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EXHIBIT 10.3(b)
SECOND AMENDMENT TO STANDARD FORM INDUSTRIAL LEASE (NET)
THIS SECOND AMENDMENT TO STANDARD FORM INDUSTRIAL LEASE (NET) (this
"AMENDMENT") is made and entered into as of this 4th day of August, 2000 by and
between Carol Point LLC c/o UBS REALTY INVESTORS, LLC, a Massachusetts limited
liability company ("LANDLORD") and PARTYLITE GIFTS, INC., a Delaware corporation
("TENANT").
W I T N E S S E T H:
WHEREAS, Landlord's predecessor-in-interest, Carol Point Builders I General
Partnership ("CAROL POINT"), and Tenant entered into that certain Standard Form
Industrial Lease (Net) dated April 22, 1993 (the "ORIGINAL LEASE"), pursuant to
which Carol Point leased to Tenant space at Carol Point Business Center Building
#2, which is located at 882-888 Carol Court, Carol Stream, Illinois as more
particularly set forth in the Original Lease; and
WHEREAS, Landlord's predecessor and interest, ERI-CP, Inc. and Tenant
entered into a certain First Amendment to Lease Agreement dated as of August 21,
1995 (the "FIRST AMENDMENT");
WHEREAS, Landlord and Tenant desire to amend the Original Lease according
to the terms hereof to extend the Term, among other things (as amended by this
Amendment, the Original Lease [as amended by the First Amendment] is hereinafter
referred to as the "LEASE");
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, Landlord and Tenant hereby agree as follows:
1. CONTROLLING LANGUAGE. Insofar as the specific terms and provisions of
this Amendment purport to amend or modify or are in conflict with the specific
terms, provisions and exhibits of the Original Lease, the terms and provisions
of this Amendment shall govern and control; in all other respects, the Original
Lease shall remain unmodified and in full force and effect.
2. TERM OF THE LEASE. The Term of the Lease is hereby extended for six
(6) years and four (4) months beginning on May 1, 2001 and ending on August 31,
2007, inclusive (the "SECOND EXTENSION TERM"), on all the terms, covenants and
conditions of the Lease, except as hereinafter set forth, and any reference in
the Lease to the Term of the Lease shall be deemed to include the Second
Extension Term and apply thereto unless it is expressly provided otherwise.
Likewise, any reference in the Lease to the Termination Date of the Lease shall
be deemed to mean August 31, 2007.
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3. RENT. Tenant shall pay to Landlord Fixed Rent with respect to the
Demised Premises for the Second Extension Term at the following rates:
<Table>
<Caption>
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TIME PERIOD MONTHLY RENT PER SQUARE FOOT PER YEAR
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May 1, 2001 - April 30, 2002 $ 50,815.50 $ 4.50 psf
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May 1, 2002 - April 30, 2003 $ 51,944.73 $ 4.60 psf
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May 1, 2003 - April 30, 2004 $ 53,073.97 $ 4.70 psf
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May 1, 2004 - April 30, 2005 $ 54,316.12 $ 4.81 psf
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May 1, 2005 - April 30, 2006 $ 55,558.28 $ 4.92 psf
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May 1, 2006 - April 30, 2007 $ 56,800.44 $ 5.03 psf
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May 1, 2007 - August 31, 2007 $ 58,042.59 $ 5.14 psf
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</Table>
4. CONDITION OF DEMISED PREMISES. Except as provided below in this
Paragraph 4, throughout the Second Extension Term, Landlord is leasing the
Demised Premises to Tenant "as is", without any representations or warranties of
any kind (including, without limitation, any express or implied warranties of
merchantability, fitness or habitability) and without any obligation on the part
of Landlord to alter, remodel, improve, repair, or decorate the Demised Premises
or any part thereof. Landlord shall improve the Demised Premises by performing
the improvements described as EXHIBIT A attached hereto and made a part hereof
(the "LANDLORD'S WORK") in accordance with plans and specifications agreed to by
Landlord and Tenant and Landlord shall pay for such work in an amount equal to
the lesser of (a) $130,000, and (b) the actual cost of Landlord's Work. If the
cost of Landlord's Work is greater than $130,000, Tenant shall pay Landlord the
difference as additional Rent and if the cost of Landlord's Work is less than
$130,000, Tenant shall have no right to such underage in the form of a credit
against Rent or otherwise.
5. ARTICLE C OF LEASE. Landlord and Tenant acknowledge that ARTICLE C of
the Lease is hereby deleted and replaced in its entirety by the following:
RENEWAL OPTION.
(1) EXERCISE OF OPTION. Provided Tenant is not in default (beyond
applicable notice and grace periods) pursuant to any of the terms and
conditions of this Lease, Tenant shall have the option (the "OPTION")
to renew this Lease for an additional five (5) year period (the
"OPTION PERIOD") for the period commencing on the date following the
Termination Date upon the terms and conditions contained in this
Lease, except as provided in this Article C. To exercise the Option,
Tenant shall give Landlord notice (the "EXTENSION NOTICE") of the
intent to exercise said Option not less than twelve (12) months or
more than fifteen (15) months prior to the date on which the Option
Period will commence. In the event
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Tenant shall not timely exercise the Option, this Lease will terminate
in its entirety at the Termination Date and Tenant will have no
further options to renew or extend the Term of this Lease.
(2) DETERMINATION OF RENT. The Fixed Rent for the Option Period shall
be determined as follows:
(a) Landlord and Tenant will have thirty (30) days after
Landlord receives the Extension Notice within which to agree on
the fair market rental value of the Demised Premises as of the
commencement date of the Option Period, as defined in subsection
(b) below. If they agree on the Fixed Rent within thirty (30)
days, they will amend this Lease by stating the Fixed Rent.
(b) If Landlord and Tenant are unable to agree on the Fixed Rent
for the Option Period within thirty (30) days, the Fixed Rent for
the Option Period will be the fair market rental value of the
Demised Premises as of the commencement date of the Option Period
as determined in accordance with subsection (c) hereof. As used
in this Lease, the "fair market rental value of the Demised
Premises" means what a landlord under no compulsion to lease the
Demised Premises, and a tenant under no compulsion to lease the
Demised Premises, would determine as Fixed Rent (including
initial monthly rent and rental increases) for the Option Period,
as of the commencement of the Option Period, taking into
consideration the uses permitted under this Lease, the quality,
size, design, location and amenities of the Demised Premises, and
the rent for comparable buildings located in the vicinity of the
Demised Premises.
(c) Within thirty (30) days after the expiration of the thirty
(30) day period set forth in subsection (b) above, Landlord and
Tenant shall each appoint one licensed real estate appraiser or
real estate broker (such broker to have no less than ten (10)
years of relevant experience relating to the rental of space
comparable to the Demised Premises in the applicable submarket in
which the Demised Premises is located) (collectively, the
"APPRAISERS") (Landlord and Tenant to each pay the cost of their
own Appraiser), and the Appraisers so appointed shall jointly
attempt to determine and agree upon the then fair market rental
value of the Demised Premises. If they are unable to agree, then
each Appraiser so appointed shall set one value, and notify the
other Appraiser, of the value set by him or her, concurrently
with such Appraiser's receipt of the value set by the other
Appraiser. The two Appraisers then shall, together, select a
third licensed appraiser or broker (such broker to have no less
than ten (10) years of relevant experience relating to the rental
of space comparable to the Demised Premises in the applicable
submarket in which the Demised Premises is located) (the cost of
such third appraiser or broker shall be shared equally by
Landlord and Tenant), who shall make a determination of the then
fair market rental value, after reviewing the reports of the
first
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two Appraisers appointed by the parties, and after doing such
independent research as he/she deems appropriate. The value
determined by the third appraiser or broker shall be the Fixed
Rent for the Demised Premises.
6. REAL ESTATE BROKER. Both parties represent to each other that they
have not dealt with any real estate broker with respect to this Amendment except
for Hiffman Shaffer Associates and Cushman & Wakefield and to their knowledge,
no other broker initiated or participated in the negotiations of this Amendment
or is entitled to any commission in connection with the Amendment. Both parties
agree to indemnify and hold the other harmless from all claims from any other
real estate broker claiming through the indemnifying party for commission or
fees in connection with this Amendment.
7. MISCELLANEOUS.
A. Landlord and Tenant hereby agree that (i) this Amendment is
incorporated into and made a part of the Lease, (ii) any and all references to
the Lease hereinafter shall include this Amendment, (iii) the Lease and all
terms, conditions and provisions of the Lease are in full force and effect as of
the date hereof, except as expressly modified and amended hereinabove, and (iv)
neither Landlord nor Tenant is in default under the terms of the Lease.
B. All terms capitalized but not defined herein shall have the same
meaning ascribed to such terms in the Lease.
C. This Amendment shall be governed by and construed under the laws
of the State of Illinois.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first above written.
LANDLORD: CAROL POINT LLC TENANT:
By UBS REALTY INVESTORS, PARTYLITE GIFTS, INC.,
LLC, a Massachusetts limited a Delaware corporation
liability company
its Investment Advisor and Agent
By: /s/ Joseph E. Gaukler By: /s/ Joseph M. Midolo
---------------------------- --------------------------
Name: Joseph E.Gaukler Name: Joseph M. Midolo
--------------------------- ------------------------
Title: Director Title: Vice President
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Date: September 14, 2000 Date: August 4, 2000
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EXHIBIT A
1. Improve the office HVAC System.
2. Improve warehouse ventilation.
3. Increase warehouse lighting.
4. Paint and carpet office area.
5. Install additional bathrooms.
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REAFFIRMATION OF CONTINUING LEASE GUARANTY
Reference is hereby made to that certain Standard Form Industrial Lease
(Net) between Carol Point Builders I General Partnership and PartyLite Gifts,
Inc. dated as of April 22, 1993 (the "ORIGINAL LEASE") and that certain First
Amendment to Lease Agreement between ERI-CP, Inc. and PartyLite Gifts, Inc.
dated August 21, 1995 (the "FIRST AMENDMENT") and that certain Second Amendment
to Standard Form Industrial Lease (Net) dated contemporaneously herewith (the
"SECOND AMENDMENT", as amended by the First Amendment and Second Amendment, the
Original Lease is referred to herein as the "LEASE").
Pursuant to the Lease, the undersigned delivered a Continuing Lease
Guaranty dated as of April 22, 1993, to Carol Point Builders I General
Partnership whereby the undersigned guaranteed certain payment and performance
obligations of PartyLite Gifts, Inc. under the Lease.
For good and valuable consideration the receipt and sufficiency whereof are
hereby acknowledged, the undersigned hereby reaffirms all of its obligations
under the Continuing Lease Guaranty and acknowledges and agrees that its
obligations under the Guaranty extend to, and include, the obligations of
PartyLite Gifts, Inc. under the First Amendment and Second Amendment.
IN WITNESS WHEREOF, the undersigned has exercised this Reaffirmation of
Continuing Lease Guaranty this 4th day of August, 2000.
GUARANTOR:
BLYTH INDUSTRIES, INC.,
a Delaware corporation
By: /s/ Richard T. Browning
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Name: Richard T. Browning
----------------------------
Title: Vice President
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