Exhibit 10.3
FIRST AMENDMENT TO LEASE
KINGSTON ANDRITA LLC
c/o Kingston Investors Corp.
135 East 57th Street
New York, New York 10021
May 15, 2002
Playboy Entertainment Group, Inc.
9242 Beverly Boulevard
Beverly Hills, California 90210
Re: Lease dated as of September 20, 2001 between Kingston Andrita
LLC, as landlord, and Playboy Entertainment Group, Inc., as
tenant, covering premises located at 3030 Andrita Street, Los
Angeles, California (the "Lease")
Ladies and Gentlemen:
Reference is made to the captioned Lease. Capitalized terms used, but not
defined, herein, shall have the meanings ascribed to them in the Lease.
In consideration of Ten Dollars ($10.00) and other good and valuable
consideration, the receipt of which hereby is acknowledged, this is to confirm
our agreement to amend the Lease as follows:
1. The last paragraph of Section 2.2(d)(i) of the Lease hereby is amended as
follows: (a) the date "June 1, 2002" is deleted from each place it
appears, and the date "August 1, 2002" is substituted therefor; (b) the
date "June 15, 2002" is deleted from each place it appears, and the date
"August 15, 2002" is substituted therefor; and (c) the date "June 30,
2002" is deleted from each place it appears, and the date "August 31,
2002" is substituted therefor.
2. The first paragraph of Section 2.2(d)(ii) of the Lease hereby is amended
as follows: the date "June 15, 2002" is deleted from each place it
appears, and the date "August 1, 2002" is substituted therefor.
3. You have requested an open ceiling modification to that portion of
Landlord's Work being performed in the Playboy Office Space, which
modification currently is estimated to cause the cost of Landlord's Work
to increase by approximately $90,000. Notwithstanding that pursuant to the
terms of the Lease the cost of such modification would be a Playboy Office
Work Change Cost, the actual cost of such open ceiling modification shall
be deemed to be Shared Excess with respect to the Playboy Office Space,
and you will pay for 50% of such increased cost in accordance with Section
15.3(e)(y) of the Lease. That portion of such actual increased cost which
is the responsibility of the undersigned shall be excluded from
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Landlord's share of the Shared Excess solely for purposes of the
calculation of the increase in Base Rent pursuant to Section 2.2(e) of the
Lease.
4. At your request, the existing approved plans for Landlord's Work will be
modified by the undersigned in order to provide more natural light by
leaving existing windows exposed in offices on the Fletcher Drive side of
the premises, as per the plan attached hereto as Exhibit A (rather than to
cover them as contemplated by such existing approved plans for Landlord's
Work). Notwithstanding that pursuant to the terms of the Lease the cost of
such modification would be a Playboy Office Work Change Cost, the
undersigned shall be responsible for 100% of any increase in the cost of
Landlord's Work that is caused by such changes (i.e., such cost shall not
be deemed to be a Playboy Office Work Change Cost or Shared Excess), and,
provided they are consistent with the changes contemplated by Exhibit A
attached hereto, the modifications to such existing plans to be made by
the undersigned due to such changes shall not be subject to your approval.
5. Notwithstanding anything in the Lease to the contrary, the Master Control
Room Rent Start Date shall be deemed to be the earlier of (a) that date on
which you commence to use or occupy all or part of the Master Control Room
for any purpose and (b) the date on which the work set forth in those
certain Directrix Plans dated 11/16/01 and the Andrita Studios-Directrix
Specifications dated November 2001 (excluding permanent air conditioning
and a certificate of occupancy [or its equivalent]) with respect to the
Master Control Room (the "MCR" Work) is substantially completed. The MCR
Work shall be deemed substantially completed when it is completed to such
an extent that only minor or insubstantial details of construction,
mechanical adjustment or decoration shall remain to be performed, the
completion of which shall not materially interfere with the use of the
Master Control Room for its intended use. In addition, in the event that
any Tenant Delay causes a delay in the substantial completion of the MCR
Work, then the MCR Work shall be deemed substantially completed on the
date on which it would have been substantially completed but for such
Tenant Delay.
6. The undersigned hereby waives any Tenant Delays that may have occurred
through the date hereof with respect to the performance of Landlord's
Work. Nothing herein, however, shall constitute a waiver by the
undersigned of any Tenant Delay that occurs after the date hereof.
Except as set forth hereinabove, all of the terms, covenants and conditions of
the Lease hereby are ratified and confirmed and shall remain in full force and
effect.
Each party hereto represents and warrants that it has not dealt with any broker
or brokers in connection with this letter agreement and agrees to defend, save
and hold the other harmless from any claims for fees and commissions and against
any liability (including reasonable attorneys' fees and disbursements) by reason
of the indemnifying party's breach of such representation and warranty.
This letter agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted assigns.
This letter agreement may be executed in counterparts, each of which shall be
deemed to be an original, and all of which, taken together, shall constitute one
and the same agreement.
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This letter agreement shall be deemed to constitute the First Amendment to the
Lease.
Each party hereby agree to execute such other or further documentation as may
reasonably be required in order to effectuate the intended purposes of this
letter agreement.
Kindly indicate your agreement to the foregoing by signing this letter agreement
in the space provided below.
Very truly yours,
KINGSTON ANDRITA LLC
By: /s/ E. Peter Krulewitch
---------------------------
Name:
Title:
ACCEPTED AND AGREED TO:
PLAYBOY ENTERTAINMENT GROUP, INC.
By: /s/ James L. English
---------------------------------
Name: James L. English
Title: President
CONSENTED TO:
Playboy Enterprises, Inc., Guarantor
By: /s/ Howard Shapiro
---------------------------------
Name: Howard Shapiro
Title: Ex. VP
CapitalSource Finance LLC
By: /s/ Michael C. Szwajkowski
---------------------------------
Name: Michael C. Szwajkowski
Title: Managing Director
EXHIBIT A
[map of floor plan]