EXHIBIT 10.38
FIFTH AMENDMENT AND ASSIGNMENT OF LEASE
This FIFTH AMENDMENT AND ASSIGNMENT OF LEASE (this "Fifth Amendment")
is made effective as of April 1, 2003 ("Effective Date"), by and among 1130
RAINIER, LLC, a Washington limited liability company, f/k/a XXXXX BUILDING, with
offices located at 0000 Xxxxxxxxx Xxx XX, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000
("Landlord"), XXXXXXXX.XXX CORPORATION, a Delaware corporation, n/k/a LOUDEYE
ENTERPRISE COMMUNICATIONS, INC., with offices at 0000 Xxxxxxx Xxxxxx Xxxxx,
Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 ("Tenant") and LOUDEYE CORP., f/k/a LOUDEYE
TECHNOLOGIES, INC., a Delaware corporation with offices at 0000 Xxxxxxx Xxxxxx
Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxx 00000 ("Assignee").
RECITALS
WHEREAS, Landlord and Tenant have entered into a written Lease dated
August 31, 1990, which Lease was amended by the First Amendment of Lease dated
September 21, 1999, and by the Second Amendment of Lease dated October 6, 1999,
and by the Third Amendment of Lease dated May 1, 2000, and by the Fourth
Amendment of Lease dated August 18, 2000 (collectively, the "Lease"), whereby
Landlord leased to Tenant the premises located in the County of King, State of
Washington, more particularly described in the Lease;
WHEREAS, Assignee subleased from Tenant one half (1/2) of the premises
pursuant to a Sublease dated February 1, 2002 (the "Sublease"); and
WHEREAS, Landlord and Tenant desire to amend the Lease for the purpose
of reducing the amount of space, length of term and rent payable under the Lease
and assign the Lease to Assignee.
AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions. Capitalized terms that are not specifically defined
herein shall have the meaning provided in the Lease. On and after the Effective
Date, the Lease shall be deemed to incorporate the terms of this Fifth Amendment
as an integral part thereof. In the event of any conflict between the terms of
this Fifth Amendment and the Lease, the provisions of the Fifth Amendment shall
control.
2. Application of Security. Landlord and Tenant agree that Landlord may
pay itself the Security Deposit, in which the Landlord holds a validly perfected
security interest, in the amount of Two Hundred Eighteen Thousand Five Hundred
and No/100 ($218,500.00) Dollars. Tenant grants to Landlord the right to
liquidate the letter of credit, #SLCSSEA00818 from U.S. Bank National
Association, in the remaining sum of Nineteen Thousand Six Hundred Twenty-Two
and 92/100 ($19,622.92) Dollars, and Tenant shall immediately execute all
documents needed to secure such release from the holder of the Letter of Credit.
Upon payment of the
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Security Deposit or liquidation of the letter of credit, Tenant and Assignee
shall be under no obligation to replenish either the Security Deposit or the
letter of credit.
3. Assignment. Landlord agrees to permit Assignee to take assignment of
a portion of Tenant's rights under the Lease, and occupy a portion of the
premises under the terms of the Lease, as such terms are modified herein.
(a) Modified Length of Assignee's Term. The modified term of
occupancy by Assignee shall be from April 1, 2003 through and including
June 30, 2003 ("Reduced Term"), which term may be extended as provided
in Paragraph 6.
(b) Reduced Space. The Assignee shall be entitled to occupy
only that portion of the premises described in Paragraph 4 and Exhibit
B of this Fifth Amendment, which shall be referred to herein as the
"Reduced Space." All portions of the premises other than the Reduced
Space are hereby surrendered to the Landlord, and are no longer subject
to the terms of the Lease (except to the extent that use of the Reduced
Space requires incidental use of the common areas of the premises). The
use of the Reduced Space shall include all improvements located therein
and in the common areas of the premises reasonably needed for use of
the Reduced Space, including the improvements described in paragraph
3(e).
(c) Modified Rent. The Assignee shall pay to Landlord the sum
of Three Hundred Fifty Thousand ($350,000) Dollars for the Reduced Term
described in paragraph 3(a), in advance of the commencement of the
term. In the event that the Assignee vacates the Reduced Space before
the end of the Reduced Term, or any portion thereof, the Assignee shall
not be entitled to any refund of the rent paid.
(d) Utility Expenses. The Assignee shall pay to Landlord, in
advance, the sum of Sixty-Thousand ($60,000) Dollars for Assignee's
future utility expenses for the Reduced Space for the Reduced Term, or
to be applied toward utility expenses in any Extension Term (as
hereinafter defined in Paragraph 6).
(e) Use of Fixtures. Assignee shall be entitled to use of the
fixtures located on the premises (including those which were installed
by the Tenant during its occupancy of the premises) during the Reduced
Term or any Extension Term, Tenant confirms that the following assets
of Tenant, which were affixed to the premises and are properly part of
the premises pursuant to Section 14(a) of the Lease are the property of
the Landlord and are held by the Landlord free and clear of any and all
claims, liens and adverse interests:
Fixtures
(i) Satellite improvements that are attached to,
or located on, the roof;
(ii) Electrical generator; and
(iii) Existing Tenant Improvements including all
communication and data wiring and cabling
and other property, provided
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such property is attached to, behind the
walls of, or under the floors of the
Premises, and the wall mounted monitors in
Grand Central but excluding all equipment
racking systems.
4. Premises. As of the Effective Date, the description of the Premises
demised by the Lease is hereby amended to specifically exclude any space on the
top floor ("Floor 3") of the Premises and approximately one-half of the ground
floor ("Floor 2") as depicted in Exhibit A, pages 1 and 2 ("Surrendered Space").
During the period from April 1, 2003 to June 30, 2003 ("Reduced Term") or any
Extension Term (as hereinafter defined), Assignee shall have the right to use
all of the space in the basement ("Floor 1") and the remaining portion of Floor
2, as depicted in Exhibit B, pages 1 and 2 ("Reduced Space").
5. Rent. As of the Effective Date, the Annual Basic Rent and Direct
Expense amounts listed in Sections 5 and 6 of the Lease, as amended, shall be
replaced by those amounts provided for in Paragraphs 3(c) and 5, herein.
6. Term; Extension Terms. Unless otherwise timely extended pursuant to
this paragraph, the Lease shall terminate June 30, 2003, (the "Expiration
Date"). Assignee shall have two (2) options to extend the term of the Lease,
each extension for an additional three (3) month period. Each option may be
exercised by Assignee only upon thirty (30) days written notice to Landlord
(each an "Extension Term"), under the following conditions:
(a) Assignee shall pay Landlord, as rent, One Hundred Thousand
($100,000) Dollars at the time of exercise of each option to extend the
term of the Lease; and
(b) Assignee shall pay Landlord, as prepaid utility expenses,
an amount equal to the actual utility expenses incurred by Landlord for
the Reduced Space for the prior three month period, in advance of the
beginning of any Extension Term (any unused utility expense funds from
the Reduced Term or prior Extension Term shall be credited to the
upcoming Extension Term) or returned to Assignee if the Lease is
otherwise terminated.
7. Landlord's Entry. Landlord may, without prior notice to Assignee,
show the Reduced Space to prospective tenants and real estate brokers. Landlord
shall have the right to place "For Lease" signs on the building and/or on the
roof of any location and in such size as Landlord deems reasonably necessary.
8. Surrender of the Premises. Upon the Effective Date, Expiration Date,
and Termination Date (as hereinafter defined), as applicable, Tenant and
Assignee shall surrender the Surrendered Space or Reduced Space, as applicable,
to Landlord, and Landlord shall accept such portion of the Premises, subject to
the following conditions:
(a) Tenant and Assignee shall vacate the Premises leaving such
space in good order, condition and repair, ordinary wear and tear
excepted;
(b) Tenant and Assignee shall remove all of its personal
property and signage from the Premises, excluding those items listed in
Section 3(e) herein, leaving the
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Premises free from all trash and debris and in a broom-clean condition
(Tenant and Assignee shall, at its sole cost and expense paid prior to
commencement of any personal property removal or work, use Xxxxx
Technology Consultants or other such company reasonably acceptable to
Landlord, to remove Tenant's and Assignee's personal property and label
all communications, data and other wiring in the Premises to facilitate
future use);
(c) Tenant and Assignee shall repair and restore any damage to
the Premises or Building caused by or resulting from Tenant's and
Assignee's use and vacation of the Premises or Tenant's and Assignee's
removal of personal property from the Premises as required hereunder
(Tenant and Assignee shall, at its sole cost and expense paid prior to
commencement of any personal property removal or work, use Xxxxxxx
Construction, or other such company reasonably acceptable to Landlord,
to make such required repairs and restorations); and
(d) Tenant and Assignee shall return all security cards, the
security computer, and keys to Landlord.
9. Lease Expiration. Upon the expiration of the Lease, including the
Reduced Term and any Extension Term, this Lease shall be of no force and effect
and Tenant and Assignee shall surrender to, and Landlord shall accept, the
Reduced Space, subject to the obligations set forth in Section 8 and Landlord's
refund to Assignee, within thirty five (35) days following the Expiration Date,
of any unused portion of pre-paid utility expenses as of the Expiration Date.
10. Landlord's Termination Right. Landlord shall have the right to
terminate the Lease at any time after mutual execution of a lease for the
Reduced Space with a new tenant. Tenant and Assignee shall surrender the Reduced
Space to Landlord within forty-five (45) days ("Termination Date") following
Landlord's written notice to Assignee. In addition to the obligations set forth
in Section 7, upon such termination Landlord shall be required to refund to
Assignee any unused portion of pre-paid utility expenses and pre-paid rent on a
pro-rata basis, no later than five (5) days as to rent and thirty five (35) days
as to utility expenses following the Termination Date.
11. Parking. Tenant and Assignee shall vacate the parking lot for the
Premises no later than April 1, 2003, except for forty (40) parking spaces on
the upper level that Assignee may use until June 30, 2003. Assignee shall be
entitled to use such parking spaces during the Reduced Term and any Extension
Term at no cost.
12. Security. Tenant shall return to Landlord on the Effective Date all
security cards, the control of the security computer, and keys for the Premises
not currently in use and shall supply to Landlord a list of all employees of
Tenant or Assignee currently in possession of and using such cards and keys by
card number and key.
13. Representation of Tenant. Tenant represents that the property
described in Paragraph 3(e) as property of the Landlord is delivered "as is"
with no additional representations regarding its value or condition, other than
a warranty of clear title by Tenant to Landlord.
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14. Release and Waiver. Landlord hereby releases Tenant, Loudeye Corp.,
Loudeye Enterprise Communications, Inc. and their respective officers,
shareholders, directors, employees, agents, successors, assigns, subsidiaries
and affiliates from any obligations relating to the Premises except for those
obligations provided herein, and any rights arising under that certain Sublease,
dated February 1, 2002, by and between Tenant and Sublandlord and Loudeye
Technologies, Inc., n/k/a Loudeye Corp. as subtenant, for Tenant's or
subtenant's failure to perform its obligations in relation thereto. Landlord
hereby waives and relinquishes any right to pursue or hold Tenant liable for any
default or pending default under the Lease existing as of the Effective Date.
Tenant, Loudeye Corp., and Loudeye Enterprise Communications, Inc. hereby
releases Landlord, and its respective officers, shareholders, directors,
employees, agents, successors, assigns, subsidiaries and affiliates from any
obligations relating to the Premises except for those obligations provided
herein, and any obligations arising under that certain Sublease, dated February
1, 2002, approved by Landlord, between Tenant and Sublandlord and Loudeye
Technologies, Inc., n/k/a Loudeye Corp. as subtenant. Tenant and Assignee hereby
waive and relinquish any right to pursue or hold Landlord liable for any default
or pending default under the Lease existing as of the Effective Date.
15. Counterparts. This Fifth Amendment may be executed in any number of
counterparts, each of which shall be deemed an original and all such
counterparts shall constitute one agreement. To facilitate execution of this
Fifth Amendment, the parties may execute and exchange facsimile counterparts of
the signature pages and facsimile counterparts shall serve as originals.
16. Settlement Costs. Upon execution of this Amendment and presentment
of an invoice for legal fees, Tenant or Assignee shall pay for Landlord's
reasonable, actual legal fees and court costs in documenting this Fifth
Amendment and vacating the judgment entered in the Pending Action which fees
shall not exceed Six Thousand and No/100 ($6,000.00) Dollars.
17. Vacating Judgments; Confessions of Judgment. Simultaneous with the
execution of this Fifth Amendment, Landlord shall vacate that certain judgment
taken against Xxxxxxxx.xxx Corporation presently known as Loudeye Enterprise
Communications, Inc. on 21 March 2003 for the principal amount of $314,964.24 in
the underlying action entitled 1130 Rainier, LLC v. Loudeye Corporation, et al.,
No. 03-2-21144-3 SEA ("Pending Action"); deliver to Tenant the Confession of
Judgment executed by the Tenant in the Pending Action on 21 March 2003; and
dismiss the pending action with prejudice and without costs to either party.
Simultaneously with the execution of this Fifth Amendment, Assignee shall
deliver to counsel for Landlord a Confession of Judgment in the form attached as
Exhibit C, which Confession of Judgment shall be held by counsel for the
Landlord according to the terms recited therein.
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18. Assignment and Assumption. As of the Effective Date, Tenant hereby
assigns all of Tenant's obligations under the Lease to Assignee and Assignee
hereby assumes all of Tenant's obligations under the Lease. Landlord hereby
consents to the assignment and assumption of the Lease set forth herein.
LANDLORD: TENANT:
1130 RAINIER, LLC LOUDEYE ENTERPRISE
f/k/a XXXXX BUILDING COMMUNICATIONS, INC. f/k/a
By Seavest Financial Corporation XXXXXXXX.XXX CORPORATION
By:_____________________________ By:___________________________
Name: Xxxx X. Xxxx Name:
Title: President Title:
ASSIGNEE:
LOUDEYE CORP. f/k/a Loudeye
Technologies Inc
By:___________________________
Name:
Title:
STATE OF WASHINGTON )
) ss.
COUNTY OF KING )
I certify that I know or have satisfactory evidence that Xxxx X. Xxxx
is the person who appeared before me, and said person acknowledged that he was
authorized to execute the instrument and acknowledged it as the President of
Seavest Financial Corporation, which corporation is the manager of 1130 Rainier,
LLC, to be the free and voluntary act of such party for the uses and purposes
mentioned in this instrument.
DATED: _____________________ 2003
__________________________________
____________________ (Printed Name)
Notary Public
My Appointment Expires: ____________
STATE OF WASHINGTON )
) ss.
COUNTY OF ___________ )
I certify that I know or have satisfactory evidence that
________________ is the person who appeared before me, and said person
acknowledged that _____ was authorized to execute
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the instrument and acknowledged it as the ________________ of Loudeye Enterprise
Communications, Inc. to be the free and voluntary act of such party for the uses
and purposes mentioned in this instrument.
DATED: _____________________ 2003
__________________________________
____________________ (Printed Name)
Notary Public
My Appointment Expires: ____________
STATE OF WASHINGTON )
) ss.
COUNTY OF ___________ )
I certify that I know or have satisfactory evidence that
________________ is the person who appeared before me, and said person
acknowledged that _____ was authorized to execute the instrument and
acknowledged it as the ________________ of Loudeye Corporation to be the free
and voluntary act of such party for the uses and purposes mentioned in this
instrument.
DATED: _____________________ 2003
__________________________________
____________________ (Printed Name)
Notary Public
My Appointment Expires: ____________
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EXHIBIT A
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EXHIBIT B
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EXHIBIT C
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