Exhibit 10.1
SECOND AMENDMENT TO SUBLEASE BETWEEN
000 XXXXXXXXX XXXXX II, LLC
AS "SUBLESSOR"
AND
BOTTOMLINE TECHNOLOGIES, INC.
AS "SUBLESSEE"
THIS SECOND AMENDMENT TO SUBLEASE ("Sublease") is made by and between
000 XXXXXXXXX XXXXX II, LLC, ("Sublessor") and BOTTOMLINE TECHNOLOGIES, INC.
("Sublessee"), the Parties to a certain Sublease dated August 31, 2000, as
amended by First Amendment to Sublease dated December 29, 2000 (collectively
referred to herein as the "Sublease"). All capitalized terms contained in this
Second Amendment to Sublease shall have the meanings given to them in the
Sublease.
WHEREAS: The Sublease provides for the design and pricing of the
Leasehold Improvement Work to be constructed by Sublessor, and further provides
a mechanism for the Sublessee to pay the costs of such Leasehold Improvement
Work to the extent such costs exceed $2,436,496 all of which was the subject of
a "CONFIRMATION OF PRICING FOR LEASEHOLD IMPROVEMENT WORK UNDER SECTION 2.8 OF
SUBLEASE BETWEEN 000 XXXXXXXXX XXXXX II, LLC AS 'SUBLESSOR' AND BOTTOMLINE
TECHNOLOGIES, INC. AS 'SUBLESSEE'" (the "Confirmation"); and
WHEREAS: The Parties desire to amend the Sublease and the
Confirmation.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and agreed, the parties agree that
the Sublease shall be, and is hereby, amended as follows:
1. The defined term "Subleased Premises" shall mean no less than 62,000 and
not more than 64,000 rentable square feet of space located on the first,
third and fourth floor(s) of the approximately 100,000 square foot building
at 000 Xxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxxxxx (the "Building"). After
completion of the Leasehold Improvement Work, Sublessor shall provide
Sublessee with a certified measurement of the rentable space within 60 days
from the date of Sublessee's occupancy of the Subleased Premises and the
appropriate Lease provision shall automatically be amended consistent
therewith.
2. Exhibit 2 to the Sublease is hereby deleted in its entirety and Exhibit 1
hereto added in its place. Exhibit 1 hereto is a plan or plans showing the
"Subleased Premises" or "Premises" leased under this Sublease.
3. Section 21.3 of the Sublease is deleted in its entirety and the following
substituted therefore:
"21.3 Expansion Option. Sublessee shall have the right and option to
expand the space which comprises the Subleased Premises and is subject to
this Sublease for up to 10,000 rentable square feet of space. The
foregoing expansion option shall be exercisable at any time during the
Original Term of the Sublease only by Sublessee and only by giving
Sublessor written notice thereof, which notice shall specify the amount of
space (up to the maximum of 10,000 rentable square feet) (the "Expansion
Space") and the proposed
commencement date for the expansion option (which notice shall be given at
least six (6) months in advance). Within thirty (30) days after the receipt
of Sublessee's notice of exercise of the expansion option, Sublessor shall
designate the location of the Expansion Space within the Building.
Sublessor shall use its reasonable best efforts to (i) provide contiguous
space located on a single floor for the Expansion Space, and (ii) make the
Expansion Space available for Sublessee's occupancy on the commencement
date proposed by the Sublessee in its notice of exercise of the expansion
option, but in any event no later than twelve (12) months following receipt
of such notice. Any costs incurred by Sublessor for relocation of tenants
and/or reconfiguration of space in creating the Expansion Space shall be
paid by Sublessee upon demand from Sublessor. As a condition precedent to
the occupancy of the Expansion Space by the Sublessee, Sublessor and
Sublessee shall execute a written amendment of this Sublease to effect the
incorporation of the Expansion Space into the Subleased Premises, which
amendment shall contain the terms and conditions of such occupancy as
agreed to by the parties, including, without limitation, the term of the
lease of the Expansion Space.
In the event Sublessee shall commence occupancy of the Expansion Space
under this Section 21.3 on or before May 1, 2004 the Base Rent per square
foot rental rate shall be the same Base Rent per square foot charge paid by
the Sublessee under Article 4.1 of this Sublease plus any other additional
charges payable by the Sublessee under this Lease, and the other terms and
conditions of the amendment to the Sublease.
In the event Sublessee shall commence occupancy of the Expansion Space
under this Section 21.3 after May 1, 2004, the Base Rent per square foot
shall be negotiated by the parties hereto, and shall be commercial
reasonable. In no event, however, shall the Base Rent for the Expansion
Space be less than the Base Rent per square foot charge paid by the
Sublessee under Article 4.1 of this Sublease.
4. A list of the final plans and specifications for the Base Building Work, as
approved by the parties in the Confirmation, is attached hereto as Exhibit
2A, which list is subject to the deletions and modifications listed on
Exhibit 9 hereto. A list of the existing plans and specifications for the
Leasehold Improvement Work, as previously approved by the parties, is
attached hereto as Exhibit 2, which list shall be subject to modification
as provided in Section 5 below. Sublessor shall use diligent efforts to
complete construction of the Base Building Work and the Leasehold
Improvement Work on or before April 25, 2002. In the event Sublessor fails
to achieve "Substantial Completion" (as defined in Section 2.5 of the
Sublease) of the Base Building Work and the Leasehold Improvement Work on
or before July 1, 2002, then Sublessee shall have the right, exercisable
by notice to Sublessor given at any time while such failure persists, to
terminate this Sublease; provided, however, if Sublessor fails to achieve
Substantial Completion because of delays caused by the Sublessee, its
agents, or employees ("Sublessee Delays"), Substantial Completion shall be
deemed to have occurred as of the date that Sublessor could reasonably have
been expected to achieve Substantial Completion absent any Sublessee
Delays. The construction deadline of July 1, 2002 shall be extended one
(1) day, up to a maximum of one hundred eighty (180) days, for each day of
delay caused by (a) the occurrence of an event of "Force Majeure" as
defined in Section 2.4 of the Sublease, or (b) Sublessee Delays.
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5. The total cost of the Leasehold Improvement Work as set forth in Exhibit 2
is presently calculated to be Three Million One Hundred Thousand and
00/100 Dollars ($3,100.000.00) (the "LIW Cost"). Sublessor shall be
obligated to pay for the entire cost of the Base Building Work and for the
LIW Cost up to the LIW Allowance. The LIW Allowance shall be One Million
Eight Hundred Thousand and 00/100 Dollars ($1,800,000.00) (not the
$2,436,486.00 provided for in Section 2.8 of the Sublease). Sublessee
shall be obligated to reimburse Sublessor for the cost of the Leasehold
Improvement Work in excess of the LIW Allowance, up to an agreed maximum
amount. In the event of any cost overruns, Sublessor shall be obligated to
pay for any costs of the Leasehold Improvement Work, in excess of the LIW
Cost. In the event that the LIW Allowance exceeds the actual cost of the
Leasehold Improvement Work, any unused portion of the LIW Allowance shall
be applied against rent first becoming due. Based on current design of the
Leasehold Improvement Work, the maximum amount payable by Sublessee is One
Million Three Hundred Thousand and 00/100 ($1,300,000.00) (the "Sublessee's
Cost") (i.e., the difference between the LIW Cost and the LIW Allowance).
Section 2.8 of the Sublease is hereby deleted in its entirety. The
Sublessee's Costs shall be paid by Sublessee in accordance with the
provisions of Exhibit 3 hereto. The parties agree to work in good faith and
with due diligence to finalize the design and pricing of revised Leasehold
Improvement Work, and in any event to reach agreement thereon no later than
October 15, 2001. At such time as the final design of the Leasehold
Improvement Work has been agreed upon by the parties, in writing, the plans
therefore shall be attached to and incorporated by reference into, the
Sublease, and the Sublessee's Cost shall be recalculated. In the event that
the parties are unable to agree on revised design and pricing for the
Leasehold Improvement Work on or before October 15, 2001, the Leasehold
Improvement Work shall be completed as originally contemplated in
accordance with the design criteria established by existing plans and
specifications on Exhibit 2A with the exception that the back half of the
original second floor will, to the extent reasonably possible, be
substantially provided for on the rear half of the third floor and the
training rooms originally in the front left section of the first floor
will, to the extent reasonably possible, be provided for on the right half
of the first floor and the Sublessee's Cost shall be as stated above,
($1,300,000.00). Sublessee acknowledges that the value of the Stock and
Warrant delivered to Sublessor pursuant to Paragraph 11 hereof shall not be
credited against, or otherwise reduce, the obligation of Sublessee to pay
the Sublessee's Cost.
6. In light of the change in the Term Commencement Day set forth below,
Sublessor shall have until April 25, 2002 to complete the Base Building
and the LIW.
7. Section 4.1 of the Sublease is deleted in its entirety and the following
substituted therefore:
"4.1. The Base Rent due from Sublessee to Sublessor during the first year
of Term hereof shall be calculated by multiplying the number of square feet
included in the Subleased Premises by Fifteen and 75/100 Dollars ($15.75).
For each year thereafter, the Base Rent due hereunder shall be increased by
a percentage of the previous year's Base Rent, which percentage shall be
the lesser of (a) five (5) times the increase in the Consumer Price Index
for the previous calendar year, or (b) Three and One Tenth Percent (3.1%).
By way of example, the following Base Rent schedule has been calculated
assuming that there are 62,000 square feet of space within the Subleased
Premises, and that the annual increase is 3.1% for each year during the
Term:
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Per
Annual Rentable Monthly
Year Amount Sq. Ft. Payment
-------------------------------------------------------------
1 $ 976,500.00 $15.75 $ 81,375.00
-------------------------------------------------------------
2 $ 1,006,771.50 $16.24 $ 83,897.63
-------------------------------------------------------------
3 $ 1,037,981.42 $16.74 $ 86,498.45
-------------------------------------------------------------
4 $ 1,070,158.84 $17.26 $ 89,179.90
-------------------------------------------------------------
5 $ 1,103,333.76 $17.80 $ 91,944.48
-------------------------------------------------------------
6 $ 1,137,537.11 $18.35 $ 94,794.76
-------------------------------------------------------------
7 $ 1,172,800.76 $18.92 $ 97,733.40
-------------------------------------------------------------
8 $ 1,209,157.59 $19.50 $100,763.13
-------------------------------------------------------------
9 $ 1,246,641.47 $20.11 $103,886.79
-------------------------------------------------------------
10 $ 1,285,287.36 $20.73 $107,107.28
-------------------------------------------------------------
Total $11,246,169.81 $937,180.82
-------------------------------------------------------------
For the purposes of this Sublease, the term "Consumer Price Index" shall
mean the Consumer Price Index (All Urban Consumers, All Cities Average)
issued by the Bureau of Labor Statistics of the United States, for the
period from the first (1st) day of such previous calendar year through the
last day of such previous year. In no event shall the Base Rent due
hereunder in any year during the Term hereof be less than the Base Rent due
during the immediately preceding year."
8. The phrase "Term Commencement Date" as used throughout the Sublease shall
mean the later of (a) May 1, 2002, or (b) the date that "Substantial
Completion" of the Base Building Work and Leasehold Improvement Work
occurs. If, however, the issuance of a Certificate of Occupancy is delayed
because of Sublessee Delays, Substantial Completion shall be deemed to have
occurred as of the date that the Sublessor could reasonably have been
expected to achieve Substantial Completion absent any Sublessee Delays.
9. Sublessor and Sublessee agree that the scope of the Base Building Work
shall be reduced by the deletions and modifications listed on Exhibit 9
attached hereto, including eliminating the flagpoles, patio, fitness
center, sports court, and generator.
10. Article 18 of the Sublease is deleted in its entirety and the following
substituted therefore:
"ARTICLE 18"
SECURITY AND DEFAULT
18.1. If Sublessee shall default in the payment of rent or other payments
required of Sublessee hereunder, and if Sublessee shall fail to cure said
default within seven (7) business days after receipt of written notice of
said default from Sublessor (or if such notice shall adversely affect the
rights of the Sublessor in any bankruptcy or receivership, then
immediately); or if Sublessee shall default in the performance or
observance of any other agreement or condition on its part to be performed
or observed, and if Sublessee shall fail to
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cure said default within thirty (30) days after notice thereof or such
longer period as shall be reasonably required so long as the Sublessee
shall be diligently pursuing such cure after receipt of written notice of
said default from Sublessor (or if such notice shall adversely affect the
rights of the Sublessor in any bankruptcy or receivership, then
immediately); or if any person shall levy upon, or take this leasehold
interest or any part hereof, upon execution, attachment, or their process
of law; or if Sublessee shall make an assignment of its property for the
benefit of creditors; or if Sublessee shall file voluntary bankruptcy; or
if any bankruptcy or insolvency proceedings shall be commenced by Sublessee
or an involuntary bankruptcy shall be filed against the Sublessee which
remains undischarged for a period of sixty (60) days; or if a receiver,
trustee, or assignee shall be appointed for the whole or any part of the
Sublessee's property (which events are referred to herein as "Defaults" or
singularly as a "Default"), then in any of said cases, Sublessor lawfully
then or at any time thereafter, and without further notice or demand, (a)
enter into and upon the Subleased Premises, or any part hereof in the name
of the whole, and hold the Subleased Premises as if this Sublease had not
been made, and expel Sublessee and those claiming under it, and remove its
or their property without being taken or deemed to be guilty of any manner
of trespass whereupon the term of this Sublease shall terminate; or (b)
send written notice of such termination to Sublessee, whereupon Sublessee
shall immediately and forthwith vacate the Subleased Premises and deliver
same to Sublessor in a good, clear and tenantable condition. Sublessee
hereby expressly waives any and all rights of redemption granted by or
under any present or future laws in the event of Sublessee being evicted or
dispossessed for any cause, or in the event Sublessor terminates this
Sublease as provided in this Article. The Sublessee shall be liable for a
late payment fee equal to Five Percent (5%) of any amounts not paid within
seven (7) business days of the date due under this Sublease.
Notwithstanding the foregoing, or any other provision of this Sublease
(including, without limitation the provisions of Article 29 below) upon the
occurrence of a Default (including failure to timely pay Sublessee's Cost),
Sublessor shall also be immediately entitled to (c) exercise any and all
rights and remedies provided by law, including initiation of legal
proceedings for eviction of Sublessee from the Subleased Premises and
collection of all amounts due hereunder, and (d) exercise its rights under
Section 18.2 below.
18.2. In case of such termination, at the sole option of Sublessor, either
(a) Sublessee shall remain responsible and liable for all rents and payment
obligations as the same become due during the remaining term of this
Sublease, in which event, Sublessee shall pay Sublessor, on demand, all
past due rent as the same become due, less any rents collected, plus all
Costs of Reletting, or (b) Sublessee shall immediately pay to Sublessor
an amount equal to the total rent that Sublessee would have been required
to pay for the remainder of the Term discounted to present value at the
Prime Rate (defined below) then in effect, minus the then full amount of
the LC (as defined in Section 18.3). Sublessor shall use reasonable
efforts to relet the Subleased Premises for a term that may be greater or
less than the balance of the Term and on such conditions (which may include
concessions, free rent and alterations of the Subleased Premises) and for
such uses as Sublessor in its absolute discretion shall determine.
Sublessor may collect and receive all rents and other income from the
reletting, but shall, if Sublessee has timely made the payment provided for
in clause (b) of this Subsection, provide Sublessee with an annual
accounting of such income, during the original Term of this Sublease and
pay to Sublessee so much thereof as may be necessary to repay Sublessee up
to, but no more than, the amount paid by Sublessee pursuant to this Section
allocable to the year in which such income was received, less costs of
Reletting.
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Sublessor shall not be responsible or liable for the failure to relet all
or any part of the Subleased Premises or for the failure to collect any
rent. "Costs of Reletting" shall include all costs and expenses incurred by
Sublessor in reletting or attempting to relet the Subleased Premises,
including, without limitation, reasonable legal fees, brokerage
commissions, the cost of alterations and other concessions or allowances
granted to a new tenant. For purposes hereof, the "Prime Rate" shall be the
per annum interest rate publicly announced as its prime or base rate by a
federally insured bank selected by Sublessor in the sate in which the
Building is located.
18.3. Sublessee shall, on or before October 1, 2001, deliver to Sublessor
an irrevocable letter of credit (the "LC") in the amount of Two Million and
00/100 Dollars ($2,000,000.00) in the form of Exhibit LC attached hereto
issued by Silicon Valley Bank or such other FDIC insured which has been
approved in writing by Sublessor, such approval not to be unreasonably
withheld. The LC shall be held by Sublessor as security for the faithful
performance by Sublessee of all terms, covenants and conditions of this
Sublease. Upon the occurrence of any event of Default which remains
uncured after the expiration of any applicable notice and grace period,
Sublessor may (but Sublessor shall not be required to) draw on said LC and,
without prejudice to any other remedy, use all or a portion of the LC to
satisfy past due rent or to cure any uncured default by Sublessee and shall
further be entitled to retain the remaining proceeds of the LC as repayment
by Sublessee to Sublessor for costs incurred by Sublessor to construct the
Building in accordance with the special requirements of Sublessee. If
Sublessor transfers its interest in the Subleased Premises, Sublessor may
assign the LC to the transferee and, following the assignment and
acceptance of the LC by such transferee, Sublessor shall have no further
liability for the return of the LC. If Sublessor intends to assign
Sublessor's interest in the Sublease, Sublessee shall, upon notice from
Sublessor, deliver to Sublessor an amendment to the LC naming Sublessor's
assignee as the beneficiary thereof. Notwithstanding anything herein to
the contrary, provided (i) Sublessee performs all of the terms, covenants
and conditions of this Sublease to be kept and performed by Sublessee and
(ii) Sublessee reports EBITDA profits averaging no less than One Million
Five Hundred Thousand and 00/100 Dollars ($1,500,000.00) per quarter for 8
consecutive fiscal quarters, including the fiscal quarter immediately
preceding the effective date of any reduction of the LC, Sublessee shall
have the right to reduce the amount of the LC to be as follows: (a) One
Million Five Hundred Thousand and 00/100 Dollars ($1,500,000.00) effective
as of any time on or after May 1, 2005; (b) One Million and 00/100 Dollars
($1,000,000.00) effective any time on or after May 1, 2007; and (c) Five
Hundred Thousand and 00/100 Dollars ($500,000) effective any time on or
after May 1, 2009. Should Sublessee fail to satisfy such requirements on
the aforementioned dates, Sublessee shall have the ability to qualify for
such reductions by meeting the aforementioned requirements for any eight
(8) consecutive fiscal quarters after the applicable date. For example, if
Sublessee does not satisfy the financial requirement on or before May 1,
2005, but does satisfy the financial requirement for the first time on or
after May 1, 2007, the amount of the LC shall be reduced to One Million and
00/100 Dollars ($1,000,000.00). Additionally, Sublessee shall have the
right to reduce the LC on a dollar-for-dollar basis for any gains
recognized by the Sublessor in excess of Three Million and 00/100 Dollars
($3,000,000.00) from the sale of the Stock and/or the Warrant issued
pursuant to Section 10 of this Second Amendment to Sublease. Such
reduction shall be accomplished by having Sublessee provide Sublessor with
a substitute Letter of Credit in the reduced amount, and otherwise meeting
all of the conditions set forth above. If Sublessee
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provides Sublessor with a substitute Letter of Credit, Sublessor shall
simultaneously return the original LC to Sublessee.
Provided no Default under this Sublease has occurred, which remains uncured
after the expiration of any applicable notice and grace period, the LC
shall be returned to Sublessee thirty (30) days after the expiration of the
original Term (or the extended Term if Sublessee exercised its option to
extend the Term) of this Sublease.
11. Sublessee shall issue to Sublessor one hundred thousand (100,000) shares of
Sublessee's common stock (the "Stock") and a warrant to purchase one
hundred thousand (100,000) additional shares of Sublessee's common stock at
an exercise price of Four and 25/100 Dollars ($4.25) (the closing price of
Sublessee's stock on September 18, 2001) (the "Warrant") as payment for
Leasehold Improvements completed prior to the date hereof for the sole use
of the Sublessee under the terms and conditions of the Sublease. Such Stock
(and any of Sublessee's common stock purchased under the Warrant) will not
be registered by Sublessee; provided, however, if at any time after
eighteen (18) months from the date hereof, Sublessee otherwise elects to
file a registration of Sublessee's common stock, Sublessee agrees to
provide Sublessor with so-called "piggy back" registration rights for such
stock. Neither the Stock nor any of Sublessee's common stock purchased
under the Warrant, will be assignable or transferable without the prior
written consent of Sublessee for a period of three (3) years from the date
hereof except (a) for transfers or assignments to Members of Sublessor or
such Members' immediate family (provided, however that any such Member or
family member of a Member shall abide by the restrictions contained
herein); and (b) in conjunction with an acquisition of one hundred percent
(100%) of the ownership of Sublessee. The Warrant shall be in the form of
Exhibit 10 attached hereto.
12. Sublessee confirms and acknowledges that it is in its best interest, as
well as the best interest of the Sublessor, that Sublessor obtain permanent
mortgage financing for the property of which the Subleased Premises are a
part, and thus agrees to cooperate with Sublessor (so long as Sublessee
incurs no cost or liability) in obtaining such permanent financing by
timely providing to any potential mortgagee copies of any publicly
available information on the financial condition of Sublessee and the
Certificates referenced in Article 20 of the Sublease. Sublessee also
agrees that, in conjunction with any such financing, any amendments of this
Sublease required by such mortgagee shall be subject to Sublessee's
approval, not to be unreasonably withheld, provided no such amendment shall
(a) change any financial terms of the Sublease; (b) make any material
change to any of Sublessee's other rights and benefits under the Sublease;
and (c) impose any additional cost or liability upon Sublessee.
13. The Sublease, as amended by this Second Amendment, contains and sets forth
the entire agreement and understanding of the parties hereto with respect
to the subject matter contained herein, and supersedes and cancels all
prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, with respect to the
subject matter hereof made by either party, and/or their respective
officers, directors, members, employees and agents, including, but not
limited to, any and all claims of default made prior hereto by or against
either of the parties hereto.
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14. In all other respects, except as herein amended, the parties ratify and
confirm that the terms and provisions contained in the Sublease shall
remain in full force and effect and continue to apply to and bind the
parties.
IN WITNESS WHEREOF, Sublessor and Sublessee have executed this Second
Amendment to Sublease effective as of the 19th day of September, 2001.
000 XXXXXXXXX XXXXX II, LLC
By:____________________________
Its:____________________________
BOTTOMLINE TECHNOLOGIES, INC.
By:____________________________
Name: Xxxxxx X. XxXxxx
Its: Chief Executive Officer
XXXXX XX XXX XXXXXXXXX
XXXXXX XX XXXXXXXXXX
Xx this _____ day of September, 2001, personally appeared ________________,
known to me (or proved to me on the basis of satisfactory evidence) to be the
____________________ of 000 XXXXXXXXX XXXXX II, LLC, and on oath stated that he
was authorized to execute this instrument and acknowledged it to be his free and
voluntary act for the uses and purposes set forth herein.
Before me,
________________________________
Notary Public/Justice of the Peace
Name:___________________________
My Commission Expires:____________
XXXXX XX XXX XXXXXXXXX
XXXXXX XX XXXXXXXXXX
Xx this _____ day of September, 2001, personally appeared Xxxxxx X. XxXxxx,
known to me (or proved to me on the basis of satisfactory evidence) to be the
Chief Executive Officer of BOTTOMLINE TECHNOLOGIES, INC. and on oath stated that
he was authorized to execute this instrument and acknowledged it to be his free
and voluntary act for the uses and purposes set forth herein.
Before me,
________________________________
Notary Public/Justice of the Peace
Name:___________________________
My Commission Expires:____________
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EXHIBIT 1
A PLAN OR PLANS SHOWING THE SUBLEASED PREMISES
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EXHIBIT 2A
A LIST OF FINAL PLANS AND SPECIFICATIONS
FOR THE BASE BUILDING WORK
10
EXHIBIT 2
A LIST OF THE EXISTING PLANS AND SPECIFICATIONS
FOR THE LEASEHOLD IMPROVEMENT WORK
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EXHIBIT 3
SCHEDULE OF SUBLESSEE PAYMENTS
FOR LEASEHOLD IMPROVEMENT WORK
On each January 1, 2002 and April 1, 2002, Sublessee shall pay to Sublessor
Fifty Percent (50%) of the total Sublessee's Cost.
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EXHIBIT 9
A LIST OF ITEMS EXCLUDED FROM BASE BUILDING WORK
FLAGPOLES,
PATIO,
FITNESS CENTER,
SPORTS COURT,
GENERATOR
TOTALING $350,000.00 IN EXCLUDED ITEMS.
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EXHIBIT 10
FORM OF WARRANT
Filed separately
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EXHIBIT LC
FORM OF LETTER OF CREDIT
STANDBY LETTER OF CREDIT DRAFT
IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB01ISXXXX
DATE:
BENEFICIARY:
______________________________________
______________________________________
______________________________________
______________________________________
AS "LANDLORD"
APPLICANT:
______________________________________
______________________________________
______________________________________
______________________________________
AS "TENANT"
AMOUNT: US$__________________ (XXXXXXXXXXX AND 00/100 U.S. DOLLARS)
EXPIRATION DATE: _______________, 2001
LOCATION: AT OUR COUNTERS IN SANTA CLARA, CALIFORNIA
DEAR SIR/MADAM:
WE HEREBY ESTABLISH OUR IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB01ISXXXX IN
YOUR FAVOR AVAILABLE BY YOUR DRAFTS DRAWN ON US AT SIGHT AND ACCOMPANIED BY THE
FOLLOWING DOCUMENTS:
1. THE ORIGINAL OF THIS LETTER OF CREDIT AND ALL AMENDMENT(S), IF ANY.
2. A DATED CERTIFICATION FROM THE BENEFICIARY SIGNED BY AN AUTHORIZED
OFFICER, FOLLOWED BY ITS DESIGNATED TITLE, STATING THE FOLLOWING:
(A) "THE AMOUNT REPRESENTS FUNDS DUE AND OWING TO US AS A RESULT OF THE
APPLICANT'S FAILURE TO COMPLY WITH ONE OR MORE OF THE TERMS OF THAT CERTAIN
LEASE BY AND BETWEEN (INSERT BENEFICIARY'S NAME), AS LANDLORD, AND (INSERT
APPLICANT'S NAME), AS TENANT"
OR
(B) "WE HEREBY CERTIFY THAT WE HAVE RECEIVED NOTICE FROM SILICON VALLEY BANK
THAT LETTER OF CREDIT NO. SVB01ISXXXX WILL NOT BE RENEWED, AND THAT WE HAVE
NOT RECEIVED A REPLACEMENT OF THIS LETTER OF CREDIT FROM (INSERT
APPLICANT'S NAME). SATISFACTORY TO US AT LEAST THIRTY (30) DAYS PRIOR TO
THE EXPIRATION DATE OF THIS LETTER OF CREDIT."
PARTIAL DRAWS ARE ALLOWED. THIS LETTER OF CREDIT MUST ACCOMPANY ANY DRAWINGS
HEREUNDER FOR ENDORSEMENT OF THE DRAWING AMOUNT AND WILL BE RETURNED TO THE
BENEFICIARY UNLESS IT IS FULLY UTILIZED.
PAGE 1 OF 3
IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB01ISXXXX
DATED
DRAFT(S) AND DOCUMENTS MUST INDICATE THE NUMBER AND DATE OF THIS LETTER OF
CREDIT.
THIS LETTER OF CREDIT SHALL BE AUTOMATICALLY EXTENDED FOR AN ADDITIONAL PERIOD
OF ONE YEAR, WITHOUT AMENDMENT, FROM THE PRESENT OR EACH FUTURE EXPIRATION DATE
UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO THE THEN CURRENT EXPIRATION DATE WE
NOTIFY YOU AND THE APPLICANT BY REGISTERED MAIL/OVERNIGHT COURIER SERVICE AT THE
ABOVE ADDRESSES THAT THIS LETTER OF CREDIT WILL NOT BE EXTENDED BEYOND THE
CURRENT EXPIRATION DATE. IN NO EVENT SHALL THIS LETTER OF CREDIT BE
AUTOMATICALLY EXTENDED BEYOND __________________.
THIS LETTER OF CREDIT MAY ONLY BE TRANSFERRED IN ITS ENTIRETY BY THE ISSUING
BANK UPON OUR RECEIPT OF THE ATTACHED "EXHIBIT A" DULY COMPLETED AND EXECUTED BY
THE BENEFICIARY AND ACCOMPANIED BY THE ORIGINAL LETTER OF CREDIT AND ALL
AMENDMENTS, IF ANY, WITH THE PAYMENT OF OUR TRANSFER FEE OF 1/4 OF 1% OF THE
TRANSFER AMOUNT (MINIMUM USD250.00).
ALL DEMANDS FOR PAYMENT SHALL BE MADE BY PRESENTATION OF THE ORIGINAL
APPROPRIATE DOCUMENTS PRIOR TO 10:00 A.M. CALIFORNIA TIME, ON A BUSINESS DAY AT
OUR OFFICE (THE "BANK'S OFFICE") AT: SILICON VALLEY BANK, 0000 XXXXXX XXXXX
XXXXX XXXXX, XX 00000, ATTENTION: STANDBY LETTER OF CREDIT NEGOTIATION SECTION
OR BY FACSIMILE TRANSMISSION AT: (000) 000-0000 OR (000) 000-0000; AND
SIMULTANEOUSLY UNDER TELEPHONE ADVICE TO: (000) 000-0000 OR (000) 000-0000),
ATTENTION: STANDBY LETTER OF CREDIT NEGOTIATION SECTION WITH ORIGINALS TO FOLLOW
BY OVERNIGHT COURIER SERVICE; PROVIDED, HOWEVER, THE BANK WILL DETERMINE HONOR
OR DISHONOR ON THE BASIS OF PRESENTATION BY FACSIMILE ALONE, AND WILL NOT
EXAMINE THE ORIGINALS.
PAYMENT AGAINST CONFORMING PRESENTATIONS HEREUNDER SHALL BE MADE BY BANK DURING
NORMAL BUSINESS HOURS OF THE BANK'S OFFICE WITHIN TWO (2) BUSINESS DAYS AFTER
PRESENTATION
WE HEREBY AGREE WITH THE DRAWERS, ENDORSERS AND BONAFIDE HOLDERS THAT THE DRAFTS
DRAWN UNDER AND IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS LETTER OF
CREDIT SHALL BE DULY HONORED UPON PRESENTATION TO THE DRAWEE, IF NEGOTIATED ON
OR BEFORE THE EXPIRATION DATE OF THIS CREDIT.
PAGE 2 OF 3
IRREVOCABLE STANDBY LETTER OF CREDIT NO. SVB01ISXXXX
DATED
THIS LETTER OF CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR
DOCUMENTARY CREDITS (1993 REVISION), INTERNATIONAL CHAMBER OF COMMERCE,
PUBLICATION NO. 500.
___________________________ ____________________
AUTHORIZED SIGNATURE AUTHORIZED SIGNATURE
PAGE 3 0F 3
EXHIBIT "A"
DATE:
TO: SILICON VALLEY BANK
0000 XXXXXX XXXXX RE: STANDBY LETTER OF CREDIT
XXXXX XXXXX, XX 00000 NO. ISSUED BY
ATTN: INTERNATIONAL DIVISION. SILICON VALLEY BANK, SANTA XXXXX
STANDBY LETTERS OF CREDIT L/C AMOUNT:
GENTLEMEN:
FOR VALUE RECEIVED, THE UNDERSIGNED BENEFICIARY HEREBY IRREVOCABLY TRANSFERS TO:
(NAME OF TRANSFEREE)
(ADDRESS)
ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY TO DRAW UNDER THE ABOVE LETTER OF
CREDIT UP TO ITS AVAILABLE AMOUNT AS SHOWN ABOVE AS OF THE DATE OF THIS
TRANSFER.
BY THIS TRANSFER, ALL RIGHTS OF THE UNDERSIGNED BENEFICIARY IN SUCH LETTER OF
CREDIT ARE TRANSFERRED TO THE TRANSFEREE. TRANSFEREE SHALL HAVE THE SOLE RIGHTS
AS BENEFICIARY THEREOF, INCLUDING SOLE RIGHTS RELATING TO ANY AMENDMENTS,
WHETHER INCREASES OR EXTENSIONS OR OTHER AMENDMENTS, AND WHETHER NOW EXISTING OR
HEREAFTER MADE. ALL AMENDMENTS ARE TO BE ADVISED DIRECT TO THE TRANSFEREE
WITHOUT NECESSITY OF ANY CONSENT OF OR NOTICE TO THE UNDERSIGNED BENEFICIARY.
THE ORIGINAL OF SUCH LETTER OF CREDIT IS RETURNED HEREWITH, AND WE ASK YOU TO
ENDORSE THE TRANSFER ON THE REVERSE THEREOF, AND FORWARD IT DIRECTLY TO THE
TRANSFEREE WITH YOUR CUSTOMARY NOTICE OF TRANSFER.
SINCERELY,
_____________________________
(BENEFICIARY'S NAME)
_____________________________
SIGNATURE OF BENEFICIARY
SIGNATURE AUTHENTICATED
____________________________
(NAME OF BANK)
____________________________
AUTHORIZED SIGNATURE
