Exhibit 10.8
LEASE AGREEMENT
WHEREAS, Xxxxxxx and Xxxxxxxxx Xxxxxx, hereafter designated as Lessor,
and Restoration Hardware, Inc., hereinafter designated as Lessee, are desirous
of entering into a lease agreement respecting the premises hereinafter
described.
NOW, THEREFORE, for and in consideration of the foregoing, and of the
mutual covenants and conditions hereinafter contained.
IT IS AGREED AS FOLLOWS:
1. Lessor leases to Lessee and Lessee leases from Lessor those
certain premises known and described as follows:
The portion of the building located at 000 Xxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxx designated as Unit 101.
2. The term of the within lease is five (5) years commencing June 1,
1994, and ending May 31, 1999. In addition, Lessee shall have the option to
extend the Lease for an additional five (5) year term in accordance with the
provisions of paragraph 4(c).
3. Lessee agrees to use said demised premises for the purpose of
operating a retail hardware and home furnishings store.
4. Lessee agrees to pay rent as follows:
(a) A monthly rental of $1,700.00 commencing June 1, 1994, and
continuing on the first day of each succeeding month during the term;
1.
(b) The monthly rent provided in subparagraph (a) above shall be
subject to adjustment at the commencement of the second year of the term and
each year thereafter ("Adjustment Date") as follows:
The base for computing the adjustment is the Consumer Price Index (all
items) for the United States, published by the Department of Labor, Bureau of
Labor Statistics ("Index"), nearest the date of the commencement of the term
("Beginning Index"). If the Index published nearest the Adjustment Date
("Extension Index") has increased over the Beginning Index, the monthly rent for
the following year shall be set by multiplying the monthly rent set forth in
subparagraph (a) above by a fraction, the numerator of which is the Extension
Index and the denominator of which is the Beginning Index. In no case shall the
monthly rent be less than the rent set forth in subparagraph (a).
If the Index is changed so that the base year differs from that used
as of the month immediately preceding the month in which the term commences, the
Index shall be converted in accordance with the Conversion Factor published by
the United States Department of Labor, Bureau of Labor Statistics. If the Index
is discontinued or revised during the term, such other government index or
computation with which it is replaced shall be used in order to obtain
substantially the same result as would be obtained if the index had not been
discontinued or revised.
Provided, however, that there shall be a minimum annual increase of
three percent (3%) and a maximum of eight percent (8%) during each year of the
term.
2.
(c) Lessee is hereby granted the right and option to renew the
within lease for an additional period of five (5) years upon the same terms and
conditions as herein set forth. Should Lessee elect to so renew, it shall notify
Lessor in writing of its intention to do at least 180 days prior to the date of
expiration of the within Lease. Rent shall be adjusted at the commencement of,
and throughout the extended term, in accordance with the provisions hereinabove
set forth.
5. Lessee agrees to maintain the interior of the premises in good
and sanitary order, condition and repair. Lessee shall permit Lessor or its
agents to enter into and upon said premises at all reasonable times for the
purpose of inspecting the same.
6. Lessee shall pay for all water, gas, heat, light, telephone,
power, garbage disposal, gardening service and window washing.
7. Lessor agrees to assume responsibility for the maintenance and
repair of all structural portions of the premises including, without limitation,
the foundation, side walls, roof, structural plumbing and structural
electricity. Any other repairs, remodelling or altering with the exception of
those specifically mentioned in the within agreement shall be considered the
obligation of the Lessee. Lessee agrees to replace all broken glass with glass
of the same size and quality of the glass broken. No structural alterations will
be made by Lessee without first obtaining the written consent of Lessor.
8. Lessee agrees to pay when due any taxes which may be levied
against equipment, furniture and fixtures installed by and belonging to Lessee.
3.
9. Lessee agrees to pay when due any real property taxes and
assessments which may be levied against the premises. Lessor shall deliver the
tax xxxx to Lessee upon receipt, and Lessee shall provide Lessor with a receipt
for payment or other evidence of payment satisfactory to Lessor, prior to the
due date of such taxes. Taxes due for any partial year shall be prorated.
10. Lessee shall be solely responsible for all damages, claims and
liabilities for personal injuries or property damages occurring on or arising
out of Lessee's use of the demised premises. Lessee agrees to hold harmless,
indemnify and defend Lessor against any and all such claims, liabilities and
demands.
(a) Lessee shall maintain in full force and effect, during the
term or any extension thereof, a policy or policies of comprehensive general
liability insurance with limits of at least $1,000,000.00 per occurrence. Lessor
shall be named as additional assured, and Lessee shall provide Lessor with a
certificate of insurance evidencing the coverage and providing that the coverage
may not be cancelled or amended, as to Lessor, without first providing 20 days
written notice.
(b) Lessor shall maintain fire insurance on the premises, but
Lessee shall be solely responsible for maintaining insurance coverage with
respect to its personal property placed upon the premises. Lessee shall pay when
due the premium due with respect to any and all fire insurance policies
maintained upon the premises by the Lessor, Lessor shall deliver the premium
notice to Lessee, upon receipt, and Lessee shall promptly pay the same no later
than date upon which payment is due.
4.
11. If the demised premises, during the term of this agreement, or
any renewal thereof, shall be destroyed by fire or other casualty, Lessor shall
be under no obligation to rebuild the same, and if Lessor shall elect to not
rebuild, then this lease shall at once become null and void and the obligations
of Lessee to pay rental hereunder shall cease. Provided, however, if the Lessor
shall elect to rebuild said premises, it may do so by restoring the same to like
condition as of the date of this agreement, and during the term of said
rebuilding the rent reserved hereunder shall cease, but upon the conclusion of
such rebuilding, the rent at once begins again. If the demised premises are
destroyed within the last 12 months of the lease term, the Lessee shall have the
right to terminate the lease.
12. If the premises shall be damaged by fire or other cause so as to
be capable of being repaired within a period of 60 days, then Lessor shall cause
the premises to be repaired and during the time said repairs are being made,
Lessor shall remit to Lessee a fair portion of the rent according to the nature
of the damage sustained and according to the extent that Lessee is deprived of
the use of said premises.
13. Should Lessee fail or omit to perform any of the covenants or
conditions herein, or should Lessee abandon the premises, Lessor may either
elect to terminate this lease, or may elect to re-rent the demised premises at
any time as the agent of the tenants, or otherwise, for whatever rental Lessor
shall be able to obtain. Should Lessor elect to re-rent the premises for the
benefit of Lessee, Lessor shall mail notice in writing to Lessee, addressed to
Lessee at 000 Xxxxxx Xxxxxx, Xxxxxx,
5.
California, notifying said Lessee of such intention; all proceeds received as
rent, in the event of such re-renting, shall be applied first to the payment of
such expenses as Lessor may have incurring in re-renting and re-entering, and
then to the payment of the rent due hereunder, and in case of a deficiency,
Lessee shall be liable therefor.
14. At the expiration of the within lease or any extension thereof,
Lessee shall remove all lettering and signs of a permanent nature placed on the
outside walls of the demised premises.
15. Lessee shall not assign this lease without the written consent of
Lessor first having been obtained.
16. The Lessee shall not sublet portions of the premises to any
separate enterprises operating separately from the Lessee.
17. In the event of any dispute between Lessor and Lessee relative to
the provisions of this lease, they shall each select an arbitrator, who in turn
shall select a third arbitrator. The arbitrators so selected shall determine the
controversy, by majority vote, and their decision thereon shall be final and
binding upon both Lessor and Lessee, who shall bear the cost of such arbitration
equally between them.
18. Failure on the part of Lessor to take any action against Lessee
by reason of any particular breach of any or all of the terms, covenants and
conditions of this lease on the part of Lessee, shall not be deemed in any way
to be a waiver of any other or subsequent breach on the part of Lessee of any or
all of the covenants and conditions of this lease.
6.
19. Upon the removal from said premises upon expiration this Lease,
or any extended period thereof, and for a period of 30 days thereafter Lessee
shall have the right to remove any and all trade fixtures placed on said demised
premises by the said Lessee. Should Lessee fail to remove such trade fixtures
prior to the expiration of the said Lease or extension thereof, Lessee shall pay
to Lessor the minimum monthly rental herein provided for such period of time as
said fixtures remain on the premises.
20. In the event of any litigation or arbitration between the parties
regarding this Lease, the prevailing party shall be entitled to recover all
costs incurred, including reasonable attorney fees.
21. All the covenants, conditions, agreements and undertakings
herein contained shall extend to and be binding upon the heirs, executors,
administrators, representatives, successors and assigns of the respective
parties hereto.
The parties hereto have set their hands as of this 4th day of May,
1994.
LESSOR:
/s/ Xxxxxxx Xxxxxx
---------------------------------
Xxxxxxx Xxxxxx
/s/ Xxxxxxxxx Xxxxxx
---------------------------------
Xxxxxxxxx Xxxxxx
LESSEE:
Restoration Hardware, Inc.
/s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx, President
7.
