SECOND AMENDMENT TO
AMENDED AND RESTATED OFFICE BUILDING NET LEASE
THIS SECOND AMENDMENT TO AMENDED AND RESTATED OFFICE BUILDING NET LEASE
(the "Amendment") is made as of October 4, 2001, by and between BEP-▇▇▇▇▇ TECH
LLC, a Delaware limited liability company ("Landlord"), and EVOLVE SOFTWARE,
INC., a Delaware corporation ("Tenant").
R E C I T A L S
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A. BEP-Emeryville, L.P. (predecessor-in-interest to Landlord) and
Tenant entered into that certain Amended and Restated Office Building Net Lease
dated as of October 18, 2000, as amended by that certain First Amendment to
Amended and Restated Office Building Net Lease dated as of November 28, 2000 (as
amended, the "Lease") for approximately 72,351 rentable square feet in the
Building (the "Original Premises"). The Original Premises consists of the
following: (i) approximately 35,335 rentable square feet on the 1st, 2nd and 3rd
floors of the East Wing of the Building (the "East Wing Premises"), (ii)
approximately 15,926 rentable square feet on the 1st floor of the West Wing of
the Building (the "1st Floor West Wing Premises"), and (iii) approximately
21,090 rentable square feet on the 2nd floor and mezzanine of the West Wing of
the Building (the "2nd Floor and Mezzanine West Wing Premises"). Any
capitalized term used but not defined herein shall have the meaning given to it
in the Lease.
B. The Term Expiration Date of the Lease is July 20, 2007. Tenant's
business needs are such that Tenant only requires to lease the East Wing
Premises. Tenant desires to terminate the Lease with respect to the 1st Floor
West Wing Premises and the 2nd Floor and Mezzanine West Wing Premises
(collectively, the "Excess Premises"). Landlord agrees to the early termination
of the Excess Premises in return for Tenant's performance of the obligations set
forth in Paragraph 2 of this Amendment. Landlord and Tenant agree that the
Lease with respect to the Excess Premises shall terminate early as set forth in
this Amendment.
C. Landlord and Tenant agree to amend the Lease upon the terms and
conditions set forth herein.
A G R E E M E N T
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1. EARLY TERMINATION OF EXCESS PREMISES.
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(a) Tenant and Landlord hereby agree to terminate the Lease with
respect to the Excess Premises effective 11:59 p.m. California time on the
earlier of (i) July 10, 2003, or (ii)the date the Remaining Base Rent Amount (as
hereinafter defined) is deposited by Tenant in an escrow account designated by
Landlord pursuant to Paragraph 2(d) (the "Termination Date"). Notwithstanding
the foregoing, if Tenant shall be in monetary default under the Lease with
respect to the Excess Premises or under this Amendment with respect to the
Excess Premises on the Termination Date, the Lease with respect to the Excess
Premises shall not terminate and the Termination Date shall be the date that
such monetary default is cured by Tenant. Neither the termination of the Lease
with respect to the Excess Premises nor anything contained in this Amendment
shall relieve Tenant of any rental or other obligations or indemnities due or
owing under the Lease with respect to the Excess Premises or this Amendment that
accrue prior to or arise from events occurring prior to the Termination Date.
All such obligations and liabilities shall remain outstanding until they are
satisfied.
(b) Prior to the Termination Date, Tenant shall continue to pay all
rents and other amounts under the Lease with respect to the Excess Premises when
due and payable, and continue to perform all other non-payment obligations of
Tenant under the Lease when due under the Lease.
2. CONSIDERATION TO TENANT AND LANDLORD. The total value of the Base
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Rent and Tenant's Proportionate Share of Operating Expenses that Tenant was
supposed to pay for the Excess Premises from the Termination Date until the Term
Expiration Date is approximately $7,100,000.00. In consideration for the early
termination of the Lease with respect to the Excess Premises, Tenant agrees to
do the following:
(a) Tenant shall pay One Hundred Thousand and NO/100 Dollars
($100,000.00) (the "Initial Payment") to Landlord immediately upon the later of
execution of this Amendment or the date on which Landlord waives in writing the
contingency in Paragraph 10(i) below, as follows: (i) Tenant shall pay to
Landlord Fifty Thousand and NO/100 Dollars ($50,000.00) by cashier's check,
wire-transfer or direct deposit of immediately available funds, and (ii) Tenant
shall transfer ownership of the Office Property (as defined in paragraph 3
below) to Landlord as set forth in paragraph 3 below (Landlord and Tenant agree
that the value of the Office Property is $50,000.00).
(b) On or before January 2, 2002, Tenant shall pay to Landlord
another One Hundred Thousand and NO/100 Dollars ($100,000.00) (the "January 2,
2002 Payment") by cashier's check, wire-transfer or direct deposit of
immediately available funds.
(c) Tenant shall continue to pay Base Rent under the Lease with
respect to the Excess Premises through July 10, 2003 and shall sublease the
Excess Premises to Landlord from October 15, 2001 (the "Sublease Commencement
Date") until the Termination Date for One and NO/100 Dollar ($1.00) per month
(the "Sublease Payment") and upon the terms and conditions set forth in (A) that
certain sublease for the 1st Floor West Wing Premises (the "1st Floor West Wing
Premises Sublease") between Tenant, as sublessor, and Landlord, as sublessee,
dated as of October 4, 2001, and (B) that certain sublease for the 2nd Floor and
Mezzanine West Wing Premises (the "2nd Floor and Mezzanine West Wing Premises
Sublease") between Tenant, as sublessor, and Landlord, as sublessee, dated as of
October 4, 2001.
(d) At any time prior to the Termination Date, with at least three
(3) business days prior written notice to Landlord, Tenant shall have the right
to stop performing under Paragraph 2(c) above if Tenant pays, in a lump sum, the
amount of Base Rent for the Excess Premises for the period beginning the date of
such lump sum payment through July 10, 2003 (the "Remaining Base Rent Amount")
by placing such lump sum amount into an escrow account (the "Escrow Account"),
with Bank of America, which Escrow Account shall be solely designated and
controlled by Landlord. The funds in the Escrow Account shall accrue interest
for the benefit of Tenant at the best money market rates available with Bank of
America. The interest accruing in the Escrow Account shall be paid to Tenant on
a monthly basis. Landlord may draw from the Escrow Account monthly payments of
Base Rent from the Escrow Account as if Tenant were paying Base Rent in the
manner set forth in Paragraph 2(c) above, except that the Termination Date shall
in such event be the date by which the funds were delivered into the Escrow
Account by Tenant.
3. 1ST FLOOR WEST WING PREMISES FURNITURE AND EQUIPMENT. As of the
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date the Initial Payment is required to be made by Tenant, Tenant shall and
hereby does bargain, sell, assign and transfer to Landlord as of the date of
this Agreement, all of its right, title and interest in and to all of the
furniture and equipment (the "Office Property") which are located on the 1st
Floor West Wing as shown on EXHIBIT 1 attached hereto. Tenant shall deliver to
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Landlord a ▇▇▇▇ of Sale with respect to the Office Property immediately after
this Agreement is fully-executed by the parties. Tenant hereby represents and
warrants that Tenant holds all right, title and interest in and to the Office
Property, free of any liens, encumbrances or interests of third parties.
Subject to the preceding sentence, the Office Property shall be conveyed to
Landlord in their "AS IS" condition, with all faults and defects.
4. BASE RENT. From January 1, 2002 until the Term Expiration Date, the
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amount of Base Rent for the Leased Premises (including the Excess Premises)
shall be modified as set forth below. The definition of Base Rent in the Basic
Lease Information sheet of the Lease is hereby deleted in its entirety and
replaced with the following:
"FOR THE LEASED PREMISES
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1/1/02 - 2/28/02: 2.597 per rentable square foot per month
3/1/02 - 7/31/02: 2.626 per rentable square foot per month
8/1/02 - 2/28/03: 2.674 per rentable square foot per month
3/1/03 - 7/31/03: 2.705 per rentable square foot per month
8/1/03 - 2/28/04: 2.755 per rentable square foot per month
3/1/04 - 7/31/04: 2.786 per rentable square foot per month
8/1/04 - 2/28/05: 2.837 per rentable square foot per month
3/1/05 - 7/31/05: 2.870 per rentable square foot per month
8/1/05 - 2/28/06: 2.922 per rentable square foot per month
3/1/06 - 7/31/06: 2.956 per rentable square foot per month
8/1/06 - 2/28/07: 3.010 per rentable square foot per month
3/1/07 - 7/20/07: 3.045 per rentable square foot per month
Notwithstanding the foregoing, in addition to Base Rent, Tenant shall continue
to pay a monthly amount of $4,413.94 through the Term Expiration Date for the
amortization of additional tenant improvements for the East Wing Premises."
5. OPERATING EXPENSES FOR THE EXCESS PREMISES. Tenant shall not be
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obligated to pay Tenant's Proportionate Share of Basic Operating Cost for the
Excess Premises commencing on January 1, 2002 until the Termination Date.
6. SECURITY DEPOSIT. Section 5.14(b) of the Lease is hereby deleted in
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its entirety and replaced with the following:
"(b) The amount of the Security Deposit shall be reduced as follows:
MINIMUM AMOUNT OF
DATE REDUCTION SECURITY DEPOSIT
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The earlier of July $580,225.41 $ 2,320,901.62
21, 2002 or the
Termination Date
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The earlier of July $820,901.62 $ 1,500,000.00
10, 2003 or the
Termination Date
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July 21, 2004 $500,000.00 $ 1,000,000.00
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July 21, 2005 $500,000.00 $ 500,000.00
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July 21, 2006 $250,000.00 $ 250,000.00
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Notwithstanding the foregoing, no reduction in the amount of the Security
Deposit shall take place on the dates referenced above if Tenant shall be in
monetary default under the Lease or under this Amendment on the applicable date;
provided, however, the amount of the Security Deposit shall be reduced as set
forth above as soon as such monetary default is cured by Tenant."
7. SIGNAGE. Effective on the Sublease Commencement Date, Tenant's right
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to place signage on the West Wing of the Building shall be null and void.
8. BROKER COMMISSIONS. Tenant hereby agrees to indemnify, defend and
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hold Landlord free and harmless from and against liability for compensation or
charges which may be claimed by Tenant's exclusive listing agent, CM Realty, or
other similar party by reason of any dealings with or actions of Tenant in
connection with the Original Premises. Tenant shall not, however, be
responsible for any liability for compensation or charges which may be claimed
by Landlord's exclusive listing agent or other similar party by reason of any
dealings with or actions of Landlord.
9. SUBLESSEE LIABILITY. Tenant shall not be liable under the Lease for
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any default or failure to perform under the Lease resulting from a default or
failure to perform under the 1st Floor West Wing Premises Sublease or the 2nd
Floor and Mezzanine West Wing Premises Sublease by the "Sublessee" thereunder or
its agents, contractors, sublessees or invitees. In addition, Tenant shall not
be liable for, or required under the Lease to indemnify or hold harmless
Landlord from and against, any losses, claims, liabilities, judgments, causes of
action, damages, costs and expenses resulting from or arising in connection with
the acts or omissions of the "Sublessee" thereunder or its agents, contractors,
sublessees or invitees.
10. LENDER/FINANCING CONTINGENCY. This Amendment shall be null and
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void (i) if Landlord does not receive approval to enter into this Amendment from
its lender, First Union National Bank, by October 31, 2001, or (ii) if Tenant
does not receive a funding from Warburg Pincus of not less than $10,000,000.00
by October 15, 2001.
11. CHANGES. Notwithstanding any term or provision of the Lease, the
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provisions of this Amendment shall amend, modify and supersede the terms of the
Lease. If there is any conflict between the Lease and this Amendment, this
Amendment shall control. Except as herein set forth, the Lease shall remain
unmodified and in full force and effect.
IN WITNESS WHEREOF, this Amendment is being executed by the parties on the
date set forth above.
"LANDLORD":
BEP-▇▇▇▇▇ TECH LLC,
a Delaware limited liability company
By: BEP-Emeryville, L.P,
a Delaware limited partnership
its Member
By: EPI Investors 103 LLC,
a California limited
liability company
its General Partner
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Inc.,
a California corporation
its Managing Member
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▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President
"TENANT":
EVOLVE SOFTWARE, INC.,
a Delaware corporation
By:
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Name:
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Title:
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EXHIBIT 1
OFFICE PROPERTY
