Shutterfly 2008 Annual Report Download - page 102

EXHIBIT “E”
SPECIAL PROVISIONS
1. Moving Allowance . Landlord agrees to provide Tenant with a moving allowance of $0.50 per rentable square foot (“Moving Allowance”)
to be paid to Tenant upon receipt
of paid moving expenses in connection with Tenant moving its personal property from its existing leased space to the Premises. This Moving Allowance may also be used for the
Improvements, cabling and furnishing the Premises. Any unused Moving Allowance shall be credited to Tenant’
s monthly Minimum Rental payments next due until such unused
Moving Allowance has been exhausted.
2. Renewal Option
. So long as Tenant is not in default under this Lease beyond any applicable cure period, Tenant is hereby granted the option to renew the term of the Lease
as to the entire Premises for three (3) additional periods (“Renewal Term”)
of either three (3) or five (5) years in length, as Tenant may elect, to commence at the expiration of the
initial Term or each then current Renewal Term. Any such renewal of this Lease shall be upon the same terms and conditions of this Lease, except there shall be one less renewal
option in each Term and the annual Minimum Rental during the Renewal Term shall be at the then prevailing Market Rate (as defined below) for comparable buildings in Charlotte,
North Carolina.
The “Market Rate”
means the rental rate which Landlord and a third party tenant would agree upon for a new lease, as of the commencement date of such Renewal Term, taking into
consideration the uses permitted under the Lease, the quality, size, design and location of the Premises, which shall exclude any specialized improvements added by the Tenant, and the
rental for a new lease for comparable space located in the vicinity. The Market Rate shall include any tenant improvements, moving allowances, tenant improvement allowances,
abatement of rentals, leasing commissions or other concessions that are then being offered by Landlord or other property owners for space comparable to the Premises.
Tenant shall notify Landlord of its intent to renew by delivering written notice to Landlord at least ten (10) months prior to the expiration of the initial Term, or then current Renewal
Term, with Tenant’
s election of the length of each such Renewal Term. Landlord and Tenant shall then mutually determine the applicable Minimum Rental which will apply to such
Renewal Term within thirty (30) days after Tenant’
s intent notification or such additional time as necessary. Tenant shall then exercise its option to renew, if at all, by delivering
written notice to Landlord six (6) months prior to the expiration of the initial Term, or then current Renewal Term (provided, however, that in no event shall Tenant be given less than
thirty (30) days after the Minimum Rental has been agreed upon in which to exercise said option), which such renewal shall be for the length time stated in Tenant’
s intent notice and
for the Minimum Rental mutually determined by Landlord and Tenant during the preceding month.
3. Termination Option . Tenant shall have the right to terminate this lease (“Termination Right”) with at least six (6) months’
prior written notice to Landlord at the end of the
fifth (5
th
) year of the term. Tenant must exercise this Termination Right, if at all, within thirty (30) days after the last day of the fifth lease year. Prior to the effective date of such
termination, Tenant shall pay to Landlord an amount equal to Landlord’
s unamortized costs for this transaction (including, but not limited to, Tenant Improvement Allowance,
Additional Tenant Improvement Allowance, moving allowance, brokers fees, and attorney’s fee) plus all amounts needed to cure then existing monetary defaults, if any.
4. Rights of First Refusal.
So long as Tenant is not in default of this Lease beyond applicable cure periods and Tenant has not exercised its option set forth in paragraph 5 of this
Exhibit “E”, and subject to any and all prior rights of first refusal granted for space in the Building as of the date of this Lease, in the event any premises in the to-be-
built adjacent
Shopton 18-C building (“Building 18-C”)
which is owned by an affiliate of Landlord becomes available for rent, Landlord shall so notify Tenant. Thereupon, Tenant shall, for a period
of ten (10) business days following receipt of such notice, have a right and option to lease such premises at Market Rent and terms for the intended use for the remainder of the term of
this Lease (as may be extended). Upon addition of space to the Premises pursuant to the exercise by Tenant of its option hereunder, Landlord and Tenant shall execute and deliver an
amendment to this Lease confirming the same (or, at Tenant’
s option, enter into a separate lease for such premises). Notwithstanding anything in this Lease to the contrary, the right of
first refusal granted to Tenant pursuant to this paragraph (i) is not applicable during the final twelve (12) months of the initial Term or any Renewal Term, unless Tenant has exercised
its next Renewal Term, if any, in accordance with this Lease, and (ii) shall have no impact on Tenant’
s right to exercise its Termination Right for the Premises in accordance with
paragraph 3 of this Exhibit “E” (it being understood and agreed that Tenant shall also terminate the lease for Building 18-
C at the same time as the Premises, if at all, by reimbursing
Landlord for all unamortized costs for the Building 18-C transaction (as described in paragraph 3 of this Exhibit “E”).
5. Right of First Refusal on Building 18-C (50,000 square feet minimum).
So long as Tenant is not in default of this Lease beyond applicable cure periods, Tenant shall have
the option of leasing a minimum of 50,000 square feet in Building 18-
C from its owner, which is an affiliate of Landlord. Tenant must exercise such right, if at all, by providing written
notice to Landlord on or before the date which is three (3) months from the date that Tenant receives notice from Landlord of the completion of the Building 18-
C shell. The terms and
conditions of any lease in Building18-
C shall be on the same terms and conditions as this Lease (including, without limitation, eight (8) months free Annual Rental), as may be adjusted
based on the actual square footage leased (i.e. the rental rate and improvement allowance shall be the same per square foot, but will be adjusted if the lease for Building 18-
C is not for
102,400 square feet). In the event any such lease is executed for space in Building 18-C (the “18-C Lease”), the Term of this Lease shall be amended to be a full eighty-
nine (89)
months from the commencement date of the new 18-
C Lease (at the same 3% annual increases in Minimum Rent) such that both leases are coterminous. Notwithstanding anything in
this Lease to the contrary, the right of first refusal granted to Tenant pursuant to this paragraph (i) is not applicable during the final twelve (12) months of the initial Term or any
Renewal Term, unless Tenant has exercised its next Renewal Term, if any, in accordance with this Lease, and (ii) shall have no impact on Tenant’
s right to exercise its Termination
Right for the Premises in accordance with paragraph 3 of this Exhibit “E” (it being understood and agreed that Tenant shall also have the right to terminate the lease for Building 18-
C
at the same time as the Premises by reimbursing Landlord for all unamortized costs for the Building 18-C transaction (as described in paragraph 3 of this Exhibit “E”).
6. Right of First Refusal on Building 18-D (25,000 square feet minimum).
So long as Tenant is not in default of this Lease beyond applicable cure periods and subject to any
and all prior rights of first refusal granted for space in the Building as of the date of this Lease, in the event any premises containing at least 25,000 square feet in the to-be-
built
Shopton 18-D building (“Building 18-D”)
which is owned by an affiliate of Landlord becomes available for rent, Landlord shall so notify Tenant. Thereupon, Tenant shall, for a period
of ten (10) business days following receipt of such notice, have a right and option to lease such premises at Market Rent and terms for the intended use for the remainder of the term of
this Lease (as may be extended). Upon addition of space to the Premises pursuant to the exercise by Tenant of its option hereunder, Landlord and Tenant shall execute and deliver an
amendment to this Lease confirming the same (or, at Tenant’
s option, enter into a separate lease for such premises) . Notwithstanding anything in this Lease to the contrary, the right
of first refusal granted to Tenant pursuant to this paragraph (i) is applicable at all times during the initial Term (and any Renewal Term), but is not applicable during the final twelve
(12) months of the initial Term or any Renewal Term unless Tenant has exercised its next Renewal Term, if any, in accordance with this Lease, and (ii) shall have no impact on
Tenant’s right to exercise its Termination Right for the Premises in accordance with paragraph 3 of this Exhibit “E” (
it being understood and agreed that Tenant shall also have the right
to terminate the lease for Building 18-D at the same time as the Premises by reimbursing Landlord for all unamortized costs for the Building 18-
D transaction (as described in
paragraph 3 of this Exhibit “E”).
7. Parking.
During the term of this Lease (as same may be extended), Tenant shall have the right to park vehicles in a minimum of 390 unreserved parking stalls on the
property known as Shopton 18B, as reflected on Exhibit “E-1”, which Exhibit “E-1”
shall subsequently be attached hereto after agreed to by Landlord and Tenant. Landlord
acknowledges that it will work with Tenant to provide extra parking areas in the rear of the Premises, or work with Tenant to find a suitable solution such as cross-
parking with the
adjacent buildings, in the event there are any parking problems during the term of the Lease to ensure that Tenant has a minimum of 390 parking stalls in the event Tenant uses some of
the above referenced 390 parking spaces as a truck court.
8. Contingency. Tenant’s obligations under this Lease are contingent upon Tenant obtaining a Charlotte-Mecklenburg Business Investment Grant (the “Grant”)
from the City
of Charlotte and County of Mecklenburg in an amount of at least $450,000 within thirty (30) days from the date of this Lease (the “Contingency”).
If Tenant does not receive the Grant
within such thirty (30) day period, Tenant shall have the right to terminate this Lease by written notice to Landlord, in which event this Lease shall be null and void, and neither party
shall have any further rights or obligations to the other.
9. Access . Tenant shall have access to the Premises and Building 24 hours per day, 7 days per week, 365 days per year.
10. Street Name.
Upon written request from Tenant, and subject to all necessary approvals from the City of Charlotte and County of Mecklenburg, Landlord agrees to promptly
(re)name the interior street immediately abutting the Building to be “Shutterfly Road”, “Shutterfly Street” or other similar name (containing the word “Shutterfly”)
to be agreed upon
by Landlord and Tenant.
11.
Environmental Matters.