Shutterfly 2008 Annual Report Download - page 106

FIRST AMENDMENT TO LEASE
THIS FIRST AMENDMENT TO LEASE (this “First Amendment”) is made and entered into as of this 26
th
day of February 2007, by and between
3915 SHOPTON
ROAD, LLC , a North Carolina limited liability company (hereinafter referred to as "Landlord"), and SHUTTERFLY, INC.
, a Delaware corporation (hereinafter referred to as
"Tenant").
RECITALS:
A. Landlord and Tenant have previously entered into that certain Lease Agreement dated December 22, 2006 (the “Lease”)
for the occupancy of approximately 102,400
rentable square feet of space (the “Premises”) known as building Shopton 18-B, in the Shopton Ridge Business Park, Charlotte, North Carolina (the “Building”).
B. Landlord and Tenant desire to amend the Lease as hereinafter set forth.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant do hereby enter into this First
Amendment and amend the Lease as set forth below. All terms used but not defined herein shall have the meanings set forth in the Lease.
“Landlord will deliver the Premises to Tenant in phases beginning with Phase I delivered on the Commencement Date, with Landlord’
s Work for each Phase (as
defined in Paragraph 1 of Exhibit ”C”
attached hereto) substantially completed in accordance with the Final Plans and Specifications (as defined in paragraph 1 of
said Exhibit ”C” ),
subject to revisions as mutually agreed to in writing by Landlord and Tenant, as evidenced, if requested by Tenant, by the certification of
Landlord’
s architect or other designated engineering representative. Tenant shall be given access to the Premises upon written request to Landlord not more than
sixty (60) days prior to the Commencement Date, for the purposes of preparing the Premises for Tenant’
s use. With the exception of any Annual Rental payments
due, all terms and conditions of this Lease shall apply to Tenant upon such occupancy. Tenant shall coordinate such occupancy with Landlord and shall not interfere
with Landlord’s completion of Landlord’s Work. If Landlord for any reason whatsoever cannot substantially complete Landlord’
s Work and deliver possession of
Phase I to Tenant on the Commencement Date as above specified, this Lease shall not be void or voidable nor shall Landlord be liable to Tenant for any loss or
damage resulting therefrom; but in that event (except to the extent that any such delay(s) has been caused by Tenant or its agent(s), employee(s), contractor(s) or
subcontractor(s) (collectively, “Tenant Delay Factors”),
and provided that in each such instance Landlord first gives Tenant written notice that if Tenant does not so
cure its act or omission within two (2) business days the same will thereafter be considered a Tenant Delay Factor, the Commencement Date shall be adjusted to be
the date when Landlord does in fact substantially complete Landlord’
s Work and deliver possession of Phase I to Tenant. Notwithstanding anything herein to the
contrary, in the event Landlord’s Work for Phase I is not complete by the date (such date referred to herein as the “Delivery Date”)
which is one hundred twenty (120)
days after approval (or deemed approval) by Landlord and Tenant of the Final Phase I Plans and Specification (as hereinafter defined), except for reasons of Tenant
Delay Factors or force majeure (which force majeure delays shall only be extended by up to 90 days), Tenant shall be granted three (3) days of free Minimal Rental
for every day beyond the Delivery Date until Landlord’
s Work for Phase I has been complete, and the Rent Commencement Date shall be adjusted accordingly. In
the event Landlord is unable to deliver the Premises by September 30, 2007, Tenant may terminate this Lease with no further obligation by providing Landlord
written notice on or before October 10, 2007.”
a. Section 5 of Exhibit “E” to the Lease is hereby deleted in its entirety and the following substituted therefor:
“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 (“Landlord’
s
Affiliate”).
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 Building 18-
C shall (i) 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), and (ii)
(subject to approval by Landlord, Landlord’s Affiliate, the applicable lenders for Landlord and Landlord’
s Affiliate and further subject to applicable Legal
Requirements) give Tenant the right, at Tenant’
s sole cost and expense (subject to application of the Improvements Allowance and the Additional Tenant
Improvement Allowance, each as hereinafter defined), to (a) block-off the back side of the driveway between Building 18-C and Building 18-
B and create an
enclosed walkway between such buildings as shown on Exhibit “E-2” attached hereto (the “Walkway”),
and (b) lay conduit between such buildings. Tenant
acknowledges that it will be solely responsible for all maintenance and repair of the Walkway and upon written demand from Landlord must remove the same at the
expiration or earlier termination of the Lease and restore the parking lot to its condition prior to installation of the Walkway. 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”).”
b. Section 7 of Exhibit “E” to the Lease is hereby deleted in its entirety and the following substituted therefor:
“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 275 unreserved
parking stalls on the property known as Shopton 18B, as reflected on Exhibit “E-1”
attached hereto. 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 that (i)
there are any parking problems during the term of the Lease, or (ii) Tenant anticipates a short-
term increase in the number of parking stalls required to support peak
production periods, or (iii) Tenant determines that it needs more than 275 parking spaces. Tenant acknowledges that such 275 parking stalls will be available only
until Tenant constructs the Walkway, if at all, and subsequent to such Walkway construction, Tenant’
s parking stalls will be reduced beyond 275 stalls by the number
lost for Tenant’s Walkway.”
c. Section 8 (Contingency) of Exhibit “E” to the Lease is hereby deleted in its entirety.
1. Commencement Date . The Commencement Date, which is defined in the first sentence of Section 2 of the Lease, is hereby amended to mean “the later
of May 30,
2007 or upon substantial completion of Phase I of Landlord
’
s Work, as defined in Exhibit
“
C
”
attached to this First Amendment and made a part hereof.
”
2.
Delivery of Possession
. Section 4 of the Lease is hereby deleted in its entirety and the following is substituted in lieu thereof:
3. Upfit of the Premises . Exhibit “C” to the Lease, Upfit of the Premises, is hereby deleted in its entirety and the revised Exhibit “C”
attached hereto is substituted in
lieu thereof.
4.
Exhibit
“
E
”
to the Lease
.
5.
Ratification
. Except as modified and amended by this First Amendment, all terms and conditions of the Lease shall remain in full force and effect.