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EXHIBIT 10.6
SUBLEASE
This SUBLEASE AGREEMENT is made as of April 5th 1999 between INDIGO
AMERICA, INC., with a principal place of business at 000 Xxxxxxx Xxxx Xxxxx,
Xxxxxx, Xxxxxxxxxxxxx ("Sublandlord") and FAIRMARKET INCORPORATED, a Delaware
corporation with a principal place of business at 000 Xxxxxxx Xxxx Xxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000 ("Sub-Tenant").
W I T N E S S E T H:
WHEREAS, Sublandlord is the tenant of certain office premises located
at 000 Xxxxxxx Xxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx (the "Prime Premises") under a
Lease Agreement dated October 6, 1993, as amended November 3, 1993, as further
amended by a Second Lease Amendment dated December 1994, and as further amended
by a Third Lease Amendment dated July 23, 1996 (the "Prime Lease") between MET
LIFE INTERNATIONAL REAL ESTATE PARTNERS LIMITED PARTNERSHIP (the "Prime
Landlord") and Sublandlord; and
WHEREAS, Sub-Tenant desires to sublet a portion of the Prime Premises
and Sublandlord is willing to sublet the same on the conditions and terms set
forth below.
NOW, THEREFORE, the parties, for valuable consideration received, agree
as follows:
1. LEASE OF PREMISES.
1.1. PREMISES. Sublandlord hereby demises and sublets to
Sub-Tenant, and Sub-Tenant hires from Sublandlord, that
portion of the Prime Premises consisting of approximately
7,829 square feet on the second floor shown on Exhibit A
attached hereto and incorporated herein by reference (the
"Premises").
2. TERM.
2.1. INITIAL TERM. The term of this Sublease shall commence on
April 19, 1999 and shall end on or about January 31, 2004, or
at the termination of the Prime Lease. Each Lease Year shall
be for twelve (12) calendar months ending on December 31st of
each year.
2.2. SUBJECT TO PRIME LEASE. Notwithstanding anything to the
contrary herein, this Sublease shall terminate, and be of no
further force and effect, upon termination of the Prime Lease
for any reason, without liability to Sublandlord whatsoever.
In addition, under no circumstances shall Sublandlord be
liable for failure to perform any obligation hereunder if said
obligation is an obligation of Prime Landlord under the Prime
Lease and Sublandlord is using reasonable efforts to enforce
its rights under the Prime Lease.
3. RENT.
3.1. BASE RENT. Commencing on June 15, 1999, Sub-Tenant covenants
and agrees
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with Sublandlord to pay base rent during the term of this
Lease in the amount of $156,580.00 per year ($13,048.33 per
month)
Equal monthly installments of base rent shall be payable in
advance on or before the first day of each calendar month of
the term of this Lease, prorated with respect to any
fractional calendar month.
3.2. ADDITIONAL RENT. Sub-Tenant agrees to pay as additional rent
the following:
(a) All electricity used or consumed on the Premises to be
paid within fifteen (15) days after a submission of an invoice
therefor;
(b) Sub-Tenant's pro rata share of Real Estate Taxes and
Operating Costs assessed by the Prime Landlord against the
Sublandlord pursuant to the Prime Lease.
(c) Sub-Tenant's pro rata share of any Additional Rent, as
same is defined in the Prime Lease, assessed by the Prime
Landlord against the Sublandlord pursuant to the Prime Lease.
3.3. LATE PAYMENT. Sub-Tenant agrees to pay Sublandlord a late
charge of Two Hundred Fifty, Dollars ($250.00) for each
payment of rent that is not paid within ten (10) days after it
is due.
3.4. SECURITY DEPOSIT. Sub-Tenant shall pay to Sublandlord upon
execution of this Lease a security deposit of Thirteen
Thousand Forty Eight and 33/100 ($13,048.33) Dollars. Such
deposit shall be held by Sublandlord (without any obligation
to segregate or to pay interest) as security for the prompt
and complete performance of all of Sub-Tenant's obligations
hereunder. At the termination of the Sublease, Sublandlord
shall return the deposit to Sub-Tenant, less any amounts owing
to Sublandlord for obligations under this Sublease.
4. PREPARATION OF PREMISES.
4.1. CONDITION &PREMISES. Sub-Tenant agrees that it is leasing the
Premises "AS IS", without representation or warranty of any
kind.
5. PERMITTED USE OF PREMISES.
5.1. PERMITTED USE. Sub-Tenant shall use the Premises for general
office purposes and for no other purposes.
5.2. INCREASED RISK. Sub-Tenant will not do anything in or upon the
Premises which may be prohibited by any insurance policy in
force carried by Sublandlord covering the Premises or any
portion thereof. In the event Sub-Tenant's occupancy or
conduct of business on or upon the Premises results in any
increase in premiums for the insurance carried from time to
time by Sublandlord with respect to the Prime Premises,
Sub-Tenant shall pay one hundred percent (100%) of any
increase
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upon demand therefor from Sublandlord. In determining whether
increased premiums are a result of Sub-Tenant's occupancy of
the Premises, the written determination of the insurer shall
be conclusive. Sub-Tenant shall promptly comply with all
reasonable requirements of the insurance authority or of any
insurer now or hereafter in effect relating to the Premises.
6. MAINTENANCE AND OPERATIONS.
6.1. SUBLANDLORD OBLIGATIONS. Subject to the provisions of the
Prime Lease, Sublandlord agrees to cause the Prime Landlord
to:
(i) furnish the Premises with heat and air conditioning
as reasonably required under the Prime Lease, and
(ii) maintain the structural aspects of the Premises and
the building of which it is a part.
6.2. SUB-TENANT'S OBLIGATIONS. Sub-Tenant agrees to:
(a) maintain the interior of the Premises, the fixtures and
appurtenances therein, and the exterior glass and doorways and
any special facades (such as special logos, designs or paint
schemes) of the Premises, including maintaining the same in a
manner appropriate for a first-class business operation;
(b) not overload or deface the Premises or permit any use of
the Premises that would increase the insurance rate or make
voidable any insurance policy on the Prime Premises, or create
any fire hazard, or be unlawful, noisy, offensive or create a
nuisance, or violate any governmental law or regulation or
applicable insurance rating association requirement, or commit
waste or other injurious acts upon person or property;
(c) quit and surrender the Premises clean and in the same
order and condition as the Premises are in on the commencement
of the term, or may be put in term with the consent of
Sublandlord, ordinary wear and tear and damage by fire or
casualty excepted;
(d) obey any rules and regulations that may be applicable to
Premises, comply with all requirements applicable to the
Sublandlord and/or Sub-Tenant under the Prime Lease, and not
otherwise permit any act or omission in connection with the
Premises that would constitute a violation or default under
the Prime Lease;
(e) install and maintain separate metering of electricity,
phone, computer networking systems and all other utilities not
provided by the Prime Landlord pursuant to the Prime Lease.
For all such utilities, Sub-Tenant shall pay all charges
directly to the applicable utility company before such amounts
are due; and
(f) pay for all other costs of operating Sub-Tenant's business
in the Premise.
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6.3. INTERRUPTIONS; REPAIRS. Sublandlord or agents of Sublandlord
may, at reasonable times enter the Premises to make repairs
and to show the Premises to prospective purchasers or tenants.
Although Sublandlord shall use reasonable efforts to ensure
that such access does not interfere with the operation of
Sub-Tenant's business, Sublandlord shall not be liable to
Sub-Tenant (whether directly or through any set-off of rent or
other charges) by reason of any inconvenience, noise or loss
of business as a result of any interruption of any service or
utility serving the Premises beyond Sublandlord's reasonable
control or for Sublandlord entering the Premises for any
authorized purpose.
7. ALTERATIONS AND ADDITIONS. Sub-Tenant may not make any structural or
non-structural alterations or additions to the Premises without Sublandlord's
written consent, which consent may be withheld in Sublandlord's sole discretion.
Prior to any such alterations or additions, Sub-Tenant shall provide Sublandlord
with detailed plans of the proposed work for Sublandlord's written approval. Any
such approved alterations or additions shall be constructed diligently at
Sub-Tenant's expense in a good and workmanlike manner and in compliance with all
applicable laws and regulations, including any requirements under the Prime
Lease, and shall be at least equal in quality to the present construction.
Sub-Tenant shall be responsible for obtaining, at Sub-Tenant's expense, all
applicable permits and approvals for such work. Sub-Tenant shall not permit any
mechanics' liens or similar liens to remain upon the Premises for labor and
material furnished to Sub-Tenant in connection with work performed at the
direction of Sub-Tenant and shall immediately cause any such lien to be released
of record without cost to Sublandlord. All alterations or additions made by
Sub-Tenant shall remain the exclusive property of Sublandlord, and upon
termination of this Sublease, if requested, by Sublandlord, Sub-Tenant shall
restore the Premises to its condition as of the date hereof, wear and tear and
damage by casualty excepted. Sub-Tenant may remove any such alteration or
addition only if Sub-Tenant has received Sublandlord approval for their removal
prior to their construction; in such case Sub-Tenant shall be responsible for
the cost of repairing any resulting injury to the Premises due to such removal.
8. ASSIGNMENT; SUBLEASING. Sub-Tenant shall not assign or sublet the whole
or any part of the Premises without the prior written consent of both the Prime
Landlord and the Sublandlord. Sublandlord's consent may not be unreasonably
withheld. However, Prime Landlord may withhold its consent in its sole
discretion. For the purposes of this Sublease, any (a) assignment as a matter of
law, whether by merger, consolidation or otherwise, and (b) any sale of the
controlling interest in the equity of Sub-Tenant, shall be deemed to be an
assignment. In the event of any permitted assignment, Sub-Tenant shall remain
liable to Sublandlord for the payment of all rent and for the full performance
of the covenants and conditions of this Lease.
9. INSURANCE; LIABILITY.
9.1. SUB-TENANT'S INSURANCE. Sub-Tenant shall maintain (a)
comprehensive public liability insurance indemnifying
Sublandlord, the Prime Landlord, any mortgagee of which
Sub-Tenant has notice, and Sub-Tenant against all claims and
demands for personal injury or death or property damage which
may be claimed to have occurred upon the Premises, such
insurance to be in reasonable amounts, but in any event not
less than $3,000,000.00 single limit coverage and (b) all-risk
casualty
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insurance with extended coverage on the Premises (naming
Sublandlord, the Prime Landlord, mortgagees of which
Sub-Tenant has notice and Sub-Tenant, as their interests may
appear) in an amount equivalent to the full replacement value
of the improvements, fixtures, equipment and Sub-Tenant's
personal property on the Premises, without allowance for
depreciation. Prior to the commencement of the term, and
thereafter not less than thirty (30) days prior to the
expiration date of each expiring policy, Sub-Tenant shall
deliver to Sublandlord original copies or certificates of the
policies required hereunder. All such policies shall be
written by responsible insurance companies authorized to do
business in the state in which the Premises are located, and
shall provide for at least thirty (30) days written notice to
all named parties prior to cancellation.
9.2. WAIVER OF SUBROGATION. Sub-Tenant will use its best efforts to
cause all policies of casualty insurance to contain the
insurers' waiver of subrogation and consent to pre-loss waiver
of rights by the insured. Effective only when permitted by the
policy or when use of its good faith efforts could have
obtained such a clause at no additional cost or premium,
Sub-Tenant waives all claims and rights to recover against
Sublandlord in event of an insurable loss or damage. If such
provision or waiver is not obtainable without the payment of
an additional premium or at all, Sub-Tenant shall promptly
notify Sublandlord and shall be relieved of its obligation to
obtain or continue such provision or waiver in its policy
unless, in the case in which the same is obtainable upon
payment of an additional premium, Sublandlord pays such
additional premium.
9.3. INDEMNIFICATION AND LIABILITY. Sub-Tenant hereby indemnifies
Sublandlord, Landlord, and all mortgagees against all
liabilities, damages and other expenses, including reasonable
attorneys' fees, which may be imposed upon, incurred by, or
asserted against them by reason of either of the following
occurring during the term of this Lease:
(a) any personal injury or property damage occurring on the
Premises (other than as a result of any negligence or willful
misconduct on the part of such party); or
(b) any personal injury or property damage occurring as a
result of any negligence or willful misconduct on the part of
Sub-Tenant, its agents and invitees; or
(c) any failure on the part of Sub-Tenant to perform or comply
with any covenant required to be performed or complied with by
Sub-Tenant under this Lease.
10. CASUALTY; CONDEMNATION.
10.1. TERMINATION; RESTORATION. If a substantial part of the
Premises shall be taken by right of eminent domain or damaged
by fire or other casualty and if Sublandlord
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does not elect to restore the Premises substantially to its
former use and dimensions, then Sublandlord may elect to
terminate this Lease upon thirty (30) days written notice. If
Sublandlord does not elect to terminate this Lease,
Sublandlord shall proceed with reasonable diligence to put the
Premises or what remains thereof in such proper condition and
to provide normal access thereto and to provide normal
services therefor as is reasonably practical.
10.2. RENT ADJUSTMENT. In case of any taking or damage rendering a
substantial portion of the Premises unfit for its intended
use, a just proportion of the rent, according to the nature
and extent of the injury, shall be abated until the Premises
shall have been restored to as reasonably its former condition
as practical. In the event of a partial taking, provision
shall be made for a permanent abatement to the extent that any
portion of the Premises can no longer be so used.
10.3. RIGHTS TO AWARDS. Sublandlord reserves all rights to insurance
proceeds with respect to casualty to the Premises and its
improvements (but not including contents and trade fixtures)
or condemnation awards by reason of any taking or settlement
in lieu of taking. Sub-Tenant grants to Sublandlord all of
Sub-Tenant's rights to such proceeds or awards and covenants
to execute and deliver such further instruments of assignment
thereof as Sublandlord may from time to time request.
Sub-Tenant may separately pursue compensation for a taking
resulting in lost business or moving expenses.
11. TITLE.
11.1. QUIET ENJOYMENT. Without limiting the provisions of Sections
2.3 and 11.2, as long as Sub-Tenant shall pay the rental and
observe the other obligations and liabilities of Sub-Tenant
set forth herein, Sub-Tenant shall peacefully and quietly
have, hold and enjoy the Premises until the expiration of the
term without any manner of hindrance or molestation by
Sublandlord or anyone else claiming by, through or under
Sublandlord.
11.2. ACCESS TO THE PREMISES. Notwithstanding any provision to the
contrary contained in this Sublease, Sub-Tenant agrees to
provide Sublandlord with access to the electrical room located
adjacent to the Premises (and accessible only through the
Premises), during Sub-Tenant's normal operating hours. In
addition, Sub-Tenant agrees to allow Sublandlord, when
accompanied by a representative of the Prime Landlord, access
to such electrical room outside of Sub-Tenant's normal
operating hours. Such access, whether during or after
Sub-Tenant's operating hours, shall be for the limited purpose
of allowing Sublandlord to access, maintain and/or repair the
electrical equipment maintained in said electrical room.
Sub-Tenant further agrees to maintain the entryway to the
electrical room in such a manner as to allow for access by the
Sublandlord and/or the Prime Landlord at all times.
11.3. SUBORDINATION. This Sublease shall be subject and subordinate
in all respects to (a) the Prime Lease, (b) any extension,
renewal, modification or replacement
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thereof (which will thereafter constitute part of the "Prime
Lease" hereunder), and (c) any and all mortgages now or at any
time hereafter constituting a lien or liens on the property of
which the Premises are a part and Sub-Tenant shall, when
requested, execute and deliver such written instruments as
shall be necessary to show the subordination of this Lease to
said mortgages.
11.3. NOTICE OF LEASE. The parties shall not execute or record a
short-form or notice of lease.
12. DEFAULT. In the event that (a) Sub-Tenant shall fail to make payment of
any installment of rent or other sum herein specified and such failure shall
continue for five (5) days; or (b) Sub-Tenant shall fail to observe or perform
any other of Sub-Tenant's covenants, agreements, or obligations hereunder and
such failure shall not be corrected within fifteen (15) days after written
notice thereof or such longer period as may be reasonably necessary to cure such
failure; then Sub-Tenant shall be deemed in default hereunder and Sublandlord
shall have the right thereafter, while such default continues, to re-enter and
take possession of the Premises, to declare the term of this Sublease ended, and
to remove Sub-Tenant's effects, or to exercise any and all rights and remedies
as is accorded the Prime Landlord for a default of Sublandlord under the Prime
Lease, all in accordance with applicable law. Sub-Tenant shall indemnify
Sublandlord against all loss of rent and other payments which Sublandlord may
incur by reason of such termination during the remainder of the term. If any
default by Sub-Tenant, or other action of Sub-Tenant, causes a default under the
Prime Lease, any grace period allowed hereunder shall in no event be greater
than five (5) days less than that allowed Sublandlord under the Prime Lease.
13. MISCELLANEOUS.
13.1. NOTICE. Any notice hereunder shall be deemed effective when
delivered (by hand, by U.S. Mail Return Receipt Requested, or
by facsimile) to the parties at the following addresses:
Sublandlord: Indigo America, Inc.
000 Xxxxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Attn: LEGAL/CONTRACTS DEPT.
Sub-Tenant: Fairmarket Incorporated
000 Xxxxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxx Xxxxxxxxxx, Office Manager
A party may change its notice address by giving proper notice to the
other party as set forth above.
13.2. WAIVER. The failure of either party to seek redress for
violation or to insist upon the strict performance of any
covenant or condition of this Lease, shall not prevent a
subsequent act, which would have originally constituted a
violation, from having
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all the force and effect of an original violation. No
provision of this Lease shall be deemed to have been waived by
either party unless such waiver be in writing and signed by
the party to be bound thereby.
13.3. SELF-HELP. If Sub-Tenant shall default in the performance or
observance of any agreement or condition in the Lease
contained on its part to be performed or observed, and if
Sub-Tenant shall not cure such default within fifteen (15)
days (or such shorter period as is permitted under Section 12)
after notice from Sublandlord (or shall not within said period
commence to cure such default and thereafter prosecute the
curing of such default to completion with due diligence),
Sublandlord may, at its option, without waiving any claim for
damages, at any time thereafter cure such default for the
account of Sub-Tenant, and any reasonable amount paid or any
contractual liability incurred by Sublandlord in so doing
shall be deemed paid or incurred for the account of Sub-Tenant
and Sub-Tenant agrees to pay to Sublandlord as additional rent
reimbursement thereof together with interest at the rate of
eighteen percent (18%) per annum.
13.4. FORCE MAJEURE. In any case where either party is required to
do any act (other than make a payment of money), delay or
impossibility caused by or resulting from Act of God, war,
civil commotion, fire or other casualty, labor strikes,
general shortages of labor, materials or equipment, government
regulations or other causes beyond such party's control (other
than causes related to such party's financial condition) shall
not be actionable and the time when the performance of such
act must be completed, whether such time be designated by a
fixed time, a fixed period of time or "a reasonable time",
shall be accordingly adjusted.
IN WITNESS WHEREOF, the parties have caused this instrument to be
executed by their duly authorized representatives under seal as of the day and
year first above written.
INDIGO AMERICA, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Print Name: Xxxxxx Xxxxxxxxx
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Title: Treasurer
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Date: 4/15/99
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SUB-TENANT:
FAIRMARKET INCORPORATED
By: /s/ Xxxxx Xxxxx
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Print Name: Xxxxx Xxxxx
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Title: VP, Marketing
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Date: 4/15/99
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