EXHIBIT 10.1
North Carolina )
) SECOND AMENDMENT TO LEASE
GUILFORD County )
THIS SECOND AMENDMENT TO LEASE, made and entered into this 15th day of
December, 2004, by and between HIGHWOODS REALTY LIMITED PARTNERSHIP, a North
Carolina Limited Partnership, hereinafter referred to as "Landlord" and
CELEBRATE EXPRESS.COM, INC., A WASHINGTON CORPORATION, hereinafter referred to
as "Tenant". Tenant leases from Landlord space in the amount of 56,000 rentable
square feet, (the "Premises"), located at 488 GALLIMORE DAIRY ROAD, SUITE D,
GREENSBORO, NORTH CAROLINA.
W I T N E S S E T H:
WHEREAS, Landlord and Tenant entered in to a Lease (the "Lease") dated
NOVEMBER 12, 1999, as modified by a First Amendment to Lease ("First
Amendment"), dated JUNE 14, 2004, . Said Lease, as amended, is incorporated
herein by reference as is set forth in this SECOND Amendment to Lease in full.
WHEREAS, Tenant desires to expand its Premises by leasing from Landlord
additional rentable square feet, as set forth below, located in 488 GALLIMORE
DAIRY ROAD (the "Building").
WHEREAS, Landlord and Tenant desire to amend said Lease as follows:
1. On JANUARY 1, 2005, on the terms set forth herein, Tenant shall lease from
Landlord and Landlord shall lease to Tenant an additional 30,400 rentable
square feet, known as SUITE A in the Building, (the "Expansion Space"), as
outlined in red on Exhibit "A", attached hereto, incorporated herein.
After addition of the Expansion Space, Tenant's new total rentable square
footage in the Premises will be 86,400 rentable square feet.
2. All referenced to Tenant's pro-rata percentage of the Building shall be
amended to 100% as of JANUARY 1, 2005, (unless Tenant occupies a portion
of the Expansion Space prior to January 1, 2005, in such event Tenant's
pro rata percentage shall be adjusted accordingly as of the date of
occupancy.)
3. Effective JANUARY 1, 2005 , Tenant shall pay base rental for the entire
Premises, including the Expansion Space, as follows:
Term: Monthly Rent: Cumulative Rent:
- ----- ------------- ----------------
1/1/2005 - 12/31/2005 $28,440.00 $341,280.00
1/1/2006 - 12/31/2006 $29,293.20 $351,518.40
1/1/2007 - 8/31/2007 $30,183.12 $241,464.96
4. Landlord agrees to provide an allowance of $10,000.00 for improvements to
be made to the Expansion Space, as detailed in the Work Letter labeled
Addendum No. One, attached hereto and incorporated herein.
5. OPTION TO RENEW: Tenant shall have the right and option to renew the Term
of this Lease for one (1) additional period of three (3) years (the option
to renew being defined as the Renewal Option@ and the three (3) year
renewal period being defined as the "Renewal Lease Term"); provided,
however, the Renewal Option is contingent upon the following: (i) Tenant
is not in default (for which Landlord has provided notice, if required,
and Tenant has not timely cured same) hereunder at the time Tenant gives
Landlord written notice of Tenant's intention to exercise the Renewal
Option; (ii) upon the Termination Date, Tenant is not in default (for
which Landlord has provided notice, if required, and Tenant has not timely
cured same) hereunder; and (iii) no event has occurred that upon notice or
the passage of time would constitute a default. Tenant shall exercise the
Renewal Option by giving Landlord written notice at least one hundred and
twenty (120) days prior to the Termination Date. If Tenant fails to give
such notice to Landlord prior to said one hundred twenty (120) day period,
then Tenant shall forfeit its right to the Renewal Option. If Tenant
exercises the Renewal Option, then during any such Renewal Lease Term,
Landlord and Tenant's respective rights, duties and obligations shall be
governed by the terms and conditions of the Lease.
(a) Term. If Tenant exercises the Renewal Option, then during the Renewal
Lease Term, all references to the term "Term," as used in the Lease, shall
mean the "Renewal Lease Term."
(b) Termination of Renewal Option on Transfer by Tenant. In the event
Landlord consents to an assignment or sublease by Tenant , then, except in
the case of a merger, all Renewal Options shall automatically terminate
unless otherwise agreed in writing by Landlord.
(c) Rent for Renewal Lease Terms. The Base Rent for the Renewal Lease Term
shall be as follows:
Term: Monthly Rent: Cumulative Rent:
- ----- ------------- ----------------
9/1/2007 - 8/31/2008 $31,073.04 $372,876.48
9/1/2008 - 8/31/2009 $32,037.12 $384,445.44
9/1/2009 - 8/31/2010 $33,001.20 $396,014.40
6. All other terms and conditions of the Lease shall remain in full force and
effect.
Signature Page Follows:
IN WITNESS WHEREOF, the parties hereto have executed this SECOND Amendment
to Lease or have caused their duly authorized representatives to execute same in
three (3) original counterparts, as of the day and year first above written.
LANDLORD:
HIGHWOODS REALTY LIMITED PARTNERSHIP, a North
Carolina Limited Partnership
By: Highwoods Properties, Inc., General Partner
Attest:
/s/ Signature Illegible By: /s/ Mark W. Shumaker
- ------------------------- -------------------------------------------
Assistant Secretary VICE President
(Corporate Seal) Mark W. Shumaker
TENANT:
CELEBRATE EXPRESS.COM, INC., A WASHINGTON
CORPORATION
Attest:
/s/ Darin White By: /s/ Michael K. Jewell
- ------------------------- -------------------------------------------
Secretary Michael K. Jewell (Please Print)
(Corporate Seal) Chief Executive Officer and President
STATE OF NORTH CAROLINA )
) ACKNOWLEDGMENT
COUNTY OF FORSYTH )
I, Betsy Styron, a Notary Public for the aforesaid State and County, do
hereby certify that PETE DEY personally came before me this day and acknowledged
to me that she/he is the Assistant Secretary of HIGHWOODS PROPERTIES, INC., a
North Carolina Corporation, and that by authority duly given and as an act of
the corporation, the foregoing instrument was signed in its name by MARK W.
SHUMAKER, its VICE President, sealed with its corporate seal, and attested to by
PETE DEY, its Assistant Secretary.
Witness my hand and official seal or stamp, this the 15th day of December,
2004.
SEAL
My Commission Expires: 5/30/06 /s/ Betsy Styron
------- -----------------
Notary Public
STATE OF WASHINGTON )
) ACKNOWLEDGMENT
COUNTY OF KING )
I, Catherine R. Terhaar, a Notary Public for the aforesaid State and
County, do hereby certify that Darin L. White (name of Secretary) personally
came before me this day and acknowledged to me that she/he is the Secretary of
CELEBRATE EXPRESS.COM, INC., A WASHINGTON CORPORATION (name of Corporation), and
that by authority duly given and as an act of the corporation, the foregoing
instrument was signed in its name by Michael K. Jewell (name of President), its
CEO / President, sealed with its corporate seal, and attested to by Darin White
(name of Secretary), its Secretary.
Witness my hand and official seal or stamp, this the 15th day of December,
2004.
SEAL
My Commission Expires: May 29, 2005 /s/ Catherine R. Terhaar
------------ ------------------------
Notary Public
ADDENDUM NO. ONE [LANDLORD TO DO WORK]
WORKLETTER. This Lease Addendum Number One (the "First Addendum") shall set
forth the rights and obligations of Landlord and Tenant with respect to space
planning, engineering, final workshop drawings, and the construction and
installation of any improvements to the Premises to be completed before the
Commencement Date ("Tenant Improvements"). This Addendum One contemplates that
the performance of this work will proceed in four stages in accordance with the
following schedule: (i) preparation of a space plan; (ii) final design and
engineering and preparation of final plans and working drawings; (iii)
preparation by the Contractor (as hereinafter defined) of an estimate of the
additional cost of the initial Tenant Improvements; (iv) submission and approval
of plans by appropriate governmental authorities and construction and
installation of the Tenant Improvements by the Commencement Date.
In consideration of the mutual covenants hereinafter contained, Landlord and
Tenant do mutually agree to the following:
1. SPACE PLANNING, DESIGN AND WORKING DRAWINGS. On Tenant's behalf, Landlord
shall provide and designate architects and engineers, who, at Tenant's
expense, which expense shall be deducted from the Allowance (as
hereinafter defined), will do the following:
a. Attend a reasonable number of meetings with Tenant and Landlord's agent
to define Tenant's requirements. Landlord shall provide one complete
space plan (EXHIBIT "A") prepared by Landlord's architect in order to
obtain Tenant's approval. Tenant shall approve such space plan, in
writing, within TEN (10) days after receipt of the space plan if the
space plan is not attached as an exhibit to this Workletter.
b. Complete construction drawings for Tenant's partition layout, reflected
ceiling grid, telephone and electrical outlets, keying, and finish
schedule (subject to the limitation expressed in SECTION 2 below).
c. Complete building standard mechanical plans where necessary (for
installation of air conditioning system and duct work, and heating and
electrical facilities) for the work to be done in the Premises.
d. All plans and working drawings for the construction and completion of
the Premises (the "Plans") shall be subject to Landlord's prior written
approval. Any changes or modifications Tenant desires to make to the
Plans shall also be subject to Landlord's prior approval. Landlord
agrees that it will not unreasonably withhold its approval of the
Plans, or of any changes or modifications thereof; provided, however,
Landlord shall have sole and absolute discretion to approve or
disapprove any improvements that will be visible to the exterior of the
Premises, or which may affect the structural integrity of the Building.
Any approval of the Plans by Landlord shall not constitute approval of
any Delays caused by Tenant and shall not be deemed a waiver of any
rights or remedies that may arise as a result of such Delays. Landlord
may condition its approval of the Plans if: (i) the Plans require
design elements or materials that would cause Landlord to deliver the
Premises to Tenant after the scheduled Commencement Date, or (ii) the
estimated cost for any improvements under the Plan is more than the
Allowance.
2. ALLOWANCE. Landlord agrees, at its sole cost and expense to provide an
allowance of up to $10,000.00, to design, engineer, install, supply and
otherwise to construct the Tenant Improvements in the Premises that
will become a part of the Building (the "Allowance"); otherwise, Tenant is
fully responsible for the payment of all costs in connection with the
Tenant Improvements.
3. SIGNAGE AND KEYING. Door and/or directory signage and suite keying in
accordance with building standards shall be provided and installed by
Landlord and deducted from the Allowance.
4. WORK AND MATERIALS AT TENANT'S EXPENSE
a. Prior to commencing and providing any such work or materials to the
Premises, Landlord shall select a licensed general contractor or
contractors, (which Tenant agrees may be an affiliate of Landlord)
(the "Contractor") to construct and install the Tenant Improvements
and Landlord shall submit to Tenant written estimates of the cost of
such work and materials and if said estimate is not already approved
by being attached as an exhibit to this Workletter, Tenant shall
approve said estimates in writing within five (5) business days
after the receipt thereof. Landlord shall not be authorized to
proceed thereon until such estimate is mutually agreed upon and
approved in writing and delivered to Landlord. If the Contractor is
not an affiliate of Landlord, Landlord's written estimate shall
include a construction supervision fee of n/a % to manage and
oversee the work to be done on Tenant's behalf.
b. Tenant agrees to pay to Landlord, promptly upon being billed
therefor, all costs and expenses in excess of the Allowance incurred
in connection with the Tenant Improvements. Such costs and expenses
shall include all amounts charged by the Contractor for performing
such work and providing such materials (including the Contractor's
general conditions, overhead and profit). The excess costs as
outlined on the attached Construction Estimate are anticipated to be
$0.00. Tenant agrees to payment option (N/A) below for any excess
costs.
i. Tenant will be billed for such costs and expenses as follows:
(a) forty-five percent (45%) of such costs and expenses shall
be due and payable upon Tenant's approval of the cost
estimates for the Tenant Improvements; (b) forty-five percent
(45%) of such costs and expenses shall be due and payable when
such work is substantially completed as defined in Section 6
below; (c) ten percent (10%) of such excess costs and expenses
shall be due and payable upon substantial completion of such
work. If unpaid within ten (10) days after receipt of invoice,
then the outstanding balance shall accrue at the rate of one
percent (1%) per month until paid in full; or
ii. Landlord will amortize the excess costs over the term of the
Lease as Additional Rent which will be paid in equal monthly
installments of $N/A.
5. TENANT PLAN DELIVERY DATE
a. Tenant covenants and agrees that although certain plans and drawings
may be prepared by Landlord's architect or engineer, Tenant shall be
solely responsible for the timely completion of the Plans and it is
hereby understood time is of the essence.
b. Tenant covenants and agrees to deliver to Landlord the final Plans
for the Tenant Improvements on or before (the "Tenant Plan Delivery
Date"). It is vital that the final Plans be delivered to Landlord by
the Tenant Plan Delivery Date in order to allow Landlord sufficient
time to review such Plans, to discuss with Tenant any changes
therein which Landlord believes to be necessary or desirable, to
enable the Contractor to prepare an estimate of the cost of the
initial Tenant Improvements, and to substantially complete the
Premises within the time frame provided in the Lease.
6. SUBSTANTIAL COMPLETION
a. The Premises shall be deemed to be "Substantially Complete" when the
work to be performed by Landlord pursuant to the Plans approved by
Landlord and Tenant has been completed and approved by the
appropriate governmental authorities, as certified by Landlord,
except for items of work and adjustment of equipment and fixtures
that can be completed after the Premises are occupied without
causing material interference with Tenant's use of the Premises
(i.e., "punch list items").
b. Notwithstanding the foregoing, if Landlord shall be delayed in
Substantially Completing the Premises (the "Delays") as a result of
the following delays (the "Delays"):
(i) Tenant's failure to approve the space plan within the time
specified in Section 1 herein; or
(ii) Tenant's failure to furnish to Landlord the final Plans on or
before the Tenant Plan Delivery Date; or
(iii) Tenant's failure to approve Landlord's cost estimates within
the time specified in Section 4 herein; or
(iv) Tenant's changes in the Tenant Improvements or the Plans
(notwithstanding Landlord's approval of any such changes); or
(v) Tenant's request for changes in or modifications to the Plans
subsequent to the Tenant Plan Delivery Date; or
(vi) Inability to obtain non-building standard materials, finishes
or installations requested by Tenant; or
(vii) The performance of any work by any person, firm or corporation
employed or retained by Tenant; or
(viii) Any other act or omission by Tenant or its agents,
representatives, and/or employees;
then, in any such event, Landlord shall have the right to declare
that the Premises shall be deemed to have been Substantially
Completed on the date that Landlord determine that the Premises
would have been Substantially Completed if such Delay or Delays had
not occurred.
7. MATERIALS AND WORKMANSHIP. Landlord covenants and agrees that all work
performed in connection with the construction of the Premises shall be
performed in a good and workmanlike manner and in accordance with all
applicable laws and regulations and with the final approved Plans.
Landlord agrees to exercise due diligence in completing the construction
of the Premises.
8. REPAIRS AND CORRECTIONS. Landlord agrees to repair and correct any work or
materials installed by Landlord or its Contractor in the Premises that
prove defective as a result of faulty materials, equipment, or workmanship
and that first appear within ninety (90) days after the date of occupancy
of the Premises. Notwithstanding the foregoing, Landlord shall not be
responsible to repair or correct any defective work or materials installed
by Tenant or any contractor other than Landlord's Contractor, or any work
or materials that prove defective as a result of any act or omission of
Tenant or any of its employees, agents, invitees, licensees, subtenants,
customers, clients, or guests.
9. POSSESSION BY TENANT. The taking of possession of the Premises by Tenant
shall constitute an acknowledgment by Tenant that the Premises are in good
condition and that all work and materials provided by Landlord are
satisfactory as of such date of occupancy, except as to any defects or
incomplete work that are described in a written notice given by Tenant to
Landlord no later than thirty (30) days after Tenant commences occupancy
of the Premises, and except for any equipment that is used seasonally if
Tenant takes possession of the Premises during a season when such
equipment is not in use.
10. ACCESS DURING CONSTRUCTION. During construction of the Tenant Improvements
in the Premises with the approval of Landlord, Tenant shall be permitted
reasonable access to the Premises, as long as such access does not
interfere with or delay construction work on the Premises for the purposes
of taking measurements, making plans, installing trade fixtures, and doing
such other work as may be appropriate or desirable to enable Tenant
eventually to assume possession of and operate in the Premises.
EXHIBIT "A"
PREMISES