exv10w8



 







Exhibit 10.8




303 EAST WACKER DRIVE

CHICAGO, ILLINOIS




OFFICE LEASE




between




303
WACKER REALTY L.L.C.




Landlord




and




PROMOTIONAL MARKETING, L.L.C.,

d/b/a UPSHOT




Tenant




Dated
as of June 30, 1998




 









 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page
	1.

	 	CERTAIN PROVISIONS AND DEFINITIONS
	 	 	1	 
	2.

	 	GRANT AND ACCEPTANCE OF LEASE
	 	 	4	 
	3.

	 	RENT
	 	 	4	 
	4.

	 	BASE RENT
	 	 	4	 
	5.

	 	ADDITIONAL RENT
	 	 	4	 
	6.

	 	USE OF PREMISES
	 	 	8	 
	7.

	 	TENANT IMPROVEMENTS
	 	 	9	 
	8.

	 	SERVICES
	 	 	9	 
	9.

	 	CONDITION AND CARE OF PREMISES
	 	 	13	 
	10.

	 	SURRENDER OF PREMISES
	 	 	16	 
	11.

	 	HOLDING OVER
	 	 	18	 
	12.

	 	RULES AND REGULATIONS
	 	 	18	 
	13.

	 	RIGHTS RESERVED TO LANDLORD
	 	 	18	 
	14.

	 	ALTERATIONS
	 	 	21	 
	15.

	 	ASSIGNMENT AND SUBLETTING
	 	 	23	 
	16.

	 	WAIVERS OF CERTAIN CLAIMS, INDEMNITIES
	 	 	28	 
	17.

	 	DAMAGE OR DESTRUCTION BY CASUALTY
	 	 	29	 
	18.

	 	EMINENT DOMAIN
	 	 	31	 
	19.

	 	DEFAULT; LANDLORD’S RIGHTS AND REMEDIES
	 	 	31	 






i









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	20.

	 	RIGHTS OF MORTGAGEES AND GROUND LESSORS
	 	 	36	 
	21.

	 	DEFAULT UNDER OTHER LEASES
	 	 	38	 
	22.

	 	INSURANCE AND SUBROGATION
	 	 	38	 
	23.

	 	NONWAIVER
	 	 	40	 
	24.

	 	ESTOPPEL CERTIFICATE
	 	 	40	 
	25.

	 	TENANT CORPORATION, LIMITED LIABILITY COMPANY OR PARTNERSHIP
	 	 	40	 
	26.

	 	REAL ESTATE BROKERS
	 	 	41	 
	27.

	 	NOTICES
	 	 	41	 
	28.

	 	MISCELLANEOUS
	 	 	42	 
	29.

	 	SECURITY DEPOSIT
	 	 	46	 
	30.

	 	INTENTIONALLY OMITTED
	 	 	49	 
	31.

	 	LANDLORD
	 	 	49	 
	32.

	 	TITLE AND COVENANT AGAINST LIENS
	 	 	49	 
	33.

	 	COVENANT OF QUIET ENJOYMENT
	 	 	49	 
	34.

	 	INITIAL GROWTH SPACE
	 	 	50	 
	35.

	 	RIGHT OF FIRST OFFER
	 	 	51	 
	36.

	 	EXPANSION OPTION
	 	 	55	 
	37.

	 	RENEWAL OPTION
	 	 	57	 
	38.

	 	MARKET RENTAL RATE
	 	 	58	 
	39.

	 	BUILDING DIRECTORY; LOBBY SIGNAGE
	 	 	59	 






ii









 






	 	 	 	 	 	 	 
	 	 	 	 	Page
	40.

	 	SATELLITE DISH
	 	 	59	 
	41.

	 	PARKING
	 	 	61	 
	42.

	 	BUILDING MANAGEMENT
	 	 	61	 
	43.

	 	EXCULPATORY PROVISIONS
	 	 	61	 






EXHIBITS




	 	 	 
	A-l

	 	Depiction of Land
	A-2

	 	Legal Description of Land
	A-3

	 	Floor Plans of Premises
	  B

	 	Other Definitions
	  C

	 	Workletter
	  D

	 	Taxes and Expenses
	  E

	 	Cleaning Specifications
	  F

	 	Rules and Regulations
	  G

	 	Form of Subordination, Non-Disturbance and Attornment Agreement
	  H

	 	Form of Letter of Credit
	  I

	 	Total Expansion Space






iii









 






OFFICE LEASE




	 	 	 	 	 
	DATED
AS OF:

	 	June 30, 1998	 	 
	 
	 	 	 	 
	BETWEEN:

	 	303 Wacker Realty L.L.C.
	 	(“Landlord”)
	(Address)

	 	303 East Wacker Drive	 	 
	 

	 	Chicago,Illinois 60601	 	 
	 
	 	 	 	 
	AND:

	 	Promotional Marketing, L.L.C.,
	 	(“Tenant”)
	(Address)

	 	     d/b/a Upshot	 	 
	 

	 	225 West Wacker Drive	 	 
	 

	 	Suite 700	 	 
	 

	 	Chicago, Illinois 60606	 	 
	 
	 	 	 	 
	LOCATION:

	 	Floors 23 and 24	 	 
	 

	 	303 East Wacker Drive	 	 
	 

	 	Chicago, Illinois 60601-5210	 	 






     Landlord and Tenant hereby covenant and agree as follows:



     1. CERTAIN
PROVISIONS AND DEFINITIONS. The following provisions and
definitions are an integral part of this lease:





     (a) “Additional Allowance”: The amount, if any, contributed by Landlord
pursuant to the Workletter to the cost of Tenant’s Work which is in excess of
the amount
of the Base Allowance provided for in the Workletter.




     (b)
“Base Rent”: The respective amounts for each Lease Year of the Initial
Term set forth in the following table (based on the respective rates of Base
Rent per square
foot of Rentable Area set forth in the following table), subject to adjustment
(i) for the first
Lease Year, pursuant to Section 34 below on account of the Initial Growth Space
and
(ii) for every Lease Year of the Initial Term, pursuant to the remaining
provisions of this
Section l(b) regarding any Additional Allowance:



 









 





	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Annual Base Rent Per	 
	Lease	 	Annual Base	 	 	Monthly	 	 	Square Foot of Rentable	 
	Year	 	Rent	 	 	Base Rent	 	 	Area of the Premises	 
	1
	 	$	757,410.00	 	 	$	63,117.50	 	 	$	15.00	 
	2
	 	$	937,657.00	 	 	$	78,138.08	 	 	$	15.50	 
	3
	 	$	1,028,398.00	 	 	$	85,699.83	 	 	$	17.00	 
	4
	 	$	1,209,880.00	 	 	$	100,823.33	 	 	$	20.00	 
	5
	 	$	1,270,374.00	 	 	$	105,864.50	 	 	$	21.00	 
	6
	 	$	1,270,374.00	 	 	$	105,864.50	 	 	$	21.00	 
	7
	 	$	1,330,868.00	 	 	$	110,905.67	 	 	$	22.00	 
	8
	 	$	1,330,868.00	 	 	$	110,905.67	 	 	$	22.00	 
	9
	 	$	1,451,856.00	 	 	$	120,988.00	 	 	$	24.00	 
	10
	 	$	1,572,844.00	 	 	$	131,070.33	 	 	$	26.00	 







If there is an Additional Allowance, Base Rent for each Lease Year of the Initial Term shall
be equal to the sum of (i) Base Rent set forth in the table above, as adjusted pursuant to Section
34 below on account of the Initial Growth Space, plus (ii) the product of (A) the amount which will
be necessary to pay the Additional Allowance, together with interest on the balance of the
Additional Allowance from time to time outstanding at the rate of eleven percent (11%) per annum,
in full in one hundred twenty (120) equal monthly installments multiplied by (B) twelve (12);
Monthly Base Rent for each Lease Year of the Initial Term shall be one-twelfth-of the respective
amounts so determined; and Base Rent per square foot for each Lease Year shall be an amount equal
to the Base Rent for the particular Lease Year as so determined divided by the Rentable Area of the
Premises.




     (c)
“Brokers”: Hines Interests Limited Partnership and Binswanger,




     (d)
“Building”: The office building located at 303 East Wacker Drive,
Chicago, Illinois 60601-5210.




     (e)
“Commencement Date”: The earlier of (i) April 1, 1999 or (ii) the day
Tenant first begins to conduct any business operations in the Premises.




     (f)
“Expiration Date”: The last full day of the Term.



2









 

]




     (g) “Initial Term”: The period ending on the last day of the tenth (10th) Lease
Year.




     (h) “Land”: The parcel(s) of real estate on which the Building is located, which are
depicted on Exhibit A-l and legally described on Exhibit A-2.




     (i) “Landlord’s Work”: The work to be performed by or on behalf of Landlord pursuant to
the Workletter.




     (j)
“Lease Year”: If the Commencement Date is the first day of a calendar
month, the period of twelve (12) consecutive months commencing on the Commencement
Date; if the Commencement Date is not the first day of a calendar month, the period
commencing on the Commencement Date and ending on the last day of the twelfth (12th)
full calendar month of the Term; and, in either case, each consecutive twelve (12) month
period thereafter which falls in whole or in part during the Term.




     (k) “Premises”: The entire 23rd and 24th floors of the Building, as shown on Exhibit
A-3, which consist of 60,494 square feet of Rentable Area measured in accordance
with the BOMA method of measurement as more fully described in Exhibit B.




     (l) “Project”: The Land and the Building, together with any other improvements located
on the Land, all equipment, fixtures, machinery, systems, apparatus and personal property of
Landlord located at or used in connection with the Land or the Building from time to time.




     (m) “Security Deposit”: See Section 29.




     (n) “Tenant Alterations”: Any alteration, improvements or additions (including
decorations) to the Premises performed or to be performed by or on behalf of Tenant,
including, without limitation, the Tenant’s Work, but excluding any of Landlord’s Work to be
performed by or on behalf of Landlord under the Workletter.




     (o) “Tenant’s Proportionate Share”: The percentage determined as described in Exhibit B,
which percentage, as of the date of this lease, is (i) 6.5566% for the first Lease Year,
subject to adjustment pursuant to Section 34 below on account of the Initial Growth Space,
and (ii) 7.8550% for each subsequent Lease Year.




     (p) “Tenant’s Work”: The work to be performed by or on behalf of Tenant to ready the
Premises for initial occupancy by Tenant, as more particularly described in Section 7 hereof
and in the Workletter.



3









 






     (q) “Term”: The Initial Term and any extension or renewal of the Initial
Term specifically provided herein.




     (r)
“Use”: General office use.




     (s)
“Workletter”: The Workletter, attached hereto as Exhibit C.




See
Exhibit B and the Workletter for other definitions of terms used
herein.



     2. GRANT
AND ACCEPTANCE OF LEASE. Landlord hereby leases the Premises
to Tenant and Tenant hereby accepts and leases the Premises from Landlord to have and to hold
during the Term, subject to the terms and conditions of this lease.



     3. RENT. Base Rent, Additional Rent, Additional Rent Estimate and all other
amounts becoming due from Tenant to Landlord hereunder (collectively “Rent”) shall be paid in
lawful money of the United States to Landlord at the following address: 303 East Wacker Drive,
Chicago, Illinois 60601 or such other address as Landlord- shall designate in writing to
Tenant
from time to time, without any demand and without any reduction, abatement, counterclaim,

deduction or set-off whatsoever, except as expressly provided herein, at the times and in the
manner hereinafter provided. Rent unpaid for five (5) days after the due date shall bear
interest
at the Default Rate from the date due until paid. The payment of Rent hereunder is independent

of each and every other covenant and agreement contained in this lease.



     4. BASE
RENT. Tenant shall pay Base Rent to Landlord in equal monthly
installments in the respective amounts per Lease Year determined
pursuant to Section 1(b),
subject
to the provisions of Section 34 below (herein called “Monthly Base Rent”), in advance on the
Commencement Date and on or before the first day of each and every calendar month during the
Term. If the Term shall begin on any day other than the first day of a calendar month or end
on
any day other than the last day of a calendar month, then the Monthly Base Rent for any
partial
calendar month within the Term shall be prorated on a per diem basis.



     5. ADDITIONAL
RENT. In addition to paving the Base Rent, Tenant shall also pay
as additional rent the amounts (collectively “Additional Rent”) determined to be Tax
Adjustment
and Expense Adjustment in accordance with this Section 5:




     (a)
Computation of Additional Rent. Tenant shall pay as Additional Rent for each
Calculation Year the following amounts:




          (i) Tenant’s Proportionate Share of Taxes for such Calculation Year (the
“Tax Adjustment”); plus



4









 






          (ii) Tenant’s Proportionate Share of Expenses for such Calculation Year (the
“Expense Adjustment”).




     (b)
Payments of Additional Rent; Additional Rent Estimate; Projections.
Tenant shall pay Additional Rent to Landlord in the manner hereinafter provided. The aggregate of
payments required to be made by Tenant on account of Additional Rent for any Calculation Year until
actual Additional Rent is determined is herein called
“Additional Rent Estimate”.




          (i) Landlord may, at any time and from time to time prior to the first Calculation
Date and during the Term (but not more than twice for any given calendar year after
Tenant’s Additional Rent Estimate is established for that calendar year), deliver to Tenant
a written notice or notices (“Projection Notice”) setting forth:





               (A) Landlord’s reasonable estimates, forecasts or projections
(collectively, the “Projections”) of any or all of Taxes and Expenses for
such Calculation Year, and




               (B) Tenant’s Additional Rent Estimate (setting forth the Expense
Adjustment component and Tax Adjustment component separately) based
upon the Projections, being the Tenant’s Proportionate Share of the
Projections.




          (ii)
On or before the first (1st) day of the next calendar month following Landlord’s
service of a Projection Notice, and on or before the first day of each month thereafter,
Tenant shall pay to Landlord one-twelfth (1/12) of the Additional Rent Estimate shown in
the Projection Notice. Within fifteen (15) days following Landlord’s service of a
Projection Notice, to bring Tenant’s payments of Additional Rent Estimate current, Tenant
shall also pay Landlord the amount set forth in the Projection Notice, which shall equal
the Additional Rent Estimate shown in the Projection Notice less (A) any previous payments
on account of Additional Rent Estimate made for such Calculation Year, and (B) total
monthly installments on account of Additional Rent Estimate not yet due and payable for
the remainder of such Calculation Year. Until such time as Landlord furnishes a Projection
Notice for a Calculation Year, Tenant shall pay to Landlord a monthly installment of
Additional Rent Estimate on the first day of each month equal to the greater of the latest
monthly installment of Additional Rent Estimate or one-twelfth (1/12) of Tenant’s latest
determined Additional Rent.



5









 






     (c)
Readjustments.




          (i) Following the end of each Calculation Year and after Landlord shall have determined
the amount of Expenses to be used in calculating the Expense Adjustment for such Calculation Year,
Landlord shall notify Tenant in writing (any such notice of Expenses and Expense Adjustment herein
called “Landlord’s Expense Statement”) of such Expenses and Tenant’s Expense Adjustment for such
Calculation Year. If the Expense Adjustment owed for such Calculation Year exceeds the Expense
Adjustment component of the Additional Rent Estimate paid by Tenant during such Calculation Year,
then Tenant shall, within thirty (30) days after the date of Landlord’s Expense Statement, pay to
Landlord an amount equal to the excess of the Expense Adjustment over the Expense Adjustment
component of the Additional Rent Estimate paid by Tenant during such
Calculation Year. If the
Expense Adjustment component of the Additional Rent Estimate paid by Tenant during such Calculation
Year exceeds the Expense Adjustment owed for such Calculation Year, then Landlord shall credit such
excess to Rent payable after the date of Landlord’s Expense Statement, or may, at its option,
credit such excess to any Rent theretofore due and owing, until such excess has been exhausted. If
this lease shall expire or be terminated prior to full application of such excess, Landlord shall,
within thirty (30) days thereafter, pay to Tenant the balance thereof not theretofore applied
against Rent and not reasonably required for payment of Rent for the Calculation Year in which the
lease expires, subject to Tenant’s obligations under Section 5(e) hereof, provided Tenant shall
have vacated the Premises and otherwise surrendered the Premises to Landlord in accordance with
this lease.




          (ii) Following the end of each Calculation Year and after Landlord shall have determined the
actual amount of Taxes to be used in calculating the Tax Adjustment for such Calculation Year,
Landlord shall notify Tenant in writing (any such notice of Taxes and Tax Adjustment herein called
“Landlord’s Tax Statement”) of such Taxes for such Calculation Year. If the Tax Adjustment owed
for such Calculation Year exceeds the Tax Adjustment component of the Additional Rent Estimate paid
by Tenant during such Calculation Year, then Tenant shall, within thirty (30) days after the date
of Landlord’s Tax Statement, pay to Landlord an amount equal to the excess of the Tax Adjustment
over the Tax Adjustment component of the Additional Rent Estimate paid by Tenant during such
Calculation Year. If the Tax Adjustment component of the Additional Rent Estimate paid by Tenant
during such Calculation Year exceeds the Tax Adjustment owed for such Calculation Year, then
Landlord shall credit such excess to Rent payable after the date of Landlord’s Tax Statement, or
may, at its option, credit such excess to any Rent theretofore due and owing, until such excess
has been exhausted. If this lease shall expire or be terminated prior to full application of such
excess, Landlord



6









 






shall, within thirty (30) days thereafter, pay to Tenant the balance thereof not
theretofore applied against Rent and not reasonably required for payment of Rent for the
Calculation Year in which the lease expires, subject to Tenant’s obligations under Section
5(e) hereof, provided Tenant shall have vacated the Premises and otherwise surrendered the
Premises to Landlord in accordance with this lease.




     (d)
Books and Records. Landlord shall maintain books and records showing
Taxes and Expenses in accordance with sound accounting and management practices.
Tenant and its Representative (as hereinafter defined) shall have the right to examine such
books and records showing Taxes and Expenses upon reasonable prior notice during
normal business hours and without interference with Landlord’s operations at any time
within sixty (60) days following Tenant’s receipt of Landlord’s Expense Statement (as it
relates to an examination of Expenses) or Landlord’s Tax Statement (as it relates to an
examination of Taxes) provided for in Section 5(c). Unless Tenant shall take written
exception to any item of Taxes or Expenses, specifying in detail the reasons for such
exception as to a particular item within ninety (90) days after Tenant’s receipt of
Landlord’s Expense Statement or Landlord’s Tax Statement (as the case may be),
Landlord’s Expense Statement and Landlord’s Tax Statement, as applicable, shall be
considered as final and accepted by Tenant. Notwithstanding any exception made by
Tenant, Tenant shall pay Landlord the full amount of its Additional Rent Estimate and its
Additional Rent as determined by Landlord, subject to readjustment at such time as any
such exception may be resolved in favor of Tenant. Tenant’s “Representative” shall be
either a nationally recognized independent certified public accounting firm licensed to do
business in the State of Illinois, or another accounting firm reasonably acceptable to
Landlord. For each examination of Landlord’s books and records, the employees of
Tenant’s Representative who personally examine such books and records shall-include a
certified public accountant, but if deemed necessary or appropriate by the accountant may
also include other real estate professionals who are experienced in management of first-
class office buildings. Tenant shall not retain its Representative on a contingent fee basis.




     (e)
Proration and Survival. With respect to any Calculation Year which does
not fall entirely within the Term, Tenant shall be obligated to pay as Additional Rent for
such Calculation Year only a pro rata share of Additional Rent as hereinabove determined,
based upon the number of days of the Term falling within the Calculation Year.
Following expiration or termination of this lease, Tenant shall pay any Additional Rent
due to Landlord within fifteen (15) days after the date of Landlord’s Expense Statement
or Landlord’s Tax Statement (as the case may be) sent to Tenant. Without limiting other
obligations of Tenant which survive the expiration or termination of this lease, the
obligations of Tenant to pay Additional Rent provided for in this Section 5 shall survive
the expiration or earlier termination of this lease. No interest or penalties shall accrue on
any amounts which Landlord is obligated to credit or pay to Tenant by reason of this
Section 5 unless any amount required to be paid to Tenant is not paid when due under this



7









 






Section 5, in which case such amount shall bear interest from the due date at the Default
Rate.




     (f)
No Decrease in Base Rent. In no event shall any Additional Rent result
in a decrease of the Base Rent payable hereunder.




     (g)
No Representation or Warranty. Exhibit D attached hereto sets forth
information about the amounts of Taxes and Expenses for the years indicated therein
which
was furnished to Landlord by the predecessor owner and manager of the Project. Tenant
acknowledges, however, that neither Landlord, nor any of its
respective agents or employees, has made or does hereby make any representation or warranty whatsoever to
Tenant as to the amount of Taxes, Expenses, Tax Adjustment or Expense Adjustment or
any component thereof for prior years or which may become payable during the Term.



     6. USE
OF PREMISES.



     (a) Use. Tenant shall use and occupy the Premises as set forth in Section l(r) hereof
only and for no other use or purpose.



     (b) Compliance
with Requirements. Tenant shall comply with all applicable Laws
(hereinafter defined) now or hereafter in force, and with all applicable insurance
underwriters
regulations and other requirements, respecting all matters of occupancy, condition or
maintenance
of the Premises, whether any of the foregoing shall be directed to Tenant or Landlord and
whether
imposed on the owner or occupant of the Premises.
“Laws” means all statutes, laws, ordinances,
codes, rules and regulations, orders and directions of public
officials or other acts having
the force
or effect of law, of all federal, state, county, municipal and other agencies, authorities or
bodies
having jurisdiction over the Premises. Notwithstanding the foregoing, but subject to the
provisions of Section 9(f) below regarding the ADA (as defined therein), Tenant shall not be
obligated to make any structural alterations to the Building if similar alterations will be
required
to be made in the Building as a whole, as distinguished from alterations made necessary by
Tenant’s particular use of the Premises or required to be made to, or made necessary by,
Tenant
Alterations; provided, however, that the cost of any such alterations made by Landlord may be
included in Expenses except for capital alterations which are required under governmental
laws,
regulations, or ordinances applicable to the Building as of the date of this lease and to the
extent
otherwise excluded from Expenses by this lease.



     Tenant shall not make or permit any use of the Premises or the Building, or do or permit to
be done anything in or upon the Premises or the Building, or bring or keep anything in the
Premises or the Building, which directly or indirectly is forbidden by any of the foregoing or
which may be dangerous to persons or property, or which may invalidate or increase the rate of
insurance on the Building above the standard risk for tenants of first-class office buildings, its



8









 




appurtenances, contents or operations, or which would tend to create or continue a nuisance or
which is contrary to or prohibited by the terms and conditions of this lease.




     7. TENANT IMPROVEMENTS. Subject to Landlord’s obligations with respect to
the Landlord’s Work, Tenant shall, at its sole cost and expense (subject to application of the
allowances provided for in the Workletter), perform such work (“Tenant’s Work”) as may be
necessary or desired by Tenant to improve the Premises for occupancy, all subject to and in
accordance with the provisions of this lease and the Workletter.



     8. SERVICES.



     (a) General Description of Services. So long as this lease is in full
force and effect, Landlord shall furnish the following services (the cost of which may be included
in Expenses):




     (i) Air conditioning and heat when necessary to provide a temperature condition
required, in Landlord’s reasonable judgment, for comfortable occupancy of the Premises
under normal business operations, Monday through Friday from 8:00 A.M to 6:00 P.M. and
Saturdays from 8:00 A.M to 1:00 P.M. Holidays excepted. The design specifications for the
Building air conditioning and heating system servicing the Premises under the design loads
for such system are set forth in the Description of Base Building Work attached to the
Workletter as Attachment 1. Levels of heating and air conditioning are subject to
adjustments pursuant to compliance by Landlord with Laws and governmental guidelines
relating to energy use.




     (ii) Domestic water in common with other tenants for drinking, lavatory and toilet
purposes drawn through fixtures installed by Landlord within the core of the Building, and
warm water in common with other tenants for lavatory purposes and for ordinary office
kitchen purposes from the same regular Building supply and fixtures.




     (iii) Customary janitor and cleaning service in and about the Premises and common
areas of the Building in accordance with the specifications attached hereto as Exhibit E.
Tenant shall not provide or use any other janitor or cleaning service.




     (iv) Passenger elevator service in common with Landlord and other persons, Monday
through Friday from 8:00 A.M. to 6:00 P.M. (Saturdays from 8:00 A;M. to 1:00 P.M.), Sundays
and Holidays excepted; and freight elevator service in common, with Landlord and other
persons, and subject to prior scheduling with Landlord, Monday through Friday from 8:00
A.M. to 4:00 P.M., Saturdays, Sundays and Holidays excepted. Limited passenger elevator
service shall be provided daily at all times when the aforesaid passenger elevator service
is not furnished.



9









 






     (v) Without limitation of Item 3 of Attachment 2 to the Workletter, security at
a level consistent with that provided by comparable first-class office buildings in
downtown Chicago, Illinois.



     (b) Electricity. Except as hereinafter provided, electricity shall not be furnished
by
Landlord, but shall be furnished by Commonwealth Edison Company or another electric utility
company serving the area selected by Landlord. Landlord shall permit Tenant to receive such
service direct from such utility company at Tenant’s cost, and shall permit Landlord’s wire
and
conduits, to the extent available, suitable and safely capable, to be used for such
purposes. The
capacity of the electrical service to the Premises is set forth in the Description of Base
Building
Work attached to the Workletter as Attachment 1. Tenant shall make all necessary
arrangements
with the utility company for metering and paying for electric current furnished by it to
Tenant,
and Tenant shall pay for all charges for electric current consumed on the Premises during
Tenant’s
occupancy thereof. Tenant shall make no alterations or additions to the electric equipment
or
systems in the Premises or the Building without the prior written consent of Landlord in
each
instance. Tenant also agrees to purchase from Landlord or its agents, as Landlord shall
direct,
all lamps, bulbs, ballasts and starters used in the Premises during the Term. Tenant
covenants
and agrees that at all times its use of electric current shall never exceed the capacity
referred to
above. Notwithstanding the foregoing, Landlord reserves the right to provide electricity to
the
Premises in whole or in part, and in such event Tenant agrees to purchase such electricity
from
Landlord, at Landlord’s then current charges at rates which shall not exceed the rates for
such
service charged to tenants of the Building leasing space comparable in size to the space
leased by
Tenant. If the Premises are not separately metered for any reason, or are separately metered
only
in part, then Tenant shall pay Landlord, as additional Rent, in monthly installments at the
time
prescribed for monthly installments of Monthly Base Rent, amounts determined by Landlord
based
upon Landlord’s then established rates therefor, which shall not exceed the rates for such
service
charged to tenants of the Building leasing space in size comparable in size to the space
leased by
Tenant.



     (c) Telephone. All telegraph, telephone, and electric connections which Tenant may
desire shall be first approved by Landlord in writing, before the same are installed, and
the
location of all wires and the work in connection therewith shall be performed by contractors
approved by Landlord, which approval shall not be unreasonably withheld, and shall be
subject
to the reasonable direction of Landlord. Landlord reserves the right to designate and
control the
entity or entities providing telephone or other communication cable installation, repair and
maintenance in the Building and to restrict and control access to
telephone cabinets. In the event landlord designates a particular
vendor or vendors to provide such cable installation, repair and
maintenance for the Building, Tenant agrees to abide by and participate in such program,
provided
that the rates for such installation, repair and maintenance are commercially reasonable in
view
of similar programs in comparable buildings. Tenant shall be responsible for and shall pay
all
costs incurred in connection with the installation of telephone cables and related wiring in
the
Premises, including, without limitation, any hook-up, access and maintenance fees related to
the



10









 




installation of such wires and cables in the Premises and the commencement of service therein, and
the maintenance thereafter of such wire and cables; and there shall be included in Expenses for
the Building all installation, hook-up or maintenance costs incurred by Landlord in connection
with telephone cables and related wiring in the Building which are not allocable to any individual
users of such service but are allocable to the Building generally. If Tenant fails to maintain all
telephone cables and related wiring in the Premises and such failure affects or interferes with
the operation or maintenance of any other telephone cables or related wiring in the Building,
Landlord or any vendor hired by Landlord may, if such failure is not cured upon reasonable prior
notice to Tenant (except in the case of an emergency, where no notice shall be required), enter
into and upon the Premises and perform such repairs, restorations or alterations as Landlord deems
necessary in order to eliminate any such interference (and Landlord may recover from Tenant all of
Landlord’s costs in connection therewith and Landlord shall have no liability to Tenant by reason
thereof). Upon the Expiration Date, Tenant agrees to remove all telephone cables and related
wiring installed by Tenant for and during Tenant’s occupancy, which Landlord shall request Tenant
to remove. Tenant agrees that neither Landlord nor any of its agents or employees shall be liable
to Tenant, or any of Tenant’s employees, agents customers or invitees or anyone claiming through,
by or under Tenant, for any damages, injuries, losses, expenses, claims or causes of action
because of any interruption, diminution, delay or discontinuance at any time for any reason in the
furnishing of any telephone service to the Premises and the Building.




     (d) Extra or Additional Services. Tenant may request Landlord to provide services
which are extra or additional services to those described in Section 8(a), by advance request
to
Landlord. If Landlord shall agree to so provide any such services which are extra or in
addition
to those services described in Section 8(a), Tenant shall pay for any such extra or additional
services so provided by Landlord at Landlord’s established rates therefor from time to time,
or
if there are no established rates, then at the rate of 115% (or, with respect to after-hours
HVAC,-
at the rate of 100%) of the cost of providing such service, or as otherwise agreed by Landlord
and
Tenant. Landlord’s current rates for after-hours HVAC are $70.50 per hour for ventilation
only,
$139.16 per hour for heating (perimeter) and ventilation, and $167.69 per hour for air
conditioning and ventilation. All charges for any such extra or additional services so
provided
by Landlord shall be deemed to be additional Rent hereunder and shall be due and payable
within
ten (10) days after Tenant receives Landlord’s bill therefor, or in installments as may be
designated by Landlord to Tenant in writing. If Tenant fails to pay when due Landlord’s proper
charges for any such extra or additional services, Landlord shall have the right, in addition
to all
other rights and remedies available to Landlord, to discontinue furnishing any such extra or
additional services for which Tenant has failed to pay. If Landlord discontinues any such
extra
or additional services as provided in this Section 8(d), no such discontinuance shall be
deemed an
eviction or disturbance of Tenant’s use of the Premises or render Landlord liable for damages
or
relieve Tenant from performance of Tenant’s obligations under this lease.



     (e) Holidays. For purposes of this Section 8, “Holidays” means New Year’s Day,
Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Day and any other



11









 




day customarily designated as a holiday by landlords operating first-class office buildings in
downtown Chicago, Illinois.




     (f) Interruption of Services. Tenant agrees that neither Landlord, nor any of
Landlord’s constituent members, nor any of their respective agents, partners or employees,
shall
be liable for damage or injury to person, property or business or for loss or interruption of
business, or for any other matter, in the event there is any failure, delay, interruption or
diminution in furnishing any service. No such failure, delay, interruption or diminution shall
be
deemed to constitute an eviction or disturbance of Tenant’s use or possession of the Premises,
in
whole or in part, actual or constructive, nor entitle Tenant to any claim for set-off,
abatement or
reduction of Rent, nor render Landlord liable for damages, nor relieve Tenant from the
performance of or affect any of Tenant’s obligations under this lease. Notwithstanding the
foregoing, if due to Landlord’s wrongful act or omission services described in Sections
8(a)(i),
(ii) (limited to water supplied to base building washrooms) and (iv) and 8(b) above are
interrupted,
so that Tenant is not able and actually ceases to conduct any business activities in the
Premises
for a period of five (5) consecutive business days, Base Rent and Additional Rent shall abate
as
of the sixth (6th) consecutive business day and thereafter until such time as service is
restored so
that Tenant is able to or actually resumes occupancy of the Premises for any of its customary
business activities.



     Landlord shall use commercially reasonable efforts to minimize any failure, delay,
interruption or diminution in furnishing any service.



     (g) Tenant’s Cooperation. Tenant agrees to cooperate fully with Landlord, at all
times, in abiding by reasonable regulations and requirements which Landlord may prescribe for
the proper functioning and protection of all utilities and services reasonably necessary for
the
operation of the Premises or the Project. Landlord and its contractors shall have free access,
upon
reasonable prior notice (except in an emergency, where no notice shall be required), to any
and
all mechanical installations in the Premises, and Tenant agrees that there shall be no
construction
of partitions or other obstructions which might interfere with the moving of the servicing
equipment of Landlord to or from the enclosures containing said installations. Tenant further
agrees that neither Tenant nor its employees, agents or contractors shall at any time tamper
with,
adjust or otherwise in any manner adversely affect Landlord’s mechanical installations in the
Premises or the Project.



     (h) Supplemental Heating or Cooling. Whenever, in Landlord’s reasonable judgment, Tenant’s
use or occupation of the Premises, including lighting, personnel, heat generating machines or
equipment, or airborne emissions of smoke or other particulates, individually or cumulatively,
causes the design loads for the system providing heat and air-cooling to be exceeded, or otherwise
affects adversely the temperature, humidity or air quality otherwise maintained by the heating,
ventilating and air handling or conditioning system in the Premises or the Building, and Tenant
fails to cure such effect by adjusting Tenant’s loads or installing supple-



12









 




mentary heating or air handling or conditioning units within fifteen (15) days after notice from
Landlord, Landlord may, but shall not be obligated to, temper such excess loads by installing
supplementary heating or air handling or conditioning units in the Premises or elsewhere where
necessary. In such event, the cost of such units and the expense of installation, including without
limitation, the cost of preparing working drawings and specifications, plus ten percent (10%) of
the cost of such units and of the hard costs of installation as an overhead and supervision fee if
such cost and hard costs are less than $100,000.00 in any instance and five percent (5%) of the
cost of such units and of the hard costs of installation as an overhead and supervision fee if such
cost and hard costs are $100,000.00 or more, shall be paid by Tenant as additional Rent within ten
(10) days after Landlord’s demand therefor. Alternatively, Landlord may require Tenant to install
such supplementary heating or air handling or conditioning units at Tenant’s sole expense. Landlord
may operate and maintain any such supplementary units, but shall have no continuing obligation to
do so or liability in connection therewith. The expense resulting from the operation and
maintenance of any such supplementary heating or air handling or conditioning units, including
utility charges, charges for condenser water, repair costs, labor costs and rent for space occupied
by any supplementary heating or air handling or conditioning units installed in Rentable Area
outside the Premises, shall be paid by Tenant to Landlord as additional rent at rates fixed by
Landlord, which shall be, for condenser water, actual tap fees incurred plus $98.65 per ton of
supplemental cooling capacity per year, subject to adjustment to reflect changes in costs of
supplying condenser water. Alternatively, Landlord may require Tenant to operate and maintain any
such supplementary units, also at Tenant’s sole expense.




     9. CONDITION
AND CARE OF PREMISES.



     (a) Condition
of Premises. Tenant’s taking possession of the Premises or any portion
thereof shall be conclusive evidence against Tenant that such portion of the Premises was then
in
good order and satisfactory condition, subject to completion of the Base Building Work and to
latent defects in any Base Building Work of which Tenant gives Landlord notice within one (1)
year after substantial completion of such Base Building Work, and also subject to Landlord’s
obligations under this lease. Tenant acknowledges that, except as expressly set forth herein
and
in the Workletter, the Premises shall be accepted by Tenant in their “as-is” condition, and
that no
promise by or on behalf of Landlord, any of Landlord’s constituent members, the leasing agent
of the Project or any of their respective agents, partners or employees, to alter, remodel,
improve,
repair, decorate or clean the Premises has been made to or relied
upon by Tenant, and that no representation respecting the condition of the Premises or the Project by or on behalf of
Landlord,
its constituent members, or any of their respective agents, partners or employees has been
made
to or relied upon by Tenant, except to the extent expressly set forth in this lease or in the
Workletter.



     (b) Tenant’s
Repairs. Subject to the provisions regarding fire and other casualty
losses set forth in Section 17 hereof, Tenant, at its expense, shall (i) keep the Premises
(including
all Landlord’s Work and Tenant Alterations) in good order, repair and condition at all times



13









 




during the Term, and (ii) promptly and adequately repair all damage to the Premises, including
damage to interior windows and to any portion of the Building air conditioning, heating, electrical
and plumbing systems which run through the Premises and which serve the Premises, caused by Tenant
or its contractors, agents, employees or invitees. Tenant shall give prompt notice to Landlord of
any material repair, maintenance or replacement items required under this Section 9(b). All work
with respect to any such maintenance, repair or replacement shall be performed within a reasonable
period after the need for such action arises and shall be subject to the provisions of Section 14
hereof. If Tenant fails to perform such work within a reasonable period and such failure continues
for thirty (30) days after written notice to Tenant from Landlord (except in the case of an
emergency, when no such notice or cure period shall be required), Landlord may, in its sole
discretion, elect to effect such repairs whether or not Tenant would otherwise be prepared to do
so, and, in such case, Tenant shall pay Landlord the cost thereof plus a coordination and
management fee equal to ten percent (10%) of such cost, upon Landlord’s written demand.








     (c) Landlord’s Repairs. Subject to the provisions regarding fire and other
casualty losses set forth in Section 17 hereof, Landlord shall (i) keep the foundations, roofs,
exterior walls, and the structural elements of the Building, and the public areas in the Building,
exclusive of the Premises and other tenant spaces occupied by or under the control of tenants, in
good order, .repair and condition at all times during the Term, and (ii) keep in good order,
condition and repair all outside windows of the Premises and the electrical, plumbing, heating,
ventilating and air conditioning systems servicing the Premises (other than as set forth in
Section 9(b) above). Notwithstanding the foregoing, (A) Landlord shall not be responsible for the
maintenance or repair of any floor or wall coverings in the Premises or any of such systems which
are located within the Premises and are supplemental or special to the Building’s standard systems
which are located within the Premises and are supplemental or special to the Building’s standard
systems; and (B) subject to the provisions of Sections 16(a) and 22(b) below, the cost of
performing any of said maintenance or repairs, whether to the Premises or to the Building, caused
by the negligence of Tenant, its employees, agents, servants, subtenants or contractors, shall be
paid by Tenant immediately upon Landlord’s demand therefor. Upon reasonable prior notice (except
in the case of an emergency, where no such notice Shall be required), and so long as Landlord uses
good faith efforts to maintain reasonable access to the Premises, minimize unreasonable
interference with the conduct of Tenant’s business, and avoid any permanent material adverse
affect on the appearance of the Premises, and subject to the restrictions contained in Section
13(n) below, Landlord may, but shall not be required to, enter the Premises at all reasonable
times to make repairs, alterations, improvements and additions to the Premises as Landlord shall
deem necessary; to make repairs, alterations, improvements and additions to the Building or to any
equipment located in the Building as Landlord shall deem necessary or reasonably deem desirable; and to
make repairs, alterations, improvements and additions to the Premises, the Building or such
equipment as Landlord may be required to make by governmental authority or court order or decree.




14









 








     (d) No Rights to Light. Air or View. This lease does not grant any rights to
light, air or view over or about the real property of Landlord or any other real property. Landlord
specifically excepts and reserves to itself all rights to and the use of any roofs, the exterior
portions of the Premises, the land, improvements and air and other rights below the improved floor
level of the Premises, the improvements and air and other rights above the improved ceiling of
Premises, the improvements and air and other rights located outside the demising walls of the
Premises and, subject to the restrictions contained in Section 13(n) below, such areas within the
Premises as are required for installation of utility lines and other installations required to
serve the Building or any occupants of the Building, and Landlord specifically reserves to itself
the right to use, maintain and repair same, and no rights with respect thereto are conferred upon
Tenant, unless otherwise specifically provided herein.



     (e) Hazardous Substances. Tenant shall comply, at its sole expense, with all Laws
relating to the protection of public health, safety and welfare and with all environmental Laws in
the use, occupancy and operation of the Premises. Tenant agrees that no Hazardous Substances (as
hereinafter defined) shall be used, located, stored or processed on the Premises or be brought
into the Building by Tenant except for (i) minor quantities of cleaning materials customary for
office use and (ii) aerosol glue in quantities which are both safe and reasonably necessary for
Tenant’s normal use in its production room, provided that the foregoing are handled, stored and
disposed of in compliance with all applicable Laws, and subject to the provisions of Section 6 of
this Lease. Tenant further agrees that no Hazardous Substances will be released or discharged from
the Premises (including, but not limited to, ground water contamination), except that aerosol glue
shall be vented directly from Tenant’s production room to the extent required by Law or by
Landlord, and to the extent permitted by Law, by means of a venting system installed as part of
the Tenant’s Work under the Workletter or pursuant to Section 14 of this Lease. The term
“Hazardous Substances” shall mean and include all hazardous and toxic substances, waste or
materials, any pollutant or contaminant, including, without limitation, PCB’s, asbestos and raw
materials that include hazardous constituents or any other similar substances or materials that
are now or hereafter included under or regulated by any environmental Laws or that would pose a
health, safety or environmental hazard. In the event that Tenant is notified of any investigation
or violation of any environmental Law arising from Tenant’s activities at the Premises, Tenant
shall immediately deliver to Landlord a copy of such notice. In such event or in the event
Landlord reasonably believes that a violation of environmental Law arising from Tenant’s
activities exists, Landlord may conduct such tests and studies relating to compliance by Tenant
with environmental Laws or the alleged presence of Hazardous Substances upon the Premises as
Landlord deems desirable, all of which shall be completed at Tenant’s expense. Landlord’s
inspection and testing rights are for Landlord’s own protection only, and Landlord has not, and
shall not be deemed to have assumed any responsibility to Tenant or any other party for compliance
with environmental Laws, as a result of the exercise, or non-exercise of such rights. Tenant shall
indemnify, defend, protect and hold harmless Landlord, its constituent members, and their
respective officers, directors, members, partners, agents, employees, successors and assigns
(collectively, the “Landlord Parties”), from and against any and all loss, claim, expense,
liability



15









 






and cost (including attorneys’ fees) arising out of or in any way related to the presence of any
Hazardous Substance introduced to the Premises during the Term by Tenant or its employees, agents,
servants, subtenants or contractors.




     Landlord agrees, as to any Hazardous Substances (as now defined) existing in the Premises on
the date hereof, to remove or otherwise remediate such Hazardous Substances if and to the extent
required by law, at Landlord’s sole cost and expense.



     (f) Americans
with Disabilities Act. Landlord and Tenant acknowledge that the
Americans With Disabilities Act of 1990 (42 U.S.C §12101 et seq.) and regulations and guidelines
promulgated thereunder, as all of the same may be amended and supplemented from time to time
(collectively referred to herein as the “ADA”) establish requirements for business operations,
accessibility and barrier removal, and that such requirements may or may not apply to the Premises
and the Building depending on, among other things: (1) whether Tenant’s business is deemed a
“public accommodation” or “commercial
facility”, (2) whether such requirements are “readily
achievable”, and (3).whether a given alteration affects a
primary function area or triggers “path
of travel” requirements. The parties hereby agree that: (a) Landlord shall be responsible for ADA
Title III compliance in the common areas of the Building, except as provided below, (b) Tenant
shall be responsible for ADA Title III compliance in the Premises, including any leasehold
improvements or other work to be performed in the Premises under or in connection with this lease,
and (c) Landlord may perform, or require that Tenant perform, and Tenant shall be responsible for
the cost of, ADA Title HI “path of travel” requirements triggered by alterations in the Premises.
Tenant shall be solely responsible for requirements under Title I of the ADA relating to Tenant’s
employees.



     10. SURRENDER OF PREMISES.



     (a) Surrender. Upon the termination of this lease by lapse of time or otherwise
or upon the earlier termination of Tenant’s right of possession, Tenant shall surrender
possession of
the Premises to Landlord and deliver all keys, computer cards or codes and other entry devices
to the Premises to Landlord and make known to Landlord the combinations of all locks of vaults
then remaining in the Premises, and shall, subject to the following subparagraphs, return the
Premises and all equipment and fixtures of Landlord therein to Landlord in as good condition
as
when Tenant originally took possession, except for ordinary wear and tear, and except for loss
or damage by fire or other casualty or condemnation, failing which Landlord may restore the
Premises and such equipment and fixtures to such condition, and Tenant shall pay the cost
thereof
to Landlord on demand.



     (b) Ownership
of Improvements. All installations, additions, partitions, hardware,
fixtures and improvements, temporary or permanent (including Tenant Alterations), except
movable furniture and equipment and other personal property or trade fixtures belonging to
Tenant, and except as may be otherwise agreed by Landlord and Tenant pursuant to the



16









 





Workletter, in or upon the Premises, whether placed there by Tenant or Landlord, shall, upon the
termination of this lease by lapse of time or otherwise or upon the earlier termination of Tenant’s
right of possession, become Landlord’s property and shall remain upon the Premises, all without
compensation, allowance or credit to Tenant; provided, however, that if at the time Landlord
consents to Tenant’s installation of Tenant Alterations or other installations, additions,
partitions, hardware, fixtures and improvements or at any other time prior to termination of this
lease or Tenant’s right to possession, Landlord requires or agrees to permit removal of the same
upon termination, then Tenant, at Tenant’s sole cost and expense, upon termination of this lease by
lapse of time or otherwise or upon the earlier termination of Tenant’s right of possession, shall
promptly remove such designated items, and Tenant shall thereafter repair any damage to the
Premises or the Project caused by such removal, failing which Landlord may remove the same and
repair the Premises or the Project, as the case may be, and Tenant shall pay the cost thereof to
Landlord on written demand. Without limitation of the foregoing, if any of the Tenant Alterations
involved the lowering of ceilings, raising of floors or the installation of specialized wall or
floor coverings or lights, then Tenant, at Landlord’s request, shall also be obligated to return
such surfaces to their condition prior to the commencement of this lease. Further, at Landlord’s
request, Tenant shall be required to close any staircases or other openings between floors within
the Premises. Tenant’s failure to perform the work described in the preceding sentences on or
before the expiration or earlier termination of this lease or Tenant’s right of possession
hereunder, shall, without limitation on other rights or remedies available to Landlord, give rise
to the right of Landlord to perform such work, and Tenant shall pay the costs thereof to Landlord
on written demand. Notwithstanding any of the foregoing, Tenant shall not be required to remove any
Tenant’s Work performed pursuant to the Workletter. Furthermore, Tenant shall not be required to
remove the existing staircases between floors of the Premises if this lease expires as to the
portion of the Premises in which such staircases are located by lapse of time, without earlier
termination of this lease or Tenant’s right of possession as to such portion of the Premises or any
other termination of this lease as to all or such portion of the Premises prior to the stated
expiration of the Term.




     (c) Removal of Personal Property. Upon the termination of this lease by lapse of time
or otherwise or upon the earlier termination of Tenant’s right of possession, Tenant shall remove
from the Premises Tenant’s furniture, machinery, safes and other items of movable personal
property of every kind and description and Tenant’s trade fixtures, and Tenant shall restore any
damage to the Premises or the Project caused thereby (such removal and restoration to be performed
prior to the expiration of the Term and prior to or immediately following any earlier termination
of this lease or Tenant’s right of possession), failing which Landlord may do so and thereupon the
provisions of Section 19(f) shall apply; provided, however, if this lease or Tenant’s possession
terminates prior to the originally stated Expiration Date, Tenant may not, without Landlord’s
prior written consent, remove any of its furniture, trade fixtures or other personal property for
which Landlord paid or gave Tenant an allowance, in whole or in part, in which case, at Landlord’s
election, such property shall be deemed to have been conveyed to Landlord as by bill of sale
without further payment or credit by Landlord to Tenant.



17









 






     (d) Survival. Without limitation of any other obligations of Tenant which shall
survive
the expiration or termination of this lease, all obligations of Tenant under this Section 10
shall
survive the expiration or earlier termination of this lease.



     11. HOLDING OVER. If Tenant retains possession of the Premises or any part
thereof after the termination of the lease by lapse of time or otherwise or after the earlier
termination of Tenant’s right of possession, Tenant shall pay to Landlord as Rent during such
holdover period an amount equal to 150% of the Rent (based on the Base Rent plus the most
current Additional Rent Estimate for the entire Premises) on a per diem basis. In addition to
and without limiting any other rights and remedies which Landlord may have on account of such
holding over by Tenant, Tenant shall indemnify Landlord from and against any and all direct
and
consequential damages suffered by Landlord on account of such holding over by Tenant,
including
any damages and claims by tenants entitled to future possession. No occupancy by Tenant after
the expiration or other termination of this lease shall be construed to extend the Term. The
provisions of this Section 11 shall not be deemed to limit or constitute a waiver of any
rights or
remedies of Landlord as provided herein or at law or equity.



     12. RULES AND REGULATIONS. Tenant agrees to observe and not to interfere
with the rights reserved to Landlord contained in Section 13 hereof and elsewhere in this
lease and
agrees, for itself, its employees, agents and contractors, to accept and comply with the rules
and
regulations set forth in Exhibit F attached to this lease, and elsewhere in this lease, and
such other
rules and regulations as may be adopted from time to time by Landlord for the Building
pursuant
to Section 13(o) or any other Section of this lease, and to use reasonable efforts to cause
its
invitees to comply with such rules and regulations. The rules and regulations in Exhibit F and
all other rules and regulations made in accordance with this lease are intended and shall be
construed to supplement and not limit or restrict in any way any of Landlord’s rights or
Tenant’s
obligations contained in Section 13 or any other Section of this lease. Nothing contained in
this
lease shall be construed to impose upon Landlord any duty or obligation to enforce any of said
rules and regulations or the terms, covenants or conditions of any other lease against any
other
tenant or any other person. Landlord shall not, however, discriminatorily enforce against
Tenant
rules and regulations applicable to office tenants of the Building generally.



     13. RIGHTS RESERVED TO LANDLORD. Landlord reserves and shall have the
following rights, each of which shall, unless expressly provided otherwise, be exercisable
without
notice and without liability of Landlord, its constituent members, or any of their respective
agents,
partners or employees, to Tenant for damage or injury to property, person or business or for
loss
or interruption of business, or for any other matter, and without effecting an eviction or
disturbance of Tenant’s use or possession, in whole or in part, actual or constructive, or
giving
rise or entitling Tenant to any claim for set-off, abatement or reduction of Rent or relieving
Tenant from the performance of or affecting any of Tenant’s obligations under this lease:



18









 





     (a) To change the name or, upon not less than sixty (60) days’ notice, the street
address of the Building; provided that if Landlord voluntarily changes the Building’s
street
address it shall reimburse Tenant for any reasonable printing costs incurred by Tenant
to
replace obsolete stationery and business cards;



     (b) To install and maintain or remove signs on the exterior and interior of the
Building and the Project.



     (c) To prescribe the location and style of the suite number and identification
sign or lettering for the Premises.



     (d) To retain at all times, and to use in appropriate instances, pass keys and
other entry devices for all doors into and within the Premises; provided, however, that
Tenant may from time to time designate limited areas of the Premises as secured areas
to
which Landlord shall not have access except in emergencies and except as otherwise
hereinafter provided. Landlord shall not be required to supply janitor service or other
routine maintenance services to any such secured areas. In an emergency, Landlord,
Building service personnel or other emergency personnel may immediately use self-help
measures, including force, to gain access to any such secured areas, and the expense of
repair of any damage caused thereby shall be borne by Tenant, subject to the provisions
of Section 16 below. Tenant shall, upon reasonable verbal notice from Landlord, and in
the company of an employee of Tenant if Tenant so requires, allow Landlord access to
secured areas for the purposes referred to in Sections 13(f) and (i) below.



     (e) To grant to anyone the right to conduct any business or render any service
in any part of the Project.



     (f) To enter the Premises for supplying janitor service or other services to be
provided to Tenant hereunder, or in the exercise of Landlord’s rights hereunder, and
upon
reasonable prior notice (except for routine services to be performed by Landlord
hereunder, or where this lease otherwise permits entry without notice or in the event
of
an emergency, in which case immediate entry shall be permitted) for other reasonable
purposes.



     (g) To require all persons entering or leaving the Project or any part thereof
during such non-business hours as Landlord may from time to time reasonably determine
to identify themselves to security personnel by registration or otherwise and to
establish
their right to enter or leave in accordance with Landlord’s security controls. Landlord
shall not be liable in damages or otherwise for any error with respect to admission to
or
eviction or exclusion from the Project or any part thereof of any person.
Notwithstanding
anything contained herein to the contrary, in case of fire, casualty, invasion,
insurrection,
mob, riot, act of terrorism, civil disorder, public excitement or other commotion, or
threat



19









 




thereof, Landlord reserves the right to limit or prevent access to the Project or any
part thereof during the continuance of the same, halt elevator service, activate elevator
emergency controls, or otherwise take such action or preventive measures reasonably deemed
necessary by Landlord for the safety or security of the tenants or other occupants of the
Project or the protection of the Project and the property in or about the Project. Tenant
agrees to cooperate in any reasonable safety or security program developed by Landlord from
time to time.




     (h) To control, restrict and prevent access to any areas of the Project, provided
that reasonable access to the Premises shall be maintained.



     (i) To rearrange, relocate, enlarge, reduce or change corridors, exits,
elevators, stairs, lavatories, doors, entrances in or to the Building and to decorate and to
make repairs, alterations, additions and improvements, structural or otherwise, in or to the
Land or the Project or any part thereof, including the Premises, and any adjacent building,
land, street or alley, including for the purpose of connection with or entrance into or use
of the Land or the Project in conjunction with any adjoining or adjacent building or
buildings or pedestrian ways, now existing or hereafter constructed, provided that Landlord
uses good faith efforts to maintain reasonable access to the Premises, minimize unreasonable
interference with the conduct of Tenant’s business, and avoid any permanent material adverse
affect on the appearance of the Premises. In that regard, Landlord may erect scaffolding
and other structures reasonably required by the character of the work to be performed, and
during such operations to enter upon the Premises upon reasonable prior notice and take into
and upon or through any part of the Project, including the Premises, all materials that may
be required to do such work or make such decorations, repairs, alterations, improvements or
additions, and in connection with any of the foregoing, to close public entryways, other
public spaces, stairways or corridors and interrupt or temporarily suspend any services or
facilities agreed to be furnished by Landlord. Landlord may at its option do any such work
and make any such decorations, repairs, alterations, improvements and additions in and about
the Project and the Premises during ordinary business hours, so long as Landlord shall use
reasonable efforts in any entry to the Premises not to unreasonably disturb Tenant’s
occupancy during business hours of the Building.



     (j) To establish reasonable controls for the purpose of regulating all property and
packages to be taken into or removed from the Building and Premises.



     (k) To reasonably regulate delivery of supplies and services in order to ensure the
cleanliness and security of the Project and to avoid congestion of the loading docks,
receiving areas and freight elevators.



20









 






     (l) To approve the weight, size and location of safes, vaults, books, files and
other heavy equipment and articles in and about the Premises and the Building so as not to
exceed the design live load per square foot designated by the structural engineers for the
Building, and to require all such items and furniture and similar items to be moved into or
out of the Building and Premises only at such times and in such manner as Landlord shall
direct in writing. Tenant shall not install or operate machinery or any mechanical devises
of a nature not directly related to Tenant’s ordinary use of the Premises without the prior
written consent of Landlord.




     (m) To show the Premises to prospective tenants at reasonable hours during the last
twelve (12) months of the Term or to prospective mortgagees, ground lessors or purchasers
of the Land or Building or both at any time.




     (n) To erect, use and maintain concealed pipes, ducts, wiring and conduits, and
appurtenances thereto, in and through the Premises in walls, below the floor and above the
suspended ceiling.




     (o) From time to time to make and adopt such rules and regulations, in addition to or
as an amendment to rules and regulations contained in Exhibit F attached to this lease or
other Sections of this lease, or adopted pursuant to this or other Sections of this lease,
for the use, entry, operation or management of the Premises or the Project or for the
protection or welfare of the Project or its tenants or occupants, or any property therein,
as Landlord may reasonably determine, and Tenant agrees to accept, abide by and comply with
all such rules and regulations.




     (p) To designate and/or approve, prior to installation, all types of window shades,
blinds, drapes, awnings or other similar items, and all internal lighting that may be
visible from the exterior of the Premises.




     (q) To have access to any mail chute and boxes located in or on the Premises as
required by any applicable rules of the Building or of the United States Post Office.



     14. ALTERATIONS.



     (a) Consent;
Conditions. Tenant shall not perform any Tenant Alterations
without first obtaining the prior written consent of Landlord. Without limitation on the
foregoing, Landlord may impose such conditions with respect to Tenant Alterations as Landlord
deems appropriate, including, without limitation, requiring Tenant to furnish to Landlord for its
approval prior to commencement of any work or entry by Tenant’s contractors into the Premises or
the Building, security for the payment of all costs to be in connection with any such Tenant
Alterations (if reasonably deemed prudent by Landlord), insurance against liabilities which may



21









 





arise out of the Tenant Alterations and plans and specifications and permits necessary for
the Tenant Alterations.




     Landlord agrees not to unreasonably withhold or delay its consent to any Tenant Alterations;
provided, however, that Landlord shall not be deemed to have acted unreasonably if it withholds its
consent because, in Landlord’s opinion, such work: could adversely affect building systems, the
structure of the Building or the safety of its occupants; would increase Landlord’s cost of
repairs, insurance or furnishing services or otherwise adversely affect Landlord’s ability to
efficiently operate the Building or furnish services to Tenant or other tenants; involves toxic or
hazardous materials; could be costly or hazardous to remove or demolish; requires entry into
another tenant’s premises or use of public areas; or is prohibited by any mortgage on the Building.
The foregoing reasons, however, shall not be exclusive of the reasons for which Landlord may
reasonably withhold consent, whether or not such other reasons are similar or dissimilar to the
foregoing.



     In addition, Tenant may perform certain interior decorating or other non-structural
alterations to the Premises such as carpeting, painting (so long as the odors from the same do not
interfere with any other tenant’s operations), hanging artwork or wall coverings, installing
furniture systems, or other similar interior decorating improvements, without obtaining Landlord’s
consent therefor, but only if (i) such items do not affect the Building structure or systems, the
public areas of the Building or any other tenant space, (ii) the cost of such items does not
exceed, in any twelve-month period, $25,000.00 and (iii) Tenant gives prior written notice to
Landlord of such items, including a description of the contemplated work and the types of
materials being used, and subject to the remaining requirements of this Section except that
approval of plans and specifications shall not be required for interior decorating where plans and
specifications are not appropriate for the work to be performed.



     (b) Contractors. Tenant Alterations shall be done at Tenant’s expense by agents or
contractors hired by Tenant who are reasonably acceptable to Landlord and whose work will not
cause or threaten to cause disharmony or interference with Landlord or other tenants,
contractors
or service providers at the Building. Before employing any such contractors, Tenant shall
submit
to Landlord the names and addresses of such contractors.



     (c) Costs; Mechanic Liens. Tenant shall promptly pay the cost, when due, of all
Tenant Alterations. In addition to the cost of such Tenant Alterations, Tenant shall also pay
to
Landlord or to its designated agent, as Landlord shall direct, an amount equal to ten percent
(10%) of the hard costs of Tenant Alterations when such hard costs are less than $100,000.00
in
any instance and five percent (5%) of the hard costs of Tenant Alterations when such hard
costs
are $100,000.00 or more, as a coordination and management fee allocable to the Tenant Alterations.
Upon completion of any Tenant Alterations, Tenant shall deliver to Landlord, if
payment
is made directly to contractors, evidence of payment, contractors’ affidavits and full and
final
waivers of all liens for labor, services and materials sufficient to
waive all rights to liens
under



22









 




the Illinois Mechanic’s Lien law arising or from the work done. Tenant shall not permit any
lien or claim for lien of any mechanic, labor or supplier or any other lien to be filed against the
Building, the Land or the Premises or any part thereof, arising out of any Tenant Alterations or
other work performed or alleged to be performed, by or at the direction of Tenant. If any such lien
or claim for lien is filed, Tenant shall, within ten (10) days of receiving notice of such lien or
claim, (i) have such lien or claim for lien released of record, (ii) cause Landlord’s title insurer
to insure over such lien or claim for lien on each outstanding owner’s and loan policy or (iii)
deliver to Landlord security in form, content, and amount satisfactory to Landlord relative to such
lien or claim for lien. Without limitation of the foregoing, Tenant shall indemnify, defend and
hold harmless, Landlord and the other Landlord Parties, from and against any such lien or claim for
lien, and the foreclosure or attempted foreclosure thereof. If Tenant fails to take the one of the
actions described in subclauses (i), (ii) or (iii) above, then Landlord, without investigating the
Validity of such lien or claim for lien, may pay or discharge the same, and Tenant shall, as
payment of additional Rent hereunder, reimburse Landlord upon demand for the payment so paid by
Landlord, including Landlord’s expenses and attorneys’ fees related thereto.




     (d) General. Tenant agrees to indemnify, defend by counsel reasonably acceptable to
Landlord and hold Landlord and the other Landlord Parties, and the Project, harmless of, from and
against any and all losses, damages, liabilities, claims, liens; costs and expenses, including
without limitation court costs and reasonable attorneys’ fees and expenses, arising in connection
with any Tenant Alterations. All Tenant Alterations done by Tenant or its contractors, including
work done pursuant to Section 9, shall be performed in a first class workerlike manner using only
good grades of materials and shall comply with all insurance requirements of Landlord and all
Laws. Within thirty (30) days after substantial completion of any Tenant Alterations by or on
behalf of Tenant, Tenant shall furnish to Landlord “as built” working drawings of such Tenant
Alterations. All Tenant Alterations shall be performed in accordance with Landlord’s standard
construction rules and regulations for the Building. In no event shall any supervision or right to
supervise by Landlord, nor shall any approvals given by Landlord hereunder, constitute any
warranty by Landlord to Tenant of the adequacy of the design, workmanship or quality of the Tenant
Alterations, or impose any liability upon Landlord in connection with the performance of such
work.



     15. ASSIGNMENT AND SUBLETTING.



     (a) Prohibitions. Tenant shall not, either prior or subsequent to the commencement of
the Term, (i) assign, transfer, mortgage, pledge, hypothecate or encumber or subject to or permit
to exist Upon or be subjected to any lien or charge, this lease or any interest under it, (ii)
allow to exist or occur any transfer of or lien upon this lease or Tenant’s interest herein by
operation of law, (iii) sublet the Premises or any part thereof, or (iv) permit the use or
occupancy of the Premises or any part thereof for any purpose not provided for under Section 6 of
this lease or by anyone other than Tenant and Tenant’s employees. Landlord has the absolute right
to withhold its consent to any of such acts without giving any reason whatsoever, except as herein



23









 




expressly provided to the contrary in Section 15(d). In no event shall this lease be assigned or
assignable by voluntary or involuntary bankruptcy proceedings or otherwise, except as provided by
law, and in no event shall this lease or any rights or privileges hereunder be an asset of Tenant
under any bankruptcy, insolvency or reorganization proceedings, except as provided by law. Any of
the foregoing performed or attempted in violation of the provisions of this Section shall be null
and void.




     (b) Continuing
Liability. No assignment, subletting, use, occupancy, transfer or
encumbrance by Tenant shall operate to relieve Tenant from any covenant, liability or obligation
hereunder except to the extent, if any, expressly provided for in any such written consent of
Landlord to the foregoing, and none of the foregoing, and no consent to any of the foregoing,
shall be deemed to be a consent to or relieve Tenant from obtaining Landlord’s consent to any
subsequent assignment, subletting, use, occupancy, transfer or encumbrance. Tenant shall pay all
of Landlord’s reasonable costs, charges and expenses, including, without limitation, reasonable
attorneys’ fees and expenses, incurred .in connection with any assignment, subletting, use,
occupancy, transfer or encumbrance made or requested by Tenant.



     (c)
Notice of Proposed Assignment or Sublease; Recapture. Tenant shall, by notice in
writing, advise Landlord of its intention from, on and after a stated date (which shall not be
less than thirty (30) nor more than one hundred eighty (180) days after the date of the giving of
Tenant’s notice to Landlord) to assign this lease or sublet all or any part of the Premises for
the balance or any part of the Term, and, in such event, Landlord shall have the right, to be
exercised by giving written notice to Tenant within fifteen (15) days after its receipt of
Tenant’s notice, (1) in the case of (A) an assignment of this Lease or (B) a subletting of space
which, when added to all prior sublettings of space which are still in effect, aggregates 15,000
square feet or more of Rentable Area, to terminate this lease with respect to the space described
in Tenant’s notice as of the date stated in Tenant’s notice for the commencement of the proposed
assignment or sublease, or (2) to consent or refuse to consent to the proposed assignment or
sublease, as described in Section 15(d) below. Tenant’s notice shall include the name and address
of the proposed assignee or subtenant, a true and complete copy of the. proposed assignment or
sublease and sufficient information, as Landlord deems reasonably necessary, to permit Landlord to
determine (i) the financial responsibility and character and the nature of the business of the
proposed assignee or subtenant, and (ii) whether Landlord has the right under this lease to
withhold consent to the proposed assignment or sublease. If Tenant’s notice covers all of the
Premises and if Landlord exercises its right to terminate this lease as to such space, then this
lease shall expire and end on the date stated in Tenant’s notice for the commencement of the
proposed assignment or sublease as fully and completely as if that date had otherwise been the
Expiration Date. If, however, Tenant’s notice covers less than all of the Premises, and if
Landlord exercises its right to terminate this lease with respect to such space described in
Tenant’s notice, then as of the date stated in Tenant’s notice for the commencement of the
proposed sublease, the Base Rent and Tenant’s Proportionate Share shall be adjusted on the basis
of the number of square feet of



24









 





Rentable Area retained by Tenant, and this lease as so amended, shall continue thereafter in full
force and effect. Landlord shall pay the cost of separately demising any such space.




     Notwithstanding any of the foregoing to the contrary, if Landlord notifies Tenant that
Landlord has elected to terminate this lease with respect to the space described in a notice from
Tenant regarding a prospective assignment or sublease transaction, as described in clause (1)
above, Tenant shall have the right, at its election, to rescind its earlier notice to Landlord
regarding such transaction, which rescission shall be exercised by notice to Landlord no later than
five (5) days following Tenant’s receipt of Landlord’s election (time being of the essence),
whereupon this lease shall continue in full force and effect, and Tenant’s earlier notice to
Landlord of a desire to make the subject assignment or sublease shall be deemed null and void.



     (d) Grounds for Withholding Consent. If Landlord, upon receiving Tenant’s notice with
respect to any such space, does not exercise its right to terminate as aforesaid or is not
entitled to do so, Landlord will not unreasonably withhold or delay its consent to Tenant’s
assignment of this lease or subletting the space covered by Tenant’s notice. Landlord shall not be
deemed to have unreasonably withheld its consent to a proposed assignment of this lease or to a
proposed sublease of part or all of the Premises if its consent is withheld because: (i) any
monetary default or any other uncured Default by Tenant shall then exist (which shall no longer be
a basis for withholding consent if such default or Default is cured); (ii) any notice of
termination of this lease or termination of Tenant’s right of possession shall have been given
under Section 19; (iii) either the portion of the Premises which Tenant proposes to sublease, or
the remaining portion of the Premises, or the means of ingress or egress to either the portion of
the Premises which Tenant proposes to sublease or the remaining portion of the Premises is of such
nature that it will violate any applicable Law, is of such accessibility, size or irregular shape
so as not to be suitable for normal renting purposes as space on a multi-tenant floor within the
Building; (iv) the proposed use of the Premises by the proposed assignee or subtenant does not
conform with the use set forth in Section 6 hereof, or will violate any applicable Law, will
impose any obligation upon Landlord or increase Landlord’s obligations under or cost of compliance
with any Laws, or will violate any exclusive right Landlord has granted to any tenant of any part
of the Project; (v) in the reasonable judgment of Landlord the proposed assignee or subtenant is
of a character or is engaged in a business which would be deleterious to the reputation of the
Project, Landlord or any of the constituent members of Landlord; (vi) in the reasonable judgment
of Landlord, the proposed assignee or subtenant is not sufficiently financially responsible to
perform its obligations under the proposed assignment or sublease; (vii) the proposed assignee or
subtenant is a government (or subdivision or agency thereof); or (viii) the proposed assignee or
subtenant is an occupant of the Building and Landlord has space available and suitable for it;
provided, however, that the foregoing are merely examples of reasons for which Landlord may
withhold its consent and shall not be deemed exclusive of any permitted reasons for reasonably
withholding consent, whether similar or dissimilar to the foregoing examples, and Landlord may
consider all relevant factors in determining whether to give or withhold its consent. Tenant
agrees that all advertising by Tenant or on Tenant’s behalf with respect to the assignment of this
lease or



25









 




subletting of any part of the Premises must be approved in writing by Landlord prior to
publication, which approval shall not apply to the quoted rent, and shall not be unreasonably
withheld or delayed.




     (e) Excess Rent Payment. If Tenant (as Tenant or debtor-in-possession) shall assign
this lease or sublet the Premises, or any part thereof, at a rental or for other consideration
in
excess of the Rent or pro rata portion thereof due and payable by Tenant under this lease,
then
Tenant shall pay to Landlord as additional Rent one-half (1/2) of any such excess rent or
other
consideration immediately upon receipt under any such assignment or, in the case of a
sublease,
(i) on the later of the first day of each month during the term of any sublease, or the day of
receipt
from such subtenant, one-half (1/2) of the excess of all rent and other consideration paid by
the
subtenant for such month over the Rent then payable to Landlord pursuant to the provisions of
this
lease for said month (or if only a portion of the Premises is being sublet, one-half (1/2) of
the
excess of all rent and other consideration due from the subtenant for such month over the
portion
of the Rent then payable to Landlord pursuant to the provisions of this lease for said month
which
is allocable on a Rentable Area basis to the space sublet), and (ii) immediately upon the
receipt
thereof, one-half (1/2) of any other consideration realized by Tenant from such subletting.
Landlord shall not be responsible for any deficiency if Tenant shall assign this lease or
sublet the
Premises or any part thereof at a rental less than that provided for herein. Whenever
reference
is made to the “excess” of rent or other consideration, such excess shall be reduced by
charging
against the rent or other consideration paid by such assignee or subtenant, reasonable
brokerage
commissions and leasehold improvements which Tenant has paid in connection with assigning the
lease or subleasing the applicable portion of the Premises. Amounts received by Tenant
representing the reasonable value of assets other than this lease (such as personal property
and
trade fixtures) sold in conjunction with an assignment or sublease shall not be taken into
account
as consideration paid for the assignment or sublease.



     (f) Lease Assumption; Subtenant Attornment. If Tenant shall assign this lease, the
assignee shall expressly assume all of the obligations of Tenant thereafter accruing hereunder
in
a written instrument provided by Landlord and delivered to Landlord not later than ten (10)
days
prior to the effective date of the assignment. If Tenant shall sublease any part of the
Premises,
Tenant shall obtain and furnish to Landlord, not later than ten (10) days prior to the
effective date
of such sublease and in form reasonably satisfactory to Landlord, the written agreement of
such
subtenant to the effect that the subtenant will attorn to Landlord, at Landlord’s option and
written
request (at Landlord’s sole election), on the terms and conditions of the sublease if this
lease
terminates before the expiration of the sublease, provided that (if Landlord makes such
election)
at the time of such attornment Landlord agrees to recognize and be bound by the terms of such
sublease. Tenant shall, not later than fifteen (15) days after the effective date of any
such
assignment or sublease, deliver to Landlord a certified copy of the instrument of assignment
or
sublease.



26









 





     (g) Corporation, Partnership and Limited Liability Company Transfers. If Tenant is a
corporation, any transaction or series of transactions (including without limitation any
dissolution, merger, consolidation or other reorganization of Tenant, or any issuance, sale, gift,
transfer or redemption of any capital stock of Tenant, whether voluntary, involuntary or by
operation of law, or any combination of any of the foregoing transactions) resulting in the
transfer of control of Tenant, other than by reason of death or retirement, shall be deemed to be a
voluntary assignment of this lease by Tenant subject to the provisions of this Section 15. If
Tenant is a partnership or limited liability company, any transaction or series of transactions
(including without limitation any withdrawal or admittance of a partner or member or any change in
any partner’s or member’s interest in Tenant, whether voluntary, involuntary or by operation of
law, or any combination of any of the foregoing transactions) resulting in the transfer of control
of Tenant, other than by reason of death or retirement, shall be deemed to be a voluntary
assignment of this lease by Tenant subject to the provisions of this Section 15. The term “control”
as used in this lease means the power to directly or indirectly direct or cause the direction of
the management or policies of the subject entity, whether through the ownership of voting
securities or other beneficial interests or otherwise.



     Notwithstanding any of the foregoing, the provisions of this Section 15(g) shall not apply to
an entity the outstanding voting stock of which is listed at the time of a transaction referred to
herein on a “national securities exchange”, as defined in the Securities Exchange Act of 1934.



     (h) Permitted Transfers. Notwithstanding any of the foregoing, Landlord’s consent
shall not be required for an assignment or sublet to a Tenant Successor or Tenant Affiliate (as
such terms are hereinafter defined), and Landlord shall not terminate this lease with respect to
the Premises or any portion of the Premises as a result of such assignment or sublet to a Tenant
Successor or Tenant Affiliate, as long as (i) Tenant gives reasonable prior notice to Landlord of
the proposed assignment or sublet; (ii) if an assignment, such assignee assumes the obligations of
Tenant under this lease; (iii) if an assignment to a Tenant Successor, in the reasonable judgment
of Landlord such assignee has a net worth (computed in accordance with generally accepted
accounting principles) equal to or greater than the original named Tenant at the time of such
assignment; and (iv) if an assignment to a Tenant Affiliate, in the reasonable judgment of
Landlord such assignee is sufficiently financially responsible to perform the obligations of the
Tenant under this lease. As used herein, the term “Tenant Successor” shall mean any entity (i)
which results from a merger or consolidation with the original Tenant under this lease or (ii)
which acquires all or substantially all of the assets of the original Tenant under this lease for
a legitimate business purpose; and the term “Tenant Affiliate” shall mean any entity which is
controlled by, controls, or is under common control with (A) the original Tenant named in this
lease or (B) a Tenant Successor.



27









 





     16. WAIVERS OF CERTAIN CLAIMS. INDEMNITIES.



     (a) General Waiver. In addition to and without limiting or being limited by any
other
releases or waivers of claims in this lease, but rather in confirmation and furtherance
thereof, to
the extent not prohibited by law, Landlord and Tenant each releases and waives any and all
claims
for, and rights to recover, damages against and from the other, and the other’s respective
agents,
members, partners, shareholders, officers and employees (collectively, the “Released
Parties”),
for loss, damage or destruction to any of its property (including the Premises, the Building
and
their contents), the elements of which are insured against by the party suffering such loss,
damage
or destruction, or are required under Section 22 hereof to be insured against by such party.
In
no event shall this clause be deemed, construed or asserted (i) to affect or limit any claims
or
rights against any Released Parties other than the right to recover damages for loss, damage
or
destruction to property, or (ii) to benefit any third party other than the Released Parties.



     (b) indemnity by Tenant. In addition to and without limiting or being limited by any
other indemnity in this lease, but rather in confirmation and furtherance thereof, to the
extent not
prohibited by law, Tenant agrees to indemnify, defend by counsel reasonably acceptable to
Landlord and hold Landlord and the Landlord Parties, and the Project, harmless of, from and
against any and all losses, damages, liabilities, claims, liens, costs and expenses, including
court
costs and reasonable attorneys’ fees and expenses, imposed on them in connection with injury
to
or death of third parties, other than the Landlord Parties, or with respect to damage to or
theft,
loss or loss of the use of any properly of third parties, other than the Landlord Parties,
occurring
in or about the Premises or the Project arising from Tenant’s occupancy of the Premises, or
the
conduct of its business or from any activity, work, or thing done, permitted or suffered by
Tenant
in or about the Premises or the Project, or due to any other negligent act or omission or
wilful
misconduct of Tenant, or any of its employees, agents or contractors.



     (c) Indemnity by Landlord. In addition to and without limiting or being limited by
any other indemnity in this lease, but rather in confirmation and furtherance thereof, to the
extent
not prohibited by law, Landlord agrees to indemnify, defend by counsel reasonably acceptable
to
Tenant and hold Tenant, its constituent members, and their respective
officers, directors,
members, partners, agents, employees, successors and assigns
(collectively, the “Tenant
Parties”)
harmless of, from and against any and all losses, damages, liabilities, claims, liens, costs
and
expenses, including court costs and reasonable attorneys’ fees and expenses, imposed on them
in
connection with injury to or death of third parties, other than the Tenant Parties, occurring
within
the common areas of the Building, or with respect to damage to or theft, loss or loss of the
use
of property of third parties, other than Tenant Parties, occurring within the common areas of
the
Building, but only to the extent that the foregoing losses, damages, liabilities, claims,
liens, costs
and expenses arise from or are caused directly or indirectly by any negligent act or omission
or
wilful misconduct of Landlord, or any of its employees, agents, officers, directors or
partners.
Such third parties shall not be deemed third party beneficiaries to this lease.



28









 





     (d) Waiver.
To the extent permitted by law, Tenant releases Landlord and the
Landlord Parties from, and waives all claims for, damage or injury to person or property
sustained by the Tenant or any occupant of the Building or Premises resulting directly or
indirectly from any existing or future condition, defect, matter or thing in and about the
Project
or the Premises or any part of either or any equipment or appurtenance therein, or resulting
from
any accident in or about the Project or resulting directly or indirectly from any act of
neglect of
any tenant or occupant of the Building or of any other person, including Landlord’s agents and
servants, except where resulting from the neglect or willful act of Landlord or any of the
Landlord
Parties. Tenant hereby waives any consequential damages, compensation or claims for
inconvenience or loss of business, rents, or profits as a result of any injury or damage
occurring
at or about the Building.



     (e) Landlord’s Negligence. Subject to the provisions of Section 16(a), no agreement
of Tenant in this lease shall be deemed to exempt Landlord from liability or damages for
injury
to persons or damage to property caused by or resulting from the negligence of Landlord, its
agents, servants or employees, in the operation or maintenance of the Premises or Building.



     17. DAMAGE OR DESTRUCTION BY CASUALTY.



     (a) Termination of Lease: Repair by Landlord. If the Premises or the Building
shall be damaged by fire or other casualty and if such damage does not render all or a substantial
portion of the Premises or the Building untenantable (as hereinafter defined), then Landlord shall
proceed with reasonable promptness to repair and restore the Building and the Premises so as to
render the Premises tenantable, subject to reasonable delays for insurance adjustments and delays
caused by matters beyond Landlord’s reasonable control, and also subject to zoning laws and
building codes then in effect. If any such damage renders all or a substantial portion of the
Premises or the Building untenantable, Landlord shall, with reasonable promptness after the
occurrence of such damage, estimate the length of time that will be required to substantially
complete the repair and restoration of the Building and the Premises, as the case may be,
necessitated by such damage and shall by notice advise Tenant of such estimate. If it is so
estimated that the amount of time required to substantially complete such repair and restoration
will exceed two hundred seventy (270) days from the date such damage occurred, then either
Landlord or Tenant (but Tenant shall have such right only if the damage was not caused by the
willful act of Tenant, its agents, employees or contractors, and only if all or a substantial
portion of the Premises is rendered untenantable and the estimated time for Landlord required to
substantially complete such repair or restoration to render the Premises tenantable will exceed
such two hundred seventy (270) day period) shall have the right to terminate this lease as of the
date of notice of such election by giving notice to the other at anytime within twenty (20) days
after Landlord gives Tenant the notice containing said estimate (it being understood that Landlord
may, if it elects to do so, also give such notice of termination together with the notice
containing said estimate). Unless this lease is terminated as provided in the preceding sentence,
Landlord shall proceed with reasonable promptness to repair and restore the Building or the
Premises so




29










 






as to render the Premises tenantable, subject to reasonable delays for insurance adjustments
and delays caused by matters beyond Landlord’s reasonable control, and also subject to zoning laws
and building codes then in effect. Landlord shall have no liability to Tenant, and Tenant shall not
be entitled to terminate this lease (except as hereinafter provided) if such repairs and
restoration are not in fact completed within the time period estimated by Landlord, as aforesaid,
or within said two hundred seventy (270) days. However, if such repairs and restoration are not
completed by a date (“Outside Date”) which is twelve (12) months after the date of such fire or
other casualty (or ninety-five (95) days after the expiration of the time period estimated by
Landlord as aforesaid, if longer than two hundred seventy (270) days and neither party terminated
the lease as permitted), which Outside Date shall be extended by all periods of delay attributable
to the acts or omissions of Tenant or Tenant’s agents, employees or contractors, for any reason
whatsoever, then tenant may terminate this lease, effective as of the date of notice of such
election, by giving written notice to Landlord within the thirty (30) day period after said Outside
Date as extended as aforesaid, but prior to substantial completion of repair or restoration.
Notwithstanding anything to the contrary herein set forth: (i) Landlord shall not be obligated (but
may, at its option, so elect) to repair or restore the Premises or Building if the damage is due
to an uninsurable casualty or if insurance proceeds are insufficient to pay for such repair or
restoration, or if any Mortgagee applies proceeds of insurance to reduce its loan balance, and the
remaining proceeds, if any, available to Landlord are not sufficient to pay for such repair or
restoration, provided that if Landlord does not elect in the circumstances referred to in this
clause to repair or restore the Premises, Landlord shall so notify Tenant and Tenant shall
thereafter have the right to terminate this lease upon notice to that effect given within thirty
(30) days after receipt of such notice from Landlord, time being of the essence; or (ii) if any
such damage rendering all or substantial portion of the Premises or Building untenantable shall
occur during the last year of the Term, either party (but as to Tenant’s right, only if all or a
substantial portion of the Premises is rendered untenantable) shall have the option to terminate
this lease by giving written notice to the other within thirty (30) days after the date such damage
occurred, and if such option is so exercised, this lease shall terminate as of the date of such
notice.




     (b) Abatement of Rent. In the event any such fire or casualty damage renders the
Premises untenantable, Rent shall abate during the period beginning with the date of such damage
and ending with the date when Landlord substantially completes its repair or restoration required
hereunder. Such abatement shall be in an amount bearing the same ratio to the total amount of Rent
for such period as the portion of the Rentable Area of the Premises which is untenantable and not
used by Tenant from time to time bears to the Rentable Area of the entire Premises. In the event of
termination of this lease pursuant to this Section 17, Rent shall be apportioned on a per diem
basis and be paid to the date of the termination, subject to the foregoing abatement.



     (c) Untenantability. As used in this lease, the term “untenantable” means reasonably incapable
of being occupied for its intended use due to damage to the Premises or Building. Notwithstanding
anything contained to the contrary in this Section 17, neither the Premises nor



30









 







any portion of the Premises shall be deemed untenantable if Tenant continues to
actually occupy the subject portion of the Premises.



18. EMINENT DOMAIN.




     (a) Substantial Taking. If the entire Project or the entire Building, or a
substantial part of either of them, or any part of the Project which includes all or a substantial
part of the Premises, shall be taken or condemned by any competent authority for any public or
quasi-public use or purpose, the Term of this lease shall end upon and not before the earlier of
the date when the possession of the part so taken shall be required for such use or purpose or the
effective date of the taking. If any condemnation proceeding shall be instituted in which it is
sought to take or damage any part of the Project, the taking or damaging of which would, in
Landlord’s reasonable opinion, prevent the economical operation of the Project, Landlord shall
have the right to terminate this lease upon written notice to Tenant given not less than ninety
(90) days prior to the date of termination designated in the notice. In either of the events above
referred to, Rent shall be apportioned on a per diem basis and be
payable to the date of the
termination.



     (b) Taking of Part. In the event a part of the Building or the Premises is taken or
condemned by any competent authority and this lease is not terminated as provided in Section 18(a)
above, the lease shall be amended to reduce the Monthly Base Rent and reduce or increase, as the
case may be, Tenant’s Proportionate Share to reflect the Rentable Area of the Premises or
Building, as the case may be, remaining after any such taking or condemnation. Landlord, upon
receipt and to the extent of the award in condemnation (or proceeds of sale) shall make necessary
repairs and restorations to the Premises and to the Building to the extent necessary to constitute
the portion of the Building not so taken or condemned as a complete architectural and economically
efficient unit.



     (c) Compensation. Landlord shall be entitled to receive the entire award (or sale
proceeds) from any such taking, condemnation or sale without any payment to Tenant, and Tenant
hereby assigns to Landlord all of Tenant’s interest, if any, in such award; provided, however,
Tenant shall have the right separately to pursue against the condemning authority a separate award
in respect of the loss, if any, to Tenant Alterations paid for by Tenant without any credit or
allowance from Landlord, so long as there is no diminution of Landlord’s award as a result, and
subject to the rights of any ground lessor or mortgagee of Landlord with respect thereto.



     19. DEFAULT;
LANDLORD’S RIGHTS AND REMEDIES. 



     (a) Default. The occurrence of any one or more of the following matters
constitutes a “Default” by Tenant under this lease:




     (i) Failure by Tenant to pay any Rent when due, if such failure continues for five
(5) days after written notice to Tenant of such failure;



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     (ii) Failure by Tenant to pay any other money required to be paid by Tenant
under this lease when due, if such failure continues for five (5) days after written notice to
Tenant of such failure;




     (iii) Failure by Tenant to observe or perform any of the covenants in respect of assignment
and subletting set forth in Section 15;




     (iv) Failure by Tenant to cure forthwith, immediately after receipt of notice from Landlord,
any hazardous condition which Tenant has created or permitted in violation of law or of this
lease;




     (v) Failure by Tenant to complete, execute and deliver any instrument or document required to
be completed, executed and delivered by Tenant pursuant to Section 20 or Section 24 of this lease
within the time required for such instrument or document in accordance with such Sections, if such
failure continues for five (5) business days after written notice to Tenant of such failure;




     (vi) Failure by Tenant to observe or perform any other covenant, agreement, condition or
provision of this lease, if such failure shall continue for thirty (30) days after written notice
thereof from Landlord to Tenant; provided that such 30-day period shall be extended for the time
reasonably required to complete such cure (not to exceed, in any event, an additional 90-day
period), if such failure cannot reasonably be cured within said 30-day period and Tenant commences
to cure such failure within said 30-day period and thereafter diligently and continuously proceeds
to cure such failure;




     (vii) The levy upon execution or the attachment by legal process of the leasehold interest of
Tenant, which levy or attachment shall not be released or discharged within ten (10) days from the
date thereof;




     (viii) Tenant abandons the Premises;




     (ix) Tenant becomes insolvent or bankrupt or admits in writing its inability to pay its debts
as they mature, or makes an assignment for the benefit of creditors, or applies for or consents to
the appointment of a trustee or receiver for Tenant or for the major part of its property;




     (x) A trustee or receiver is appointed for Tenant or for a major part of its property,
without Tenant’s application therefor or consent thereto, and is not discharged within sixty (60)
days after such appointment;




     (xi) Any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or
other proceeding for relief under any bankruptcy law or similar law for the



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relief of debtors, is instituted (A) by Tenant, or (B) against Tenant and is
allowed against it or is consented to by it or is not dismissed within sixty (60) days after
such institution; or




     (xii) Upon the third occurrence within any twelve-month period that Tenant
fails to pay Rent when due or has breached a particular covenant of this lease (whether or
not such failure or breach is thereafter cured within any stated cure or grace period or
statutory period).



       (b) Landlord’s Rights and Remedies. If a Default occurs, Landlord shall have the rights
and remedies hereinafter set forth, which shall be distinct, separate and cumulative and shall not
operate to exclude or deprive Landlord of any other right or remedy allowed it at law or in
equity:




     (i) Landlord may terminate this lease, in which event the Term of this lease shall
end, and all right, title and interest of Tenant hereunder shall expire, on the date stated
in such notice;




     (ii) Landlord may terminate the right of Tenant to possession of the Premises without
terminating this lease, whereupon the right of Tenant to possession of the Premises or any
part thereof shall cease on the date stated in such notice; and




     (iii) Landlord may enforce the provisions of this lease and may enforce and protect
the rights of Landlord hereunder by a suit or suits in equity or at law for the specific
performance of any covenant or agreement contained herein, and, except as specifically
hereinafter provided, for the enforcement of any other appropriate legal or equitable
remedy, including without limitation injunctive relief, recovery of all money due or to
become due from Tenant under any of the provisions of this lease and recovery of damages
incurred by Landlord by reason of the Default. Notwithstanding any of the foregoing or
anything else to the contrary in this lease, Landlord waives all rights to distrain for
rent against Tenant’s property in the Premises.




     (iv) Landlord may cure or correct such Default or take steps to perform any covenant,
agreement, condition or provisions of this lease, and all costs and expenses incurred by
Landlord in so doing (including reasonable attorneys’ fees) shall be paid by Tenant to
Landlord as additional rent upon demand plus interest at the Default Rate (defined in
Section 28(i)) from the date of expenditure. Landlord’s proceeding under the rights
reserved to Landlord under this Section 19(b)(iv) shall not in any way prejudice or waive
any rights as Landlord might otherwise have against Tenant by reason of that or any other
Default.



33









 





     (c) Surrender. If Landlord exercises any of the remedies provided for in
subparagraphs (i) and (ii) of Section 19(b), Tenant shall surrender possession of and vacate the
Premises and immediately deliver possession thereof to Landlord, and Landlord may re-enter and take
complete and peaceful possession of the Premises, with process of law if Tenant is in occupancy of
the Premises, full and complete license so to do being hereby granted to Landlord, and Landlord may
remove all occupants and property therefrom, using such lawful force as may be necessary, without
being deemed in any manner guilty of trespass, eviction or forcible entry and detainer, and without
relinquishing Landlord’s right to Rent or any other right given to Landlord hereunder or by law or
in equity.



     (d) Termination of Right of Possession. If Landlord terminates the right of Tenant to
possession of the Premises without terminating this lease, as provided for by subparagraph (ii) of
Section 19(b), then Landlord shall be entitled to recover from Tenant all the fixed dollar amounts
of Rent accrued and unpaid for the period up to and including such termination date, as well as
all other additional sums payable by Tenant, or for which Tenant is liable or in respect of which
Tenant has agreed to indemnify Landlord under any of the provisions of this lease, which may be
then owing and unpaid, and all costs and expenses, including without limitation court costs and
reasonable attorneys’ fees and expenses incurred by Landlord in the enforcement of its rights and
remedies hereunder, and in addition, Landlord shall be entitled to recover from Tenant from time
to time, and Tenant shall remain liable for, all Rent and all other additional sums thereafter
accruing as they become due under this lease during the period from the date of such notice of
termination of possession to the stated end of the Term. In any such case, Landlord shall use
reasonable efforts to relet the Premises for the account of Tenant for such rent, for such time
(which may be for a term extending beyond the Term of this lease), in such portions and upon such
terms as Landlord in Landlord’s reasonable judgment shall determine, and Landlord shall not be
required to accept any tenant offered by Tenant or to observe any instructions given by Tenant
relative to such reletting. Landlord may give priority over leasing the Premises to any other
space Landlord desires to lease in the Building and shall not be required in any case to offer
rent, length of terms or other terms for the Premises which are or would be less favorable to
Landlord than being offered for comparable space of Landlord in the Building. Also, in any such
case, Landlord may make repairs, alterations and additions in or to the Premises and redecorate
the same to the extent deemed by Landlord necessary, and in connection therewith Landlord may
change the locks to the Premises, and Tenant shall upon written demand pay the cost thereof
together with Landlord’s expenses of reletting. Landlord may collect the rents from any such
reletting and shall apply the same first to the payment of the expenses of reentry, redecoration,
repair, alterations and reletting and second to the payment of Rent herein provided to be paid by
Tenant, and any excess or residue shall operate only as an offsetting credit against the amount of
Rent, if any, due and owing or as the same thereafter becomes due and payable hereunder, but the
use of such offsetting credit to reduce the amount of Rent due Landlord, if any, shall not be
deemed to give Tenant any right, title or interest in or to such excess or residue, and any such
excess or residue shall belong to Landlord solely; provided that in no event shall Tenant be
entitled to such a credit against Rent in excess of the aggregate sum (including Base Rent and



34









 







Additional Rent) which would have been paid by Tenant for the period for which the credit to
Tenant is being determined had no Default occurred. No such re-entry, repossession, repairs,
alterations, additions or reletting shall be construed as an eviction or ouster of Tenant or as an
election on Landlord’s part to terminate this lease, unless a written notice of such intention is
given to Tenant, or shall operate to release Tenant in whole or in part from any of Tenant’s
obligations hereunder, and Landlord may, at any time and from time to time, sue and recover
judgment for any deficiencies from time to time remaining after the application from time to time
of the proceeds of any such reletting.



     (e) Termination of Lease. In the event of the termination of this lease by Landlord as
provided for by subparagraph (i) of Section 19(b), Landlord shall be entitled to recover from
Tenant all the fixed dollar amounts of Rent accrued and unpaid for the period up to and including
such termination date, as well as all other additional sums payable by Tenant, or for which Tenant
is liable or in respect of which Tenant has agreed to indemnify Landlord under any of the
provisions of this lease, which may be then owing and unpaid, and all costs and expenses, including
without limitation court costs and reasonable attorneys’ fees and expenses incurred by Landlord in
the enforcement of its rights and remedies hereunder, and in addition, Landlord shall be entitled
to recover an amount equal to the present value of the aggregate Base Rent and Additional Rent
payable for the period from the termination date stated in Landlord’s notice terminating this lease
until the date which would have been the Expiration Date but for such termination, less the present
value of the fair rental value of the Premises for the same period (which fair rental value shall
be calculated so as to include a reasonable vacancy period for reletting the Premises and
deductions for reasonable expenses and inducements incurred by Landlord to achieve such reletting,
including without limitation attorneys’ fees and expenses, brokerage fees, advertising costs, rent
abatements, tenant improvement allowances and the like).



     (f) Tenant’s Property. All property of Tenant removed from the Premises by Landlord
or which becomes Landlord’s property pursuant to any provisions of this lease or by law may be
handled, removed or stored by Landlord at the cost and expense of Tenant, and Landlord shall in no
event be responsible for the value, preservation or safekeeping thereof. Tenant shall pay Landlord
for all expenses incurred by Landlord in such removal and for storage charges for such property so
long as the same shall be in Landlord’s possession or under Landlord’s control. All property not
removed from the Premises or retaken from storage by Tenant on or before the end of the Term,
however terminated, or the termination of Tenant’s right of possession, shall, at Landlord’s
option, be conclusively deemed to have been conveyed by Tenant to Landlord as by bill of sale,
without further payment or credit by Landlord to Tenant.



     (g) Waiver of Notices Not Provided for in this Lease. Tenant expressly waives the
service of any notice of intention to terminate this lease or to reenter the Premises and waives
the service of any demand for payment of rent or for possession and waives the service of any and
every other notice or demand prescribed by any ordinance, statute or other law (except as expressly
otherwise provided in this lease) and agrees that the breach of any covenants or



35









 







agreements provided in this lease shall, in and of itself, without the service of
any notice or demand whatever (except as expressly otherwise provided in this lease), constitute a
forcible detainer by Tenant of the Premises.



     (h) Waiver of Trial by Jury. Landlord and Tenant hereby do waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto against the other on
any matter whatsoever arising out of or in any way connected with this lease, the relationship of
Landlord and Tenant, Tenant’s use of or occupancy of the Premises or any claim of injury or damage
and any emergency statutory or any other statutory remedy. If Landlord commences any summary
proceeding for non-payment of rent, Tenant will not interpose any counterclaim of whatever nature
or description in any such proceeding, except that Tenant may interpose any mandatory counterclaim
(i.e., any claim which Tenant may not lawfully pursue in any other or separate proceedings).



     20. RIGHTS OF MORTGAGEES AND GROUND LESSORS.



     (a) Subordination of Lease. Landlord may have heretofore or may hereafter
encumber with a mortgage or trust deed the Building, the Land, the Project, any part thereof or
any interest therein, may sell and lease back the Land, or any part of the Project, and may
encumber the leasehold estate under such a sale and leaseback arrangement with a mortgage or trust
deed. (Any such mortgage or trust deed is herein called a “Mortgage” and the holder of any such
mortgage or the beneficiary under any such trust deed is herein called a “Mortgagee.” Any such
lease of the Land or other part of the Project is herein called a “Ground Lease” and the lessor
under any such lease is herein called a “Ground Lessor.”) This lease and the rights of Tenant
hereunder shall be and are hereby expressly made subordinate at all times to any Mortgage and to
any Ground Lease now or hereafter existing, and to all amendments, modifications, renewals,
extensions, consolidations and replacements thereof, and to all advances made or hereafter to be
made upon the security thereof, subject to the remaining provisions of this Section.
Notwithstanding the foregoing, Landlord shall use reasonable efforts to obtain a non-disturbance
agreement from Metropolitan Life Insurance Company (i.e., being the existing Mortgagee of the
Building), which agreement shall be in the form attached hereto as Exhibit G. Landlord shall
deliver a counterpart of the same executed by Metropolitan Life Insurance Company to Tenant within
thirty (30) days following execution and delivery by Landlord and Tenant of this lease and such
subordination, non-disturbance and attornment agreement, failing which, as Tenant’s sole remedy
for such failure, Tenant may terminate this lease by notice to Landlord to that effect given
within ten (10) days after the end of such thirty (30) day period and prior to Tenant taking
possession of the Premises. Tenant agrees to execute and deliver to Landlord such further
instruments consenting to or confirming the subordination of this lease to any Mortgage and to any
Ground Lease and containing such other provisions which may be requested in writing by Landlord
within ten (10) days after Tenant’s receipt of such written request; provided that any such
instrument shall also include recognition and non-disturbance provisions to the effect that the
Mortgagee or Ground Lessor will not disturb Tenant’s continued occupancy of the Premises under



36









 







this lease so long as Tenant is not in Default hereunder, which recognition and
non-disturbance provisions may contain such other terms and conditions as are contained in the
Mortgagee’s or Ground Lessor’s customary form of subordination, non-disturbance and attornment
agreement.



     (b) Notice of and Opportunity to Cure Defaults. Tenant agrees that if Landlord
defaults in the performance or observance of any covenant or condition of this lease required to be
performed or observed by Landlord hereunder, Tenant will give written notice specifying such
default by certified or registered mail, postage prepaid, to any Mortgagee or Ground Lessor of
which Tenant has been notified in writing, and before Tenant exercises any right to terminate this
lease which Tenant may have on account of any such default of Landlord, such Mortgagee or Ground
Lessor shall have an additional thirty (30) days after receipt of notice thereof within which to
cure such default (or if such default cannot be cured within that time, then such additional time
as may be necessary, if, within such thirty (30) days, any Mortgagee or Ground Lessor has commenced
and is diligently pursuing the remedies necessary to cure such default, including but not limited
to commencement of foreclosure proceedings or other proceedings to acquire possession of the
mortgaged or leased estate, if necessary to effect such cure). Such period of tune shall be
extended by any period within which such Mortgagee or Ground Lessor is prevented from commencing or
pursuing such foreclosure proceedings or other proceedings to acquire possession of the mortgaged
or leased estate by reason of Landlord’s bankruptcy.



     (c) Rights of Successors. If any Mortgage is foreclosed, or Landlord’s interest under
this lease is conveyed or transferred in lieu of foreclosure, or if any Ground Lease is terminated:




     (i) No person or entity which as the result of any of the foregoing has succeeded to
the interest of Landlord in this lease (any such person or entity being hereafter called a
“Landlord Successor”) shall be liable for any default by Landlord or any other matter which
occurred prior to the date such Landlord Successor succeeded to Landlord’s interest in this
lease, nor shall such Landlord Successor be bound by or subject to any offsets or defenses
which Tenant may have against Landlord or any other predecessor in interest to such
Landlord Successor.




     (ii) Upon request of any Landlord Successor, Tenant will attorn to such
Landlord Successor, as Landlord under this lease, subject to the provisions of this
Section 20(c) and Section 20(e), and will execute and deliver such instruments as may be
necessary or appropriate to evidence such attornment within ten (10) days after receipt of
a written request to do so.




     (iii) No Landlord Successor shall be bound to recognize any prepayment by more
than thirty (30) days of Base Rent or Additional Rent.



37









 






     (iv) No Landlord Successor shall be bound to recognize any amendment or
modification of this lease made without the written consent of the Mortgagee or Ground
Lessor (as the case may be).



     (d) Subordination of Mortgage. Notwithstanding anything to the contrary contained
herein, any Mortgagee may subordinate, in whole or in part, its Mortgage to this lease by sending
Tenant notice in writing subordinating all or any part of such Mortgage to this lease, and Tenant
agrees to execute and deliver to such Mortgagee such further instruments consenting to or
confirming the subordination of all or any portion of its Mortgage to this lease and containing
such other provisions which may be requested in writing by such Mortgagee within ten (10) days
after Tenant’s receipt of such written request.



     (e) Liability of Mortgagee and Ground Lessor. Whether or not any Mortgage is
foreclosed or any Ground Lease is terminated, or any Mortgagee or Ground Lessor succeeds to any
interest of Landlord under this lease, no Mortgagee or Ground Lessor shall have any liability to
Tenant for any security deposit paid to Landlord by Tenant hereunder, unless such security deposit
has actually been received by such Mortgagee or Ground Lessor.



     (f) Requests by Mortgagee or Ground Lessor. Should any prospective Mortgagee or Ground
Lessor require execution of a short form of this lease for recording (containing, among other
customary provisions, the names of the parties, a description of the Premises and the Term of this
lease), Tenant agrees to execute such short form of lease and deliver the same to Landlord within
ten (10) days following the request therefor.



     21. DEFAULT
UNDER OTHER LEASES. If the term of any lease, other than this lease and
other than any lease of storage space, heretofore or hereafter made by Tenant for any space in the
Building shall be terminated or terminable after the making of this lease because of any Default by
Tenant or any such other party under such other lease, such fact shall empower Landlord, at
Landlord’s sole option, to terminate this lease by written notice to Tenant or to exercise any of
the rights or remedies set forth in Section 19.



     22. INSURANCE
AND SUBROGATION. 



     (a) Tenant’s Insurance. Tenant shall carry insurance during the entire Term
hereof, with terms, coverages and in companies satisfactory to Landlord, and with such changes in
insured parties and increase in limits as Landlord may from time to time request consistent, as to
limits, with limits being required by comparable first-class office buildings in downtown Chicago,
Illinois, but initially Tenant shall maintain the following coverages in the following amounts:




	 	(i)	 	Public liability insurance with the broad form commercial liability
endorsement, including contractual liability insurance covering Tenant’s
indemnity obligations hereunder, insuring against claims for death, bodily




38









 






	 	 	 	injury, personal injury and property damage occurring upon, in or
about the Premises in an amount not less than $5,000,000.00 per occurrence
and having a general aggregate amount on a per location basis of not less
than $5,000,000.00.
	 
	 	(ii)	 	“All risk” physical damage insurance including fire, sprinkler leakage,
vandalism and extended coverage for the full replacement cost of all office
furniture, trade fixtures, office equipment, merchandise and all other
items of Tenant’s property on the Premises.
	 
	 	(iii)	 	Workers’ Compensation and Employers’ Liability insurance in an amount
of not less than $1,000,000.00, both in accordance with the laws of the
State of Illinois.
	 
	 	(iv)	 	Such other insurance or coverage as Landlord reasonably requests which
is consistent with insurance and coverages being required by comparable
first-class office buildings in downtown Chicago, Illinois.





     All policies of liability insurance (specifically not including Workers’ Compensation) shall
name Landlord, Landlord’s constituent members and agents, all Mortgagees and Ground Lessors and
their respective agents, partners and employees as additional insureds.



     Tenant shall, prior to the commencement of the Term and from time to time during the Term
(and, in any event, not less than ten days prior to the expiration of any such policy), furnish to
Landlord certificates of insurance (with proof of payment) and, if requested by Landlord, copies
of all policies, evidencing the foregoing insurance coverage. Tenant’s policies shall state that
such insurance coverage may not be amended, cancelled or not renewed without at least thirty (30)
days’ prior written notice to Landlord and Tenant, and shall further provide that the policy shall
not be invalidated should the insured party have waived in writing prior to a loss, any and all
rights of the insured party against any other party for losses covered by such policy.



     (b) Waiver of Subrogation. Landlord and Tenant each agree to have all property or
physical damage insurance which it may carry endorsed with a clause providing that any release from
liability of or waiver of claim for recovery from the other party or any of the parties named in
Section 22(a) above or Released Parties described in Section 16(a) entered into in writing by the
insured thereunder prior to any loss or damage shall not affect the validity of said policy or the
right of the insured to recover thereunder. Tenant’s policy shall provide further that the insurer
waives all rights of subrogation which such insurer might have against any of the parties named in
Section 22(a) above. Tenant further agrees to first seek recovery under any applicable insurance
policy before proceeding against Landlord. Notwithstanding the foregoing or anything contained in
this lease to the contrary, any release or waiver of claims shall not be operative, nor shall the
foregoing endorsements be required, in any case where the effect of such release or



39









 










waiver is to invalidate insurance coverage or invalidate the right of the insured to recover
thereunder or increase the cost thereof (provided that in the case of increased cost the other
party shall nave the right, within ten (10) days following written notice, to pay such increased
cost, thereby keeping such release or waiver in full force and effect).



     (c) Landlord’s Insurance. Landlord shall carry during the Term hereof replacement
cost property insurance on the Building (including all base Building improvements at the Building,
the Landlord’s Work, and the Tenant’s Work and other Tenant Alterations) against fire and other
extended coverage perils in an amount sufficient to prevent Landlord from being deemed a
co-insurer of the risks insured under the policy.



     23. NONWAIVER. No waiver of any condition expressed in this lease shall be implied
by any neglect of a party to enforce any remedy on account of the violation of such condition,
whether or not such violation be continued or repeated subsequently, and no express waiver shall
affect any condition other than the one specified in such waiver and that one only for the time and
in the manner specifically stated. Without limiting Landlord’s rights under the provisions of
Section 11, it is agreed that no receipt of money by Landlord from Tenant after the termination in
any way of the Term or of Tenant’s right of possession hereunder or after a Default shall
reinstate, continue or extend the Term or affect any notice given to Tenant prior to the receipt of
such money. It is also agreed that after Default or the commencement of a suit or after final
judgment for possession of the Premises, Landlord may receive and collect any money due, and
Landlord’s receipt and collection of said money shall not waive or affect any said Default, suit or
judgment.



     24. ESTOPPEL CERTIFICATE. Tenant agrees that from time to time upon not less than ten (10)
business days’ prior request by Landlord, or any existing or prospective Mortgagee or Ground
Lessor, Tenant will complete, execute and deliver to Landlord or Landlord’s designee or to any
existing or prospective Mortgagee or Ground Lessor, a written estoppel certificate certifying (a)
that this lease is unmodified and is in full force and effect (or if there have been modifications,
that this lease, as modified, is in full force and effect and setting forth the modifications); (b)
the amounts of the monthly installments of Base Rent and Additional Rent Estimate then required to
be paid under this lease; (c) the date to which Rent has been paid; (d) that to Tenant’s knowledge,
Landlord is not in default under any of the provisions of this lease, or if in default, the nature
thereof in detail and what is required to cure same; and (e) such other information concerning the
status of this lease or the parties’ performance hereunder reasonably requested by Landlord or the
party to whom such estoppel certificate is to be addressed.



     25. TENANT
CORPORATION LIMITED LIABILITY COMPANY OR PARTNERSHIP. In case
Tenant is a corporation or a limited liability company, (a) Tenant represents and warrants that
this lease has been duly authorized, executed and delivered by and on behalf of Tenant and
constitutes the valid and binding agreement of Tenant, and (b) if Landlord



40









 







so requests, Tenant shall deliver to Landlord, concurrently with the delivery of this
lease executed by Tenant, resolutions of the board of directors or board of managers (and
shareholders and/or members, if required) of Tenant authorizing Tenant’s execution and delivery of
this lease and the performance of Tenant’s obligations hereunder, certified as true and correct by
any authorized representative of Tenant. In case Tenant is a partnership, (a) Tenant represents and
warrants that all of the persons who are general or managing partners in said partnership have
executed this lease on behalf of Tenant, or that this lease has been executed and delivered
pursuant to and in conformity with a valid and effective authorization therefor by all of the
general or managing partners of such partnership, and is and constitutes the valid and binding
agreement of the partnership, and (b) if Landlord so requests, Tenant shall deliver to Landlord,
concurrently with the. delivery of this lease executed by Tenant, authorization of the general
partners (and limited partners, if required by the partnership agreement) of Tenant authorizing
Tenant’s execution and delivery of this lease and the performance of Tenant’s obligations
hereunder, certified as true and correct by a general partner of Tenant. If Tenant is a
partnership, limited liability company or corporation whose stock is not publicly traded, Tenant
represents and warrants to Landlord that it has disclosed in writing to Landlord the persons or
entities who individually or collectively own a controlling interest in Tenant as of the date of
the execution of this lease.



     26. REAL ESTATE BROKERS. Landlord and Tenant each represent and warrant to the other that the
party making such representation and warranty did not deal with any broker in connection with this
lease other than the Brokers identified in Section l(c). Landlord hereby agrees to pay the
brokerage commissions payable to said Brokers in accordance with a written agreement between
Landlord and such Broker. Each party shall indemnify, defend and hold the other, its agents, their
respective partners and employees and, with respect to the indemnification of Landlord, the
Project, harmless of, from and against any and all losses, damages, liabilities, claims, liens,
costs and expenses, including without limitation court costs and reasonable attorneys’ fees and
expenses, arising from any claims or demands of any other broker or brokers or finders for any
commission alleged to be due such other broker or brokers or finders claiming to have dealt with
the party making the indemnification in connection with this lease or with whom such party
hereafter deals or whom such party employs.



     27. NOTICES. All notices, waivers, demands, requests or other communications required
or permitted hereunder shall, unless otherwise expressly provided, be in writing and be deemed to
have been properly given, served and received (a) if delivered personally or by sameday courier
messenger, when delivered, (b) if sent by nationally required overnight courier, on the first (1st)
business day after deposit with said courier, and (c) if mailed by United States Mail, certified or
registered, postage prepaid, return receipt requested, upon receipt or deemed receipt (as
hereinafter defined).



41









 





	 	 	 	 	 	 	 
	 	 	If to Landlord:	 	303 Wacker Realty L.L.C.
	 

	 	 	 	 	 	c/o Hines
	 

	 	 	 	 	 	303 East Wacker Drive
	 

	 	 	 	 	 	Chicago, Illinois 60601
	 

	 	 	 	 	 	Attention: Property Manager
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	with an additional copy to:
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	Hines Interests Limited
Partnership
	 

	 	 	 	 	 	70 West Madison Street
	 

	 	 	 	 	 	Suite 440
	 

	 	 	 	 	 	Chicago, Illinois 60602
	 

	 	 	 	 	 	Attention: C. Kevin Shannahan
	 
	 	 	 	 	 	 
	 	 	and to	 	303 Wacker Realty L.L.C.
	 

	 	 	 	 	 	c/o J.P. Morgan Investment
Management Inc.
	 

	 	 	 	 	 	522 Fifth Avenue
	 

	 	 	 	 	 	New York, New York 10036
	 

	 	 	 	 	 	Attention: Sheryl M. Crosland
	 
	 	 	 	 	 	 
	 	 	If to Tenant:	 	Upshot
	 

	 	 	 	 	 	225 West Wacker Drive
	 

	 	 	 	Prior to occupancy of the
	 	Suite 700
	 

	 	 	 	Premises by Tenant:
	 	Chicago, Illinois 60606
	 

	 	 	 	 	 	Attention: Carol Griseto
	 
	 	 	 	 	 	 
	 

	 	 	 	After occupancy of the
	 	Upshot
	 

	 	 	 	Premises by Tenant:
	 	303 East Wacker Drive

Chicago, Illinois 60601
	 

	 	 	 	 	 	Attention: Carol Griseto





or to such other address(Expansion Space) or addressee(s) as any party entitled to receive
notice hereunder shall designate to the others in the manner provided herein for the service of
notices. Rejection or refusal to accept or inability to deliver because of changed address or
because no notice of changed address was given, shall be deemed receipt.




     28. MISCELLANEOUS.



     (a) Successors and Assigns. Each provision of this lease shall extend to and
shall bind and inure to the benefit not only of Landlord and Tenant, but also their respective
heirs, legal representatives, successors and assigns, but this provision shall not operate to
permit any assignment, subletting, mortgage, lien, charge, or other transfer or encumbrance
contrary to the provisions of this lease.



42









 





     (b) Amendment. No modification, waiver of amendment of this lease or of
any of its conditions or provisions shall be binding upon a party hereto unless the same shall be
in writing and signed by such party.



     (c) Offer. Submission of this instrument for examination shall not constitute a
reservation of or option for the Premises or in any manner bind Landlord, and no lease or
obligation on Landlord shall arise until this instrument is signed and delivered by Landlord and
Tenant; provided, however, the execution and delivery by Tenant of this lease to Landlord, or its
agents, shall constitute an irrevocable offer by Tenant to lease the Premises on the terms and
conditions herein contained, which offer may hot be revoked for thirty (30) days after such
delivery.



     (d) Tenant. The word “Tenant” whenever used herein shall be construed to mean Tenants
or any one or more of them in all cases where there is more than one Tenant; and the necessary
grammatical changes required to make the provisions hereof apply either to corporations or other
organizations, partnerships or other entities, or individuals, shall in all cases be assumed as
though in each case fully expressed. In all cases where there is more than one Tenant, (a) the
liability of each shall be joint and several and (b) any one person or entity comprising Tenant may
give any notice or approval required or permitted to be given by Tenant under this lease and such
notice or approval shall be deemed binding upon all persons or entities comprising Tenant and may
be relied upon by Landlord as if such notice or approval had been given by all persons or entities
comprising Tenant.



     (e) Expenses of Enforcement. The non-prevailing party shall pay upon demand all of the
reasonable costs, charges and expenses (including the court costs and fees and out-of-pocket
expenses of counsel, agents and others retained by the prevailing party) incurred by the prevailing
party in enforcing the terms of this lease, and a party shall also pay such costs and expenses
incurred by the other party in any litigation, negotiation or transaction in which said party
causes the other party without the other party’s fault to become involved or concerned. Any amount
due from Tenant to Landlord pursuant to this Section shall be deemed to be additional Rent due
under this lease.



     (f) Exhibits and Riders. Exhibits and riders, if any, referred to in or affixed to
this lease are made an integral part hereof.



     (g) Approval of Plans and Specifications. Neither review nor approval by or on behalf
of Landlord of any plans and specifications for any Tenant Alterations or any other work shall
constitute a representation or warranty by Landlord, any of Landlord’s constituent members, or any
of their respective agents, partners or employees, that such plans and specifications either (i)
are complete or suitable for their intended purpose, or (ii) comply with applicable Laws, it being
expressly agreed by Tenant that neither Landlord, nor any of Landlord’s constituent members, nor
any of their respective agents, partners or employees, assume any responsibility or



43









 







liability whatsoever to Tenant or to any other person or entity for such
completeness, suitability or compliance.



     (h) Time of Essence. Time is of the essence of this lease and of each and all
provisions hereof.



     (i) Due Date; Interest. Except as otherwise specifically provided in this lease, all
amounts owed by Tenant to Landlord pursuant to any provision of this lease shall be paid by Tenant
within ten (10) days after Landlord’s written demand, and all such amounts (including, without
limitation, Base Rent and Additional Rent) shall bear interest from the date due until paid at the
annual rate equal to the Default Rate (hereinafter defined), unless a lesser rate shall then be the
maximum rate permissible by law with respect thereto, in which event such lesser rate shall be
charged. The term “Default Rate” means three (3) percentage points in excess of the rate of
interest announced from time to time by The First National Bank of Chicago, Chicago, Illinois (or
any successor), as its “prime rate” or “corporate base rate,” changing as and when such rate
changes, or if such rate is no longer announced, then a comparable prime, base or reference rate
used by such bank or by one of the five largest banks in Chicago, Illinois, as designated by
Landlord, shall be used in its place. The provisions of this subparagraph shall in no way relieve
Tenant of the obligation to pay Rent or any other sums due hereunder on or before the date on which
payment is due, nor shall the collection by Landlord of any amount under this subparagraph impair
the ability of Landlord to collect any amount under Section 19 of this lease.



     (j) Interpretation. The invalidity of any provision of this lease shall not, to the
extent commercially reasonable, impair or affect in any manner the validity, enforceability or
effect of the rest of this lease.



     (k) Force Majeure. Without limiting or being limited by the provisions of Section 8
or Section 13, or any of the other provisions of this lease, if Landlord fails to perform timely
any of the terms, covenants or conditions of this lease (including, without limitation, the terms,
covenants and conditions of the Workletter) on Landlord’s part to be performed, and such failure
is due in whole or in part to any strike, lockout, labor trouble, civil disorder, riot,
insurrection, act of terrorism, war, accident, fire or other casualty, adverse weather condition,
act of God, governmental inaction, restrictive governmental law or regulation, inability to
procure materials, electricity, gas, other fuel or water or other utilities at the Building after
reasonable effort to do so, act or event caused directly or indirectly, by or by default of Tenant
or any of Tenant’s employees, agents or contractors, concealed subsurface condition not reasonably
anticipated from test results obtained prior to commencement of work or any cause beyond the
reasonable control of Landlord, then Landlord shall not be deemed in default under this lease as a
result of such failure provided that Landlord has diligently performed and diligently continues to
pursue such obligations to the extent reasonably possible under the circumstances.



44









 





     (l) Application of Payments. Landlord shall have the right to apply payments
received from Tenant pursuant to this lease (regardless of Tenant’s designation of such payments)
to satisfy any obligations of Tenant hereunder, in such order and amounts as Landlord, in its sole
discretion, may elect.



     (m) Cumulative Remedies; Illinois Law. Except as expressly provided in this lease to
the contrary, the rights and remedies of each party under this lease are cumulative and none shall
exclude any other rights or remedies allowed by law or equity. This lease is for the lease of
space in a building located in the State of Illinois and is declared to be an Illinois contract,
and all of its terms shall be construed according to the laws of the State of Illinois.



     (n) Counterparts. This lease may be simultaneously executed in several counterparts,
each of which shall be an original and all of which shall constitute but one and the same
instrument.



     (o) Relationship. Landlord and Tenant disclaim any intention to create a joint
venture, partnership or agency relationship.



     (p) Action on Behalf of Landlord. Any service which may be provided by Landlord under
this lease may be provided by Landlord, any of its constituent members, or any agent or contractor
of any of them, and the cost to Landlord of any such agent or contractor shall be included in any
charge to Tenant for such service, provided that the fees or costs of any such services (other than
management services, which are provided for in Exhibit B) provided by affiliates of Landlord are
at competitive rates in the downtown Chicago, Illinois area. Except as provided in the following
sentence, any right reserved to Landlord under this lease may be exercised by Landlord, any of its
constituent members, or any agent, contractor or designee of any of them. Any notice, demand,
consent or approval which may be given by Landlord under this lease may be given only by Landlord,
any constituent member of Landlord, or any agent or attorney of any of them.



     (q) Entire Agreement. This lease contains the entire agreement between Landlord, and
Tenant with respect to its subject matter, and all negotiations, considerations, representations,
understandings and agreements, oral or written, which may have been previously made between any of
the foregoing parties are incorporated and merged into this lease. In executing and delivering
this lease, Tenant has not relied on any representation, warranty or statement by Landlord, any of
Landlord’s constituent members, or any of their respective agents, partners or employees, which is
not set forth in this lease, including without limitation any representation as to the amount of
any Additional Rent, or any component thereof, or any representation that Landlord is furnishing
the same services to other tenants, at all, on the same level or on the same basis.



45









 





     (r) Financial Statements. At Landlord’s request, Tenant shall deliver to
Landlord, within thirty (30) days after written request by Landlord, Tenant’s most recent annual
financial statements and any more recent quarterly financial statements then available, including
balance sheets, income statements and cash flow statements, prepared in accordance with generally
accepted accounting principles consistently applied. Such financial statements shall be certified
by the chief financial officer of Tenant as being true, accurate and complete in all material
respects. Tenant shall also, upon Landlord’s reasonable requests from time to time, deliver to
Landlord such other financial information regarding Tenant as may be reasonably available.
Landlord shall not disclose such financial information to any third party other than its lenders,
partners, members, agents, consultants, advisors, attorneys and accountants or as may be
otherwise required by a government or governmental agency or pursuant to court order.



     (s) Delivery of Possession. If Landlord shall be unable to deliver possession of the
Premises to Tenant on any date for any reason, Landlord shall not be liable or responsible for
any claims, damages, or liabilities in connection therewith or by reason thereof, and such
failure should not effect the validity of this lease or otherwise affect the obligations of
Tenant hereunder; provided, however, in such event, the Commencement Date hereof shall be
extended until such time as Landlord so delivers possession of the Premises to Tenant. In the
event the Commencement Date is deferred pursuant to this Section, Rent under this lease shall not
commence until said revised Commencement Date, and the stated Term of this lease shall thereupon
commence, and the Expiration Date shall be extended, so as to give effect to the full stated Term
hereof.



     29. SECURITY DEPOSIT. On or before September 1, 1998, Tenant Shall deliver to Landlord
an unconditional and irrevocable letter of credit (“Letter of Credit”) in the amount of One Million
Five Hundred Thousand and No/100 Dollars ($1,500,000.00) (“Security Deposit”) as security for the
full and faithful performance of every provision of this lease to be performed by Tenant. Tenant’s
failure to deliver the initial Letter of Credit to Landlord when required hereunder shall be a
default and material breach of this lease. The first such Letter of Credit shall expire no earlier
than twelve (12) months after issuance and all subsequent replacement Letters of Credit shall
expire no earlier than twelve (12) months from the expiry date of the then outstanding and expiring
Letter of Credit. Each such Letter of Credit shall be in substantially the form attached hereto as
Exhibit H and otherwise in form and substance satisfactory to Landlord. Each such Letter of Credit
shall be issued by a bank reasonably satisfactory to Landlord. Without limitation of the foregoing,
each issuer of a Letter of Credit shall have an office in Chicago, Illinois at which such Letter of
Credit may be presented. Subject to the remaining provisions of this Section concerning reductions
in the amount of the Letter of Credit, Tenant shall ensure that at all times during the Term of
this lease and for ninety (90) days after expiration of the Term, an unexpired Letter of Credit in
the face amount of the Security Deposit or cash in the amount of the Security Deposit shall be in
the possession of Landlord. Subject to such provisions, during the Term Tenant shall deliver a
replacement Letter of Credit to Landlord no later than thirty (30) days prior to the expiry date of
then outstanding and expiring Letter of Credit. In addition, unless



46









 








the total assets of the issuer of any outstanding Letter of Credit are $1 billion or more
(unless Landlord has previously approved a lesser figure) as established to the reasonable
satisfaction of Landlord, Landlord may require that Tenant deliver a replacement Letter of Credit
from another issuer satisfactory to Landlord within thirty (30) days after notice from Landlord to
Tenant requesting such replacement Letter of Credit. Failure by Tenant to deliver any replacement
Letter of Credit as required by the foregoing provisions shall entitle Landlord to draw under the
outstanding Letter of Credit and to retain the entire proceeds thereof for application as the
Security Deposit under this lease, but Landlord shall refund such proceeds to Tenant simultaneously
with later delivery by Tenant of a Letter of Credit conforming with this Section. Each Letter of
Credit shall be for the benefit of Landlord and its successors and assigns, shall be expressly
assignable, and shall entitle Landlord or its successors or assigns to draw from time to time under
the Letter of Credit in portions or in whole upon presentation of a sight draft accompanied by a
statement that Landlord is entitled to draw thereunder pursuant to the terms of this lease.



     If Tenant defaults with respect to any provision of this lease, including but not limited to
the provisions relating to the payment of Rent, Landlord may draw under the Letter of Credit and
use or apply the proceeds drawn or any cash or other Security Deposit for the payment of Rent or
any other past due amount or for any amount which Landlord may spend or become obligated to spend
by reason of Tenant’s default or to compensate Landlord for any other loss which Landlord may
suffer by reason of Tenant’s default. If any portion of the proceeds are to be used or applied,
Tenant shall, within five (5) days after written demand therefor, restore the Security Deposit (by
either a cash deposit or delivery of a replacement Letter of Credit) to its original amount and
Tenant’s failure to do so shall be a default and material breach of this lease. Except to the
extent required by law, Tenant shall not be entitled to interest for any period during which
Landlord is holding cash as a Security Deposit nor shall Landlord be required to keep such cash
Security Deposit separate from its or their general funds. Any cash Security Deposit which
Landlord is holding at the expiration of the lease term, or any balance thereof, and any
outstanding Letter of Credit shall be returned to Tenant (or at Landlord’s option to the last
permitted assignee of Tenant’s interest hereunder, if any) within thirty (30) days after the
expiration of the lease Term and Tenant’s vacation of the Premises, provided Tenant is not then in
default hereunder, and to the extent not returned to Tenant because Tenant is in default under
this lease, shall be returned when any such default is cured, to the extent not applied to cure
such default or applied to other obligations of Tenant under this lease. Landlord may deliver the
Letter of Credit or any cash Security Deposit funds to the purchaser of Landlord’s interest in the
Project, in the event that such interest is sold, transferred or conveyed, and thereupon Landlord
shall be discharged from any further liability with respect to the Security Deposit provided that
the transferee assumes Landlord’s obligations with respect thereto.



     If as of the respective dates on which the requirements of this sentence are satisfied for
the fiscal years indicated in the table below (each a “Security Deposit Reduction Date”) (a)
Tenant is not then La default with respect to any provision of this lease and (b) Tenant’s net
income for Tenant’s most recent fiscal year is greater than $6,700,000.00 and Tenant has delivered
to



47









 







Landlord audited financial statements demonstrating that such condition has been met
(the “Net Income Test”), Tenant shall have the right to deliver a replacement Letter of Credit,
as a substitute for the Letter of Credit then being held by Landlord hereunder, or an amendment
to the Letter of Credit then being held by Landlord hereunder, reducing the amount of the Letter
of Credit by the “Permitted Security Deposit Reduction” so that the outstanding Letter of Credit
shall be in the amount of the “Remaining Security Deposit Balance”, as follows:



	 	 	 	 	 	 	 	 	 
	Security Deposit	 	Permitted Security	 	 	Remaining Security	 
	Reduction Date	 	Deposit Reduction	 	 	Deposit Balance	 
	First
Tenant fiscal
year ending
during the Term
for which the
Net Income Test
is met
	 	$	300,000	 	 	$	1,200,000	 
	Second
Tenant fiscal
year ending
during the Term
for which the
Net Income Test
is
met
	 	$	300,000	 	 	$	900,000	 
	Third
Tenant fiscal
year ending
during the Term
for which the Net
Income Test
is
met
	 	$	300,000	 	 	$	600,000	 
	Fourth
Tenant fiscal
year ending
during the Term
for which the Net
Income Test
is
met
	 	$	600,000	 	 	 	0	 





If the initial amount of the Security Deposit has been increased, the above schedule shall
be modified such that (a) twenty percent (20%) of the increased Security Deposit amount shall
become the “Permitted Security Deposit Reduction” amount on each of the first three Security
Deposit Reduction Dates described above, and (b) forty percent (40%) of the increased Security
Deposit amount shall become the “Permitted Security Deposit Reduction” amount on the final
Security Deposit Reduction Date described above. Notwithstanding any of the foregoing, the first
Security Deposit Reduction Date shall not occur prior to the beginning of the second (2nd) Lease
Year and subsequent Security Deposit Reduction Dates shall not occur prior to the beginning of
the third (3rd), fourth (4th) and fifth (5th) Lease Years, respectively. All references in this
paragraph to fiscal years shall mean fiscal years of at least twelve (12) months each; any fiscal
years of less than twelve (12) months shall be deemed, for purposes of this paragraph, to be part
of the next succeeding fiscal year of at least twelve (12) months. Financial statements delivered
pursuant to this paragraph shall be prepared in accordance with generally accepted accounting
principles in effect at the time and otherwise on a basis consistent with the financial
statements of Tenant delivered to Landlord prior to the execution of this lease (collectively as
used herein, “GAAP”), be in a form reasonably satisfactory to Landlord, and be certified by
nationally


48









 






recognized independent certified public accountants or by other accountants
reasonably satisfactory to Landlord. If Tenant is not entitled to a reduction in any Letter of
Credit pursuant to this paragraph solely because Tenant is in default under this lease, Tenant may
take the benefit of such reduction when such default and any other subsequent defaults are cured.




     If all or substantially all of the assets of Tenant are transferred to a third parry
transferee and assignee of this lease (“Transferee”) with Landlord’s consent pursuant to Article 15
hereof or in a transaction for which such consent is not required, and if said Transferee’s net
income for its most recent three (3) fiscal years prior to the effective date of the assignment is
equal to or greater than $25,000,000 per annum (as evidenced by audited financial statements
prepared in accordance with GAAP in form reasonably satisfactory to Landlord) and Tenant is not in
default under this lease, then Landlord shall return any cash Security Deposit which Landlord is
then holding and any outstanding Letter of Credit to Tenant or, at Landlord’s option, to said
Transferee within thirty (30) days after the effective date of such assignment and said Transferee,
as successor tenant, shall have no further requirement for delivery of any security deposit
hereunder. If Tenant and the transferee are not entitled to the return of any cash Security Deposit
and Letter of Credit pursuant to this paragraph solely because Tenant is in default under this
lease, the same shall be returned when such default and any other subsequent defaults are cured.



30. INTENTIONALLY OMITTED.




     31. LANDLORD. The term “Landlord” as used in this lease means only the owner of
Landlord’s interest in the Premises from time to time. In the event of any assignment, conveyance
or sale, once or successively, of Landlord’s interest in the Premises or any assignment of this
lease by Landlord, said Landlord making such assignment, conveyance or sale shall be and hereby is
entirely freed and relieved of all covenants and obligations of Landlord hereunder accruing after
such assignment, conveyance or sale, and Tenant agrees to look solely to such assignee, grantee or
purchaser with respect thereto, who shall be deemed to have assumed the same for the period of its
ownership. The holder of a Mortgage (or assignment in connection with a Mortgage) shall not be
deemed such an assignee, grantee or purchaser under this Section 31 unless and until the
foreclosure of the Mortgage or the conveyance or transfer of Landlord’s interest under this lease
in lieu of foreclosure, and then subject to the provisions of Section 20. This lease shall not be
affected by any such assignment, conveyance or sale, and Tenant agrees to attorn to the assignee,
grantee or purchaser.



     32. TITLE AND COVENANT AGAINST LIENS. Nothing in this lease contained shall empower
Tenant to do any act which can, shall or may encumber the title of Landlord. Tenant has no
authority or power to cause or permit any lien or encumbrance of any kind whatsoever, whether
created by act of Tenant, operation of law or otherwise, to attach to or be placed upon Landlord’s
title or interest hi the Premises or any part of the Project, and any and all liens and
encumbrances created by Tenant shall attach to Tenant’s interest only.



49









 





     33. COVENANT OF QUIET ENJOYMENT. Landlord agrees that provided no Default
by Tenant shall then exist, Tenant shall, during the Term, peaceably and quietly have, hold and
enjoy the Premises, subject to the terms, covenants, conditions, provisions and agreements of this
lease, free from hindrance by Landlord or any person claiming by, through or under Landlord.



     34. INITIAL GROWTH SPACE. (a) Following the date hereof and not later than the date
which is thirty (30) days following Landlord’s approval of final plans and specifications for the
Tenant’s Work pursuant to the Workletter, Tenant shall designate a portion of the Premises
consisting of not more than 10,000 square feet of Rentable Area (the exact area (subject to the
foregoing 10,000 square foot limitation), configuration and location of which shall be determined
by Tenant) as the “Initial Growth Space” under this lease by giving written notice of such
designation to Landlord. The Base Rent and Tenant’s Proportionate Share set forth in Section 1 of
this lease for the first Lease Year have been calculated on the basis of 50,494 square feet of
Rentable Area, which is the Rentable Area of the initial Premises set forth in Section 1(k) above
of 60,494 square feet, less 10,000 square feet of Rentable Area as the estimated Initial Growth
Space. If the Initial Growth Space is less than 10,000 square feet of Rentable Area, then Base Rent
and Tenant’s Proportionate Share for the first Lease Year shall be adjusted to reflect the actual
Rentable Area of the Initial Growth Space, and shall be subject to further adjustment pursuant to
the remaining provisions of this Section.



     (b) Landlord shall deliver possession of the Initial Growth Space to Tenant concurrently with
delivery of possession of the remainder of the Premises (i.e., shall deliver possession of the
entire Premises to Tenant notwithstanding that a portion thereof may have been or shall later be
designated the Initial Growth Space), Tenant shall construct Tenant’s Work in the Initial Growth
Space concurrently with the construction of Tenant’s Work in the remainder of the Premises, and the
Initial Growth Space shall otherwise be included in the Premises from and after the date hereof for
all purposes of this lease (i) except as expressly provided to the contrary elsewhere in this lease
and (ii) except that Tenant shall not occupy any portion of the Initial Growth Space prior to the
first day of the second Lease Year for any purpose other than for the construction of Tenant’s Work
therein without first complying with this Section.



     (c) If Tenant desires to occupy all or a portion of the Initial Growth Space during the first
Lease Year for any purpose other than for the construction of Tenant’s Work therein, Tenant shall
give not less than five (5) days’ written notice to Landlord to that effect (a “Phase-In Notice”),
designating in the Phase-In Notice the portion (if less than all) of the Initial Growth Space which
Tenant desires to so occupy (“Phase-In Space”) and the intended date of such occupancy (a “Phase-In
Date”). Tenant may not give more than three (3) Phase-In Notices, and no Phase-In Notice shall
designate less than 3,000 square feet of Rentable Area of Initial Growth Space as Phase-In Space.
Effective as of each Phase-In Date (or any earlier date on which Tenant first begins to conduct any
business operations in the related Phase-In Space):



50









 






	 	(i)	 	annual Base Rent shall be
increased by the product of $15.00 times the Rentable Area of
such Phase-In Space, and Monthly Base Rent shall be adjusted
accordingly; and
	 
	 	(ii)	 	Tenant’s Proportionate Share shall be
recalculated to reflect the Rentable Area of such Phase-In
Space.





     35. RIGHT OF FIRST OFFER. Subject to the provisions hereinafter set forth, Landlord
hereby grants to Tenant the right to lease, on the terms and conditions hereinafter set forth,
each portion of the space on the 21st and 25th floors of the Building (the “First Offer Space”)
which Landlord proposes to lease for any term commencing during the First Offer Period (as
hereinafter defined).




     (a) If Landlord is in serious discussions with a party other than Tenant concerning a
lease of any portion of the First Offer Space for a term commencing during the First Offer
Period (which shall include, in order to constitute serious discussions, delivery by
Landlord to such party of an initial proposal for the leasing of such portion of the First
Offer Space and at least one revised proposal), and in any event prior to leasing any
portion of the First Offer Space for a term commencing during the First Offer Period,
Landlord shall give Tenant written notice of the location and Rentable Area of such portion
of the First Offer Space, the date of commencement of the term of the demise, as determined
by Landlord, with respect to such portion of the First Offer Space (the “First Offer Space
Commencement Date”) and the rental rate for such portion of the First Offer Space
(determined as hereinafter provided). The First Offer Space Commencement Date shall not be
less than thirty (30) days after the date such notice is given by Landlord unless such
portion of the First Offer Space has or will become available for leasing by reason of early
termination of a lease, in which case the First Offer Space Commencement Date shall not be
less than ten (10) days after the date such notice is given by Landlord.




     (b) Tenant’s right to lease the First Offer Space described in such a notice from
Landlord shall be exercisable by written notice from Tenant to Landlord of Tenant’s election
to exercise said right (a “First Offer Exercise Notice”) given not later than seven (7)
business days after Landlord’s notice is given, time being of the essence. If such right is
not so exercised, Tenant’s right of first offer shall thereupon terminate as to such portion
of the First Offer Space, and Landlord may thereafter lease and re-lease such portion of the
First Offer Space without notice to Tenant and free of any right in Tenant. Notwithstanding
the foregoing, Landlord shall not enter into a lease of any such portion of the First Offer
Space without again giving the notice referred to above if the net present value as of the
proposed commencement date of such lease expressed as a single dollar figure, discounted
using a rate of ten percent (10%) per annum, of all rent (other than such Tenant’s
Additional Rent) of whatever nature or however denominated for the term of such lease, less
the net present value of any rent concessions, construction allowances, tenant




51










 








improvement work and other relevant economic concessions, discounted at the same rate, is less
than eighty-five percent (85%) of the comparable amount determined by using the economic terms set
forth in Landlord’s notice to Tenant regarding such First Offer
Space (as adjusted on a
proportional basis to reflect any differences in the size of space or length of the term). In
addition, if Landlord shall not have leased such First Offer Space within the period ending six (6)
months following the date of Landlord’s notice to Tenant regarding such First Offer Space plus, if
Landlord is negotiating with a particular potential, tenant at the time such period expires, such
additional period during which Landlord continues to negotiate with such potential tenant,
Landlord shall not enter into a lease of any such portion of the First Offer Space without again
giving the notice referred to above. Tenant may not elect to lease less than the entire area of the
First Offer Space described in a Landlord’s notice, and if a third-party lease would include all or
a portion of the First Offer Space together with other space in the Building which is not First
Offer Space, Tenant must exercise its right for such First Offer
Space and such other space.




     (c) Tenant may only exercise its right to lease a portion of the First Offer Space,
and an exercise thereof shall only be effective, if at the time of Tenant’s exercise of
said right and on the pertinent First Offer Space Commencement Date this lease is in
full force and effect and Tenant is not in Default under this lease, and (inasmuch as
this right of first offer is intended only for the benefit of the original Tenant named
in this lease and any Tenant Successors and Tenant Affiliates) at least 45,000 square
feet of Rentable Area of the Premises is occupied by the original Tenant named herein or
a Tenant Successor or Tenant Affiliate, this lease has not been assigned other than to
a Tenant Successor or Tenant Affiliate, not more than 15,000 square feet of Rentable
Area of the Premises is subject to subleases other than subleases to Tenant Successors or
Tenant Affiliates, and Landlord has not terminated this lease as to any part of the
Premises pursuant to Section 15 above. Without limitation of the foregoing, no sublessee, and no
assignee other than a Tenant Successor or Tenant Affiliate, shall be entitled to exercise any
right hereunder, and no exercise of any right hereunder by the original Tenant named herein or a
Tenant Successor or Tenant Affiliate shall be effective in the event said Tenant or Tenant
Successor or Tenant Affiliate assigns this lease prior to the pertinent First Offer Space
Commencement Date other than to a Tenant Successor or Tenant Affiliate or more than 15,000 square
feet of Rentable Area of the Premises is subject to subleases as of the pertinent First Offer Space
Commencement Date other than subleases to Tenant Successors or Tenant Affiliates or Landlord
terminates this lease as to any part of the Premises pursuant to Section 15 above prior to the
pertinent First Offer Space Commencement Date.




     (d) If Tenant has validly exercised its right to lease a portion of the First Offer
Space, then effective as of the First Offer Space Commencement Date such portion of the
First Offer Space shall be included in the Premises, subject to all of the terms,
conditions and provisions of this lease, except that:



52









 






	 	(i)	 	except as hereinafter provided, Base Rent per square foot of Rentable Area for such
portion of the First Offer Space shall be equal to the Market Rental Rate (as hereinafter
defined) for such First Offer Space;
	 
	 	(ii)	 	the Rentable Area of the Premises shall be increased by the Rentable Area of such
portion of the First Offer Space;
	 
	 	(iii)	 	the term of the demise covering such portion of the First Offer Space shall commence on
the First Offer Space Commencement Date and shall expire simultaneously with the expiration of the Term of this lease, including any extension or
renewal thereof; and
	 
	 	(iv)	 	except as hereinafter provided, the First Offer Space shall be rented in its “as is”
condition as of the First Offer Space Commencement Date (inasmuch as tenant improvement
work, allowances, and time for construction of tenant improvements, if any, will be
reflected in the Market Rental Rate pursuant to Section 38 below).






Notwithstanding clauses (i) and (iv) above, with respect to any portion of the First Offer Space on
the 25th floor of the Building as to which Tenant is entitled to, and does, give a First Offer
Exercise Notice prior to the end of the second Lease Year:




	 	(A)	 	Base Rent per square foot of Rentable Area for such portion of the
First Offer Space for the Lease Year in which the related First Offer Space
Commencement Date occurs and for subsequent Lease Years shall be at the same
respective rates as Base Rent for the initial Premises as determined pursuant to
Section l(b) above; and
	 
	 	(B)	 	Tenant shall be entitled to allowances for such portion of the First
Offer Space in the same amounts per square foot of Rentable Area as provided for in
the Workletter for the initial Premises, prorated by multiplying such amounts by the ratio which the number of full calendar months in the Initial Term of this
lease from and after the pertinent First Offer Space Commencement Date bears to 120
months If any additional Allowance is paid for such First Offer Space, Base Rent
for such portion of the First Offer Space shall be increased pursuant to
Section l(b) above on account




53









 












	 	 	 	thereof in the same manner as Base Rent for
the initial Premises, except that the increase in Base Rent shall be effective
as of the pertinent First Offer Space Commencement Date and the amortization shall
be based on the remaining number of months of the Initial Term thereafter.






     (e) If Tenant has validly exercised its right to lease a portion of the First Offer Space,
within thirty (30) days after request by either party hereto
Landlord and Tenant shall enter into
a written amendment to this lease confirming the terms, conditions and provisions applicable to
such portion of the First Offer Space as determined in accordance herewith.




     (f)
If Tenant has validly exercised its right to lease a portion of the First Offer Space,
Landlord shall use reasonable efforts to deliver possession of such First Offer Space to Tenant on
the pertinent First Offer Space Commencement Date, but in the event Landlord should be unable for
any reason to do so, Landlord shall not be subject to any liability for failure to deliver
possession, Such failure to deliver possession shall not affect either the validity of this lease
or the obligations of either Landlord or Tenant hereunder or be construed to extend the expiration
of the Term of this lease either as to such portion of the First Offer Space or the balance of the
Premises provided, however, that under such circumstances, rent shall not commence as to such
portion of the First Offer Space until Landlord is able to deliver possession, and if Base Rent for such portion of
the First Offer Space will be the Market Rental Rate, such Base Rent shall be adjusted to reflect
the reduction in the length of the term of the lease of such portion of the First Offer Space to
the extent that the length of such term had an effect on the computation of the Market Rental
Rate.




     (g) In the event any portion of the First Offer Space is leased to Tenant other than pursuant
to the right of first offer described herein, such portion of the First Offer Space shall thereupon
be deleted from the First Offer Space.




     (h) Tenant’s rights to lease the portion of the First Offer Space on the 21st floor of the
Building are subject to the rights of KPMG Peat Marwick;existing on the date hereof to lease such
portion of the First Offer Space (or portions thereof). Tenant’s rights to lease the First Offer
Space are also subject to any rights to lease the First Offer Space or portions thereof granted in
any lease of First Offer Space entered into by Landlord and a third party following notice to
Tenant in accordance with this Section and Tenant’s failure to lease such space pursuant to this
Section, to the extent that Landlord’s notice identified such rights; and to Landlord’s right to
extend or renew the lease of any tenant occupying any portion of the First Offer Space even if not
pursuant to an option contained in its lease.



54









 






     (i)
As used herein, the term “First Offer Period” shall mean the Term of this lease
and all extensions and renewals thereof, provided, however, that the
First Offer
Period shall not include the last two (2) years of the initial or any extension or
renewal : term unless, as to the Initial Term, Tenant has exercised the option
granted to Tenant in this lease to extend the Term hereof or renew this lease for the
additional period following such Initial Term or Landlord and Tenant have entered
into an amendment to this lease extending the Term for an additional period or a new
lease for the Premises.



     36. EXPANSION
OPTION. Subject to the provisions hereinafter set forth,Landlord hereby grants to
Tenant the option to lease, on the terms and conditions hereinafter set forth, space (the
“Expansion Space”) within the area on the 25th floor of the Building shown on Exhibit I to this
Lease (the “Total Expansion Space”), the exact area, configuration and location of the Expansion
Space and the date of commencement of the term of the demise with respect to the Expansion Space
(the “Expansion Space Commencement Date”) to be designated by Landlord within the parameters set
forth below.




     (a) Landlord shall determine the portion of the Total Expansion
Space to be made available for lease by Tenant as the Expansion Space
(without regard to whether other portions of the Total Expansion Space may
also be available for leasing) and the Expansion Space Commencement Date,
subject to the following conditions:




	 	(i)	 	the area of the Expansion Space shall be 10,000 square feet of Rentable Area, plus or
minus 20%;
	 
	 	(ii)	 	the Expansion Space shall include the portion of the 25th floor of the Building
where an existing staircase connects . the 24th and 25th floors, unless such portion of the
25th floor has been leased by Tenant pursuant to its right to lease First Offer Space or
otherwise leased by Tenant; and
	 
	 	(iii)	 	the Expansion Space Commencement Date shall fall within the
period commencing on the first
day of the sixth Lease Year and ending on the last day of the sixth
month of the seventh
Lease Year.






     (b) Tenant’s option to lease the Expansion Space shall be exercisable by written
notice from Tenant to Landlord of Tenant’s election to exercise said option given not
earlier than the first day of the fifth Lease Year and not later than the last day of the
sixth month of the fifth Lease Year, time being of the essence. If Tenant’s option is not
so exercised, said option shall thereupon terminate and Tenant shall not thereafter have
any right to lease any portion of the Total Expansion Space pursuant to this expansion
option.



55









 






     Tenant may not elect to lease less than the entire area of the. Expansion Space designated
by Landlord!




     (c) Landlord shall give Tenant written notice of the location and Rentable Area of the
Expansion Space, the Expansion Space Commencement Date, and the Market Rental Rate for the
Expansion Space within sixty (60) days after Tenant’s exercise of its option to lease the
Expansion Space.




     (d) Tenant may only exercise said option, and an exercise thereof shall only be effective, if
at the time of Tenant’s exercise of said option and on the Expansion Space.Commencement Date this
lease is in full force and effect and tenant is not in Default under this lease, and (inasmuch as
said option is intended only for the benefit of the original Tenant named in this lease and any
Tenant Successors and Tenant Affiliates) at least 45,000 square feet of Rentable Area of the
Premises is occupied by the original Tenant named herein or a tenant Successor or Tenant Affiliate,
this lease has not been assigned other.’than to a Tenant Successor or Tenant Affiliate, not more
than 15,000 square . feet of Rentable Area of the Premises is subject to subleases other than
subleases to Tenant Successors or Tenant Affiliates, and Landlord has not terminated this lease as
to any part ... , of the Premises pursuant to Section 15 above. Without limitation of the.
foregoing, no sublessee, and no assignee other man a tenant Successor or tenant Affiliate, shall be
entitled to exercise said; option, and no exercise of said option by the original tenant • named
herein or a Tenant Successor or Tenant Affiliate shall be effective in the event said . Tenant or
Tenant Successor or tenant Affiliate assigns this lease prior to the Expansion Space Commencement
Date other than to a Tenant Successor or Tenant Affiliate or more than 15,000 square feet of
Rentable Area of the Premises is subject to subleases other than subleases to Tenant Successors or
Tenant Affiliates as of the Expansion Space Commence-ment Date or Landlord terminates this lease as
to any part of the Premises pursuant to Section 15 above prior to, the Expansion Space Commencement
Date. .




     (e) If Tenant has validly exercised its option to lease the Expansion Space, then
effective as of the Expansion Space Commencement Date the Expansion Space shall be included in the
Premises, subject to all of the terms, conditions and provisions of this lease, except that:




	 	(i)	 	Base Rent per square foot of Rentable Area for the Expansion Space shall be equal to the Market
Rental Rate for the Expansion Space;
	 
	 	(ii)	 	the Rentable Area of the Premises shall be increased by the Rentable Area of the Expansion
Space;




56









 






	 	(iii)	 	the term of the demise covering the Expansion Space shall commence on the Expansion Space
Commencement Date and shall expire simultaneously with the expiration or earlier termination of me
Term of this tease, including any extension or renewal thereof; and
	 
	 
	 	(iv)	 	the Expansion Space shall be rented in its “as is” condition as of the Expansion Space
Commencement Date (inasmuch as tenant improvement work, allowances, and time for

construction of tenant improvements, if any, will be reflected in the Market Rental Rate pursuant
to Section 38 below).






     (f) If Tenant has validly exercised its option to lease the. Expansion Space, within thirty
(30) days after request by other party hereto landlord and Tenant shall enter into a written
amendment to this lease confirming the terms, conditions and. provisions applicable to the
Expansion Space as determined in accordance herewith. •




     (g) If Tenant has validly exercised its option to lease the Expansion Space, Landlord shall
use reasonable efforts to deliver possession of the Expansion Space on the Expansion Space
Commencement Date, but, notwithstanding the provisions of Section 36(a)(iii) above, in the event Landlord should be unable for any reason to deliver
possession of the Expansion Space on the Expansion Space Commencement Date, Landlord shall not
be subject to any liability for failure to deliver possession. Such failure to deliver
possession.shall not affect either the validity of this lease:or the obligations of either Landlord
or Tenant hereunder or be construed to extend the expiration of the Term of this lease either as to
the Expansion Space or the balance of the Premises; provided,
however, that under such circumstances, rent shall not commence as to the Expansion Space until
Landlord is able to deliver possession, and Base Rent for the Expansion Space shall be adjusted to
reflect the reduction in the length of the term of the. lease of the Expansion Space to the extent
that the length of such term had an effect on the computation of the Market Rental Rate for the
Expansion Space.




     (h) : In the event the portion of the Total Expansion Space which includes an existing
staircase connecting the 24th and 25th floors of the Building is leased to Tenant other than
pursuant to the expansion option described herein; such portion of the total Expansion Space shall
thereupon be deleted from the Total Expansion Space and the minimum area which Landlord may
designate as the Expansion Space pursuant to Section 36(a)(i) above shall be reduced by the
Rentable Area of such portion of the Total Expansion Space.



57









 





     37. RENEWAL OPTION. Subject to the provisions hereinafter set forth, landlord hereby
grants to Tenant an option to extend the Term of this lease on the same terms, conditions . and
provisions as contained in this lease, except as otherwise provided herein, for one period of: five
(5) years (the “Renewal Period”) after the expiration of the Term, which Renewal Period shall
commence on the first day of the eleventh Lease Year (the “Renewal Period Commencement Date”) and
end on the last day of the fifteenth Lease Year.




     (a) Said option shall be exercisable by written notice from Tenant to Landlord of
Tenant’s election to exercise said option given not later than the date which is twelve
(12) months prior to the Renewal Period Commencement Date, time being of the essence.
If Tenant’s option is not so exercised, said option shall thereupon expire.




     (b) Tenant may only exercise said option, and an exercise thereof shall only be
effective, if at the tune of Tenant’s exercise of said option and on the Renewal Period
Commencement Date this lease is in full force and effect and Tenant is not in default tinder
this lease, and (inasmuch as said option is intended only for the benefit of the original
Tenant named in this lease and any Tenant Successors and Tenant Affiliates) at least
45,000 square feet of Rentable Area of the Premises is: occupied, by the original Tenant
herein or a Tenant Successor or Tenant Affiliate, this lease has not been assigned
other than to a Tenant Successor or Tenant. Affiliate, not more than 15,000 square feet of
Rentable Area of the Premises is subject to subleases other than subleases to Tenant
Successors or Tenant Affiliates, and Landlord has not terminated this lease as to arjy part
of the Premises pursuant to Section 15 above. Without limitation of the foregoing, no
sublessee, and no. assignee other than a Tenant Successor or Tenant Affiliate, shall be
entitled to exercise said option, and no exercise of said option by the original Tenant
named herein or a Tenant Successor or Tenant Affiliate shall be effective in the event said
Tenant or Tenant Successor or Tenant Affiliate assigns this lease prior to the Renewal
Period Commencement Date other than to a Tenant Successor or Tenant Affiliate or more
than 15,000 square feet of Rentable Area of the Premises is subject to subleases other than
subleases to Tenant Successors or Tenant Affiliates as of the Renewal Period Commence-
ment Date or Landlord terminates this lease as to any part of the Premises pursuant to
Section 15 above prior to the Renewal Period Commencement Date.




     (c) Rent per square foot of Rentable Area of the Premises payable during the Renewal Period
with respect to all space included in the Premises as of the Renewal Period Commencement Date shall
be equal to the Market Rental Rate for the Premises. Landlord shall give Tenant written notice of
the Market Rental Rate within thirty (30) days following written request by Tenant made not earlier
than forty-five (45) days prior to the . Renewal Period Commencement Date.




     (d) If Tenant has validly exercised said option, within thirty (30) days after
request by either party hereto Landlord and Tenant shall enter into a written amendment



58









 






to this lease confirming the terms, conditions and provisions applicable to the Renewal
Period as determined in accordance herewith, with such revisions to the rental provisions of this
lease as may be necessary to conform such provisions to the Market Rental Rate. .




     (e) Tenant shall not have any option to extend the Term of this lease beyond the expiration of the
Renewal Period.




     38. MARKET
RENTAL RATE.  As used herein, the term “Market Rental
Rate”
per square foot of Rentable Area shall mean (i) the annual rate of net rent reasonably
determined by Landlord to be the prevailing market net rental rate for comparable tenants for
leases of comparable office space at the Building which has been built out for occupancy (taking
into consideration the duration of the terms for which such space is being leased, location and/or
floor level within the Building, when the applicable rate first becomes effective and other
comparable • factors; reflecting (i.e., reduced to reflect that prevailing concessions will not be
provided to Tenant in kind)) prevailing concessions, such as, but not limited to, rental
concessions, tenant improvement work, design, construction and moving allowances, and time for
construction of tenant improvements; and assuming that leasing commissions will be paid) for terms
commencing on or about the First Offer .Space Commencement Date, Expansion Space Commencement Date
or Renewal Period Commencement Date (as the case may be), or, if there is no comparable space or
recent comparable transactions in the Building, then in comparable buildings in the area of
downtown Chicago, Illinois in which the Building is located, plus (ii) additional components of the
Market Rental Rate, which may include, among the other then prevailing components of rent, periodic
adjustments or additions to. a fixed rent based on a share of real estate taxes and other expenses
(such as Additional Rent) and increases to adjust for inflation. Bona fide written offers to lease
comparable space at the Building received by Landlord from third parties (at arm’s length) . or
given by Landlord to third parties (at arm’s length) may be used by Landlord as an indication of
the Market Rental Rate. .



     39. BUILDING DIRECTORY; LOBBY SIGNAGE. (a) A Building directory in the lobby will be included
in the Landlord’s Work under the Workletter. Tenant shall be provided with space on the directory,
when installed, for entries for the name of Tenant and a reasonable number of Tenant’s designated
personnel (but with total entries not exceeding Tenant’s Proportionate Share of directory entries
unless Landlord otherwise agrees in its sole discretion). Tenant shall pay Landlord for the cost of
any substitution in name entries following the initial . installation of Tenant’s directory
entries.



     (b) Within nine (9) months following the Commencement Date, Landlord shall provide and install
lobby identification for Tenant at a location and of a size, design and materials determined by
Landlord in its sole and absolute discretion. Tenant’s rights, to lobby identification are
non-exclusive. The rights under this Section shall be available only to the original Tenant named
in this lease and any Tenant Successor and their respective Tenant Affiliates, and only so long as
such are leasing and occupying at least 50,000 square feet of Rentable Area in the



59









 




Building. Tenant shall pay Landlord for the cost of any change in the name to be displayed in
the lobby, following the initial installation of the lobby identification provided for in
this Section.




     40. SATELLITE DISH. Subject to the terms and conditions hereinafter set forth, Landlord
grants to Tenant, during the Term, the right to install, maintain, repair and replace a satellite
or microwave dish relating to Tenant’s business in the Premises on the roof of the Building where
designated by Landlord, for receiving signals relayed by satellite and, except as otherwise
provided, to connect such equipment through existing mechanical shafts to the Premises.




     (a) .If Tenant desires to exercise such right, Tenant shall give a written notice
to that effect to Landlord (a “Satellite Notice”). The Satellite Notice shall specify in detail
the requirements of such installation, all of which shall be subject to the approval of
Landlord. Landlord shall not unreasonably withhold its approval provided that the use of
the roof for such purposes shall (i) be compatible with Landlord’s use of the roof, (ii) be
subject to Landlord’s supervision, (iii) not adversely affect the structural safety or integrity
of the Building, (iv) meet reasonable aesthetic and other standards of Landlord and
Landlord’s architect and:(v) satisfy other conditions hereinafter set forth. If Landlord
approves Tenant’s use of the roof for such purposes. Landlord shall designate by written
notice to Tenant an appropriate area for such installation (“Installation Area”). Landlord
shall use good faith efforts to select an Installation Area which will be consistent with
adequate reception. The right granted to Tenant under this Section shall be subject to the
following conditions precedent:(l) there must be available space on the roof and existing
mechanical shafts from the roof to the Premises for Tenant’s, proposed installation;
(2) Landlord’s architect shall approve of the location of the Installation Area (acting
reasonably) and the appearance of those portions of the equipment to be visible to the
public; (3) Landlord’s structural engineer shall approve of the location of the Installation
Area (acting reasonably), the design and specifications of the equipment, the load caused
on roof of the Building by such equipment, and other structural requirements of the
installation; (4) The installation must comply with the applicable requirements of any
covenant, condition or restriction of record and any municipal, county, state, federal or
other governmental ordinance, law, rule or regulation including, but not limited to zoning .
ordinances; and (5) the installation and operation of such equipment shall not interfere with
the safety or operations of the Building or reduce or affect its structural integrity, and shall
comply with me terms of this lease.




     (b)
Tenant shall pay all costs and expenses of any kind related to the
installation, operation, maintenance or removal of its communication equipment, including
any reasonable architect’s or engineering fees incurred in connection with required
approvals, but Tenant shall not be obligated to pay any fee for the roof or access thereto.
Tenant shall maintain all such equipment in good repair. Tenant shall be responsible for
any damage, loss or injury to the Building or other property and for any injury to persons
caused by installation; operation, maintenance or removal of such equipment. Upon the



60









 






expiration or earlier termination of this lease, Tenant shall, at its sole cost and expense,
(i) remove the commmunication equipment and restore that portion of the roof of the Building
where the communications equipment was located to its condition existing prior  to the
installation thereof, ordinary wear and tear excepted, and (ii) repair any damage or destruction
caused by such removal. Restoration and repair herein required to be performed by Tenant shall be
completed under the supervision of Landlord or Landlord’s
representative. Notwithstanding the foregoing, Tenant shall not remove, and shall not be
reimbursed for the cost thereof, any portion of the communication equipment which is embedded or
permanently attached in or to the Building including, but not limited to, cables and other wiring,
unless Landlord so directs otherwise. To the extent not expressly prohibited by law, Tenant agrees
to hold Landlord and its beneficiaries, and their agents, servants and employees, harmless and to
indemnify each of them against claims and liabilities, including reasonable attorney’s fees, for
injuries to persons and damage to or theft, misappropriation or loss, of property occurring in or
about the Building and arising out of the installation, maintenance, operation, removal or other
use of the communications equipment installed hereunder.



     41. PARKING.
During the Term, Tenant shall be entitled to have up to fifteen (15) cars parked
in the garage below the concourse level of the Building, so long as Tenant
pays the parking charges in effect from time to time (at monthly rates, if monthly rates are
then being charged), subject to the terms and conditions, including parking rules and regulations,
applicable from time to time to parking in the garage. In that connection, Tenant may be required
to periodically execute standard parking agreements. Tenant shall pay parking charges for all
parking provided for hereunder, whether or not Tenant does, in fact, utilize such parking. If
Tenant, at any time, fails to contract for, or otherwise pay the parking charges relating to, any
one or more of the parking spaces being made available to Tenant under this Section (each such
parking space being referred to as a “Waived Space”), then Tenant shall forfeit its rights relative
to each such Waived Space, and Landlord shall have no further obligation to offer such Waived
Space to Tenant during the balance of the Term hereof. Landlord shall not be liable to Tenant in
damages or otherwise under any circumstances for failure to provide parking if at any time Landlord
or the garage operator is legally restricted from operating a parking garage or providing parking
below the concourse level of the Building or otherwise unable to do so for reasons beyond its
reasonable control, and in no event shall Tenant have any right to terminate this lease due to
Landlord’s failure to make parking available as required under this Section. Spaces will not be
reserved for Tenant, except that if Landlord converts parking spaces in the garage to reserved
spaces, Tenant will be entitled to convert a pro rata share (if at least one full space) of the
parking spaces then available to Tenant under this Section to reserved parking. Access to and from
the parking garage will be available 24 hours per day, seven days per week, subject to reasons
beyond Landlord’s reasonable control, including, but not limited to, default by the garage
operator.



     42. BUILDING MANAGEMENT. Landlord shall manage the Building in a manner consistent with other
first-class office buildings in downtown Chicago.



61









 





     43. EXCULPATORY
PROVISIONS. The liability of any Landlord under this lease or any amendment to
this lease, or any instrument or document executed in connection with this lease, shall be
limited to and enforceable solely against the assets of such Landlord constituting an interest in
the Project and not other assets of such Landlord. Assets of a Landlord which is a partnership or
limited liability company do not include the assets of the partners or members of such landlord,
and any negative capital account of a partner or member in a partnership or limited liability
company which is a Landlord, and any obligation of a partner or member to contribute capital to the
partnership or limited liability company which is Landlord, shall not be deemed to be assets of the
partnership or limited liability company which is the Landlord. No directors, officers, employees,
managers, members, or shareholders of any corporation or limited liability company which is
Landlord shall have any personal liability arising from or in connection with this lease. At any
time during which Landlord is trustee of a land trust, all of the representations, warranties,
covenants and conditions to be performed by it under this lease or any documents or instruments
executed in connection with this lease are undertaken solely as trustee, as aforesaid, and not
individually, and no personal liability shall be asserted or be enforceable against it or any of
the beneficiaries under said trust agreement by reason of any of the representations, warranties,
covenants or conditions contained in this lease or any documents or instruments executed in
connection with this lease.



62









 





     IN WITNESS WHEREOF, the parties have caused this lease to be executed as of the date first
written above



	 	 	 
	LANDLORD:

	 	TENANT:
	 
	 	 
	303 WACKER REALTY L.L.C.,

	 	PROMOTIONAL MARKETING,
	a Delaware limited liability

	 	L.L.C., an Illinois limited liability
	company

	 	company d/b/a UPSHOT






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	Hines Three Illinois Center Associates

Limited Partnership, its managing member	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	By:	 	[ILLEGIBLE]
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Bines Three Illinois Center L.L.C.,
a general partner	 	 	 	Its	 	CEO
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Hines Interests Limited
Partnership, a member.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Hines Holding, Inc., its
general partner	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By :  	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	Name: 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	Title: 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 





63









 





AMENDMENT
TO LEASE




          This Amendment to Lease is made and entered into this 27th day of August 1998, by and
between 303 Wacker Realty L.L.C. (“Landlord”) and Promotional Marketing, L.L.C. d/b/a Upshot
(“Tenant”).




          A,
Landlord and Tenant entered into an Office Lease dated June 30, 1998 (the
“Lease”), pursuant to which Landlord leased to Tenant and Tenant accepted from Landlord
approximately 60,494 square feet of Rentable Area, being the entire 23rd and 24th floors
of the building commonly known as 303 East Wacker Drive, Chicago, Illinois.




          B. The parties desire to amend the Lease as hereinafter set forth, but not
otherwise.




          In consideration of the premises and the mutual covenants hereinafter contained, and
in consideration of the execution and delivery by HA-LO Industries, Inc. of a Guaranty in
the form attached hereto, as Exhibit A, it is hereby agreed as follows:




          1. Section l(m) is hereby amended to read in its entirety as follows: “(m) “Security
Deposit”: None.”




          2. Section 29 of the Lease is hereby deleted in its entirety.




          3. Section 27 of the Lease is hereby amended to add, as an additional addressee of
any notice to Tenant, the following:



HA-LO Industries, Inc.

5980 West Touhy Avenue

Niles, Illinois

Attention: Barry Margolin



With a copy to:



Stone, Pogrund & Korey

221 N. LaSalle

32nd Floor

Chicago, Illinois 60601

Attention: David Pogrund




          4. Exhibit H to the Lease is hereby deleted in its entirety.




          5. The second sentence of Paragraph 9(a) of the Workletter (Exhibit C) is hereby
amended to delete “(i)” and all of clause (ii).




          6. Except as herein specifically amended, the Lease shall continue in full force and
effect.




 









 








          The parties hereto have hereunder set their hands and seals the day and year first above
written




	 	 	 
	LANDLORD:

	 	TENANT:
	 
	 	 
	303 WACKER REALTY L.L.C.,

	 	PROMOTIONAL MARKETING,
	a Delaware limited liability

	 	L.L.C., an Illinois limited liability
	company

	 	company d/b/a UPSHOT






	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:	 	Hines Three Illinois Center Associates

Limited Partnership, its managing member	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	By:	 	[ILLEGIBLE]
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Hines Three Illinois Center L.L.C.,
a general partner	 	 	 	Its	 	CEO
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Hines Interests Limited
Partnership, a member.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Hines Holding, Inc., its
general partner	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By :	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name:
	 	C. Kevin Shannahan	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	Executive Vice

President	 	 	 	 	 	 






 -2-





 










 







GUARANTY




     THIS
GUARANTY (the “Guaranty”) is made and entered into as
of this 26th day of
August, 1998, by the undersigned (the “Guarantor”) who, having received a copy of that certain
Office Lease dated June 30, 1998 and the amendment thereof of even date with this Guaranty (said
Office Lease, as amended by such amendment, being herein referred to as the “lease”) between 303
WACKER REALTY L.L.C., a Delaware limited liability company (“Landlord”), and PROMOTIONAL MARKETING,
L.L.C., an Illinois limited liability company d/b/a UPSHOT (“Tenant”), has examined the Lease and
is familiar with all the terms, covenants and provisions contained therein, and as an inducement to
Landlord to enter into the Lease, does hereby unconditionally guarantee to Landlord: (i) the full
and prompt payment of all Base Rent, Additional Rent and other items of Rent and all other sums and
charges payable by Tenant under the Lease; (ii) the full and timely performance and observance of
all the covenants, terms, conditions, and agreements therein provided to be performed and observed
by Tenant; (iii) the full and prompt payment of all costs, expenses and reasonable attorneys’ fees
incurred by Landlord in enforcing the Lease and/or this Guaranty; and (iv) the full and prompt
payment to Landlord of the amount of any payments made to Landlord which are recovered from
Landlord by a trustee, receiver or creditor of the Guarantor or Tenant pursuant to applicable law;
and the Guarantor hereby covenants and agrees to and with Landlord that if default shall at any
time be made by Tenant in the payment of any Base Rent, Additional Rent, other items of Rent, or
any other sum or charge payable by Tenant under said Lease, or if Tenant should default in the
performance and observance of any of the covenants, terms, conditions, or agreements contained in
said Lease, the Guarantor will forthwith pay such rent and such other sums and charges to Landlord,
and any arrears thereof, and shall forthwith faithfully perform and fulfill all of such terms,
covenants, conditions, and agreements.



     This Guaranty is an absolute and unconditional guaranty of payment and of performance, and not
of collection. It shall be enforceable against the Guarantor without the necessity of any suit or
proceedings on Landlord’s part of any kind or nature whatsoever against Tenant and without the
necessity of any notice of nonpayment, nonperformance or nonobservance or of any notice of
acceptance of this Guaranty or of any other notice or demand to which the Guarantor might otherwise
be entitled, all of which the Guarantor hereby expressly waives; and the Guarantor hereby expressly
agrees that the validity of this Guaranty and the obligations of the Guarantor hereunder shall in
no way be terminated, affected, diminished, or impaired by reason of the assertion or the failure
to assert by Landlord against Tenant, or against Tenant’s successors and assigns, any of the rights
or remedies reserved to Landlord pursuant to the provisions of said Lease or by relief of Tenant
from any of Tenant’s obligations under the Lease or otherwise, including, but not by way of
limitation, the rejection of said Lease in connection with proceedings under the bankruptcy laws
now or hereafter in effect.



     This Guaranty shall be a continuing guaranty and the liability of the Guarantor hereunder
shall in no way be affected, modified or diminished by reason of any assignment, renewal, further
modification, or extension of the Lease or by reason of any modification or waiver of or change in



 









 




any of the terms, covenants, conditions, or provisions of the Lease, or by reason of any extension
of time that may be granted by Landlord to Tenant, or a changed or different use of the Leased
Premises, or by reason of any dealings or transactions or matters or things occurring between
Landlord and Tenant, whether or not notice thereof is given to the Guarantor.




     It is agreed that the failure of Landlord to insist in any one or more instances upon strict
performance or observance of any of the terms, provisions or covenants of the Lease or to exercise
any right therein contained shall not be construed or deemed to be a waiver or relinquishment for
the future of such term, provision, covenant or right, but the same shall continue and remain in
full force and effect.



     No assignment or other transfer of the Lease, or any interest therein, shall operate to
extinguish or diminish the liability of the undersigned hereunder.



     This Guaranty shall continue to be effective, or be reinstated, as the case may be, if at
anytime any whole or partial payment of the rental or other lease obligations guaranteed hereunder
is or is sought to be rescinded or must otherwise be disgorged, restored or returned by Landlord
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Tenant or the
undersigned (or any other guarantor) or upon or as a result of the appointment of a receiver,
intervenor or conservator of, or trustee or similar officer for, Tenant or the undersigned (or any
other guarantor) or of or for any substantial pan of the property owned by Tenant, all as though
such payments or performance, to the extent so rescinded or otherwise disgorged, restored or
returned, had not been made. Without limiting the generality of the foregoing, this Guaranty shall
remain in full force and effect until one (1) full calendar year has elapsed since the full payment
of all rental and other guaranteed lease obligations (or, in the event of a determination by
Landlord that the “reachback” or preference period under the Federal Bankruptcy Code is extended
for a period longer than one (1) year, such applicable longer period as may be required by notice
to the undersigned from Landlord), and, in such case, thereafter if and for so long as there is
pending at the end of such one year (or longer) period against either of Tenant or the undersigned
(or any other guarantor) a proceeding under any federal or state bankruptcy or insolvency laws.



     The Guarantor hereby unconditionally waives (a) presentment, notice of dishonor, protest,
demand for payment, and all notices of any kind, including, without limitation, notice of
acceptance hereof; notice of nonpayment, non-performance, or other default under the Lease; and
notice of any action taken to collect upon or enforce any of the terms and provisions of the Lease;
(b) any subrogation to the rights of Landlord against Tenant until all of the obligations of Tenant
under the Lease have been fully complied with and the Lease has expired or terminated and such
payments made by the Guarantor are not subject to a right of recovery; and (c) any setoffs or
counterclaims against Landlord (except for any setoffs or counterclaims which may be expressly
provided for in the Lease) which would otherwise impair Landlord’s rights against the Guarantor
hereunder.



2









 





     The assignment by Landlord of the Lease and/or the rents, profits, avails, and/or proceeds
thereof made either with or without notice to the Guarantor shall in no manner whatsoever release
the Guarantor from any liability as Guarantor.



     All of Landlord’s rights and remedies under the Lease or under this Guaranty are intended to
be distinct, separate and cumulative and no such right or remedy therein or herein mentioned is
intended to be in exclusion of or a waiver of any of the others.



     Notice of acceptance of this Guaranty and any obligations or liabilities contracted or
incurred by Tenant are all hereby waived by the Guarantor.



     This Guaranty shall be governed by and construed in accordance with the laws of the State of
Illinois.



     All of the provisions of this Guaranty shall inure to the benefit of Landlord and its
grantees, successors and assigns and shall inure to the benefit of any future owner of the fee
title of which the Premises are a part, and all the provisions of this Guaranty shall be binding
upon the Guarantor and its legal representatives, successors, and assigns.



     Initially capitalized terms used but not otherwise defined herein have the same meanings given
them in the Lease.



     IN WITNESS WHEREOF, the undersigned has executed this Guaranty as of the date first written
above.



	 	 	 	 	 
	 	 	HA-LO INDUSTRIES, INC., an Illinois
corporation
	 
	 	 	 	 
	 

	 	By:
	 	/s/ Richard A. Magid
	 

	 	 	 	 
	 	 	Name: RICHARD A. MAGID
	 	 	Title: CHIEF OPERATING OFFICER






3









 






SECOND AMENDMENT TO OFFICE LEASE




     THIS SECOND AMENDMENT TO OFFICE LEASE (“Amendment”) is made and entered into this
31st day of March, 2000, by and between 303 WACKER REALTY L.L.C., a Delaware limited
liability company (hereinafter referred to as “Landlord”), and PROMOTIONAL MARKETING, L.L.C. (d/b/a
UPSHOT), an Illinois limited liability company (hereinafter
referred to as “Tenant”).



RECITALS:




     A. Landlord and Tenant are parties to that certain Office Lease dated June
30, 1998, demising premises (the “Premises”) situated on the 23rd and
24th floors of the Building commonly known as 303 East Wacker Drive, Chicago, Illinois.
Said Office Lease has been amended by a certain Amendment to Lease dated August 27,
1998, and as so amended and as otherwise amended from time to time is hereinafter referred to as
the “Lease”); and



     B. Landlord and Tenant desire to further amend the Lease to among other things, include
additional space on the 25th and 26th floors of the Building as part of the
Premises, upon the terms and conditions hereinafter set forth.



     NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and
other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
Landlord and Tenant hereby amend the Lease in the following respects only:



     1. Defined Terms. As used in this Amendment, the following terms shall have the
respective meanings indicated below:




     (a) “Additional Premises” shall mean, collectively, Area No. 1, Area No. 2, Area No. 3, Area
No. 4 and Area No. 5, as shown on Exhibits A-l and A-2 attached hereto and made a part hereof,
which consist of a total of 55,340 square feet of Rentable Area measured in accordance with the
BOMA method of measurement as more fully described in Exhibit B to the Lease.




     (b) “Area No. 1” shall mean the premises on the 25th floor of the Building, as
shown on Exhibit A-l attached hereto and made a part hereof, which consist of 8,503 square, feet of
Rentable Area measured in accordance with the BOMA method of measurement as more fully described in
Exhibit B to the Lease.




     (c) “Area No. 2” shall mean the premises on the 25th floor of the Building, as
shown on Exhibit A-l attached hereto and made a part hereof, which consist of 7,839 square



 









 






feet of Rentable Area measured in accordance with the BOMA method of measurement as more fully
described in Exhibit B to the Lease.




     (d) “Area No. 3” shall mean the premises on the 25th floor of the Building,
as shown on Exhibit A-1 attached hereto and made a part hereof, which consist of 16,342 square feet
of Rentable Area measured in accordance with the BOMA method of measurement as more fully described
in Exhibit B to the Lease.




     (e) “Area No, 4” shall mean the premises on the 26th floor of the Building,
as shown on Exhibit A-2 attached hereto and made a part hereof, which consist of 7,422 square feet
of Rentable Area measured in accordance with the BOMA method of measurement as more fully described
in Exhibit B to the Lease, plus such portion, if any, of Area No. 5 as Tenant may elect to include
in the Premises for a term commencing on the Area No. 4 Commencement Date by giving notice to
Landlord prior to the Area No. 4 Commencement Date designating such portion of Area No. 5. Any such
portion of Area No. 5 designated by Tenant shall be contiguous to Area No. 4, and the remaining
portion of Area No. 5 shall be in a leasable configuration.




     (f) “Area No. 5” shall mean the premises on the 26th floor of the Building, as
shown on Exhibit A-2 attached hereto and made a part hereof, which consist of 15,234 square feet of
Rentable Area measured in accordance with the BOMA method of measurement as more fully described in
Exhibit B to the Lease, less any portion thereof which Tenant may elect to include in Area No. 4
pursuant to Section l(e) above.




     (g) “Area No. 1 Commencement Date” shall mean April 1, 2000, which date is subject to
adjustment pursuant to Section 7 below.




     (h) “Area No. 2 Commencement Date” shall mean June 1, 2000, which date is subject to
adjustment pursuant to Section 7 below.




     (i) “Area No. 3 Commencement Date” shall mean June 1, 2000, which date is subject to
adjustment pursuant to Section 7 below.




     (j) “Area No. 4 Commencement Date” shall mean June 1, 2000, which date is subject to
adjustment pursuant to Section 7 below.




     (k) “Area No. 5 Commencement Date” shall mean January 1, 2001, which date is subject to
adjustment pursuant to Section 7 below.



     All other capitalized terms used but not otherwise defined herein shall have the same meanings
as set forth in the Lease. For purposes of the Lease, the tend
“Rent” shall specifically include
the rental payments due with respect to the Additional Premises as described in this Amendment.



2









 




Further,
as used herein, any reference to a “portion of the Additional
Premises” shall mean either
Area No. 1, Area No. 2, Area No. 3, Area No. 4, and/or Area No. 5, as applicable.




     2. Additional Premises Commencement Dates. Effective as of the following respective
dates (herein collectively referred to as the “Additional
Premises Commencement Dates”) and fora
lease term expiring concurrently with the end of the Term for the remainder of the Premises (as it
may be sooner terminated or extended as provided in the Lease), the Premises shall include the
following respective portions of the Additional Premises, and the Rentable Area of the Premises
shall thereupon be increased by the Rentable Area of each such designated portion of the Additional
Premises (as such respective Rentable Area designations are described in Section 1 of this
Amendment).



	 	 	 
	 	 	APPLICABLE PORTION
	DATE	 	OF ADDITIONAL PREMISES
	Area No. 1 Commencement Date
	 	Area No. 1
	Area No. 2 Commencement Date
	 	Area No.2
	Area No. 3 Commencement Date
	 	Area No. 3
	Area No. 4 Commencement Date
	 	Area No. 4
	Area No. 5 Commencement Date
	 	Area No. 5






     3. Lease Governs. From and after each respective Additional Premises
Commencement Date described in Section 2 above, and through the end of the Term of the Lease, all
provisions of the Lease shall be in full force and effect with respect to, and shall govern
Tenant’s possession of, the applicable portion of the Additional Premises.



     4. Additional Premises Base Rent.



     (a) From and after the respective Additional Premises Commencement Dates for Area No. 1,
Area No. 2, Area No. 4 and Area No. 5, Base Rent under the Lease with respect to each such portion
of the Additional Premises shall be payable at the same respective annual rates per square foot of
Rentable Area as applicable to the initial Premises under the Lease (i.e., as set forth in Section
l(b) of the Lease), changing as and when such rates otherwise change with respect to such initial
Premises.



     (b) From and after the Area No. 3 Commencement Date, Base Rent under the Lease with
respect to Area No. 3 shall be payable in the amounts and at the respective rates per square foot
of Rentable Area of Area No. 3 for the respective periods hereinafter described:



3









 





	 	 	 	 	 	 	 
	 	 	 	 	 	 	Annual Base Rent
	 	 	 	 	 	 	Per Square Foot of
	 	 	 	 	Monthly Base	 	Rentable Area of
	Period	 	Annual Base Rent	 	Rent	 	Area No. 3
	Area No. 3
	 	$294,156.00	 	$24,513.00	 	$18.00
	Commencement Date
through March 31,
2001
	 	 	 	 	 	 
	April 1, 2001
through March 31,2002
	 	$302,980.68	 	$25,248.39	 	$18.54
	April 1, 2002
through March 31,
2003
	 	$312,132.20	 	$26,011.02	 	$19.10
	April 1, 2003
through March 31,
2004
	 	$321,447.14	 	$26,787.26	 	$19.67
	April 1, 2004
through March 31,
2005
	 	$331,088.92	 	$27,590.74	 	$20.26
	April 1, 2005
through March 31,
2006
	 	$341,057.54	 	$28,421.46	 	$20.87
	April 1, 2006
through March 31,
2007
	 	$351,189.58	 	$29,265.80	 	$21.49
	April 1, 2007
through March 31,
2008
	 	$361,811.88	 	$30,150.99	 	$22.14
	April 1, 2008
through March 31,
2009
	 	$372,597.60	 	$31,049.80	 	$22.80







     (c) Base Rent attributable to the Additional Premises, as described above in this Section 4,
shall be payable at such times and at such place and in accordance with such provisions as
otherwise set forth in the Lease relative to the payment of Base Rent and Monthly Base Rent
thereunder.



     5.  Additional Premises Additional Rent.



     (a) For any calendar year in which a respective Additional Premises Commencement Date falls,
Tenant’s Proportionate Share of Expenses and Taxes (i.e., Additional Rent under the Lease) provided
for in Section 5 of the Lease shall be calculated separately for the applicable portion of the
Additional Premises for which such Additional Premises Commencement Date pertains, apart from the
remainder of the Premises, but not for any subsequent years of the Term of the Lease. In subsequent
years, Additional Rent shall be calculated for such applicable portion of the Additional Premises
together with the remainder of the Premises. Additional Rent for each portion of the



4









 




Additional Premises for the calendar year in which its corresponding Additional Premises
Commencement Date falls shall be prorated by multiplying (i) the Additional Rent attributable to
the applicable portion of the Additional Premises for such calendar year, as a whole, by (ii) a
fraction, the numerator of which is the number of days remaining in such calendar year from and
after the applicable Additional Premises Commencement Date and the denominator of which is 365.




     (b) For purposes of calculating Additional Rent payable on account of any applicable
portion of the Additional Premises for the calendar year in which its corresponding Additional
Premises Commencement Date falls, as” provided in Section 5(a)
above, “Tenant’s Proportionate
Share” shall be determined in accordance with the definition thereof set forth in Exhibit B of the
Lease, except that the numerator of the ratio described therein shall be die Rentable Area of the
applicable portion of the Additional Premises (as set forth in Section 1 hereinabove). For purposes
of calculating Additional Rent payable on account of such portion of the Additional Premises,
together with the remainder of the Premises, for all subsequent calendar years (or portions
thereof) within the Term of the Lease, as provided in Section 5(a) above, “Tenant’s Proportionate
Share” shall be determined in accordance with the definition thereof set forth in Exhibit B of the
Lease, except that the numerator of the ratio described therein shall be the Rentable Area of the
applicable portion of the Additional Premises together with the Rentable Area of the then balance
of the Premises.



     (c) All Additional Rent described in this Section 5 shall be payable at such times, in
such manner, and in accordance with such procedures (i.e, including payment of “Additional Rent
Estimate” and final reconciliations) as set forth in Section 5 of the Lease relative to payment of
Additional Rent thereunder.



     6. Condition: Tenant Improvements. Subject to Landlord’s obligations with respect to
the Landlord’s Additional Premises Work under the Workletter attached hereto as Exhibit B and made
a part hereof (the “Additional Premises Workletter”), Tenant hereby accepts each portion of the
Additional Premises in their “as is” condition as of the date of execution and delivery of this
Amendment by both Tenant and Landlord and acknowledges that Landlord shall not be required to make
any improvements to any portion of the Additional Premises for Tenant’s use and occupancy. Without
limitation of the foregoing, it is acknowledged that Tenant, at its sole cost and expense (subject
to application of the allowances provided for in the Additional Premises Workletter), (a) shall
perform any work at the Additional Premises as may be necessary or desired by Tenant to improve the
Additional Premises for occupancy and (b) may, at Tenant’s option, perform the work necessary in
order to modify the base building washrooms on the 25th floor of the Building to match
the 23rd and/or 24th floor base building washrooms, in each case subject to
and in accordance with the provisions of the Lease and the Additional Premises Workletter. All work
as referenced in this Section 6 performed by Tenant within any respective portion of the Additional
Premises prior to or within one hundred twenty (120) days following its/corresponding Additional
Premises Commencement Date and in the 25th floor washrooms prior to or within one
hundred twenty (120) days following the last Additional Premises Commencement Date to occur for
Additional Premises on the 25th floor is referred to herein and in the Additional
Premises Workletter as “Tenant’s



5









 




Additional
Premises Work”. Tenant’s Additional Premises Work shall be “Tenant Alterations” for
purposes of the Lease.




     7. Possession.



     (a) Landlord shall deliver possession of each respective portion of the Additional Premises to
Tenant not later than the following respective dates (herein, collectively, the “Additional
Premises Turnover Dates”):



	 	 	 
	Portion of Additional Premises	 	Projected Turnover Date
	Area No. 1

	 	The date of full execution and delivery of
this Amendment
	Area No. 2

	 	The date of full execution and delivery of
this Amendment
	Area No. 3

	 	The date of full execution and delivery of
this Amendment
	Area No. 4

	 	The date of full execution and delivery of
this Amendment as to the premises
designated “Area No. 4” on Exhibit A-2 and,
as to any additional premises designated by
Tenant as Area No. 4 premises pursuant to
Section l(e) above, not later than thirty
(30) days after Tenant gives notice to
Landlord of such designation
	Area No. 5

	 	October 1, 2000, or such earlier date as
Tenant may designate by not less than
thirty (30) days’ prior written notice, to
Landlord






     (b) If Landlord should be unable for any reason to deliver possession of any given
portion of the Additional Premises on its corresponding Additional Premises Turnover Date, Landlord
shall not be subject to any liability for failure to deliver possession. Such failure to deliver
possession shall not affect either the validity of the Lease (as amended hereby) or the obligations
of either Landlord or Tenant under the Lease (as amended hereby) or be construed to extend the
expiration of the Term of the Lease either as to the respective portion of the Additional Premises
or the balance of the Premises. However, under such circumstances the applicable Additional
Premises Commencement Date set forth in Section 1 above for such portion of the Additional Premises
shall be extended by one day for each day of delay beyond the corresponding Additional Premises
Turnover Date in delivery of possession of such portion of the Additional Premises to Tenant.



     (c) Notwithstanding anything to the contrary contained herein, with respect to each
respective portion of the Additional Premises, if Tenant occupies such portion of the Additional
Premises for the conduct of business operations therefrom prior to the Additional Premises
Commencement Date-determined pursuant to Section 1 and the preceding provisions of this



6









 




Section 7, the Additional Premises Commencement Date for such portion of the Additional Premises
shall be the date on which Tenant commences business operations therefrom.




     8. Lobby Signage. Tenant shall have the right to install, at Tenant’s sole cost
and expense and prior to the date which is one year after the last Additional Premises Commencement
Date to occur, two additional Tenant identification signs on the glass panel in the high-rise
elevator bank lobby on the ground floor of the Building. Such signs shall be similar to (and not
larger than) the existing “Upshot” sign already installed in that location pursuant to Section
39(b) of the Lease and shall be deemed to be lobby identification under Section 39(b) and subject
to the terms and conditions of that Section to the extent not inconsistent with this Section 8. One
of such additional signs shall display the name “Ha-Lo” and the other shall display the name
“Starbelly” or, in each case, Tenant may substitute the name of another Tenant Affiliate subject to
Landlord’s prior written approval, which shall not be unreasonably withheld, and subject to any
rights at the time of other tenants of the Building regarding competitors’ signage.



     9. Staircase and Fire Stairwell. (a) At such time as, and for so long as, the
Premises include the portions of the
25th and 26th floors of the Building which are directly above
the staircase which connects the 23rd and 24th floors of the Building, Tenant shall
have the right to extend the internal staircase in the Premises from the 24th floor to
the 25th and 26th floors of the Building. Such work may be performed, with
Landlord’s approval of structural and other matters pursuant to the Workletter or to Section. 14 of
the Lease and at Tenant’s sole cost and expense, and also subject to applicable building and fire
codes and regulations, either as part of the Tenant’s Additional Premises Work, or pursuant to and
on the terms and conditions contained in Section 14 and any other applicable provisions of the
Lease.



     (b) Tenant shall have the right to use the fire stairwells connecting portions of the Premises
on the 23rd 24th , 25th and 26th floors of the
Building (at such time as, and for so long as, connecting portions of the Premises are located on
such floors) for travel between floors of the Premises, so long as such use is permitted by
applicable building and fire codes and regulations. With Landlord’s approval pursuant to Section 14
of the Lease and at Tenant’s sole cost and expense, and also subject to applicable building and
fire codes and regulations, Tenant shall have the right to improve the portions of the stairwell
serving the Premises and install a card key access system on stairwell doors in order to control
entry from the stairwell to the Premises.



     10. Right of First Offer. Subject to the provisions hereinafter set forth,
Landlord hereby grants to Tenant the right to lease, on the terms and conditions hereinafter set
forth, each portion of the space on the
12th,
20th and
28th floors of the Building (the “First
Offer Space”) which Landlord proposes to lease for any term commencing during the First Offer
Period (as hereinafter defined).




     (a) Subject to Section 10(h) below, if Landlord is in serious discussions with a party other
than Tenant concerning a lease of any portion of the First Offer Space for a term commencing during
the First Offer Period (which shall include, in order to constitute serious discussions, delivery
by Landlord to such party of an initial proposal for the leasing of such



7









 






portion of the First Offer Space), and in any event prior to leasing any portion of the First Offer
Space for a term commencing during the First Offer Period, Landlord shall give Tenant written
notice of the location and Rentable Area of such portion of the First Offer Space, the date of
commencement of the term of the demise, as determined by Landlord, with respect to such portion of
the First Offer Space (the “First Offer Space Commencement
Date”) and the rental rate for such
portion of the First Offer Space (determined as hereinafter provided). The First Offer Space
Commencement Date shall not be less than thirty (30) days after the date such notice is given by
Landlord unless such portion of the First Offer Space has or will become available for leasing by
reason of early termination of a lease, in which case the First Offer Space Commencement Date shall
not be less than ten (10) days after the date such notice is given by Landlord, and shall not be
earlier than the date on which Tenant exercises its right to lease such portion of the First Offer
Space.




     (b) Tenant’s right to lease the First Offer Space described in such a notice from
Landlord shall be exercisable by written notice from Tenant to Landlord of Tenant’s election to
exercise said right (a “first Offer Exercise Notice”) given not later than seven (7) business days
after Landlord’s notice is given, time being of the essence. If such right is not so exercised,
Tenant’s right of first offer shall thereupon terminate as to such portion of the First Offer
Space, and Landlord may thereafter lease and re-lease such portion of the First Offer Space without
notice to Tenant and free of any right in Tenant. Notwithstanding the foregoing, if Landlord shall
not have leased such First Offer Space within the period ending six (6) months following the date
of Landlord’s notice to Tenant regarding such First Offer Space plus, if Landlord is negotiating
with a particular potential tenant at the time such period expires, such additional period during
which Landlord continues to negotiate with such potential tenant, Landlord shall not enter into a
lease of any such portion of the First Offer Space without again giving the notice referred to
above. Tenant may not elect to lease less than the entire area of the First Offer Space described
in a Landlord’s notice, and if a third-party lease would include all or a portion of the First
Offer Space together with other space in the Building which is not First Offer Space, Tenant must
exercise its right for such First Offer Space and such other space.




     (c) Tenant may only exercise its right to lease a portion of the First Offer Space, and
an exercise thereof shall only be effective, if at the time of Tenant’s exercise of said right and
oh the pertinent First Offer Space Commencement Date the Lease is in full force and effect and
Tenant is not in Default under the Lease, and (inasmuch as this right of first offer is intended
only for the benefit of the original Tenant named in the Lease and any Tenant Successors and Tenant
Affiliates) the entire Premises are occupied by the original Tenant named in the Lease or a Tenant
Successor or Tenant Affiliate, and said Tenant has not assigned the Lease (other than to a Tenant
Successor or Tenant Affiliate), nor sublet any portion of the Premises (other than to a Tenant
Successor or Tenant Affiliate), and Landlord has not terminated the Lease as to any part of the
Premises pursuant to Section 15 of the Lease. Without limitation of the foregoing, no sublessee,
and no assignee other than a Tenant Successor or Tenant Affiliate, shall be entitled to exercise
any right hereunder, and no



8









 






exercise of any right hereunder by the original Tenant named in the Lease or a Tenant Successor or
Tenant Affiliate shall be effective in the event said Tenant or Tenant Successor or Tenant
Affiliate assigns the Lease (other than to a Tenant Successor or Tenant Affiliate) or subleases any
portion of the Premises (other than to a Tenant Successor or Tenant Affiliate), or if Landlord
terminates the Lease as to any part of the Premises pursuant to Section 15 of the Lease, prior to
the pertinent First Offer Space Commencement Date.




     (d) If Tenant has validly exercised its right to lease a portion of the First Offer Space,
then effective as of the First Offer Space Commencement Date such portion of the First Offer Space
shall be included in the Premises, subject to all of the terms, conditions and provisions of the
Lease, except that:




	 	(i)	 	Base Rent per square foot of Rentable Area for such portion of the Erst Offer
Space shall be equal to the Market Rental Rate (as defined in Section 38 of the Lease)
for such First Offer Space;
	 
	 	(ii)	 	the Rentable Area of the Premises shall be increased by the Rentable Area of
such portion of the First Offer Space;
	 
	 	(iii)	 	the term of the demise covering such portion of the First Offer Space shall
commence on the First Offer Space Commencement Date and shall expire simultaneously
with the expiration of the Term of the Lease, including any extension or renewal
thereof; and
	 
	 	(iv)	 	the First Offer Space shall be rented in its “as is” condition as of the
First Offer Space Commencement Date (inasmuch as tenant improvement work, allowances,
and time for construction of tenant improvements, if any, will be reflected in the
Market Rental Rate pursuant to Section 38 of the Lease).






     (e) If Tenant has validly exercised its right to lease a portion of the First Offer Space,
within thirty (30) days after request by either party hereto, Landlord and Tenant shall enter into
a written amendment to the Lease confirming the terms, conditions and provisions applicable to such
portion of the First Offer Space as determined in accordance herewith.




     (f) If Tenant has validly exercised its right to lease a portion of the First Offer Space,
Landlord shall use reasonable efforts to deliver possession of such First Offer Space to Tenant on
the pertinent First Offer Space Commencement Date, but in the event Landlord should be unable for
any reason to do so, Landlord shall not be subject to any liability for failure to deliver
possession. Such failure to deliver possession shall not affect either the validity of the Lease or
the obligations of either Landlord or Tenant under the Lease or be construed to extend the
expiration of the Term of the Lease either as to such portion of the Erst Offer Space or the
balance of the Premises; provided, however, that under such



9









 






circumstances, rent shall not commence as to such portion of the First Offer Space until Landlord
is able to deliver possession, and Base Rent for such portion of the First Offer Space shall be
adjusted to reflect the reduction in the length of the term of the lease of such portion of the
First Offer Space if and to the extent that the length of such term had an effect on the
computation of the Market Rental Rate.




     (g) In the event any portion of the First Offer Space is leased to Tenant other than pursuant
to the right of first offer described herein, such portion of the First Offer Space shall thereupon
be deleted from the First Offer Space.




     (h) Tenant’s rights to lease the First Offer Space are subject and subordinate to the rights
with respect to such space heretofore granted to those tenants (including their respective
successors and assigns) described on Schedule 1 hereto, as set forth in such existing tenants’
respective leases at the Building in effect as of the date of execution and delivery of this
Amendment by both Tenant and Landlord and more fully described (whether characterized on Schedule 1
hereto as expansion rights, rights of first offer, or other rights) in such respective leases.
Tenant’s rights to lease the First Offer Space are also subject and subordinate to Landlord’s right
to extend or renew the lease of any tenant occupying any portion of the First Offer Space, even if
not pursuant to an option contained in its lease.




     (i) As used herein, the term “First Offer Period” shall mean the period commencing on the date
of execution and delivery of this Amendment by both Tenant and Landlord and continuing for the
remainder of the Term of the Lease and all extensions and renewals thereof, provided, however, that
the First Offer Period shall not include the last Lease Year of the Initial Term or the last two
(2) Lease Years of any extension or renewal term unless, as to the Initial Term, Tenant has
exercised the option granted to Tenant in the Lease to extend the Term thereof or renew the Lease
for the additional period following such Initial Term, or Landlord and Tenant have entered into an
amendment to the Lease extending the Term for an additional period.




     (j) If me First Offer Space Commencement Date for any portion of the First Offer Space will be
during the second to the last Lease Year of the Initial Term
(i.e., during the period beginning on
April 1, 2007 and ending on March 31, 2008), then, notwithstanding anything to the contrary
contained herein, Tenant may only exercise its right to lease such portion of the First Offer
Space, and an exercise thereof shall only be effective, if (i) Tenant simultaneously exercises its
option under Section 37 of the Lease to extend the Term of the Lease and (ii) Tenant is then
entitled, pursuant to the terms of Section 37(b) of the Lease, to exercise such option.



     11. Security Deposit. On or before the date of execution and delivery of this
Amendment by Tenant, Tenant shall deliver to Landlord, at Tenant’s option, either (a) cash (“Cash
Security Deposit”) in the amount of $845,000.00, or (b) an unconditional and irrevocable letter of
credit (“Letter of Credit”) in the amount of $845,000.00 (“Security Deposit”), as security for the
full and



10









 




faithful performance of every provision of the Lease (as amended hereby) to be performed by Tenant.
Tenant’s failure to deliver the Security Deposit to Landlord when required hereunder shall be a
default and material breach of the Lease. The first such Letter of Credit (i.e., if that is the
applicable form of the Security Deposit) shall expire no earlier than twelve (12) months after
issuance and all subsequent replacement Letters of Credit shall expire no earlier than twelve (12)
months from the expiry date of the then outstanding and expiring Letter of Credit. Each such Letter
of Credit shall be in substantially the form attached hereto as Exhibit C and otherwise in form and
substance satisfactory to Landlord. Each such Letter of Credit shall be issued by a bank reasonably
satisfactory to Landlord. Without limitation of the foregoing, each issuer of a Letter of Credit
shall have an office in Chicago, Illinois at which such Letter of Credit may be presented. Subject
to the remaining provisions of this Section concerning reductions in the amount of the Security
Deposit and return of the Security Deposit, Tenant shall ensure that at all times during the Term
of the Lease and for sixty (60) days after expiration of the Term, an unexpired Letter of Credit in
the face amount of the Security Deposit or cash in the amount of the Security Deposit shall be in
the possession of Landlord. Subject to such provisions, during the Term Tenant shall deliver a
replacement Letter of Credit to Landlord no later man thirty (30) days prior to the expiry date of
then outstanding and expiring Letter of Credit. In addition, unless the total assets of the issuer
of any outstanding Letter of Credit are $ 1 billion or more (unless Landlord has previously
approved a lesser figure) as established to the reasonable satisfaction of Landlord, Landlord may
require that Tenant deliver a replacement Letter of Credit from another issuer satisfactory to
Landlord within thirty (30) days after notice from Landlord to Tenant requesting such replacement
Letter of Credit. Failure by Tenant to deliver any replacement Letter of Credit as required by the
foregoing provisions shall entitle Landlord to draw under the outstanding Letter of Credit and to
retain the entire proceeds thereof for application as the Security Deposit under the Lease, but
Landlord shall refund such proceeds to Tenant simultaneously with later delivery by Tenant of a
Letter of Credit conforming with this Section. Each Letter of Credit shall be for the benefit of
Landlord and its successors and assigns, shall be expressly assignable, and shall entitle Landlord
or its successors or assigns to draw from time to time under the Letter of Credit in portions or in
whole upon presentation of a sight draft accompanied by a statement that Landlord is entitled to
draw thereunder pursuant to the terms of the Lease.




     If a Default by Tenant occurs under the Lease, including but not limited to a Default relating
to the payment of Rent, Landlord may draw under the Letter of Credit and use or apply the proceeds
drawn or any cash or other Security Deposit for the payment of Rent or any other past due amount or
for any amount which Landlord may spend or become obligated to spend by reason of Tenant’s Default
or to compensate Landlord for any other loss which Landlord may suffer by reason of Tenant’s
Default. If any portion of the proceeds are to be used or applied, Tenant shall, within five (5)
days after written demand therefor, restore the Security Deposit (by either a cash deposit or
delivery of a replacement Letter of Credit) to the amount then required by this Section and
Tenant’s failure to do so shall be a default and material breach of the Lease. Except to the extent
required by law, Tenant shall not be entitled to interest for any period during which Landlord is
holding cash as a Security Deposit nor shall Landlord be required to keep such cash Security
Deposit separate from its or their general funds. Any cash Security Deposit which Landlord is
holding at the expiration of the lease term, or any balance thereof, and any outstanding Letter of
Credit shall be returned to



11









 




Tenant (or at Landlord’s option to the last permitted assignee of Tenant’s interest hereunder, if
any) within thirty (30) days after the expiration of the lease Term and Tenant’s vacation of the
Premises, provided Tenant is not then in default under the Lease, and to the extent not returned to
Tenant because Tenant is in default under the Lease, shall be returned when any such default is
cured, to the extent not applied to cure such default or applied to other obligations of Tenant
under the Lease. Landlord may deliver the Letter of Credit or any cash Security Deposit funds to
the purchaser of Landlord’s interest in the Project, in the event that such interest is sold,
transferred or conveyed, and thereupon Landlord shall be discharged from any further liability with
respect to the Security Deposit provided that the transferee assumes Landlord’s obligations with
respect thereto.




     In the event that Tenant has not defaulted with respect to any obligation under the Lease
(including, without limitation, any default in the payment of Rent when due) at any time on or
prior to the respective “Security Deposit Reduction Date,” hereinafter described, then,
notwithstanding anything contained hereinabove to the contrary, (i) Landlord shall return to
Tenant, upon Tenant’s request therefor, that portion of any Cash Security Deposit then being held
by Landlord hereunder corresponding to the amount of the “Permitted Security Deposit Reduction”
permitted as of such Security Deposit Reduction Date (as hereinafter set forth), or (ii) Tenant
shall have the right to deliver a replacement letter of credit as a substitute for any Letter of
Credit then being held by Landlord hereunder, or an amendment to the Letter of Credit then being
held by Landlord hereunder, which replacement letter of credit or amended Letter of Credit shall be
in the amount of the “Remaining Balance of Security Deposit” corresponding to such Security Deposit
Reduction Date (as hereinafter set forth):



	 	 	 	 	 	 	 	 	 
	Security Deposit	 	Permitted Security	 	Remaining Security
	Reduction Date	 	Deposit Reduction	 	Deposit Balance
	March 31, 2004
	 	$	140,833.00	 	 	$	704,167.00	 
	March 31, 2005
	 	$	140,833.00	 	 	$	563,334.00	 
	March 31, 2006
	 	$	140,833.00	 	 	$	422,501.00	 
	March 31, 2007
	 	$	140,833.00	 	 	$	281,668.00	 
	March 31, 2008
	 	$	140,833.00	 	 	$	140,835.00	 
	March 31, 2009
	 	$	140,835.00	 	 	$	0	 






     Notwithstanding the foregoing, if Tenant is not entitled to a reduction in the Security
Deposit pursuant to the preceding paragraph solely because Tenant is in default under the Lease, as
described therein, Tenant may again take the benefit of such reduction if and when such default and
all other subsequent defaults have been cured within applicable cure periods provided under the
Lease.



     If the net income of Tenant and/or any guarantor of the Lease (collectively the “Tenant
Obligor”), for the Tenant Obligor’s most recent three (3) fiscal years, is equal to or greater than




12










 






$25,000,000 per annum (as evidenced by audited financial statements reasonably satisfactory to
Landlord, prepared in accordance with generally accepted accounting principles and otherwise on a
basis consistent with the financial statements of Tenant delivered to Landlord prior to execution
of the Lease) and Tenant is not in default under the Lease, then Landlord shall return any cash
Security Deposit which Landlord is then holding and any outstanding Letter of Credit to Tenant or,
at Landlord’s option, to any Tenant Obligor within thirty (30) days after the date of submittal of
such financial statements and Tenant’s demand therefor, and Tenant shall have no further
requirement for delivery of any Security Deposit hereunder. If Tenant is not entitled to the return
of any Cash Security Deposit or Letter of Credit pursuant to this paragraph solely because Tenant
is in default under the Lease, the same shall be returned if and when such default and any other
subsequent defaults are cured within applicable cure periods under the Lease.




     12. Real Estate Brokers. Tenant represents and warrants that Tenant has not dealt with
any broker in connection with this Amendment other than Binswanger Midwest of Illinois (whose
commissions shall be payable by Landlord pursuant to separate written agreement between
Landlord
and said broker). Tenant agrees to indemnify and hold Landlord harmless from all loss,
damages,
liabilities, claims, costs and expenses (including reasonable attorneys’ fees) arising from
any claims
or demands of any other broker or brokers or finders with whom Tenant dealt for any commission
alleged to be due such broker, brokers or finders.



     13. Present Status. Tenant certifies to Landlord that as of the execution and delivery of
this Amendment by both Tenant and Landlord, and to Tenant’s actual knowledge, Landlord is not
in
default under the Lease by reason of failure to perform any obligations thereunder.



     14. Inapplicable Provisions. The following provisions of the Lease are hereby deleted,
and shall hereafter be deemed null and void in their entirety:




     (a) Section 35 of the Lease (i.e., entitled “Right of First Offer”);




     (b) Section 36 of the Lease (i.e., entitled “Expansion Option”);




     (c) Paragraph 1 of the Workletter to the Lease (i.e., entitled “Landlord’s Work”)
(it being acknowledged and confirmed by Tenant that such Landlord’s Work has heretofore
been completed by Landlord in accordance with the requirements of said Workletter); and




     (d) Paragraphs 9(a) and 9(b) of the Workletter to the Lease (i.e., pertaining to any
further obligations of Landlord to fund the Allowances described therein).



     15. Commencement Date. The parties confirrn and agree that (a) the Commencement
Date of the Lease was March 4,1999, (b) the Expiration Date of the Initial Term will be March
31,
2009 and (c) each Lease Year under the Lease shall end on March 31.



13









 





     16. Lease Supplement. At either party’s request following any given Additional
Premises
Commencement Date, Landlord and Tenant shall enter into a supplement to the Lease, confirming
the terms and provisions applicable to the applicable portion of the Additional Premises as
determined
in accordance herewith. Any failure by the parties to fully execute and deliver any supplement
shall
not, however, affect their rights and obligations under the Lease as amended by this Amendment
with
respect to such portion of the Additional Premises.



     17.  Entire Agreement. The entire agreement of the parties is set forth in this Amendment
and in the Lease as amended hereby. No prior agreement or understanding with respect to the
Lease
and this Amendment shall be valid or of any force or effect.



     18. Lease in Full Force and Effect. Except as amended hereby, all the terms and
provisions of the Lease shall remain in full force and effect, and are hereby ratified and
confirmed, and
the terms of Section 43 shall apply to this Amendment and to the Lease, as amended hereby.



[Signature Page to Follow]




14









 






     IN WITNESS WHEREOF, the parties have entered into this Amendment as of the
day and year first above written.



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:	 	 	 	TENANT:	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	303 WACKER REALTY L.L.C.	 	 	 	PROMOTIONAL MARKETING,	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	L.L.C., an Illinois limited liability	 	 
	By:	 	Hines Three Illinois Center Associates Limited	 	 	 	company d/b/a UPSHOT	 	 
	 	 	Partnership, its managing member	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Hines Three Illinois Center L.L.C., a	 	 	 	By:	 	/s/ John Kelley	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	general partner	 	 	 	Name:	 	John Kelley	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	Title:
	 	President (CEO)	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Hines Interests Limited Partnership, a	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	member	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	Hines Holdings, Inc., its general	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	partner	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:
	 	/s/ C. Kevin Shannahan
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Name: C. Kevin Shannahan	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Title: Executive Vice President	 	 	 	 	 	 	 	 







15









 








ACKNOWLEDGMENT OF GUARANTOR




     The undersigned, being the “Guarantor” under that certain Guaranty (“Guaranty”) dated August
26,1998 pertaining to the above-described Lease, hereby acknowledges and consents to the terms of
the foregoing Amendment, and confirms that the Guaranty remains in full force and effect and shall
continue to apply, in all respects, relative to the Lease, as amended by the foregoing Amendment,
and as further amended from time to time.



     IN WITNESS WHEREOF, the undersigned has executed this Acknowledgment as of the day and year
first set forth above in this Amendment



	 	 	 	 	 
	 	 	GUARANTOR:
	 
	 	 	 	 
	 	 	HA-LO INDUSTRIES,INC., an Illinois corporation
	 
	 	 	 	 
	 

	 	By:
	 	/s/ John Kelley
	 

	 	 	 	 
	 

	 	Name:
	 	John Kelly
	 

	 	 	 	 
	 

	 	Title:
	 	President / CEO
	 

	 	 	 	 






 









 








ASSIGNMENT, ASSUMPTION, CONSENT AND 

THIRD AMENDMENT TO LEASE




     THIS ASSIGNMENT, ASSUMPTION, CONSENT AND THIRD AMENDMENT TO LEASE (“Amendment”) is made
and entered into as of the 22nd day of may, 2002 by and among 303 WACKER REALTY L.L.C., a
Delaware limited
liability company (hereinafter referred to as “Landlord”), PROMOTIONAL MARKETING, L.L.C. (d/b/a
Upshot) (hereinafter referred to as “Original Tenant”), and EQUITY MARKETING, INC., a Delaware
corporation (hereinafter referred to as “Tenant”).



WITNESSETH:




     WHEREAS, Landlord and Original Tenant have entered into that certain Lease dated June
30, 1998 (the “Original Lease”), as amended by Amendment to Lease dated August 27, 1998 (the
“First Amendment”) and by Second Amendment to Office Lease dated March 31, 2000 (the “Second
Amendment”), and as supplemented by side-letter agreement dated effective as of March 1, 2002 (the
“Side-Letter”) (said Original Lease, as so amended by the First Amendment and Second Amendment and
as so supplemented by the Side-Letter, as amended hereby and as further amended from time to time,
the  “Lease”), which Lease covers space located on the 23rd through 26th
floors (inclusive) of the Building known as 303 E. Wacker Drive, Chicago, Illinois;



     WHEREAS, Landlord, Original Tenant and Metropolitan Life Insurance Company (“Existing
Mortgagee”) have heretofore entered into a certain Subordination, Non-Disturbance and Attomment
Agreement (herein, the “Non-Disturbance Agreement”) relative to the Lease;



     WHEREAS, Original Tenant desires to assign to Tenant all of Original Tenant’s right, title
and interest in, to and under the Lease and the Non-Disturbance Agreement and with respect to the
Premises thereunder effective from and after the “Effective Date” (as defined below), and Tenant
desires to accept such assignment and assume all obligations and liabilities of Original Tenant
under said Lease and Non-Disturbance Agreement and with respect to said Premises effective from
and after the “Effective Date” (as defined below), all conditioned upon Landlord’s and Existing
Mortgagee’s consent to such assignment and to the agreement of Landlord and Tenant to amend the
Lease as hereinafter set forth;



     WHEREAS, Original Tenant and Tenant have requested Landlord to consent to the aforedescribed
assignment, and Landlord has agreed to consent to such assignment, subject to the terms and
conditions hereinafter set forth; and



     WHEREAS, Landlord and Tenant desire to amend the Lease, effective from and after the
“Effective Date”, to exclude certain space from the Premises being demised under the Lease and
for other matters as hereinafter set forth;



     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreements
contained herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged by the parties hereto, Landlord, Original Tenant and Tenant hereby
agree as follows:



     1. Defined Terms. All capitalized terms used but not otherwise defined herein shall
have the same meaning as in the Lease.




 









 








     2. Assignment. Subject to Paragraph 19 below, effective as of the “Closing
Date”
(as defined in Paragraph 19 below) (herein, the “Effective Date”), Original Tenant hereby
assigns to Tenant all of Original Tenant’s right, title and interest in, to and under the
Lease and
the Non-Disturbance Agreement, and with respect to the leased premises thereunder. Original
Tenant and/or Tenant shall notify Landlord, in writing, of the occurrence of such Closing Date
within one (1) business day after the occurrence thereof.



     3. Acceptance and Assumption. Subject to Paragraph 19 below, effective from
and after the Effective Date, Tenant hereby accepts such assignment and assumes the
obligations
and liabilities of the “Tenant” (as such term is used in the Lease) under the Lease and the
Non-
Disturbance Agreement, all to the extent such obligations and liabilities arise or accrue on
or
following the Effective Date, and Tenant agrees to make all payments and to keep and perform
all conditions and covenants to be kept and performed by the “Tenant” thereunder from and
after
the Effective Date, as fully and completely as if Tenant had executed the Lease and the Non-
Disturbance Agreement in its own name. Tenant agrees that such assumption and agreement is
made for the benefit of Original Tenant, Landlord and Existing Mortgagee.



     4. Certification by Original Tenant. Original Tenant represents and warrants to
Landlord and to Tenant that the following are true as of the date hereof, and will be true as
of the
Effective Date (provided, however, that the following representations or warranties, whether
or
not true, shall not affect, in any manner, Tenant’s liability to Landlord under the Lease or
to
Existing Mortgagee under the Non-Disturbance Agreement for all obligations of “Tenant” arising
or accruing on or following the Effective Date):




     (a) Original Tenant owns and holds the entire interest of “Tenant” under the
Lease;




     (b) There exist no subleases affecting the Premises under the Lease or any
part thereof;




     (c) Original Tenant has not assigned or encumbered the “Tenant’s” interest
under the Lease or any part thereof;




     (d) No contracts for the furnishing of any labor or materials with respect to
improvements or alterations in or about the Premises have been let by Original Tenant
or
are outstanding that have not been fully performed and satisfied by Original Tenant;




     (e) To the best of Original Tenant’s knowledge after due inquiry, Landlord is
not in default under the Lease by reason of failure to perform any obligation
thereunder
and there is no circumstance, event, condition or state of facts which, by the passage
of
time or the giving of notice or both, could constitute or result in such a default; and




     (f) Original Tenant is not in default under the Lease by reason of failure to
perform any obligation thereunder and, to Original Tenant’s knowledge, there is no
circumstance, event, condition or state of facts which, by the passage of time or the
giving of notice or both, could constitute or result in such a default.



2









 





     5. Certification
by Landlord. Landlord hereby certifies to Tenant that, as of
the
date hereof, (i) Original Tenant is not in default of its obligation to pay Base Rent or
Additional
Rent as and when due under the Lease, (ii) Landlord has not delivered to Original Tenant any
written notice (which has not been heretofore withdrawn by Landlord) stating that Tenant is in
default under the Lease, and (iii) there is no Ground Lessor or Mortgagee with rights in the
Building other than Existing Mortgagee.



     6. Original
Tenant’s Liability. Original Tenant shall remain fully liable to
Landlord under the Lease in accordance with its terms, all to the extent (and only to the
extent)
of all obligations or liabilities arising or accruing prior to the Effective Date hereof
(including,
without limitation, those additional Rent reconciliation obligations described in Paragraph 11
below). Original Tenant shall be released from all obligations and liabilities of the
“Tenant”
under the Lease first arising or accruing from and after the Effective Date, all of which
being
expressly assumed by Tenant hereunder. Notwithstanding anything to the contrary set forth
herein, Landlord hereby acknowledges and agrees that Tenant shall have no responsibility for
any obligations or liabilities arising or accruing under the Lease prior to the Effective
Date, and
Landlord shall not exercise any rights or remedies under the Lease against Tenant as a result
of
any acts or omissions of Original Tenant occurring prior to the Effective Date.



     7. Consent of Landlord. Landlord hereby consents to the foregoing assignment to
Tenant, subject to the terms and conditions contained herein. Landlord’s consent shall not be
deemed to otherwise modify any of the terms and provisions set forth in the Lease, nor does
Landlord hereby consent to any further assignment of the Lease or subletting of all or any
portion of Premises.



     8. Partial Termination of Lease. The term of the Lease and all other Lease terms
and conditions shall terminate on the Effective Date only as to that portion of the Premises
located on the 25th and 26th floors of the Building, as shown on
Exhibits A-l and A-2 of the
Second Amendment and stipulated to contain 55,340 square feet of Rentable Area (the
“Excluded Premises”), as though the Lease had expired by lapse of time on the Effective Date
with respect to the Excluded Premises. Following the Effective Date, the remaining balance of
the Premises (the “Remainder Leased Premises”), consisting of the entirety of floors 23 and 24
at the Building and stipulated to contain 60,494 square feet of Rentable Area (i.e., 30,172
square
feet on the 23rd floor and 30,322 square feet on the 24th floor), shall
be deemed to be the
“Premises” under the Lease, which Remainder Leased Premises is shown on Exhibit A-3 to the
Original Lease.



     9. Surrender and Notice. Original Tenant shall vacate and deliver possession of
the Excluded Premises to Landlord on or before 11:59 p.m. on the Effective Date, in its
“as-is”
condition existing as of the date of this Amendment, subject, however, to Tenant’s continuing
obligation to remove all furnishings and other personal property therefrom (other than the
“Excluded Premises Construction Materials”, as described below) on or before the Effective
Date, in accordance with Section 10(c) of the Original Lease. Any retention of possession by
Original Tenant or by Tenant of all or part of the Excluded Premises after the Exclusion Date
shall be deemed a holding over under Section 11 of the Lease without consent of Landlord, and
shall be subject to the terms and conditions of Section 11 with respect to such holdover.
Without
limitation of the foregoing, Landlord and Original Tenant hereby agree that, from and after
the
date hereof, Original Tenant shall not remove from the Excluded Premises any of the
construction materials currently being stored at the Excluded Premises (i.e., consisting of



3









 




drywall, ductwork and the like) (herein, the “Excluded Premises Construction Materials”).
Effective as of the Effective Date, the Excluded Premises Construction Materials shall
become the property of the Landlord, without any additional compensation, allowance or credit
to Original Tenant therefor, other than the benefits derived by Original Tenant under this
Amendment. Accordingly, for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Original Tenant hereby quitclaims, bargains, sells and delivers
to Landlord its entire right, title and interest in and to the Excluded Premises Construction
Materials, which conveyance shall become effective as of the Effective Date. Without
limitation of the foregoing, Original Tenant hereby confirms that, to its knowledge, Original
Tenant and/or Landlord is the owner of the aforedescribed Excluded Premises Construction
Materials, and no other party has any liens, claims for lien or other rights with respect
thereto. Tenant shall have no liability with respect to the surrender of the Excluded Premises
or the disposition of the Excluded Premises Construction Materials, it being hereby agreed
that Tenant shall not succeed to any right, title or interest of Original Tenant therein.




     10. Decrease in Base Rent. Effective as of the Effective Date, Base Rent provided
to be paid pursuant to Section l(b) and Section 4 of the Lease with respect to the Remainder
Leased Premises shall be reduced to the following amounts for the following respective periods
(and Section l(b) is amended accordingly):



	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	
	 	 	 	 	 	 	 	 	 	 	Annual Base
	 	 	 	 	 	 	 	 	 	 	Rent Per Square Foot of
	 	 	Annual	 	Monthly	 	Rentable Area
	Period	 	Base Rent	 	Base Rent	 	of the Premises
	Effective Date through
March 31, 2003

	 	$	1,028,398.00	 	 	$	85,699.83	 	 	$	17.00	 
	April 1, 2003 through March
31, 2004

	 	$	1,079,817.90	 	 	$	89,984.83	 	 	$	17.85	 
	April 1, 2004 through March
31, 2005

	 	$	1,079,817.90	 	 	$	89,984.83	 	 	$	17.85	 
	April 1, 2005 through March
31, 2006

	 	$	1,131,237.80	 	 	$	94,269.82	 	 	$	18.70	 
	April 1, 2006 through March
31, 2007

	 	$	1,197,781.20	 	 	$	99,815.10	 	 	$	19.80	 
	April 1, 2007 through March
31, 2008

	 	$	1,306,670.40	 	 	$	108,889.20	 	 	$	21.60	 
	April 1, 2008 through March
31, 2009

	 	$	1,415,559.60	 	 	$	117,963.30	 	 	$	23.40	 






     11. Additional Rent. Additional Rent for the calendar year which includes
the Effective Date shall be calculated separately for the Excluded Premises and the Remainder
Leased Premises as follows:




     (a) Additional Rent attributable to the Excluded Premises shall be prorated
pursuant to Section 5(e) of the Original Lease for the calendar year which includes
the Effective Date as though the Lease will terminate on the Effective Date, and “the
number of days of the Term falling within the Calculation Year”, as used in said
Section 5(e), shall be deemed to be the number of days in the period commencing on
January 1st of the




4









 









calendar year which includes the Effective Date and ending on the Effective Date. “Tenant’s
Proportionate Share”, as determined under Exhibit B to the Original Lease, shall, for
purposes of determining Additional Rent attributable to the Excluded Premises for said
calendar year, be deemed to be 55,340 square feet (i.e., being the rentable square footage
of the Excluded Premises). Original Tenant shall be responsible for payment of Additional
Rent attributable to the Excluded Premises for the calendar year which includes the
Effective Date (including, without limitation, all rights and/or obligations with respect to
reconciliations of actual Additional Rent as compared to Additional Rent Estimate relative
to the Excluded Premises for such year, as required under Section 5(c) of the Lease), and
Tenant shall have no rights or responsibility therefor.




     (b) Additional Rent attributable to the Remainder Leased Premises for the calendar
year which includes the Effective Date and for the remainder of the Lease term thereafter
shall be computed pursuant to Section 5 of the Lease, except that the “Tenant’s
Proportionate Share” as determined under Exhibit B of the Lease, for purposes of
determining Additional Rent for the Remainder Leased Premises, shall be deemed to be 60,494
square feet (i.e., being the rentable square footage of the Remainder Leased Premises).
Without limitation of the foregoing, the parties hereby agree that Original Tenant shall
have all rights and shall be responsible for all obligations with respect to
reconciliations of actual Additional Rent as compared to Additional Rent Estimate (i.e., as
required under Section 5(c) of the Lease) attributable to the Remainder Leased Premises for
the calendar year which includes the Effective Date, but only with respect to the period
from and after January 1st of such year and through the day preceding the
Effective Date (and Tenant shall have no rights or responsibility therefor), and Tenant
shall have all rights and shall be responsible for all obligations with respect to such
reconciliation for said calendar year for the period from and after the Effective Date and
through December 31st of such year (and Original Tenant shall have no rights or
responsibility therefor). All such Additional Rent reconciliation rights and obligations of
Original Tenant and Tenant shall survive the assignment effectuated hereby.



     12. Additional Rent Abatement. Notwithstanding anything herein or in the Lease to the
contrary, but subject to the last sentence of this Paragraph 12, an amount equal to fifteen
percent (15%) of the Additional Rent otherwise due and owing from Tenant hereunder relative to the
Remainder Leased Premises shall abate during the 24-month period from and after the Effective Date
and through the day preceding the 24-month anniversary thereof (the “Partial Additional Rent
Abatement Period”); provided, however, that Tenant shall continue to remain responsible for the
balance of Additional Rent (i.e., being 85% of the Additional Rent which would otherwise be due
and owing under the Lease) due and owing during such Partial Additional Rent Abatement Period, and
for all Base Rent and other obligations of Tenant due and owing relative to said Partial
Additional Rent Abatement Period, and provided further, that Tenant shall be responsible for all
rental and other obligations hereunder from and after the end of such Partial Additional Rent
Abatement Period. Notwithstanding the foregoing and without limitation of other remedies available
to Landlord, it is acknowledged and agreed that Tenant shall not be entitled to the foregoing
partial Additional Rent abatement relative to any month or months occurring within the Partial
Additional Rent Abatement Period during which Tenant is otherwise in “Default” in the payment of
Rent under the Lease (i.e., after expiration of appliable cure periods set forth therein).



5









 





     13. Security Deposit. It is acknowledged that Original Tenant has heretofore delivered
a Letter of Credit Security Deposit under Paragraph 11 of the Second Amendment, which has been
converted to cash in the sum of $845,000.00 and which is currently being held by Landlord as the
“Security Deposit” under the Lease (herein, the “Current Security Deposit”). It is further
acknowledged that, pursuant to the Side-Letter, all Monthly Base Rent and the Additional Rent
Estimate attributable to the Excluded Premises (i.e., being calculated at a rate of $80,495.56 for
March, 2002 and thereafter at a rate of $91,007.69 per month for Monthly Base Rent, and at a rate
of $63,325.19 per month for Additional Rent Estimate, prorated on a per diem basis for any partial
calendar month) is being deferred under the Lease from and after March 1, 2002 and through the
Effective Date (herein in the aggregate, the “Deferred Rent”), all of which is due and owing by
Original Tenant on or before the Effective Date hereof. Landlord, Original Tenant and Tenant hereby
agree to the following terms relative to the Security Deposit required under the Lease and the
aforedescribed Current Security Deposit and Deferred Rent:




     (a) Original Tenant and Tenant hereby direct Landlord to disburse to
Landlord’s own account and to retain, on the Effective Date, from the Current Security
Deposit being held by Landlord, an amount equal to all Deferred Rent which has accrued
through the Effective Date, which amount shall be applied against Deferred Rent due and
owing from Original Tenant under the Lease. In the event that the amount of Deferred
Rent accruing through the Effective Date exceeds the amount of the Current Security
Deposit being held by Landlord, then Landlord shall so disburse and retain the entire
Current Security Deposit as provided in the preceding sentence, and, in addition,
Original
Tenant shall pay Landlord, on or before the Effective Date, the entire amount of such
excess of Deferred Rent over the amount of the Current Security Deposit. Any payment
due from Original Tenant as provided in the preceding sentence shall be paid in cash,
or
by certified or cashiers check or wire transfer of same-day funds, and without
limitation
of other remedies available to Landlord, it is understood and agreed that such timely
payment shall be a further condition (at Landlord’s sole election) to the effectiveness
of
the Amendment.




     (b) On or before the Effective Date, and as a further condition (at Landlord’s
sole election) to the effectiveness of this Amendment, Tenant shall deliver to Landlord
a
Letter of Credit in the amount of $422,500.00, otherwise meeting the letter of credit
requirements described in Paragraph 11 of the Second Amendment, which amount shall
thereafter constitute the requisite “Security Deposit” under the Lease. All terms
governing such Security Deposit shall remain as set forth in Paragraph 11 of the Second
Amendment, modified as follows:




     (i) provided that Landlord has then received the requisite Security Deposit as
set forth in this Paragraph 13(b), then the Security Deposit Reduction schedule set
forth on page 12 of the Second Amendment shall be deleted effective as of the
Effective Date, and the following shall be substituted therefor:



6









 





	 	 	 	 	 
	Security Deposit Reduction Date	 	Permitted Security Deposit Reduction	 	Remaining Security Deposit Balance
	Third
anniversary of
Effective Date
	 	$105,625.00	 	$316,875.00
	Fourth
anniversary of
Effective Date
	 	$105,625.00	 	$211,250.00
	Fifth
anniversary of
Effective Date
	 	$105,625.00	 	$105,625.00
	Sixth
anniversary of
Effective Date
	 	$105,625.00	 	$0.00







     (ii) the last full paragraph of Paragraph 11 of the Second
Amendment (i.e., beginning with the language “If the net income...”) is deleted in
its entirety.




     (c) Provided that Landlord has then received the requisite Security Deposit as set
forth in Paragraph 13(b) above, then, no later than five (5) business days following
the Effective Date, Landlord shall deliver the balance of the Current Security Deposit
(i.e., being the Current Security Deposit less the amount applied to pay Deferred Rent
as described in Paragraph 13(a) above), if any, to or at the direction of Original
Tenant.



     14. Renewal Option. It is acknowledged that Tenant constitutes a “Tenant
Successor” (as defined in Section 15(h) of the Original Lease) for all purposes of the Lease,
and,
as such, the terms of Section 37 of the Original Lease (i.e., entitled “Renewal Option”) shall
continue to apply in full force and effect from and after the assignment to Tenant being
effectuated hereby, all in accordance with the terms of said Section 37.



     15. Real Estate Brokers.




     (a) Original Tenant represents and warrants that Original Tenant has not dealt
with any broker in connection with this Amendment and Original Tenant agrees to
indemnify and hold Landlord, its members, the managing agent and the leasing agent of
the Building harmless from all losses, damages, liabilities, claims, costs and expenses
(including reasonable attorneys’ fees) arising from any claims or demands of any broker
or brokers or finders for any commission alleged to be due such broker or brokers or
finders claiming to have dealt with Original Tenant in connection with this Amendment.




     (b) Tenant represents and warrants that Tenant has not dealt with any broker
in connection with this Amendment and Tenant agrees to indemnify and hold Landlord,
its members, the managing agent and the leasing agent of the Building harmless from all
losses, damages, liabilities, claims, costs and expenses (including reasonable
attorneys’
fees) arising from any claims or demands of any broker or brokers or finders for any
commission alleged to be due such broker or brokers or finders claiming to have dealt
with Tenant in connection with this Amendment.




     (c) Landlord represents and warrants that Landlord has not dealt with any
broker in connection with this Amendment and Landlord agrees to indemnify and hold




7









 








Tenant and Original Tenant harmless from all losses, damages, liabilities and
expenses (including reasonable attorneys’ fees) arising from any claims or demands of any
broker or brokers or finders for any commission alleged to be due such broker or brokers
or finders claiming to have dealt with Landlord in connection with this Amendment.



     16. As-Is. Tenant hereby accepts the Premises in its “as-is” condition. Tenant
acknowledges that Landlord shall not be required to make any improvements to the Premises or to
contribute any allowance proceeds therefor, in order for Tenant to ready the Premises for its
occupancy during the balance of the Lease term.



     17. Inapplicable Provisions. It is acknowledged and agreed that the terms of
Sections 34, 35 and 36 of the Lease (i.e., entitled “Initial Growth Space”, “Right of First Offer”
and “Expansion Option”, respectively) are no longer applicable, and such provisions are deemed null
and void. Further, it is acknowledged and agreed that Landlord shall have no further obligations
under the “Additional Premises Workletter” attached to the Second Amendment (i.e., including,
without limitation, any further construction obligations or any obligations to fund any further
portion of the “Allowances” thereunder), and all such obligations of Landlord under said Additional
Premises Workletter are hereby terminated and deemed null and void. Further, it is acknowledged and
agreed that Paragraphs 8 and 10 of the Second Amendment (i.e., entitled “Lobby Signage” and “Right
of First Offer”, respectively) are no longer applicable, and such provisions are hereby terminated
and deemed null and void. Finally, it is acknowledged and agreed that subparagraph (a) of
Paragraph 9 of the Second Amendment (i.e., said Paragraph 9 being entitled “Staircase and Fire
Stairwell”) is no longer applicable, and such subparagraph (a) of Paragraph 9 of the Second
Amendment is hereby terminated and deemed null and void, and, further, it is agreed that
subparagraph (b) of such Paragraph 9 of the Second Amendment is hereby amended by deleting the
phrase “23rd, 24th, 25th and 26th floors” from the
second line thereof, and by substituting the, phrase “23rd and 24th floors”
therefor. As a result of the foregoing, the parties acknowledge and agree that there are no
further expansion or first offer rights under the Lease of any kind which remain effective from and
after the date hereof.



     18. Parking. Landlord hereby confirms that Original Tenant has not heretofore waived
any of its parking spaces under Section 41 of the Lease, and Landlord agrees that Tenant shall be
entitled to all of Tenant’s parking rights under said Section 41 as of the Effective Date, all as
and in accordance with the terms and conditions set forth in said Section 41.



     19. Conditions Precedent.




     (a) The Amendment is expressly conditioned upon the “Closing Date” (as
hereinafter defined) having occurred on or before August 31, 2002. Notwithstanding anything
herein to the contrary, in the event the “Closing Date” does not so occur on or before
August 31,2002 (time being of the essence), for any reason, then this Amendment (including,
without limitation, the assignment of Original Tenant’s interest hereunder and Landlord’s
consent thereto) shall thereupon terminate, without further action of either party,
whereupon this Amendment shall be null and void in its entirety, and the Lease shall
continue, in full force and effect, without regard hereto. For purposes hereof, the term
“Closing Date” shall mean the date when both of the following events have occurred: (i) the
conveyance of all or substantially all of the assets of Original Tenant to Tenant, and (ii)
the issuance of a bankruptcy court order, issued by the appropriate United States
bankruptcy court which has jurisdiction over the current Chapter 11 bankruptcy



8









 






proceeding involving Guarantor, as debtor, whereby such bankruptcy court expressly
authorizes the transaction described in subclause (i) of this sentence.




     (b) Without limitation of the condition precedent described in Paragraph 19(a), it is
hereby further agreed that this Amendment (including, without limitation, the assignment
of Original Tenant’s interest hereunder and Landlord’s consent thereto) is expressly
conditioned upon the execution and delivery by Existing Mortgagee of its “Mortgagee
Joinder Consent” attached to this Amendment, and if Existing Mortgagee fails, for any
reason, to so execute and deliver such Mortgagee Joinder Consent on or before May 24, 2002
(time being of the essence), then this Amendment shall thereupon terminate without further
action of either party, whereupon this Amendment shall be null and void in its entirety,
and the Lease shall continue, in full force and effect, without regard hereto.



     20. Subordination of Lease. Section 20(a) of the Original Lease (i.e., entitled
“Subordination of Lease”) is hereby amended by adding the following language to the end of the
third full sentence thereof, following the phrase “subject to the remaining provisions of this
Section”:




“and subject, in any event, to Tenant and any such Mortgagee or Ground Lessor
entering into a subordination, non-disturbance and attornment agreement as
described in the last sentence of this Section 20(a)”.



     21. Existing Non-Disturbance Agreement. The parties acknowledge and agree that the
Non-Disturbance Agreement being assigned to Tenant hereunder satisfies the requirement for a
subordination, non-disturbance and attornment agreement from Existing Mortgagee as required under
Section 20 of the Lease (as such Section 20 has been amended by Paragraph 20 above), and that
Existing Mortgagee shall have no obligation to enter into any further subordination,
non-disturbance and attornment agreement with respect to the Lease.



     22. Entire Agreement. The entire agreement of the parties with respect to the
matters covered hereby is set forth in this Amendment and in the Lease as amended hereby.



     23. Counterparts. This Amendment may be executed in multiple counterparts which,
when taken together, shall constitute one and the same instrument.



     24. Lease in Full Force and Effect. Except as herein provided, all the terms and
provisions of the Lease shall remain in full force and effect, and Section 43 of the Original Lease
shall apply to this Amendment and to the Lease, as amended hereby.



[Signature Page Follows]




9









 








     IN WITNESS WHEREOF, this Amendment is executed by the parties as of the day and year
first set forth above.



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	LANDLORD:	 	 	 	 	 	 	 	 	 	ORIGINAL TENANT:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	303 WACKER REALTY L.L.C.	 	 	 	PROMOTIONAL MARKETING,	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	L.L.C., an Illinois limited liability	 	 
	By:	 	Hines Three Illinois Center	 	Company d/b/a UPSHOT	 	 
	 	 	Associates Limited Partnership, its	 	 	 	 	 	 
	 	 	managing member	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	By:
	 	/s/ Marc S. Simon	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Hines Three Illinois Center	 	Name:	 	Marc S. Simon	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	L.L.C., a general partner	 	Title:	 	 Manager	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	TENANT:	 	 
	 	 	 	 	By:	 	Hines Interests Limited

Partnership, a member	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Hines Holdings, Inc.,	 	EQUITY MARKETING, INC., a	 	 
	 	 	 	 	 	 	 	 	its general partner	 	Delaware corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:
	 	/s/ C. Kelvin Shannahan	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name:
	 	C. KELVIN SHANNAHAN	 	By:
	 	/s/ Leland P. Smith	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	EXECUTIVE VICE PRESIDENT	 	Name:
	 	Leland P. Smith	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	Title:
	 	 SVP	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






10









 







ACKNOWLEDGEMENT
AND CONSENT




     The undersigned “Guarantor” hereby acknowledges and consents to the terms of the
foregoing Amendment, and confirms that the Guaranty remains in full force and effect and shall
continue to apply, in all respects, relative to the obligations of “Original Tenant” under the
Lease, as amended by the foregoing Amendment; provided, however, that (a) Guarantor shall have no
obligations or liabilities under the Guaranty pertaining to any liabilities or obligations of the
“Tenant” under the Lease first arising or accruing from and after the Effective Date (with
Guarantor being expressly released therefrom), and (b) nothing contained herein shall constitute
an assumption by Guarantor of the Guaranty within the meaning of Section 365 of the Bankruptcy
Code; and provided further, however, that nothing contained herein shall operate to transform the
obligations, if any, of Guarantor under the Guaranty into administrative or priority claims under
Sections 503 and/or 507 of the Bankruptcy Code.



     IN WITNESS WHEREOF, the undersigned has executed this acknowledgement and
consent as of the 22nd day of May, 2002.



	 	 	 	 	 	 	 
	 

	 	GUARANTOR:	 	 
	 
	 	 	 	 	 	 
	 	 	HA-LO INDUSTRIES, INC.,	 	 
	 	 	an Illinois corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Marc S. Simon	 	 
	 

	 	Name:
	 	 

Marc S. Simon
	 	 
	 

	 	Title:
	 	CEO	 	 






11









 






MORTGAGEE
JOINDER CONSENT




     The undersigned, being the “Existing Mortgagee” as defined in the foregoing Amendment
and the current holder of the first mortgage encumbering the building located at 303 E. Wacker
Drive in Chicago, Illinois, hereby joins in the execution of such Amendment for the purpose of
consenting to the terms of such Amendment (including, without limitation, the assignment of
Original Tenant’s interest under the Lease and under the Non-Disturbance Agreement to Tenant, as
therein described), and Existing Mortgagee hereby acknowledges and agrees that, by virtue of Tenant
succeeding to all of Original Tenant’s interest under the Lease, Tenant shall be deemed a
“permitted assign” of Original Tenant’s interest under the Non-Disturbance Agreement described in
said Amendment, for all purposes.



     IN WITNESS WHEREOF, the undersigned has executed this Mortgagee Joinder Consent as of the
22nd day of May  2002.



	 	 	 	 	 	 	 
	 	 	METROPOLITAN LIFE INSURANCE COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mitchell E. Ryan	 	 
	 

	 	Name:
	 	 

MITCHELL E. RYAN
	 	 
	 

	 	Title:
	 	VICE PRESIDENT	 	 







12