EXHIBIT 10.5.2
FIRST AMENDMENT TO SUBLEASE AGREEMENT
This First Amendment to Sublease Agreement (this "Amendment") is made
and entered into as of July 3, 2003, between Xxxxxx.xxx Holdings, Inc., a
Delaware corporation ("Sublandlord") and Blue Nile, Inc., a Delaware corporation
("Subtenant").
RECITALS:
A. Sublandlord and Subtenant entered into that certain Sublease
Agreement dated May 22, 2003 with respect to certain premises (the "Leased
Premises") located in the Opus Center South Building (the "Building") in
Seattle, Washington. The Leased Premises and the Building are more fully
described in EXHIBIT A to this Sublease. The Sublease is in full force and
effect.
B. The parties have agreed that the Expansion Space described in
the Sublease shall be added to the Leased Premises, and that Subtenant may
construct improvements to the Expansion Space as a part of its initial
improvements to the Leased Premises, all subject to certain terms and
conditions.
C. Sublandlord and Subtenant now wish to amend the Sublease to
provide for the foregoing and for certain other matters, all as set forth below.
AGREEMENT
In consideration of the mutual promises of the parties and for other good and
valuable consideration, the receipt and sufficiency of which are acknowledged,
the parties agree as follows:
1. DEFINITIONS
The capitalized words used in this Amendment shall have the meanings ascribed to
them in the Sublease unless the context requires otherwise.
2. SUBLEASE OF EXPANSION SPACE
2.1 AMENDMENT TO SECTION 1.2. Section 1.2 of the Sublease is
amended to read in its entirety as follows:
1.2 Expansion Space. The entire balance of the 9th floor of the
Building ("Expansion Space") shall be added to and become a part of the
Subleased Premises for all purposes under this Sublease on that date (i) which
is eighteen (18) months after the Sublease Commencement Date, or (ii) on which
Subtenant first uses the Expansion Space for any purpose whatsoever (other than
the purposes described in Section 1.5 or Section 6.1 below), whichever shall
first occur ("Expansion Effective Date"); provided, however, that (a) the
Security Deposit shall be increased by the sum of $5,901.75 (subject to
adjustment after the Subleased Premises and Expansion Space are measured
pursuant to Section 1.1), (b) there will be no abatements in Basic Rent for the
Expansion Space for time periods occurring prior to the Expansion Effective
Date, (c) the Subtenant Improvement Allowance for the Expansion Space will be a
prorated portion of the Subtenant Improvement Allowance provided pursuant to
Section 6.1 below stated
1.
on a per square foot basis, based upon the total number of months that the
Expansion Space will be a part of the Subleased Premises as compared to the
total number of months of the Sublease Term, (d) the Subtenant Improvement
Allowance for the Expansion Space will be paid at the time and in the manner set
forth in Section 6.1 below, and (e) Sublandlord will not pay Moving Expenses
with respect to the Expansion Space. The following example is for purposes of
clarification of the manner in which the Subtenant Improvement Allowance will be
calculated for the Expansion Space: Assuming that the Expansion Space is 4,000
Square Feet of Rentable Area and that it becomes a part of the Subleased
Premises at the commencement of the 19th month of the Sublease Term, and
assuming that the Sublease Term is 93 months, then the total available allowance
stated on a per square foot basis would be 75/93 times $58.50 (the Subtenant
Improvement Allowance stated in Section 6.1). Subject to the terms and
conditions of Section 6.1, Sublandlord hereby assigns to Subtenant the right to
receive from Landlord a portion of the Improvement Allowance equal to $30 per
square foot of the Rentable Area in the Expansion Space; the remaining allowance
amount will be provided by Sublandlord as Additional Allowance. The total
Subtenant Improvement Allowance for the Expansion Space shall be included for
purposes of calculating the Early Termination Fee pursuant to Section 2.2.
2.2 DELETION OF SECTION 1.3. Section 1.3 of the Sublease is
deleted in its entirety.
2.3 AMENDMENT TO SECTION 1.4. Section 1.4 of the Sublease is
amended by deleting the first six words of that Section, so that the first
sentence of Section 1.4 reads as follows:
At any time after the expiration of the forty-eighth (48th) month of
the Sublease Term ("Adjacent Floor RFO Date"), Subtenant will have a right of
first offer to sublease any space that Sublandlord intends to sublease on a
floor that is adjacent to a floor on which Subtenant is already subleasing space
from Sublandlord, subject to the pre-existing rights of other subtenants of the
Building as of the Adjacent Floor RFO Date.
3. INITIAL SUBTENANT IMPROVEMENTS FOR EXPANSION SPACE
The second paragraph of Section 6.1 of the Sublease shall be amended to read in
its entirety as follows:
At Subtenant's option, Subtenant may build out its initial improvements
to the Expansion Space ("Expansion Space Improvements") at the same time as, and
as a part of, construction of Subtenant's Improvements to the initial Subleased
Premises, subject to the terms of this Sublease concerning approval of all of
Subtenant's Improvements by Landlord and Sublandlord. The Expansion Space shall
he measured pursuant to Section 1.1 above upon completion of the Expansion Space
Improvements. Subtenant shall have no right whatsoever to use, appropriate or
otherwise enjoy the benefit of the Expansion Space Improvements prior to the
Expansion Effective Date except that Subtenant, its agents, employees and
invitees will have the right at all times prior to the Expansion Effective Date
to walk through the Expansion Space to jet to and from other parts of the
Subleased Premises. The Subtenant Improvement Allowance (both the Base
Improvement Allowance and the Additional Allowance) and the Architectural
Allowance with respect to the Expansion Space shall be paid to Subtenant thirty
(30) days after the Expansion Effective Xxxx, provided, however, that (a)
Subtenant shall have provided to Sublandlord, immediately upon completion of
construction of the Expansion Space Improvement, valid invoices for completion
of all of the Expansion Space Improvements, whether or not the
2.
Expansion Effective Date shall have occurred, and (b) the Subtenant Improvement
Allowance will be immediately revoked during the existence of any Event of
Default (as defined in the Prime Lease) under this Sublease that remains uncured
or that is no longer susceptible of cure in accordance with the terms of this
Sublease.
4. REVOCABLE LICENSE TO USE GENERATOR
The parties acknowledge that the Building is served by a backup power generator
owned by Landlord and that Sublandlord has certain rights to use the generator
pursuant to the Prime Lease. Sublandlord agrees that Subtenant may install such
wires, lines and appurtenances as may be reasonably necessary in Order to
connect to the generator to serve the Subleased Premises (subject to the terms
of this Sublease concerning approval of all of Subtenant's Improvements by
Landlord and Sublandlord), and may use a portion of the capacity of the
generator as described in the report of Cochrane Electrics dated May 30, 2003 (a
copy of has been received by each party) (the "Revocable License"). Subtenant
shall install a protection device between the building electrical supply and any
devices owned by Subtenant with sufficient buffering capacity to protect
Subtenant's devices from variances in electrical supply. Sublandlord or Landlord
may revoke the Revocable License on written notice given to Subtenant no less
than five (5) days prior to the effective date of the revocation. No later than
the effective date of the revocation Subtenant shall disconnect its service from
the generator, and Subtenant shall promptly thereafter remove all wires, lines
and appurtenances that were installed by or on behalf of Subtenant in order to
connect to and use the generator, and shall repair any damage caused by the
installation or removal of those wires, lines and appurtenances. Neither
Sublandlord nor Landlord makes any representations or warranties as to the
available capacity of the generator or the adequacy of the generator to meet
Subtenant's needs. Neither Sublandlord nor Landlord shall have any liability to
Subtenant with respect to the generator and Subtenant releases any and all
claims it may have against either of them in the event the generator fails to
supply adequate electricity to Subtenant's equipment.
5. LANDLORD'S CONSENT
The effectiveness of this Amendment is expressly conditioned upon Landlord's
written consent given in substantially the form attached to this Amendment as
Exhibit B within thirty (30) days of the date of this Amendment. The additional
funds required pursuant to Section 2.1 of this Amendment in order to increase
the Security Deposit shall be tendered to Sublandlord within 5 business days
after receipt of Landlord's consent.
6. EXHIBITS
The following Exhibits attached to this Amendment are incorporated into
and made a part of it by this reference:
EXHIBIT A Subleased Premises and Legal
Description
EXHIBIT B Landlord's Consent
7. RATIFICATION
3.
Except as specifically amended by this Amendment, the Sublease is ratified and
confirmed.
4.
Executed in duplicate as of the date first written above.
SUBLANDLORD:
XXXXXX.XXX HOLDINGS, INC.
By: /s/ Xxxx Xxxx
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Name: Xxxx Xxxx
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Title: VP
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SUBTENANT:
BLUE NILE, INC.
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
------------------------------------
Title: CEO
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5.
STATE OF WASHINGTON )
) ss.:
COUNTY OF KING )
On this 21st day of July, 2003, before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn,
personally appeared Xxxx X. Xxxx, to me known to be the person who signed as VP
of Xxxxxx.xxx Holdings, Inc., the corporation that executed the within and
foregoing instrument, and acknowledged said instrument to be the free and
voluntary act and deed of said corporation for the uses and purposes therein
mentioned, and on oath stated that he was duly elected, qualified and acting as
said officer of the corporation, that he was authorized to execute said
instrument and that the seal affixed, if any, is the corporate seal of said
corporation.
IN WITNESS WHEREOF I have hereunto set my hand and official seal the
day and year first above written.
/s/ Xxxxx Xxxxxx Xxxxxx
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(Signature of Notary)
Xxxxx Xxxxxx Xxxxxx
-----------------------------------------
(Print of stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington, residing at Seattle.
My appointment expires: 5/9/07.
6.
STATE OF WASHINGTON )
) ss.:
COUNTY OF KING )
On this 7th day of July, 2003, before me, the undersigned, a Notary
Public in and for the State of Washington, duly commissioned and sworn,
personally appeared Xxxx Xxxxx, to me known to be the person who signed as CEO
of Blue Nile, Inc., the corporation that executed the within and foregoing
instrument, and acknowledged said instrument to be the free and voluntary act
and deed of said corporation for the uses and purposes therein mentioned, and on
oath stated that he was duly elected, qualified and acting as said officer of
the corporation, that he was authorized to execute said instrument and that the
seal affixed, if any, is the corporate seal of said corporation.
IN WITNESS WHEREOF I have hereunto set my hand and official seal the day and
year first above written.
/s/ Xxxxxx X. Xxxx
-----------------------------------------
(Signature of Notary)
Xxxxxx X. Xxxx
-----------------------------------------
(Print of stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington, residing at Kenmore.
My appointment expires: 10/5/03.
_________________________________________
(Signature of Notary)
_________________________________________
(Print of stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington, residing at _____________.
My appointment expires: ________________.
7.
EXHIBIT A TO SUBLEASE
SUBLEASED PREMISES AND LEGAL DESCRIPTION
8.
Legal Description
"Property" means, collectively, subject to Section 3.7, the Building and all
other improvements to the Landlord's Unit in which the Building is located.
"Union Station Condominium" means Union Station, a condominium, recorded in
Volume 15 of Condominiums, pages 37-45, according to the amended and restated
declaration thereof recorded under King County Recording No. 9811171094 and any
amendments thereto, including and together with those certain easements for
support, utilities, equipment and improvements, elevators, access and
telecommunications links as set forth therein; situated in the City of Seattle,
County of King, State of Washington.
"Unit" means Xxxx 0 xx Xxxxx Xxxxxxx Xxxxxxxxxxx.
0.
XXXXX PLAN POCKET SPACE - 3289 USF
SCALE: FIT TO PAGE
7/17/03
[FLOOR PLAN]
EXHIBIT B TO SUBLEASE
LANDLORD'S CONSENT
The undersigned, Landlord under the Prime Lease (as defined in the
foregoing Sublease Agreement dated as of May 22, 2003, by and between Xxxxxx.xxx
Holdings, Inc. and Blue Nile, Inc.), hereby consents, as contemplated in Article
13 of such Prime Lease, to the foregoing Amendment on the express condition that
nothing in this consent is intended to relieve, release, discharge or otherwise
affect the liability of Sublandlord or Original Tenant from the performance of
their respective obligations to Landlord under the Prime Lease and they shall
remain fully liable under the Prime Lease to perform all of the obligations of
the "Tenant" under the Prime Lease.
Notwithstanding the foregoing, Landlord agrees that the Improvement Allowance
payable by Landlord under the Prime Lease with respect to the Expansion Space
Improvements (as that term is defined in the foregoing Amendment) shall be paid
in accordance with the terms of the First Amendment to the Prime Lease at the
time described in Section 3 of the foregoing Amendment.
This Consent shall apply only to this Amendment and shall not be deemed to be
either (a) a consent to any other amendment to the sublease or (b) a release
from or waiver of the obligation to obtain Landlord's consent in the event of
any future amendment to the sublease.
This consent represents the entire agreement of Landlord with respect
to the foregoing Amendment and shall be binding upon and inure to the benefit of
Subtenant, Sublandlord, Original Tenant, and Landlord and their respective
successors and assigns.
Nothing in this Consent, the Amendment or the Sublease shall be deemed
to obligate Landlord to perform any obligations under the Prime Lease for the
benefit of Subtenant. This Consent is issued on the understanding that nothing
contained in the Amendment, the Sublease or this Consent and no direct
relationship between Landlord and Subtenant including, without limitations, the
provisions of Section 4.3 of the Sublease, shall modify, expand or enlarge
Landlord's obligations under the Prime Lease nor release Sublandlord or Original
Tenant from any of their obligations thereunder.
Dated this 29 day of July, 2003.
SEATTLE UNION STATION II, LLC,
a Washington limited liability company
By: /s/ Xxxxxx X. Xxxxxxxxx
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Xxxxxx X. Xxxxxxxxx, Asst Secy of MIG
Corp., its Manager
10.
ORIGINAL TENANT'S CONSENT AND ACKNOWLEDGMENT
Original Tenant hereby consents to the foregoing Amendment and ratifies
and affirms that Original Tenant remains liable under the Prime Lease as a
principal and not as a surety notwithstanding execution of the foregoing
Amendment or any course of conduct or dealings between Subtenant and Tenant and
nothing contained herein and no such course of conduct or dealings shall
relieve, release, discharge or otherwise affect the liability of Original Tenant
for the performance of Sublandlord's and Original Tenant's obligations to
Landlord under the Prime Lease.
Agreed to and accepted this 11 day of July, 2003.
XXXXXX.XXX, INC.
By: /s/ Xxxxx Xxx
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Name: Xxxxx Xxx
Title: VP
11.
