for a period of five (5) years (the "Option Term"), which option
shall be exercisable only by written Exercise Notice (as defined below)
delivered by Tenant to Landlord as provided below. Notwithstanding the
foregoing, at Landlord's option, in addition to any other remedies available to
Landlord under this Lease, Tenant shall not have the right to extend the Lease
Term for the Option Term if as of the date of delivery of the Exercise Notice by
Tenant, or as of the end of the initial Lease Term, Tenant is in default under
this Lease and the cure period therefore has expired. Upon the proper exercise
of such option to extend, the Lease Term shall be extended for the Option Term.
The rights contained in this Extension Rider shall be personal to the original
Tenant executing the Lease and any Affiliate to which Tenant's entire interest
in this Lease has been assigned pursuant to Section 14.7 of the Lease, and may
only be exercised by the original Tenant or such Affiliate assignee, as the case
may be (and not any other assignee, sublessee or other transferee of Tenant's
interest in the Lease) if the original Tenant or such Affiliate assignee, as the
case may be, occupies the entire Premises as of the date of the Exercise Notice.
2. Option Rent. The Annual Base Rent payable by Tenant during the Option
Term (the "Option Rent") shall be equal to the greater of: (i) the Annual Base
Rent payable by Tenant during the last year of the initial Lease Term; or (ii)
the annual base rent at which tenants, as of the commencement of the Option
Term, will be leasing non-sublease space comparable in size, location and
quality to the Premises for a comparable term, which comparable space is located
in the Building Complex and in other comparable first-class mid-rise office
buildings in West Los Angeles, California, taking into consideration all free
rent and other out-of-pocket concessions generally being granted at such time
for such comparable space for the Option Term (the "Fair Market Rental Rate").
All other terms and conditions of the Lease shall apply throughout the Option
Term; however, (A) any obligation of Landlord to construct Tenant Improvements
or provide a tenant improvement allowance (if applicable) shall not apply during
the Option Term (unless the Option Rent is determined to equal the Fair Market
Rental Rate and such improvements and/or tenant improvement allowance are
specifically included in the determination of the Fair Market Rental Rate), and
(B) Tenant shall, in no event, have the option to extend the Lease Term beyond
the Option Term described in Section 1 above.
3. Exercise of Option. The option contained in this Extension Rider shall
be exercised by Tenant, if at all, only in the following manner: (i) Tenant
shall deliver written notice to Landlord not more than thirteen (13) months nor
less than eleven (11) months prior to the expiration of the initial Lease Term
stating that Tenant may be interested in exercising its option; (ii) Landlord,
after receipt of Tenant's notice, shall deliver notice (the "Option Rent
Notice") to Tenant not less than ten (10) months prior to the expiration of the
initial Lease Term setting forth Landlord's determination of the Option Rent;
and (iii) if Tenant wishes to exercise such option, Tenant shall, on or before
the date (the "Exercise Date") which is the earlier of (A) the date occurring
nine (9) months prior to the expiration of the initial Lease Term, and (B) the
date occurring thirty (30) days after Tenant's receipt of the Option Rent
Notice, exercise the option by delivering written notice ("Exercise Notice")
thereof to Landlord. If Landlord determines in the Option Rent Notice that the
Option Rent shall equal the amount set forth in clause (i) of Section 2 above,
such determination shall be conclusive and all the provisions of Section 4 below
shall not apply. If, however, Landlord determines in the Option Rent Notice that
the Option Rent shall be the Fair Market Rental Rate, then Tenant may, at its
option, object to the Fair Market Rental Rate contained in the Option Rent
Notice, by delivering written notice thereof to Landlord concurrently with
Tenant's delivery to Landlord of its Exercise Notice. Tenant's failure to
deliver the Exercise Notice on or before the Exercise Date, shall be deemed to
constitute Tenant's waiver of its extension right hereunder.
4. Determination of Option Rent. Provided that Tenant timely and
appropriately objects in its Exercise Notice to Landlord, to the Fair Market
Rental Rate for the Option Term initially determined by Landlord in the Option
Rent Notice, then Landlord and Tenant shall attempt in good faith to agree upon
the Fair Market Rental Rate. If Landlord and Tenant fail to reach agreement
within twenty (20) days following Tenant's delivery of such Exercise Notice (the
"Outside Agreement Date"), then each party shall submit to the other party a
separate written determination of the Fair Market Rental Rate within ten (10)
business days after the Outside Agreement Date, and such determinations shall be
submitted to arbitration in accordance with the provisions of Sections 4.1
through 4.8 below. The failure of Tenant or Landlord to submit a written
determination of the Fair Market Rental Rate within such ten (10) business day
period shall conclusively be deemed to be such party's approval of the Fair
Market Rental Rate submitted within such ten (10) business day period by the
other party.
EXTENSION
OPTION RIDER
1
<PAGE>
4.1 Landlord and Tenant shall each appoint one (1) appraiser who shall
by profession be a real estate appraiser who shall have been active over
the two (2) year period ending on the date of such appointment in the
appraisal of office buildings in the West Los Angeles area of Los Angeles,
California. The determination of the appraisers shall be limited solely to
the issue of whether Landlord's or Tenant's submitted Fair Market Rental
Rate is the closer to the actual Fair Market Rental Rate as determined by
the appraisers, taking into account the requirements with respect thereto
set forth in Section 2 above. Each such appraiser shall be appointed within
fifteen (15) days after the Outside Agreement Date.
4.2 The two (2) appraisers so appointed shall, within fifteen (15)
days of the date of the appointment of the last appointed appraiser, agree
upon and appoint a third appraiser who shall be qualified under the same
criteria set forth hereinabove for qualification of the initial two (2)
appraisers.
4.3 The three (3) appraisers shall, within thirty (30) days of the
appointment of the third appraiser, reach a decision as to which of
Landlord's or Tenant's submitted Fair Market Rental Rate is closer to the
actual Fair Market Rental Rate and shall select such closer determination
as the Fair Market Rental Rate and notify Landlord and Tenant thereof.
4.4 The decision of the majority of the three (3) appraisers shall be
binding upon Landlord and Tenant.
4.5 If either Landlord or Tenant fails to appoint an appraiser within
the time period specified in Section 4.1 hereinabove, the appraiser
appointed by one of them shall reach a decision, notify Landlord and Tenant
thereof, and such appraiser's decision shall be binding upon Landlord and
Tenant.
4.6 If the two (2) appraisers fail to agree upon and appoint a third
appraiser, a third appraiser shall be appointed by the Superior Court of
Los Angeles, California.
4.7 Each party shall pay the fees and expenses of the appraiser
appointed by or on behalf of it, and each shall pay one-half of the fees
and expenses of the third appraiser, if any.
4.8 In no event shall the Fair Market Rental Rate selected by the
appraisers be less than the Annual Base Rent payable by Tenant during the
last year of the initial Lease Term.
"Landlord" W9/WLA REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
By:Legacy Partners Commercial, Inc.,
a Texas corporation,
as manager and agent for Landlord
By: /s/ MACK LANEY
-----------------------------------
Name: Mack Laney
Its: COO
"Tenant" STYLECLICK.COM, INC.,
a California corporation
By: /s/ BARRY HALL
--------------------------------------
Name: Barry Hall
Its: CFO
By: /s/ MAURIZIO VECCHIONE
--------------------------------------
Name: Maurizio Vecchione
Its: CEO
EXTENSION
OPTION RIDER
2
<PAGE>
LETTER OF CREDIT RIDER
This Letter of Credit Rider ("LC Rider") is made and entered into by and
between W9/WLA REAL ESTATE LIMITED PARTNERSHIP, a Delaware limited partnership
("Landlord") and STYLECLICK.COM, INC., a California corporation ("Tenant"), and
is dated as of the date of the Office Lease ("Lease") by and between Landlord
and Tenant to which this LC Rider is attached. The agreements set forth in this
LC Rider shall have the same force and effect as if set forth in the Lease. To
the extent the terms of this LC Rider are inconsistent with the terms of the
Lease, the terms of this LC Rider shall control.
1. Concurrently upon execution of the Lease, Tenant shall deliver to
Landlord, as collateral for the full and faithful performance by Tenant of all
of its obligations under the Lease and for all losses and damages Landlord may
suffer as a result of any default by Tenant under the Lease, an irrevocable and
unconditional negotiable letter of credit (the "Letter of Credit"), in the form
and containing the terms required herein, payable in the County of Los Angeles,
California, running in favor of Landlord issued by a solvent nationally
recognized bank with a long term rating of BBB or higher, under the supervision
of the Superintendent of Banks of the State of California, or a National Banking
Association, in the amount of One Million Six Hundred Thousand Dollars
($1,600,000.00 ("LC Amount"). The Letter of Credit shall be (i) at sight and
irrevocable and unconditional, (ii) subject to the terms of this LC Rider,
maintained in effect, whether through replacement, renewal or extension, for the
entire period from the date of execution of this Lease through the date which is
sixty (60) days after the Lease Expiration Date, and Tenant shall deliver a new
Letter of Credit or certificate of renewal or extension to Landlord at least
fifteen (15) days prior to the expiration of the Letter of Credit, without any
action whatsoever on the part of Landlord, (iii) subject to the Uniform Customs
and Practices for Documentary Credits (1993-Rev) International Chamber of
Commerce Publication #500, and (iv) fully assignable by Landlord, and (v) permit
partial draws. In addition to the foregoing, the form and terms of the Letter of
Credit (and the bank issuing the same) shall be acceptable to Landlord, in
Landlord's reasonable discretion, and shall provide, among other things, in
effect that: (A) Landlord, or its then managing agent, shall have the right to
draw down an amount up to the face amount of the Letter of Credit upon the
presentation to the issuing bank of Landlord's (or Landlord's then managing
agent's) of a written statement certifying that such amount is due to Landlord
under the terms and conditions of the Lease, it being understood that if
Landlord or its managing agent be a limited liability company, corporation,
partnership or other entity, then such statement shall be signed by a managing
member (if a limited liability company), an officer (if a corporation), a
general partner (if a partnership), or any authorized party (if another entity);
(B) the Letter of Credit will be honored by the issuing bank without inquiry as
to the accuracy thereof and regardless of whether the Tenant disputes the
content of such statement; and (C) in the event of a transfer of Landlord's
interest in the Building, Landlord shall transfer the Letter of Credit, in whole
or in part (or cause a substitute letter of credit to be delivered, as
applicable) to the transferee and thereupon the Landlord shall, without any
further agreement between the parties, be released by Tenant from all liability
therefor, and it is agreed that the provisions hereof shall apply to every
transfer or assignment of the whole or any portion of said Letter of Credit to a
new Landlord.
2. If, as result of any application or use by Landlord of all or any part
of the Letter of Credit, the amount of the Letter of Credit shall collectively
be less than the LC Amount, Tenant shall, within ten (10) days thereafter,
provide Landlord with additional letter(s) of credit in an amount equal to the
deficiency (or a replacement letter of credit in the total amount of the LC
Amount) and any such additional (or replacement) letter of credit shall comply
with all of the provisions of this LC Rider, and if Tenant fails to comply with
the foregoing, notwithstanding anything to the contrary contained in Article 19
of the Lease the same shall constitute an uncurable default by Tenant. Tenant
further covenants and warrants that it will neither assign nor encumber the
Letter of Credit, or any part thereof and that neither Landlord nor its
successors or assigns will be bound by any such assignment, encumbrance,
attempted assignment or attempted encumbrance. Without limiting the generality
of the foregoing, if the Letter of Credit expires earlier than the date which is
sixty (60) days after the Lease Expiration Date, and Tenant has not provided
Landlord with cash in lieu of the entire LC amount then outstanding pursuant to
Paragraph 1 above, Landlord will accept a renewal thereof or substitute letter
of credit (such renewal or substitute letter of credit to be in effect and
delivered to Landlord, as applicable, not later than fifteen (15) days prior to
the expiration of the Letter of Credit), which shall be irrevocable and
automatically renewable as above provided through the date which is sixty (60)
days after the Lease Expiration Date upon the same terms as the expiring Letter
of Credit or such other terms as may be acceptable to Landlord in its reasonable
discretion. However, if the Letter of Credit is not timely renewed or a
substitute letter of credit is not timely received, or if Tenant fails to
maintain the Letter of Credit in the amount and in accordance with the terms set
forth in this LC Rider, Landlord shall have the right to present the Letter of
Credit to the bank in accordance with the terms of this LC Rider, and the entire
sum evidenced thereby shall be paid to and held by Landlord as collateral for
performance of all of Tenant's obligations under the Lease and for all losses
and damages Landlord may suffer as a result of any default by Tenant under the
Lease.
LETTER OF
CREDIT RIDER
1
<PAGE>
3. If there shall occur a default under the Lease as set forth in Article
19 of the Lease and such default remains uncured beyond the applicable notice
and cure periods set forth in Article 19, Landlord may, but without obligation
to do so, draw upon the Letter of Credit, in part or in whole, to cure any
default of Tenant and/or to compensate Landlord for any and all damages of any
kind or nature sustained or which may be sustained by Landlord resulting from
Tenant's default. Tenant agrees not to interfere in any way with payment to
Landlord of the proceeds of the Letter of Credit, either prior to or following a
"draw" by Landlord of any portion of the Letter of Credit, regardless of whether
any dispute exists between Tenant and Landlord as to Landlord's right to draw
from the Letter of Credit. No condition or term of the Lease shall be deemed to
render the Letter of Credit conditional to justify the issuer of the Letter of
Credit in failing to honor a drawing upon such Letter of Credit in a timely
manner.
4. Landlord and Tenant acknowledge and agree that in no event or
circumstance shall the Letter of Credit or any renewal thereof or substitute
therefor be (i) deemed to be or treated as a "security deposit" within the
meaning of California Civil Code Section 1950.7, (ii) subject to the terms of
such Section 1950.7, or (iii) intended to serve as a "security deposit" within
the meaning of such Section 1950.7. The parties hereto (A) recite that the
Letter of Credit is not intended to serve as a security deposit and such Section
1950.7 and any and all other laws, rules and regulations applicable to security
deposits in the commercial context ("Security Deposit Laws") shall have no
applicability or relevancy thereto and (B) waive any and all rights, duties and
obligations either party may now or, in the future, will have relating to or
arising from the Security Deposit Laws.
5. Notwithstanding the foregoing provisions of this LC Rider to the
contrary, Tenant shall have the right to substitute for the Letter of Credit a
guaranty ("Guaranty") in favor of Landlord executed by USA Networks, Inc.
("Guarantor") provided that Tenant satisfies each of the following conditions:
(i) Tenant shall deliver to Landlord the Guaranty duly executed by Guarantor,
which shall be in the form of Exhibit 1 attached hereto; (ii) Guarantor shall
have a net worth, as of the date of Tenant's delivery of the Guaranty to
Landlord in the amount of at least Three Hundred Million Dollars
($300,000,000.00), as evidenced by financial statements certified by a national
independent accounting firm, and delivered to Landlord concurrently with the
Guaranty if Guarantor is not a publicly held company at the time such Guaranty
is delivered to Landlord; and (iii) as of the date of such delivery, Tenant is
not then in default under the Lease and Landlord has not previously drawn down
all or any portion of the Letter of Credit. Within thirty (30) days following
the delivery the Guaranty and satisfaction of the foregoing conditions, Landlord
shall return the Letter of Credit to Tenant.
"Landlord" W9/WLA REAL ESTATE LIMITED PARTNERSHIP,
a Delaware limited partnership
By:Legacy Partners Commercial, Inc.,
a Texas corporation,
as manager and agent for Landlord
By: /s/ MACK LANEY
-----------------------------------
Name: Mack Laney
Its: COO
"Tenant" STYLECLICK.COM, INC.,
a California corporation
By: /s/ BARRY HALL
--------------------------------------
Name: Barry Hall
Its: CFO
By: /s/ MAURIZIO VECCHIONE
--------------------------------------
Name: Maurizio Vecchione
Its: CEO
LETTER OF
CREDIT RIDER
2
<PAGE>
EXHIBIT 1
GUARANTY OF LEASE
1. Guaranty. USA NETWORKS, INC., a Delaware corporation ("Guarantor"),
whose address is 152 West 57th Street, New York, New York, 10019 and whose tax
identification number is 59-2712887, as a material inducement to and in
consideration of W9/WLA REAL ESTATE LIMITED PARTNERSHIP, a Delaware partnership,
as Landlord, entering into that certain lease (the "Lease") dated as of even
date herewith, with STYLECLICK.COM, INC., a California corporation, as Tenant,
concerning office space located at 5105 West Goldleaf Circle, Los Angeles,
California, hereby unconditionally, irrevocably and jointly and severally
guarantees and promises to and for the benefit of Landlord that Tenant shall
perform all of its covenants under the Lease, including but not limited to the
payment of rent and all other sums now or hereafter becoming due or payable
under the Lease.
2. Standard Provisions. A separate action may be brought or prosecuted
against any Guarantor whether or not the action is brought or prosecuted against
any other Guarantor or Tenant. If Tenant defaults under the Lease, Landlord may
proceed immediately against Guarantor or Tenant, or both, or Landlord may
enforce against Guarantor or Tenant, or both, any rights that it has under the
Lease or against Guarantor pursuant to this Guaranty. If the Lease terminates
Landlord may enforce any remaining rights thereunder against Guarantor without
giving previous notice to Tenant or Guarantor, and without making any demand on
either of them. This Guaranty shall not be affected by Landlord's failure or
delay to enforce any of its rights hereunder or under the Lease. Guarantor
hereby waives notice of or the giving of its consent to any amendments which may
hereafter be made to the terms of the Lease, and this Guaranty shall guarantee
the performance of the Lease as amended, or as the same may be assigned from
time to time. Guarantor waives the right to require Landlord to (i) proceed
against Tenant; (ii) proceed against or exhaust any security that Landlord holds
from Tenant; or (iii) pursue any remedy in Landlord's power. Guarantor waives
any defense by reason of any disability of Tenant, the statute of limitations
and any other defense based on the termination of Tenant's liability from any
cause. Until all of Tenant's obligations to Landlord have been discharged in
full, Guarantor shall have no right of subrogation against Tenant. Guarantor
waives its right to enforce any remedies that Landlord now has, or later may
have, against Tenant. Guarantor waives any right to participate in any security
now or later held by Landlord. Guarantor waives all presentments, demands for
performance, notices of nonperformance, protests, notices of protest, notices of
dishonor, and notices of acceptance of this Guaranty, and waives all notices of
existence, creation, or incurring of new or additional obligations from Tenant
to Landlord. Without limiting the generality of the preceding waivers, Guarantor
hereby expressly waives any and all benefits under California Civil Code
Sections 2809, 2810, 2819, 2845, 2849 and 2850. If Landlord disposes of its
interest in the Lease, "Landlord," as used in this Guaranty, shall mean
Landlord's successors in interest and assigns. If Landlord is required to
enforce Guarantor's obligations by legal proceedings, Guarantor shall pay to
Landlord all costs incurred, including, without limitation, Landlord's
reasonable attorneys' fees and all costs and other expenses incurred in any
collection or attempted collection or in any negotiations relative to the
obligations hereby guaranteed, or in enforcing this Guaranty against the
undersigned, individually and jointly. This Guaranty will continue unchanged by
any bankruptcy, reorganization or insolvency of the Tenant or any successor or
assignee thereof or by any disaffirmance or abandonment by a trustee of Tenant.
Guarantor's obligations under this Guaranty may not be assigned and shall be
binding upon Guarantor's heirs and successors. This Guaranty shall be governed
by the laws of, and may be enforced in the courts of, the State of California.
Dated: ___________, 2000 Guarantor
USA NETWORKS, INC.,
a Delaware corporation
By:
----------------------------------
Name:
-----------------------------
Its:
-----------------------------
By:
----------------------------------
Name:
-----------------------------
Its:
-----------------------------
EXHIBIT 1
1
<PAGE>
