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Exhibit 10.9  

 
 

EXHIBIT G-1
  
    LEASE    
    

        THIS LEASE made and dated as of this 13 day of October, 1994, between WILLIAM P. McCORMICK ("Lessor"), and JAKE'S RESTAURANT, INC. ("Lessee"). 

WITNESSETH:  

        In consideration of the covenants and agreements herein contained, the parties hereto mutually agree as follows: 

ARTICLE 1  

 LEASED PREMISES  

        Section 1.1    Lessor, in consideration of the rent and other payments hereinafter described to be paid and covenants to
be performed by Lessee, has let to the Lessee, and the Lessee does hereby rent from Lessor, those certain lands of Lessor located at 401 SW 12th Avenue, Portland, Oregon, more particularly described
as follows: 

The
premises now occupied by the restaurant doing business as Jake's Famous Crawfish, which premises includes 401-409 SW Washington and 1220 SW Stark, being the 7,000 square feet of food
storage, preparation and office space located in the basement; the 6,700 square feet of
food preparation and restaurant seating area located on the first floor; the 2,100 square feet of office space located on the second floor; and the 800 square feet of employee locker area located on
the third floor, but excluding the front or Duke Hotel Lobby portion of No. 409 SW 12th Avenue, all in the City of Portland, County of Multnomah, and State of Oregon ("Premises"), all as
further set forth on Exhibit "A" hereto, 

subject,
however, to all zoning, building and use ordinances and restrictions, and to all easements now in effect, and to any state of facts which an accurate survey would show, and further subject
always to the terms and provisions hereof. 

ARTICLE 2  

 TERM  

        Section 2.1    The original term of this Lease shall be fifteen (15) years, commencing on the 13th day of October,
1994, ("Commencement Date") and ending at midnight on the 12th day of October, 2009 (the "Original Term"). At the option of the Lessee, this Lease may be renewed at the end of the Original Term for an
additional five (5) year period (the "First Renewal Term"), and may be renewed again at the end of the First Renewal Term for an additional five (5) year period (the "Second Renewal
Term"), on the same terms and conditions, except that the minimum rental for said First and Second Renewal Terms shall be as provided in Sections 3.3 and 3.4 below. 

ARTICLE 3  

 RENTALS  

        Section 3.1    Base Rent.    Lessee covenants and agrees to pay to Lessor minimum monthly rentals (hereinafter
Base Rent) for the leased Premises in the amount of $17,500 for each and every month during the term of the Lease on or before the first day of each month. 

        Section 3.2    Additional Rent.    As and for additional rent, the Lessee shall make the payments required
under Article 4 and 5 hereof. 

 

        Section 3.3    Rent for First Renewal Term.    Base Rent for each lease year during the First Renewal Term
shall be an amount equal to 85% of the average annual total rent paid (Base Rent plus percentage) for the three (3) calendar years preceding the first year of the First Renewal Term. In no
event shall rent for the First Renewal Term be less than the annual base rent paid for the final year of the Original Term. 

        Section 3.4    Rent for Second Renewal Term.    Base Rent for each lease year during the Second Renewal Term
shall be an amount equal to 85% of the average annual total rent paid (Base Rent plus percentage) for the three (3) calendar years preceding the first year of the Second Renewal Term. In no
event shall rent for the Second Renewal Term be less than the annual base rent paid for the final year of the First Renewal Term. 

ARTICLE 4  

 TAXES, ASSESSMENTS AND CHARGES  

        Section 4.1    Throughout the term of this Lease, Lessee shall pay and discharge, prior to delinquency, all taxes,
assessments, impositions and charges whatsoever assessed or imposed upon the leased Premises, any improvements thereon and all personal property located on or in the leased Premises as they become due
and payable, and Lessee shall, upon written request from Lessor, submit to Lessor proper and sufficient receipts or other evidence of the payment and discharge of the same; provided, however, if the
Premises real property taxes, assessments or other charges are not imposed separately from the building of which they form a part, then the Lessee shall pay sixty percent (60%) thereof as its
pro rata portion. Lessee shall also pay sixty percent (60%) of all taxes, assessments, or other charges levied against all Common Building Improvements as defined in Section 14.3 hereof. Lessor
will promptly forward any tax statements it shall receive pertaining to all or part of Lessee's premises. If taxes, assessments, or other charges are imposed on areas of the property which do not
comprise or affect the Premises and are not Common Building Improvements, Lessor shall pay one hundred percent (100%) of said taxes. In the event any such taxes, assessments, impositions or charges
should not be paid when
due, Lessor shall have the right, but shall not be obligated, to pay the same. If Lessor shall make such payments, it shall thereupon become entitled to repayment by Lessee on demand, together with
interest thereon as provided in Article 19. 

        Lessee
may elect to let any improvement assessment go to bond in accordance with applicable law. Taxes and assessments levied or imposed preceding the expiration or termination of this
Lease, including payments on improvement bonds, shall be prorated as of the date of termination of this Lease. 

        Public
improvement assessments previously wholly or partially paid by Lessee shall be prorated on the basis of a 30-year amortization term as of the termination date of this
Lease or any extension hereof, and Lessee shall be reimbursed for the unexpired portion of such 30-year period; provided, however, that Lessee shall pay, as its pro rata share, sixty
percent (60%) of all improvement assessments and the like which are not assessed separately from the building of which they form a part. 

        The
first year and last year of the term of this Lease will be prorated between Lessor and Lessee. 

        Section 4.2    Lessee shall have the right in good faith, at its expense, in Lessor and/or Lessee's name, to contest or
review in legal proceedings, or in such manner as it deems suitable, any such taxes, assessments, impositions or charges, provided that such contest or review operates to suspend the collection of
such taxes, assessments, impositions or charges or prevents the sale of the leased Premises (or the said personal property, respectively) to satisfy the same; and provided further that Lessee, not
less than five (5) days before any such taxes, assessments, impositions or charges shall become delinquent, shall give notice to Lessor of its intention to contest or review same; and, pending
any such proceedings to contest or review same, that is to say, until such tax, assessment, imposition or charge 

2

 

shall
have become final, Lessor shall not have the right to pay, remove or discharge the tax, assessment, imposition or charge so contested or reviewed. Lessee may pay such item of contested tax,
assessment, imposition or charge to the appropriate public authority, under protest. Lessor will join in any contest or protest provided for in this Section 4.2 at the request of Lessee, but at
Lessee's sole cost and expense. 

        Section 4.3    Lessee shall also have the right, if Lessee so desires, to endeavor to obtain a lowering of the assessed
valuation of the leased Premises or the improvements placed thereon and Lessor agrees to cooperate and join in any such endeavor at no expense to Lessor. Nothing in this lease shall be construed as
requiring Lessee to pay any franchise tax, corporate license fees, income tax or personal property tax of Lessor, nor to pay any tax that may be levied upon or against the income or profits of Lessor,
including but not by way of limitation, any income from the rentals provided for herein, nor
any real property tax assessed against real property of Lessor, other than the property herein leased, nor any inheritance, gift, succession or estate tax based upon any inheritance, gift or transfer
of Lessor's interest in the leased Premises, nor any tax of the same nature as any tax mentioned in this sentence, nor any tax substituted for any tax mentioned in this sentence. 

        Section 4.4    Lessee agrees that within thirty (30) days after written notice from Lessor, it will exhibit to
Lessor for examination receipts for all taxes, assessments and charges paid. Real estate taxes shall be prorated between Lessee and Lessor as of the date of the signing of this Lease and also as of
the date of termination of this Lease; that is, Lessor is to bear and pay all real property taxes for the period prior to the signing of this Lease, and further, after termination of this Lease,
Lessor to be charged and to pay all real property taxes for the portion of the tax year following said Lease termination. 

ARTICLE 5  

 PERCENTAGE RENT  

        Section 5.1    Percentage Rent.    In addition to the Base Rent payable under Article 3, Lessee agrees
to pay to Lessor as additional rent in each year during the Original Term of this Lease and the Renewal Terms, if applicable, a sum equal to 6% percent of Lessee's gross sales in and from said
Premises in such year, computed as hereinafter provided, less the aggregate amount of the Base Rent paid in such year. 

        Section 5.2    Definition of Gross Sales.    The term "gross sales" as used in this Lease, shall mean the gross
amount received by Lessee whether or not for cash, credit, check, or charge account (whether payment is actually received for sales or credit or not) from all sales of merchandise, services and from
income from all other sources derived from business conducted on said Premises and including off premises sales and banquet and meeting room charges if the food was prepared at the Premises. 

        Section 5.3    Deductions from Gross Sales.    There shall be excepted from Lessee's gross sales, as said term
is used herein: a) the amount of all sales, excise or other taxes imposed by a governmental body, whether such taxes are separately added to, or included in the selling price; b) the
aggregate amount of the established discounts deducted by Diner's Club, American Express or other organizations issuing credit cards to customers of Lessee from the amounts charged to such customers;
c) insurance proceeds from casualty and business losses, except for business interruption insurance or other insurance to the extent that such insurance compensates Lessee for loss of sales;
d) the proceeds of the sale of any franchise to operate a restaurant on the premises; e) proceeds from the sale of fixtures or equipment used in the business; f) money deposited
in coin-operated devices, so long as said devices remain only a minor activity incidental to Lessee's use of the Premises; g) delivery or consumption of food where there exists no
intention to charge or collect for such delivery or consumption, as in the case of promotional meals, charity meals, and meals for employees; h) tips for 

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employees;
i) the amount of any actual refunds or credits made by Lessee for returned merchandise, the amount whereof had theretofore been included by Lessee in Lessee's gross sales. 

        Section 5.4    Accounting.    Lessee shall keep or cause to be kept, full, complete, and proper books, records
and accounts of the gross sales and credits of each separate department and concession at any time operated in the demised premises; said books, records and accounts, including any sales tax reports
that Lessee may be required to furnish to any governmental agency, shall at all reasonable times be open to the inspection of Lessor, Lessor's auditor or other authorized representative or agent. 

        Section 5.5    Percentage Rent Payments/Sales Reports.    On or before the fifteenth (15th) day of each
calendar month during the term of this Lease, Lessee shall prepare and deliver to Lessor at the place designated by Lessor a statement of gross sales made during the preceding calendar month. At such
time, Lessee shall pay to Lessor an amount equal to 6% of Lessee's gross sales for the prior month, less the aggregate amount of the Base Rent paid in such month. In addition, within fifteen
(15) days after the expiration of each lease year and within ninety (90) days after termination of this Lease if the Lease should not terminate at the end of the lease year, Lessee shall
prepare and deliver to Lessor at the place designated by Lessor a statement of gross sales during the preceding calendar year certified to be correct by Lessee. Lessee shall furnish similar statements
for any licensees, concessionaires, and subtenants if they are permitted by landlord pursuant to Article 13 below. All such statements shall be in such form as Lessor may reasonably require,
and are subject to Sections 5.6 and 5.7 below. 

        Section 5.6    Audit.    At Lessor's expense, Lessor may cause at any reasonable time upon fifteen
(15) days prior notice to Lessee a complete audit be made of Lessee's records relating to gross sales for the period covered by any statement issued by Lessee pursuant to this Lease; provided,
however, that if such records are found to be incorrect to the extent of three-percent (3%) or more over the gross sales figure submitted by Lessee, Lessee shall pay for such audit. Lessee shall
promptly pay to Lessor any deficiency, or Lessor shall promptly refund to Lessee any overpayment, as the case may be, which is established by such audit. Lessor shall only have the right to audit
Lessee's books and records with respect to Gross sales once per year. 

        Section 5.7    Year-end Adjustment.    Within thirty (30) days after the close of each lease
year, a final adjustment and accounting for each lease year shall be had to determine the gross sales of the preceding lease year, and the amount of rent paid by the Lessee during such preceding lease
year, including the rent based upon the percentage of gross sales. In the event the amounts of rent for said year actually paid by Lessee exceed 6% of the gross sales as so computed on a twelve month
basis, then such excess rental payments shall, at Lessee's option, be promptly refunded to Lessee, or be credited by Lessor to Lessee upon the next installment or installments of monthly base rental
due under the Lease. Provided, however, that Lessee shall never pay for any lease year less than the Base Rent provided for above. In the event the amount of rent paid by Lessee is less than six
percent (6%) of the gross sales, Lessee shall pay the difference to Lessor. All debits and credits arising under the terms of this paragraph shall be paid within thirty (30) days of the
completion of the final adjustment and accounting. 

        Section 5.8    Operation of Business.    Lessee shall continuously during the entire term of this Lease,
operate said business on said Premises with due diligence and efficiency as to reasonably produce the maximum return to Lessee and keep said premises open for business and cause such business to be
conducted thereon at a minimum during lunch and dinner hours Monday through Friday and during the dinner hours Saturday and Sunday; provided, however, that this provision shall not apply if the
demised premises shall be closed and the business of Lessee therein shall be temporarily shut down on account of (i) strikes; (ii) lockouts; (iii) reconstruction as a consequence
of casualty; (iv) force majeure; (v) public holidays; (vi) causes beyond the control of Lessee; b) periods less than ten (10) consecutive days in any one lease year
on account of repair and/or renovation; or c) for not more than three (3) days out of respect to the memory of any deceased officer or employee of Lessee, or the relative of 

4

 

any
such officer or employee. Except as otherwise provided in this Lease, the Premises shall be closed for no longer than five (5) consecutive days without the express written consent of
Lessor. Lessor shall not unreasonably withhold such consent. 

        Section 5.9    Confidentiality.    Lessor covenants and agrees with Lessee that the Lessor will keep and treat
as strictly confidential all information and data obtained from the Lessee's report of gross sales. Lessor shall not disclose such information nor disseminate copies or excerpts of all or any portion
of Lessee's report of gross sales, except a) to lending institutions from which the Lessor has, or in full faith intends to seek financing; b) to a prospective transferee of Lessor's
interest in the Premises; c) in connection with litigation between Lessor and Lessee arising hereunder; d) in compliance with subpoenas or judicial orders duly issued to Lessor; or
e) in any registration statement filed with the Security and Exchange Commission or similar body. Any disclosures made by Lessor pursuant to this Section 5.9 will be made only after
executing a confidentiality agreement containing terms similar to those delineated herein, with the third party to whom such disclosures will be made. 

ARTICLE 6  

 USE OF PREMISES  

        Section 6.1    It is within the contemplation of the parties that Lessee will use the leased property for sales of food
and liquor in a first class restaurant. No other use is permitted. 

        Section 6.2    Lessee covenants that during the term of this Lease, all building improvements comprising the leased
Premises and the Premises itself shall be kept by Lessee at its own expense in good repair in a clean, safe, wholesome, insurable and tenantable condition and in conformity with the requirements of
the United States, State of Oregon, and County of Multnomah and all other applicable public authorities. The building improvements at any time comprising the leased Premises, and all parking areas,
sidewalk areas, vaults, steps and excavations upon or contiguous to, and used solely for the benefit of the leased Premises, shall be made and kept by the Lessee at its own expense in a safe, clean,
secure and conformable condition, conformable in all ways to the requirements of all public authorities having jurisdiction thereof. 

        Section 6.3    Indemnity.    Lessor shall not be liable for any damage or liability of any kind or for any
damage or injury to persons or property, after Lessee's occupancy of the Premises, from the use, occupation, and enjoyment of the Premises by Lessee, or any person thereon, or holding under Lessee, or
arising out of any breach or default by Lessee in the performance of its obligations hereunder, and Lessee agrees to indemnify, defend, and hold harmless Lessor and Lessor's employees, agents, and
affiliates from all such liability whatsoever (including costs and reasonable attorney's fees) on account of any such damage or injury and from all liens, claims, and demands arising out of the use by
Lessee of the Premises or any repairs or alterations which Lessee may make to the Premises; provided, however, Lessee shall not be obligated to indemnify Lessor for any liability or damage directly
and primarily caused by or attributable to, any act or omission of the Lessor, its agents, servants, employees or contractors, nor shall Lessee have any liability for any damage or injury to persons
or property occurring prior to the date hereof. 

        In
any case in which Lessee shall be obligated under any provision of this Lease to pay Lessor any loss, cost, damage, liability, or expense suffered or incurred by Lessor, Lessor shall
allow Lessee, as an offset against the amount thereof, the net proceeds of any insurance collected by Lessor for or on account of such loss, cost, damage, liability, or expense. 

        Lessor
shall indemnify, defend, and hold harmless Lessee and Lessee's employees, agents and affiliates for any damage or liability of any kind, including costs and reasonable attorney
fees, arising out of Lessor's possession of the Premises and directly or primarily attributable to Lessor's negligence 

5

 

or
intentional wrongful conduct or directly or primarily attributable to the negligence or intentional wrongful conduct of Lessor's servants or employees. 

        Section 6.4    Lessee shall keep in force such insurance policy or policies as necessary to fully protect the Lessee and
Lessor against all claims and demands as in this Article 6 described, such insurance to be single limit $5,000,000 coverage for death or personal injury and provide coverage of not less than
$500,000 for property damage, and Lessee shall furnish to Lessor written evidence that said policy is currently in effect. In the event that Lessee shall fail to provide said insurance coverage, the
Lessor may, but is not obligated to, effect said insurance coverage. Lessee shall pay on demand the amount properly paid by the Lessor for such purpose, with interest thereon at the rate of ten
percent (10%) per annum, from the date of payment thereof by Lessor, and in case of failure of Lessee so to pay, such amount shall be added to and become part of the next monthly installment of rent
and shall become and thereafter for all purposes be additional rent and the Lessor shall have the same remedies for the collection thereof or otherwise as in the case of default of payment of the
monthly rent hereby reserved. 

ARTICLE 7  

 LEGAL REQUIREMENTS  

        Section 7.1    Except for any obligations of the Lessor contained in this Lease, Lessee shall comply with all
governmental laws, ordinances, regulations and rules of every kind pertaining to said Premises or to the use and occupancy thereof ("legal requirements"), and Lessee shall indemnify, defend, and hold
harmless Lessor from all costs, attorney fees, expenses, claims and damages arising by reason of Lessee's failure to comply therewith. Lessee shall have the right to contest the validity of or seek a
variance from or review of said legal requirements, or any of them, by administrative or court proceedings or in such other manner as Lessee deems suitable and, if able, may have said legal
requirements, or any of them, cancelled, removed or revoked without actual compliance with the same. If such actions or proceedings are instituted, they shall be conducted promptly at the expense of
Lessee and free of expense to Lessor. If and whenever any of said legal requirements shall become absolute against Lessee and the leased Premises, or against Lessor after contest thereof, Lessee shall
comply with the same due diligence. If Lessee is in default thereof for five (5) days, Lessor may comply therewith and the cost and expense of so doing may be paid by Lessor. Lessee shall
reimburse Lessor upon demand, together with interest on all sums paid by Lessor as provided in Article 19. 

        Section 7.2    Lessor will join in any contest provided for in this paragraph at the request of Lessee but at Lessee's
sole cost and expense, and, as a condition of such joinder, may require reasonable indemnity against cost or other damages by reason of such joinder. 

ARTICLE 8  

 UTILITIES; UTILITY EASEMENTS; MECHANIC'S LIENS  

        Section 8.1    During the term hereof, Lessee shall pay for all gas, water, electricity and other utilities, materials
and services which may be furnished to, used or consumed by Lessee in or about the Premises, and shall keep the Premises free and clear of any lien or encumbrance of any kind arising out of Lessee's
non-payment thereof. 

        Notwithstanding
the foregoing, in the event the electrical service to the Premises is interrupted for more than twenty-four (24) consecutive hours, and as a result
thereof Lessee is unable to conduct its business on the Premises, the Base Rent shall abate until such service is restored. 

        Section 8.2    Lessor agrees at the reasonable request of Lessee, when Lessee is not in default, to grant such easements
over, on, or beneath the Premises, as may be necessary to enable the Premises to 

6

 

be
adequately served by gas, electricity, water, sewer and telephone utilities during the term of this lease. 

        Section 8.3    Lessee shall keep the Premises and improvements thereon at all times during the term free of mechanic's
and materialmen's liens and any other liens by or through the contracts, acts or omissions of Lessee, its agents, servants, employees, affiliates, or contractors, and will defend, indemnify, and hold
Lessor harmless against all such liens or claims and against all reasonable attorney fees and other costs and expenses growing out of or incurred by reason or on account of any such liens or claims.
Should Lessee fail fully to discharge any such lien or claim (the validity of which is not disputed by Lessee or, in any case, if finally adjudicated against Lessee by any court of law) within thirty
(30) days after written demand from Lessor to Lessee to do so, Lessor, at Lessor's option, may pay the same or any part thereof, and Lessor shall be the sole judge of the validity of said lien
or claim. All amounts so paid by Lessor, together with interest thereon, shall be paid by Lessee as provided in Article 19. However, in the event Lessee in good faith desires to contest the
validity or justness of any such charge or lien
before paying the same, then Lessee shall have the right to do so and to postpone payment thereof until the final determination of any such proceedings. 

ARTICLE 9  

 INSURANCE FOR FIRE AND PHYSICAL DESTRUCTION  

        Section 9.1    Lessee shall procure and maintain in full force and effect continuously during the term of this lease at
its sole expense, the following kinds of insurance, and with coverage in amounts not less than stated below, which insurance shall be written by companies which are qualified to engage in the
insurance business in the state, such insurance to include as the insured parties thereunder, Lessor and Lessee, as their interests may appear: 

	(a)
	Fire
and extended coverage insurance on the building improvements comprising the Premises, in an amount sufficient to prevent Lessor or Lessee from becoming a co-insurer
of any loss, but in an amount at all times equal to not less than ninety percent (90%) of the then full insurable value of the building improvements at any time comprising the leased Premises. The
mortgagee of any mortgage on any part of the leased Premises pursuant to Article 12, if any, shall be named as an additional insured under said insurance as its interests may appear, subject to
Lessor notifying Lessee of the name of such mortgagee. Lessor agrees to waive any claim upon, or interest in, fire insurance proceeds, provided that same is used for restoration or improvements on the
Premises.

	

	In
the event that the Lessee shall elect not to utilize the proceeds of fire insurance policy(ies) in repairing or rebuilding the improvements on the Premises, same shall
be applied for the following purposes and priorities:

	(1)
	In
reduction of any then existing encumbrances against the demised Premises and the improvements, including taxes, assessments (bonded or otherwise) and mortgages;

	(2)
	In
payment of any rents accrued and unpaid and any other sums theretofore arising under this lease and unpaid to Lessor;

	(3)
	In
payment of the Base Rents that would fall due during the balance of the leasehold term.

	(4)
	The
overplus to be the property of the Lessor. 

        Section 9.2    Lessee may maintain such insurance under a blanket policy covering the leased Premises and other Premises
and property of Lessee and affiliated companies. Lessee, upon Lessor's reasonable request, shall cause to be furnished to Lessor a certificate evidencing the insurance maintained by Lessee as required
by this lease, or satisfactory evidence that such insurance is in effect. 

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        Section 9.3    Every such insurance policy shall contain to the extent obtainable, an agreement by the insurer that it
will not cancel such policy except upon ten (10) days' prior written notice to Lessor and to said mortgagees. 

        Section 9.4    If Lessee fails to procure any such insurance or keep the same in force and effect, Lessor may, after
written notice to Lessee, procure the necessary insurance and pay the premium therefor and Lessee shall repay Lessor on demand the amount so paid as premium, together with interest as provided in
Article 19. 

ARTICLE 10  

 EMINENT DOMAIN  

        Section 10.1    Partial Taking.    If a portion of the Premises is condemned and Section 10.2 does not
apply, the Lease shall continue on the following terms: 

        (1)   Lessor
shall be entitled to all of the proceeds of condemnation, and Lessee shall have no claim against Lessor as a result of the condemnation, except it shall have a
claim against the condemning
authority as permitted by statute, for the value of fixtures installed by it, relocation expenses, and for reasonable moving expenses, if applicable. 

        (2)   Lessor
shall proceed, promptly upon its receipt of the condemnation award, to make such repairs and alterations to the Premises as are necessary to restore the remaining
Premises to a condition as comparable as reasonably practicable to that existing at the time of the condemnation. Such repairs shall be completed as rapidly as reasonably practical, subject to
obtaining all necessary building approvals and permits, and shall be completed within six (6) months unless delayed without fault or neglect of Lessor (excusable delay shall include the delay
of building officials in granting permits, where Lessor has submitted timely and adequate plans and specifications). If such repairs are delayed longer than six (6) months due to the fault or
neglect of Lessor, Lessee may terminate the Lease. 

        (3)   After
the date on which title vests in the condemning authority or an earlier date on which alterations or repairs are commenced by Lessor, to restore the balance of the
Premises in anticipation of taking, the Base Rent shall be reduced in proportion to the reduction in usable space on account of the partial taking. If the parties are unable to agree on the amount of
rent, the amount shall be determined by arbitration in the manner provided in Section 21. 

        (4)   During
any period of reconstruction or renovation, there shall be an abatement of Base Rent, additional rent, and all other charges under the Lease until the earlier of
a) Lessee's reopening business to the public; or b) thirty (30) days following completion of Lessor's renovation work. 

        (5)   If
a portion of Lessor's property not included in the Premises is taken, and severance damages are awarded on account of the Premises, or an award is made for detriment
to the Premises as a result of activity by a public body not involving a physical taking of any portion of the Premises, this shall be regarded as a partial condemnation to which Sections 10.1(1) and
10.1(3) apply, and the Base Rent shall be reduced to the extent of reduction in rental value of the Premises as though a portion had been physically taken. 

        (6)   The
term of the Lease shall be automatically extended by any period of time that Lessee's business is closed due to a partial taking or the renovation or repair thereof. 

        Section 10.2    Total Taking.    If a condemning authority takes all of the Premises or a portion sufficient to
render the remaining Premises reasonably unsuitable for the use that Lessee was then making of the Premises, which determination shall be made according to the reasonable discretion of the Lessee,
provided that more than thirty percent (30%) of the square footage of the Premises is 

8

 

taken,
the Lease shall terminate as of the date the title vests in the condemning authorities. Lessor shall be entitled to all of the proceeds of condemnation, and Lessee shall have no claim against
Lessor as a result of the condemnation, and Lessee shall have such claim against the condemning authority as permitted by statute for the value of fixtures installed by it, relocation expenses and
moving expenses. 

        Section 10.3    Sale in Lieu of Condemnation.    Sale of all or part of the Premises to a purchaser with the
power of eminent domain in the face of a threat or probability of the exercise of the power shall be treated for the purposes of this Section 10 as a taking by condemnation. 

ARTICLE 11  

 ESTOPPEL CERTIFICATES AND

QUIET ENJOYMENT  

        Section 11.1    Lessee agrees, at any time and from time to time upon not less than twenty (20) days' prior
written request by Lessor, to execute, acknowledge and deliver to Lessor, and the Lessor agrees, at any time and from time to time upon not less than twenty (20) days' prior written request by
the Lessee or any mortgagee, to execute, acknowledge and deliver to the Lessee or such mortgagee, a statement in writing certifying that this lease is unmodified and in full force and effect (or if
there have been modifications, that the same is in full force and effect as modified, and stating the modifications) and the dates to which Base Rent and other charges have been paid in advance, if
any, and whether or not there is any existing default by Lessee or notice of default served by Lessor, it being intended that any such statement delivered pursuant to this Article 11 may be
relied upon by any prospective purchaser of the fee or leasehold or mortgagee or assignee of any mortgagee upon the demised Premises or any prospective mortgage. 

        Section 11.2    Lessor covenants with Lessee that Lessor has fee simple title to the leasehold Premises and has the
necessary rights to grant easements appurtenant thereto, and Lessor covenants and agrees with Lessee that conditioned upon Lessee's paying the rent herein provided and performing and fulfilling all
the covenants, agreements, conditions and provisions herein, Lessee shall and may at all times during the term have, hold, and enjoy the Premises, peacefully, quietly, and exclusively, without
hindrance from Lessor or anyone claiming by, through, or under Lessor. 

ARTICLE 12  

 SUBORDINATION OF LEASE AND

IMPROVEMENTS BY LESSEE  

        Section 12.1    Lessee agrees to install all of the necessary equipment and fixtures to operate its business, at its own
cost and expense. 

        Section 12.2    Lessee does hereby pledge, hypothecate, assign and set over unto the Lessor all of said fixtures and
equipment affixed to the real estate as security for the faithful performance of this Lease, and does hereby subordinate its interest therein to any future mortgage or mortgages placed on the Premises
by the Lessor. 

        Section 12.3    This Lease and all rights of the Lessee shall at all times be subject and subordinate to any mortgage
presently existing on the Premises by the Lessor, and any renewal, extension, modification or consolidation of such mortgage. Lessor will request a nondisturbance agreement for said mortgage, but
Lessee acknowledges there is no right of Lessor to compel such agreement from any mortgagee. 

        Provided,
however, as a condition to any future mortgages to which subordination is requested, Lessee shall be entitled to receive a nondisturbance agreement which shall provide that so
long as the Lessee shall faithfully discharge the obligations on its part to be kept and performed under the terms 

9

 

of
this Lease, its tenancy shall not be disturbed, nor shall this Lease be effected by any default under any such mortgage, lease or other instrument, and in the event of foreclosure or enforcement of
any such mortgage, lease or other instrument, the rights of the Lessee hereunder shall survive and this Lease shall in all respects continue in full force and effect; provided, however, that Lessee
fully performs all of its duties and obligations hereunder. 

        Section 12.4    Subject to the provisions of Section 12.3, nothing contained in this Lease shall preclude the
Lessor from mortgaging its fee or reversionary interest or estate in the leased property, or renewing, extending, modifying, consolidating or replacing any such mortgage. 

        Subject
to the paragraphs herein provided, all subleases, if approved as provided herein, entered into by the Lessee shall be subject and subordinate to all the terms, conditions and
covenants of this Lease. 

        Section 12.5    Subject to the provisions of Section 12.3 hereof, the Lessee shall execute, whenever required by
the Lessor, a proper instrument of subordination in accordance with the provisions of these Articles. 

ARTICLE 13  

 ASSIGNMENT AND SUBLETTING  

        Section 13.1    Subject always to the Lessor's right of first refusal under Section 28.1 of this Lease, the
Lessee's interest in this Lease may not be assigned, transferred, encumbered or sublet, in whole or in part, voluntarily or by operation of law, without the written consent of the Lessor, and if any
of these acts are attempted, or occur without the consent, this Lease may be terminated at the option of the Lessor; provided, however, Lessor shall not unreasonably withhold consent to assignment or
sublease to a reliable transferee which shall operate a first class, high quality restaurant. 

        For
purposes of this Article 13, an assignment or transfer includes any direct or indirect change in control of the Lessee, whether by merger, consolidation, liquidation sale or
other change in ownership of Lessee's business or the business of the parent company of Lessee. 

        Section 13.2    Notwithstanding the foregoing, Lessor's consent shall be given to any of the following transfers or
assignments: a) a sale or transfer of all or a substantial part of the issued and outstanding capital stock of Lessee, or any direct or indirect parent of Lessee which controls Lessee, pursuant
to a public offering, for such capital stock; provided, however, such indirect or direct parent shall control Lessee immediately prior to the public offering; or b) a transfer of all its stock
or assets (or the stock or assets of any direct or indirect parent of Lessee, which controls Lessee), in connection with a transfer or disposition of a majority of the McCormick and Schmick
restaurants, but in no event less than three (3). 

        Notwithstanding
the Lessor's consent to assignment, the Assignor shall remain liable for all obligations accruing under the lease prior to the date of assignment and within one year
thereafter. 

10

   ARTICLE 14  

 MAINTENANCE OF IMPROVEMENTS  

        Section 14.1    Lessor shall have no obligation during the initial term or any extension thereof to make any repairs,
alterations, additions or improvements upon the demised Premises. 

        Section 14.2    Lessee as and for additional rent shall keep and maintain the improvements on said Premises, including
all systems, plumbing, drain pipes, sewers and each and every other incident thereof, together with the grounds, in a state of good repair and upkeep, and shall neither suffer nor permit any waste or
deterioration thereof, and shall deliver up the same upon expiration of the base term or any extension thereof in the same good order and condition as same may be at the date of the execution of this
Lease, reasonable use and wear thereof, damage by fire and unavoidable casualty, only, excepted; provided, however, Lessee shall pay sixty percent (60%) of the cost of repairs or maintenance to Common
Building Improvements, as defined in Section 14.3 below. 

        Section 14.3    Lessee shall not be responsible for said repairs in areas of the building occupied by other tenants of
the building and not within the Premises, as defined in Article 1.1 above, and Lessee shall only be responsible for sixty percent (60%) of repairs to Common Building Improvements. Common
Building Improvements are defined as those improvements which affect areas shared by or having the ability to be shared by Lessee with other tenants, including but not limited to the roof; exterior
walls; common stairways and/or elevators; fire escapes; central heating, cooling and/or ventilation systems; central mechanical, electrical or plumbing systems and the foundation of the building. 

ARTICLE 15  

 ASSESSMENTS FOR PUBLIC UTILITIES  

        Section 15.1    In the event that during the period of this lease or any renewal thereof, public improvement assessments
for sewer, water, streets, lights or other public utilities are imposed upon the demised Premises, Lessee shall initially pay or arrange to pay all such charges either in cash or by installments as
may be authorized by the public authority imposing such assessment; and in the event of termination of this lease by expiration of term or for any reason other than default in performance of the
obligations hereof during the Original or Renewal Terms Lessee shall be entitled to prorate reimbursement as of the termination or expiration of such term, based on an assumed 20-year
depreciation or amortization period; that is to say, that the Lessee shall be reimbursed for the remaining period during which such improvement would otherwise be payable by Lessee, but for the
termination or expiration of the lease based on a 20-year useful life of such improvement; provided, however, assessments which burden the building of which the Premises form a part
shall be Lessee's responsibility to the extent of sixty percent (60%) of their total cost. 

ARTICLE 16  

 SIGNS  

        Section 16.1    At Lessee's own cost and expense a sign or signs may be placed on the leased Premises with Lessor's
approval, which approval will not be unreasonably withheld. 

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ARTICLE 17  

 ENVIRONMENTAL PROVISIONS  

        Section 17.1    Definitions:    

        (a)   "Applicable
law" is broadly defined by specific reference to environmental statutes to include all federal, state, and local laws, regulations, and local ordinances
governing (i) the existence, clean-up or remedy of contamination; (ii) the protection of human health and the environment; (iii) the control of hazardous waste; and
(iv) the use, generation, transport, removal, and treatment of Hazardous Substances (as defined herein). 

        (b)   "Hazardous
Substances" shall mean any and all hazardous or toxic substances, materials or wastes now or hereafter defined or listed under the Environmental Laws (as
defined herein). 

        (c)   "Environmental
Laws" shall mean the Resource Conservation and Recovery Act, the Toxic Substances Control Act, Comprehensive Environmental Response, Compensation
Liability Act, the Solid Waste Disposal Act, ORS 466.005, et seq or any comparable federal or state statutes, or any regulation promulgated under any of the federal or state statutes relating to the
protection of human health or the environment, and any amendments thereto. 

        Section 17.2    Lessor Responsibilities.    Lessor shall be solely and completely responsible for responding
and complying with any administrative notice, order, request or demand, or any third party claim or demand relating to potential or actual environmental contamination by Hazardous Substances which
were in, on, or under the premises by reasons of Lessor's activities on the premises, or for any reason other than those which are the responsibility of Lessee under Section 17.3 below,
including, but not limited to, response, clean-up, and removal. The responsibility conferred under this Section 17.2, includes, but is not limited to, responding to such orders on
behalf of Lessee and defending against any assertion of Lessee's financial responsibility or individual duty to perform under such orders. 

        Under
no circumstances is either party responsible to the other for any Hazardous Substance contamination in, on or under the property by reason of activities by or conduct of prior
Owners, Lessees, or Possessors, their employees, agents, affiliates, licensees, contractors or invitees at any time prior to the date this Lease was executed. 

        Section 17.3    Lessee Responsibilities.    Without limiting any other obligations under any other paragraph of
this Lease, Lessee shall be solely and completely responsible for responding and complying with any administrative notice, order, request, or demand or any third party claim or demand relating to
potential or actual environmental contamination by hazardous substances caused by Lessee or its successors, assigns, sublessees, contractors, or invitees on or under the Premises, including, but not
limited to, response, clean up and removal. Responsibility conferred under this paragraph includes, but is not limited to, responding to such orders on behalf of Lessor in defending against any
assertion of Lessor's financial responsibility or individual duty to perform under such orders. 

        Section 17.4    Hazardous Substances.    Without limiting any other obligation under any paragraph of this
Lease, Lessee shall not cause or permit any Hazardous Substances to be brought upon, kept, or used in or about the premises by Lessee, its agents and employees, contractors, affiliates, licensees or
invitees,
other than Hazardous Substances which are necessary or useful to Lessee's business, and will be used, kept, and stored in a manner that complies with all laws regulating any such Hazardous Substances
so brought upon or used, or kept in or about the premises. Lessee shall install no underground tanks on the premises. 

        Section 17.5    Indemnification.    Without limiting any other obligation or indemnification under any other
paragraph of this Lease, each of the parties shall indemnify, defend, and hold the other party harmless from and against any and all claims, judgments, damages, penalties, fines, costs, liabilities or 

12

 

losses
which have arisen before or during or after the Lease term as a result of contamination by Hazardous Substances, which are their responsibility under the foregoing paragraphs of this
Section 17. This indemnification includes, without limitation, costs (including reasonable attorney's fees) incurred in connection with any investigations of site conditions or any
clean-up, remedial removal, or restoration work required of any federal, state, or local governmental agency or political subdivision, because of Hazardous Substances present in the soil
or in ground water, on or under the premises. Without limiting the foregoing, if the presence of any Hazardous Substances on the premises caused or permitted by Lessee or Lessor, its agents,
employees, contractors or affiliates, results in any contamination of the premises, Lessee (or Lessor, as the case may be) shall promptly take all actions at its sole expense as are necessary to
remove such contamination and clean, restore, and remediate the premises therefrom in accordance with Applicable Law, provided that Lessor's approval (or Lessee's approval, as applicable) of such
actions shall first be obtained, which approval shall not be unreasonably withheld, so long as such action would not potentially have any material adverse long term or short term affect on the
premises. The foregoing indemnity with respect to contaminations caused by Lessee during the tenancy enforced under this Lease, shall survive the expiration or early termination of this Lease. 

ARTICLE 18  

 NONSTRUCTURAL CHANGES  

        Lessee may, without Lessor's consent, make interior nonstructural alterations, or other alterations in or to the Premises, provided that the costs do not exceed
$10,000 in any one Lease Year, and further provided that such alterations or additions do not adversely affect the structural integrity of the Premises. 

ARTICLE 19  

 LESSOR'S PERFORMANCE OF

LESSEE'S OBLIGATION  

        Section 19.1    If Lessee shall default in the performance of any covenant contained herein to be performed by Lessee
and, following five (5) days' written notice of Lessor's intention to do so, Lessor performs the same for the account of Lessee, in accordance with the provisions of this Lease, Lessee shall
reimburse Lessor on account thereof, upon demand, with interest at the rate of ten percent (10%) per annum. The application of this Article 19 shall be limited to covenants contained in
Articles within which reference is made to this Article 19. 

ARTICLE 20  

 SURRENDER OF PREMISES ON TERMINATION OF LEASE—

IMPROVEMENTS TO BECOME PROPERTY OF LESSOR  

        Section 20.1    Lessee shall, upon expiration or other termination of the original Term or Renewal Terms hereof, for any
reason whatever, surrender to the Lessor the leased Premises, together with the buildings and structures hereafter erected or standing thereon, and the building equipment then upon the leased Premises
and the sidewalks adjacent thereto, together with all alterations and replacements thereon, in good order and condition and repair, except for reasonable wear and use thereof, and except also that
damage by fire, the elements, or other cause for which the Lessee is obligated to maintain insurance under any of the provisions of Article 9 shall be governed by the provisions of said
article, and except further damage or termination of this lease by any taking by condemnation, or exercise of eminent domain shall be governed by the provisions of Article 10. 

13

 

        All
alterations, additions and improvements which may be made or installed by either Lessor or Lessee upon the leased Premises shall, upon the making or installation thereof be and
become a part of the leased Premises and shall remain upon and be surrendered with the leased Premises as part thereof at the termination of this lease; subject, however, to the terms and provisions
of this lease; provided,
however, that any furniture, fixtures or other similar leasehold improvements installed upon the Premises by sublessees and required by the terms of said sublease to remain the property of sublessee
shall be exempt from any right of Lessor herein. 

        It
is further agreed and understood that when Lessee's rights have terminated hereunder, that all mortgages, security arrangements and other financial obligations imposed upon the
Premises by Lessee shall be satisfied and completely cleared from the title to said leased Premises. 

        Section 20.2    Unattached, movable fixtures, furniture, equipment, art work and signs (other than building equipment)
("Trade Fixtures") installed by the Lessee in the leased Premises or which may be installed therein during the Original or Renewal Terms, as applicable, shall not become a part of the leased Premises
and may be removed by the Lessee from the leased Premises at any time during or within a reasonable time after the expiration of the Original or Renewal Terms, provided that Lessee is not then in
default hereunder and provided that Lessee shall, at its own cost and expense, repair any and all damages to the leased Premises resulting from or caused by the removal thereof; provided, however,
that all Trade Fixtures owned by Lessor prior to the Commencement Date and their replacement shall become the property of Lessor upon the termination of the Lease and may not be then removed. 

        Section 20.3    No surrender of the leased Premises by the Lessee at any time other than the end of the leased term shall
terminate Lessee's obligations under this Lease unless it be in writing and acknowledged in writing by Lessor. 

ARTICLE 21  

 ARBITRATION  

        Section 21.1    Whenever under any provisions of this lease, it is provided that a dispute shall be determined by
arbitration, then either party may notify the other in writing of the dispute and request a settlement and appoint as arbitrator one independent real estate appraiser or property manager, whichever is
most appropriate, having experience with respect to the matter in dispute. If the dispute is not resolved within ten days after such notice, the responding party shall likewise choose an arbitrator
having similar experience. The two arbitrators shall within five days choose a third having the above qualifications. If the choice of the second or third arbitrator is not made within five days after
the end of the period in which the choice is to be made, then either party may apply to the presiding judge of the Multnomah County Circuit Court to choose the required arbitrator. At any time within
twenty days after appointment of the third arbitrator, either parry may submit the dispute for settlement by the arbitrators. 

        The
arbitrators to whom a dispute is submitted shall conduct such investigations and hearings as they shall consider necessary, and the written decision of the majority shall be
submitted to both parties within thirty days after the referral, unless the arbitrators determine that further time is reasonably required to make a proper investigation of the relevant facts. In
addition to other powers conferred by law or this agreement, a majority of the arbitrators shall have the power to compel oral or documentary evidence from either party for discovery purposes. The
arbitration shall take place in the State of Oregon. 

        The
parties shall be bound by the decision of a majority of the arbitrators, including any decision as to whether or not the question was subject to arbitration. 

14

 

        The
cost of arbitration shall be allocated between the parties by the arbitrators on the basis of the extent to which the position of one or the other party is adopted in the
arbitrators' decision. 

ARTICLE 22  

 NOTICES  

        Section 22.1    Whenever under the terms hereof provision is made for notice of any kind, it shall be deemed sufficient
only if delivered personally, or sent by registered or certified mail, return receipt requested, postage prepaid as follows: 

To
Lessor at: 

Mr. William
McCormick

c/o McCormick & Schmick

Management Services, Inc.

550 Morgan Building

720 SW Washington Street

Portland, Oregon 97205-3507 

With
Copy to: 

Christopher
James

888 SW Fifth Avenue

Suite 1150

Portland, Oregon 97204 

To
Lessee at: 

Jake's
Restaurant, Inc.

McCormick & Schmick

Management Services, Inc.

550 Morgan Building

720 SW Washington Street

Portland, Oregon 97205-3507 

With
Copy to: 

David
B. Pittaway

Castle Harlan, Inc.

150 East 58th Street

New York, New York 10155 

        Change
of address may be effected by giving notice as aforementioned. 

        Section 22.2    All notices shall be deemed to have been given when they are mailed by registered mail or certified mail
by postage prepaid, addressed as hereinabove provided or personally delivered to the addressee. 

ARTICLE 23  

 ATTORNEY FEES  

        Section 23.1    In the event of legal action or proceeding instituted by Lessor or Lessee (or the mortgagee of the
Lessee), or their successors or assigns, to enforce a right or rights provided by or arising from this lease, the non-prevailing party agrees to pay to the party who prevails as
reimbursement for the prevailing party's reasonable attorney fees and other legal costs and expenses as 

15

 

a
court of competent jurisdiction deems proper, including all appeals, administrative, and bankruptcy proceedings. 

        Section 23.2    Lessee further covenants and agrees that in case the Lessor shall be made party to any litigation
commenced against the Lessee, then the Lessee shall pay all expenses, costs and reasonable attorney fees incurred by or imposed on the Lessor in connection with such litigation, and such expenses,
costs and attorney fees as referred to herein shall be so much additional rent due on the last rent day after service of notice of such payment or payments, together with interest at ten percent (10%)
per annum from the date of payment, and shall be collected as any other rent specified herein. 

ARTICLE 24  

 NON-WAIVER  

        Section 24.1    No covenant, term or condition of this lease to be performed by one party shall be waived, except by
written consent of the other party, and forbearance or indulgence by one party in any regard whatever shall not constitute a waiver of the covenant, term or condition to be performed by the other
party, and until the complete performance by the delinquent party of such covenant, term or condition, the other party shall be entitled to invoke any remedy available under this lease or by law or
equity, despite such forbearance or indulgence. 

ARTICLE 25  

 TIME OF ESSENCE  

        Section 25.1    Time is of the essence of this lease and all provisions hereof. 

ARTICLE 26  

 SUCCESSORS  

        Section 26.1    Subject to the other provisions of this lease, all of the terms, covenants and conditions of this lease
shall inure to the benefit of and shall bind as the case may be, not only the parties hereto but the heirs, executors, administrators, successors, assigns and legal representatives of the respective
parties hereto. 

ARTICLE 27  

 DEFAULT  

        Section 27.1    Failure to Pay Rent.    In the event of the failure of Lessee to pay any rental due hereunder,
it shall be the duty of Lessor to extend to Lessee fifteen (15) days' written notice of such failure, and if upon termination of said fifteen (15) days' notice period, payments have not
been fully paid, then Lessee shall be in default hereunder and Lessor is to have the rights hereinafter described. 

        Section 27.2    Failure to Comply with Other Terms and Conditions.    In the event of the failure of Lessee to
keep any other terms or conditions of this Lease which are to be observed or performed by the Lessee, then it shall be the duty of Lessor to extend to Lessee thirty (30) days written notice of
such failure, and if upon termination of said thirty (30) days' notice, payments have not been fully paid, then Lessee shall be in default hereunder, and Lessor have the rights hereinafter
described; provided, however, that if the default cannot be cured within thirty (30) days, Lessee shall not be in default of the Lease if Lessee promptly, after notice from Lessor, commences to
cure the default within the thirty (30) day period and thereafter, using its best efforts, diligently and in good faith continues to cure the default. 

16

 

        Section 27.3    Insolvency.    If the Lessee shall become bankrupt or insolvent, or file any debtor's
proceedings, or take a petition in bankruptcy or insolvency or for reorganization (unless the same is dismissed within sixty (60) days of filing) or for appointment of a receiver or trustee of
all or a portion of Lessee's property, or if Lessee makes an assignment for the benefit of creditors, or petitions for or enters into an arrangement, or suffer this lease to be taken under any writ of
execution, Lessee shall be in default hereunder, and Lessor will have the rights hereinafter described. 

        Section 27.4    Abandonment.    If Lessee shall abandon Premises for any reason other than those delineated in
Sections 5.8 and 10, Lessee shall be in default hereunder, and Lessor shall have the rights hereinafter described. 

        Section 27.5    Remedies.    Upon default, Lessor shall have the immediate right of re-entry into
and upon said Premises, or any part thereof, and repossess the same of Lessor's former estate, and expel said Lessee and those claiming by, through and under Lessee without being deemed guilty of
trespass, or becoming liable for any loss or damage which may be occasioned thereby, and without prejudice to any remedy which might otherwise be used, for arrearage of rent or preceding breach of
covenant. 

        Should
Lessor elect to re-enter, as hereinabove provided, or should they take possession pursuant to legal proceedings or pursuant to any notice provided by law, Lessor may
either terminate this lease or may, from time to time without terminating this lease, make such alterations and repairs as may be necessary in order to relet the Premises, and relet said Premises, or
any part thereof, for such term or terms (which may be for a term extending beyond the term of this lease) at such rental or rentals and upon such other terms and conditions as Lessor in his
reasonable discretion may deem advisable; upon each such reletting all rentals received by the Lessor shall be applied first to the payment of any indebtedness other than rent due hereunder from
Lessee to Lessor; second, to the payment of any costs and expenses of such reletting, including brokerage fees and attorney fees and costs of such alterations and repairs; third, to the payment of
rent due and unpaid hereunder; and the residue, if any, shall be held by Lessor and applied in payment of future rent as the same may become due and payable hereunder with the overplus to be available
to pay Lessee's mortgages and encumbrances against the leased Premises. If such rentals received from such reletting during any
month be less than that to be paid during that month by Lessee hereunder, Lessee shall pay any deficiency to Lessor. Such deficiency shall be calculated and paid monthly. No such re-entry
or taking of possession of Premises by Lessor shall be construed as an election on Lessor's part to terminate this lease unless a written notice of such intention be given Lessee or unless the
termination thereof be decreed by a Court of competent jurisdiction. Notwithstanding any such reletting without termination, Lessor may at any time thereafter elect to terminate this lease for such
previous breach. Should Lessor at any time terminate this lease for any breach, in addition to any other remedies that Lessor may have, it may recover from Lessee all damages it may incur by reason of
such breach, including the cost of recovering the leased Premises, reasonable attorney fees, and including the worth at the time of such termination of the excess, if any, of the amount or rent and
charges equivalent to rent reserved in this lease for the remainder of the stated term over the then reasonable rental value of the leased Premises for the remainder of the stated term, all of which
amounts shall be immediately due and payable from Lessee to Lessor. 

ARTICLE 28  

 MISCELLANEOUS  

        Section 28.1    Should Lessee at any time desire to sell or in any manner transfer its interest under this lease to any
person or party, Lessor shall have the right of first refusal to acquire the leasehold interest of Lessee on the same terms and conditions and at the same price that the Lessee shall deem acceptable
according to the terms of any bona fide offer made by a third party. If such acceptable offer shall be referred to Lessor and Lessor shall elect to purchase according to such price, terms and 

17

 

conditions
within thirty (30) days thereafter, and if such election to purchase be not made as herein provided, Lessor's right shall terminate in the event that such bona fide offer be accepted
and a transaction thereon closed. Notwithstanding the above, Lessor shall not have a right of first refusal in the event that Lessee's restaurant is sold or transferred in connection with a public
offering under Section 13.2 a) herein, or a sale or transfer of all its stock or assets (or the stock or assets of any direct or indirect parent of Lessee, which controls Lessee), in
connection with a transfer or disposition of at least three (3) McCormick and Schmick restaurants, subject to all applicable provisions set forth in Sections 13.1 and 13.2 herein. 

        Section 28.2    The waiver by Lessor or Lessee of any breach of term, covenant or condition herein contained shall not be
deemed to be a waiver of such term, covenant or condition, or any subsequent breach of the same, or any other term, covenant or condition herein contained. The subsequent acceptance of rent hereunder
by Lessor shall not be deemed to be a waiver of any preceding breach by Lessee of any term, covenant, or condition of this lease, other than the failure of Lessee to pay the particular rental so
accepted, regardless of Lessor's knowledge of such preceding breach at the time of
acceptance of such rent. No covenant, term or condition of this lease shall be deemed to have been waived by Lessor, unless such waiver be in writing by Lessor or Lessee. 

        Section 28.3    Lessee shall not record this lease without the written consent of the Lessor. 

        Section 28.4    Holding Over.    In the event Lessee for any reason, shall hold over after the expiration of
this lease or any extension thereof, such holding over shall not be deemed to operate as a renewal or extension of this lease, but shall only create a tenancy from
month-to-month which may be terminated at will at any time by the Lessor. 

        Section 28.5    Reduction of Leased Premises.    Upon six (6) months advance written notice by Lessor,
the employee's office space located on the second floor of the Premises and employee's locker space located on the third floor of the Premises, comprising 2,900 square feet of the Premises, will
revert to the Lessor, provided that Lessor is able to provide Lessee with comparable substitute space of the same size and condition, in the building, which shall then become a part of the Premises,
as described in Section 1.1 above. Lessor shall pay all costs associated with such substitution. 

ARTICLE 29  

 INSPECTION BY LESSOR  

        Lessor reserves the right of entry upon the demised Premises, and the improvements thereof at all reasonable times for the purpose of examining and inspecting
same and to ascertain whether or not Lessee is complying with the requirements hereof. Unless there is an emergency, said entry shall only occur after forty-eight (48) hours advance written
notice has been provided to Lessee. 

ARTICLE 30  

 LEASE CHANGES BY WRITING ONLY

AND BINDING AGREEMENT  

        The lease and all terms and provisions hereof shall be and remain binding upon the parties hereto, their successors, executors, administrators and assigns, and
none of the terms, covenants and agreements of this Lease shall in any manner be altered, waived or changed, except by written instrument signed and delivered by the parties hereto. 

18

 

ARTICLE 31  

 ENTIRE AGREEMENT  

        The Lease and the covenants and agreements set forth herein are and shall constitute the entire agreement between the parties. Each party to this Lease hereby
acknowledges and agrees that the other party has made no warranties, representations, covenants or agreements, expressed or implied, to such party other than those expressly set forth herein, and that
each party, in entering into and executing this Lease, has relied upon no warranties, representations, covenants or agreements other than those expressly set forth herein. 

ARTICLE 32  

 SINGLE AND PLURALITY  

        In construing this Lease, it is understood that the Lessor or the Lessee may be more than one person; that if the context so requires the singular pronoun shall
be taken to mean and include the plural, the masculine, the feminine and the neuter, and that generally all grammatical changes shall be made, assumed and implied to make the provisions hereof apply
equally to corporations and individuals. 

ARTICLE 33  

 GOVERNING LAW  

        This Lease shall be construed and enforced in accordance with the laws of the State of Oregon. 

ARTICLE 34  

 SEVERABILITY  

        If any term, covenant, condition, or provision of this Lease is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of
the provisions shall remain in full force and effect and shall in no way be affected or impaired. 

ARTICLE 35  

 REASONABLE FEES, COSTS, EXPENSES  

        Wherever this Lease provides that either party shall be entitled to recover fees, costs, or expenses from the other, such fees, costs, or expenses shall be
reasonable in nature. 

        IN
WITNESS THEREOF, the respective parties have executed this instrument, in duplicate, on the day and year first hereinabove written, any corporate signature being by authority of its
Board of Directors. 

	 	 	LESSOR:
	

 	
 	

/s/  WILLIAM P. MCCORMICK      
 WILLIAM P. McCORMICK
	

 	
 	

LESSEE:
	

 	
 	

JAKE'S RESTAURANT, INC.
	

 	
 	

By	

/s/

19

 

	 	 	 	Its	 
	 	 	 	 	

20

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Exhibit 10.10  

 
  LEASE SUMMARY SHEET    
    

        The following lease summary sheet is prepared for the convenience of the Landlord and Tenant in negotiating the attached Retail Lease Agreement. It is not part of
the Retail Lease Agreement. To the extent that the description contained in this Lease Summary Sheet differs from the executed Retail Lease Agreement between the parties, the terms of the Retail Lease
Agreement shall in all cases govern. 

        A.    Parties.    CORNERSTONE DEVELOPMENT COMPANY, a corporation in the State of Washington, dba in Oregon as
CORNERSTONE/WEYERHAEUSER COMPANY Landlord; and CORNERSTONE-MCCORMICK JOINT VENTURE, dba HARBORSIDE RESTAURANT, a general partnership in the State of Oregon as Tenant. 

        B.    Premises.    The Net Usable Area is 8,228 square feet and the Rentable Area is 8,228 square-feet on
the ground floor(s) of the Esplanade South Building, located at 0309 Southwest Montgomery Street as more fully described in Exhibit 1 in Portland, Oregon 97201 as outlined in red on the floor
plan attached as Exhibit 2 to the Lease. 

        C.    Dates.    

        1.     Commencement
Date for Lease Term (Section 2.1): July 1,1985, but this date may be earlier, if Landlord permits Tenant to occupy the premises earlier, and
may be later if the improvements are completed later. 

        2.     Commencement
Date for Rent (Sections 3.5 and 8.4): Rent is due and payable from the date the Lease Term commences, except that the commencement date for Minimum Rent and
Percentage Rent may be later, pursuant to Section 8.4. 

        3.     Plan.
Submittal Date for Tenant Improvements (Section 8.2):n/a, 19n/a. Termination date if plan is not approved: n/a, 19n/a. 

        4.     Expiration
Date of Lease (Section 2.1): June 30, 1995. 

        D.    Rent.    

        1.     Minimum
Rent (Section 3.1): Ten Thousand Two Hundred Eighty-Five and no/100 ($10,285.00) per month. 

        2.     Percentage
Rent (Section 3.2): 5.0% of Gross Sales. 

        3.     Tenant's
Share of Estimated Direct Expenses and Direct Expense Adjustment (Section 6): Tenant's percentage of the rentable square feet of the Building is 41.0%.
For calendar year 1985, Tenant's Share of Estimated Direct Expenses is $2,742.66 per month. 

        4.     Minimum
Rent Adjustment. Minimum rent is subject to adjustment as provided in Section 38 of the Lease. 

        5.     Prepaid
Rent and Security Deposit (Section 4): n/a ($n/a). 

        E.    Use (Section 5).    The Premises are to be used solely for restaurant, cocktail lounge, nightclub and
related necessary administrative offices; and are to be kept open for business during normal operating hours for similar dining establishments in the Portland Central Business District, but in no case
less than twelve (12) hours Monday through Friday, and eight (8) hours Saturday and Sunday. 

 
Table of Contents  

	 
	 
	 	Page

	SECTION 1	LEASED PREMISES	 	2
	

SECTION 2	

TERM	
 	

2
	

SECTION 3	

RENT	
 	

3
	

SECTION 4	

PREPAID RENT AND SECURITY DEPOSIT	
 	

5
	

SECTION 5	

USE	
 	

5
	

SECTION 6	

TENANT'S SHARE OF EXPENSES	
 	

6
	

SECTION 7	

COMMON AREAS	
 	

8
	

SECTION 8	

INITIAL LEASEHOLD IMPROVEMENTS	
 	

8
	

SECTION 9	

ALTERATIONS, ADDITIONS AND IMPROVEMENTS BY TENANT	
 	

9
	

SECTION 10	

LIENS	
 	

10
	

SECTION 11	

HOLD HARMLESS	
 	

10
	

SECTION 12	

INSURANCE	
 	

10
	

SECTION 13	

CASUALTY, DAMAGE OR DESTRUCTION	
 	

11
	

SECTION 14	

CONDEMNATION	
 	

12
	

SECTION 15	

DAMAGE FROM OTHER CAUSES	
 	

13
	

SECTION 16	

ASSIGNMENT AND SUBLETTING	
 	

13
	

SECTION 17	

DEFAULT	
 	

14
	

SECTION 18	

LANDLORD'S REMEDIES	
 	

15
	

SECTION 19	

ACCESS	
 	

16
	

SECTION 20	

SURRENDER OF PREMISES AND HOLDING OVER	
 	

16
	

SECTION 21	

COMPLIANCE WITH LAW	
 	

17
	

SECTION 22	

RULES AND REGULATIONS	
 	

17
	

SECTION 23	

ESTOPPEL CERTIFICATES	
 	

17
	

SECTION 24	

SUBORDINATION	
 	

18
	

SECTION 25	

TENANT'S PROPERTY	
 	

18
	

SECTION 26	

REMOVAL OF PROPERTY	
 	

18
	

SECTION 27	

PROPERTY TAXES	
 	

19
	

SECTION 28	

NOTICES	
 	

19
	

SECTION 29	

LANDLORD MAINTENANCE	
 	

19
	

SECTION 30	

TENANT MAINTENANCE	
 	

20
	

SECTION 31	

SERVICES AND UTILITIES	
 	

20
	

SECTION 32	

TENANT'S REMEDIES	
 	

21
	 	 	 	 

i

 

	

SECTION 33	

WAIVER OF SUBROGATION RIGHTS	
 	

21
	

SECTION 34	

ATTORNEYS' FEES	
 	

21
	

SECTION 35	

WAIVER	
 	

21
	

SECTION 36	

MISCELLANEOUS PROVISIONS	
 	

22
	

SECTION 37	

CONDOMINIUM CONVERSION	
 	

23
	

SECTION 38	

MINIMUM RENT INCREASE	
 	

23
	

Addendum	

 	
 	

 
	Exhibits	 	 	 
	 	Exhibit 1	Legal Description	 	 
	 	Exhibit 2	Floor Plan	 	 
	 	Exhibit 3	Standard Leasehold Improvement	 	 
	 	Exhibit 4	Rules and Regulations	 	 
	 	Exhibit 5	Signage Criteria—(to be furnished by Landlor to Tenant upon approval thereof by the Portland Development Commission and the City of Portland, but in no case later than one hundred and twenty (120) days after the
execution of this Lease)	 	 
	 	Exhibit 6	Option to Extend	 	 

ii

   RETAIL LEASE AGREEMENT  

        THIS LEASE AGREEMENT IS MADE THIS 14th day of February 1985, between CORNERSTONE DEVELOPMENT COMPANY, a Washington corporation, dba in Oregon as
CORNERSTONE/WEYERHAEUSER COMPANY ("Landlord") and CORNERSTONE-McCORMICK JOINT VENTURE, dba HARBORSIDE RESTAURANT, a general partnership in the State of Oregon as ("Tenant") 

SECTION 1  

 LEASED PREMISES  

        1.1    On
and subject to the terms and conditions set forth in this Lease, Landlord hereby leases to Tenant and Tenant hereby leases from Landlord those certain premises (the
"Premises") in the buildings known as the Commercial Units of RiverPlace Condominium Number One (the "Building"), which Building is located at 0309 SW Montgomery Street on the land, described in
Exhibit 1 (the "Land"). The Premises consist of the area on the ground floor(s) outlined in red on the floor plan of the Building attached hereto as Exhibit 2. 

        1.2    Landlord
and Tenant agree to the following areas and percentage: 

        1.2.1    Rentable
Area of the Building:20,147 sq. ft. 

        1.2.2    Rentable
Area of the Premises:8,228 sq. ft. 

        1.2.3    Net
Usable Area of the Premises:8,228 sq. ft. 

        1.2.4    Tenant
Percentage of the Building:41.0% 

        1.3    The
term "Project" means all parts of the Building and the supporting facilities of the Building, including Common Areas, the Land and all equipment and other property
of Landlord used in connection with the Building, the Common Areas and the Land. 

SECTION 2  

 TERM  

        2.1    On
and subject to the terms and conditions set forth herein or in any exhibit or addendum hereto, the term of this Lease ("Term") shall begin on the first day of
July 1985 ("Commencement Date"), and shall end on the 30th day of June 1995 ("Expiration Date"). 

        2.2    If
Landlord permits Tenant to occupy the Premises prior to the Commencement Date stated in Section 2.1, the Commencement Date of the Term shall be the date of
such earlier occupancy. 

        2.3    If
the Premises are not ready for occupancy by Tenant at the Commencement Date stated in Section 2.1, this Lease shall not be void or voidable nor shall Landlord
be liable or responsible to Tenant or third parties for any claims, liabilities, loss or damage therefrom or by any reason thereof, but in that event, the Commencement Date of the Term shall be the
date specified in a written notice from Landlord to Tenant; provided, that if the Premises are not ready for occupancy by Tenant on the Commencement Date specified in Section 2.1 due to delays
caused by Tenant or Tenant's failure to fulfill any of its obligations under this Lease (including, without limitation, Tenant's failure to deliver Tenant's Plans on the Plan Submittal Date), the Term
of this Lease shall commence on the Commencement Date stated in Section 2.1; provided further, that if the Premises are not ready for occupancy by Tenant within six (6) months following
the Commencement Date stated in Section 2.1, for reasons other than delays caused by Tenant or Tenant's failure to fulfill any of its obligations under this Lease, then Tenant may terminate
this Lease by written notice to Landlord. 

2

 

SECTION 3  

 RENT  

        3.1    Minimum Rent.    Tenant agrees to pay to Landlord as minimum rent the sum of Ten Thousand Two Hundred
Eighty-Five and No/100 Dollars ($10,285.00) per month ("Minimum Rent"). The Minimum Rent shall be subject to adjustment as provided in Section 3.3 and subject to increase as
provided in Section 38 of this Lease, if applicable. 

        3.2    Percentage Rent.    Tenant agrees to pay to Landlord the amount, if any, by which five percent (5.0%) of
Tenant's Gross Sales made from or upon the Premises during the month exceeds the Minimum Rent paid for that month ("Percentage Rent"). Percentage Rent shall be computed and paid as hereinafter
provided. Tenant's "Gross Sales" means the gross amounts paid by customers or purchasers for all merchandise or services sold, leased, licensed or delivered in or from the Premises by Tenant, its
permitted subtenants, licensees or concessionaires, whether for cash or on credit (whether collected or not), and all other receipts of all business conducted on or from the Premises, including but
not limited to the gross amounts received by reason of mail or telephone orders received or filled at the Premises, deposits not refunded to purchasers or customers, sales to employees, sales of gift
or merchandise certificates, sales through vending machines or other devices, orders taken on the Premises even though filled elsewhere, and any sums that Tenant receives from pay telephones, stamp
machines, amusement machines, and vending machines. Any transaction on an installment basis or which involves the extension of credit shall be treated as a sale for the full price at the time of the
transaction, regardless of the time or amount of payment received by Tenant. Gross Sales shall not include, or if included there shall then be deducted (but only to the extent they have been
included), the following: 

        3.2.1    The
purchase price of all merchandise returned by purchasers and accepted for full credit or the amount of discounts, refunds, and allowances made by Tenant on such
returned merchandise. 

        3.2.2    Any
sums paid to third parties for the use or rental of pay telephones, stamp machines, music machines, amusement machines, and other vending machines. 

        3.2.3    Sums
received by Tenant from casual sales of trade fixtures, equipment, or other personal property provided that such property is not Tenant's inventory or stock in
trade, and such sales are permitted under this Lease. 

        3.2.4    Amounts
received by Tenant in written settlement of claims made by Tenant for loss of or damage to Tenant's merchandise. 

        3.2.5    Sales
and use taxes and other similar taxes now or in the future imposed on the sale of merchandise or services, but only if such taxes are added to the selling price,
separately stated, and collected from customers or purchasers. 

        3.3    Minimum Rent Adjustment.    [RESERVED] 

        3.4    Additional Rent.    In addition to the Minimum Rent and the Percentage Rent, Tenant shall also pay, as
additional rent, all other sums of money as shall become due and payable by Tenant to Landlord under this Lease including but not limited to Tenant's Share of Estimated Direct Expenses and the Direct
Expense Adjustment as defined in Section 6. The Minimum Rent and Percentage Rent, together with Tenant's Share of Estimated Direct Expenses, the Direct Expense Adjustment, and all other sums of
money as shall become due and payable by Tenant to Landlord under this Lease are collectively called the "Rent". 

3

 

        3.5    Payment of Rent.    

        3.5.1    Except
as otherwise expressly provided in Section 8.4, Minimum Rent shall be due and payable in advance on the first day of each calendar month during the Term
of this Lease and any extensions or renewals thereof. 

        3.5.2    On
or before the 20th day of each calendar month during the Lease Term and any extensions or renewals thereof, Tenant shall furnish to Landlord a statement of Tenant's
Gross Sales for the preceding calendar month. Each statement shall be signed and certified to be correct by Tenant or its authorized representative (and if Tenant is a corporation, the statement shall
be signed and certified to be correct by an officer of Tenant). At the time Tenant submits the statement of Tenant's Gross Sales, Tenant shall also pay to Landlord the amount, if any, by which five
percent (5.0%) of Tenant's Gross sales for the calendar month covered by the statement exceeds the Minimum Rent that Tenant has paid for such month, except as otherwise expressly provided in
Section 8.4. 

        3.5.3    Except
as otherwise expressly provided in this Lease, all other Rent (including but not limited to Tenant's Share of Estimated Direct Expenses) shall be due and
payable in twelve (12) equal monthly installments in advance on the first day of each calendar month during the Term of this Lease and any extensions or renewals thereof. 

        3.5.4    Tenant
hereby agrees to so pay all Rent to Landlord without demand and without any reduction, abatement, counterclaim or offset at such address as may be designated by
Landlord from time to time. 

        3.6    Prorated Installments.    If the Term of this Lease commences on other than the first day of a Month or ends on
other than the last day of a month, then the Rent provided for herein for such month or months (except Percentage Rent) shall be prorated and the installment or installments so prorated shall be paid
in advance. 

        3.7    Interest on Past Due Rent.    All past due payments of Rent shall bear interest at an annual rate of two
percent (2%) above the prime rate of interest published or announced by the United States National Bank of Oregon, Main Office, in effect upon the date said payment is due and calculated from due date
until paid; provided that if the maximum annual rate of interest permitted by applicable law shall be less than the rate of interest provided for herein, then all past due payments shall bear interest
at the maximum rate permitted by applicable law from due date until paid. 

        3.8    Books and Records.    

        3.8.1    Tenant
shall keep at the Premises full and accurate books of account, records, cash receipts, and other pertinent data showing its Gross Sales. Tenant shall install
and maintain accurate receipt-printing cash registers and shall record on the cash registers every sale and other transaction made from the Premises; or, if Tenant does not have and does not wish to
install receipt-printing cash registers, Tenant shall use serialized sales slips and shall record every sale and other transaction made from the Premises on such sales slips. Such receipts or sales
slips shall be kept and maintained as provided in this Section 3.8. Tenant shall also furnish to Landlord copies of Tenant's income tax returns at the time each is filed with the State of
Oregon and the Internal Revenue Service of the United States. 

        3.8.2    Said
books of account, records, cash receipts, sales slips and other pertinent data shall be kept for a period of two (2) years from the end of each calendar
year during the Lease Term. The receipt by Landlord of any statement, or any payment of Percentage Rent for any period shall not bind Landlord as to the correctness of the statement or the payment.
Landlord shall be entitled, during the Term of this Lease and for two (2) years after the end of the Term, to inspect and examine all Tenant's books of accounts, records, cash receipts, sales
slips and other pertinent 

4

 

data
for the purpose of ascertaining and verifying Tenant's Gross Sales. Tenant shall cooperate fully with Landlord in making such inspection. Landlord shall also be entitled, no more frequently than
once every calendar year during the Term and once after the end of the Term of this Lease, to an independent audit of Tenant's books of accounts, records, cash receipts, sales slips, and other
pertinent data to determine Gross Sales, such audit to be conducted by a certified public accountant designated by Landlord. If such an audit shows that there is a deficiency in the payment of any
Percentage Rent, the deficiency shall become immediately due and payable. The cost of the audit shall be paid by Landlord unless the audit shows that Tenant has understated Gross Sales by more than
two percent (2%) in which case Tenant shall pay all costs of the audit. 

SECTION 4  

 PREPAID RENT AND SECURITY DEPOSIT  

[RESERVED] 

SECTION 5  

 USE  

        5.1    The
Premises are to be used and occupied by Tenant solely for restaurant, cocktail lounge, nightclub and related necessary administrative offices and for no other use or
purpose without the prior written consent of Landlord. Tenant agrees that it has determined to its satisfaction that the Premises can be used for these purposes, and waives any right to terminate this
Lease in the event the Premises cannot be used for such purposes during the Lease Term. 

        5.2    Tenant
shall not do, bring, or keep anything in or about the Premises or the Project that will increase the existing rate of insurance on the Project or any part
thereof, or any of its contents, or that will cause the cancellation of any insurance covering the Project, or any part thereof, or any of its contents. If the rate of any insurance carried by
Landlord is increased as a result of Tenant's use, Tenant shall pay to Landlord within ten (10) days before the date Landlord is obligated pay a premium on the insurance, or within ten
(10) days after Landlord delivers to Tenant a statement from Landlord's insurance carrier stating that the rate increase was caused solely by an activity of Tenant on the Premises as permitted
in this Lease, whichever date is later, a sum equal to the difference between the original premium and the increased premium. 

        5.3    Tenant
shall not do or permit any of its agents, employees, invitees or visitors to do anything in or about the Premises or the Project which will in any way obstruct or
interfere with the rights of other tenants or occupants of the Project or injure or annoy or disturb them; or use or allow the Premises or the Project to be used for any unlawful or disreputable
purpose. 

        5.4    Tenant
shall not commit or suffer to be committed any waste in or upon the Premises or the Project. 

        5.5    Tenant
shall not place upon or install in windows or other openings or exterior sides of doors or walls of the Premises or any part of the Premises visible from the
exterior of the Premises any signs, symbols, drapes or other materials without the prior written consent of Landlord. 

        5.6    Tenant
shall use its best efforts to operate its business on the Premises in a manner that will produce the maximum dollar volume of Gross Sales. Tenant shall
continuously use and operate the Premises for the uses and purposes specified in Section 4.1. Tenant shall keep the Premises open for business and cause Tenant's business to be conducted on the
Premises during normal operating hours for similar dining establishments in the Portland Central Business District, but in no case less than 

5

 

twelve
(12) hours Monday through Friday, and eight (8) hours Saturday and Sunday, subject to the following: 

        5.6.1    If
the Premises are damaged or destroyed or partially taken by condemnation, and this Lease shall remain in full force and effect, Tenant shall continue the operation
of its business at the Premises to the extent reasonably practical during any period of repair. 

        5.6.2    If
the Premises should be closed and the business of Tenant temporarily discontinued because of strikes, walkouts, or similar cause beyond Tenant's control, Tenant
shall be temporarily relieved of its obligation to keep the Premises open for and to conduct business on the Premises during the hours and days specified above; provided that if Tenant's business on
the Premises shall be discontinued for a
period of sixty (60) consecutive days by reason of any such cause beyond Tenant's control, then Landlord may, at its option, terminate this Lease by written notice to Tenant. Such notice shall
be effective on receipt thereof by Tenant; all Rent owed up to the time of effective date of such notice shall be paid by Tenant and this Lease shall terminate as of the effective date of such notice.
The parties agree that lack of financial resources is not a cause beyond Tenant's control. 

SECTION 6  

 TENANT'S SHARE OF EXPENSES  

        6.1    "Direct
Expenses" shall mean all costs and expenses (except specific costs which are separately billed to and paid by specific tenants) of every kind and nature which
Landlord shall pay or become obligated to pay because of or in connection with the ownership, operation, maintenance and repair of the Project and such additional facilities now and in subsequent
years as may be determined by Landlord to be necessary to the Project. However, in no case shall Tenant be obligated to share in or pay any portion of those expenses arising from the ownership,
operation, maintenance or repair of the RiverPlace marina or any other portion of the RiverPlace development not included in the specific area described as the Project in Section 1.3. All such
Direct Expenses shall be determined by Landlord in accordance with generally accepted accounting and management practices which shall be consistently applied (with reserves appropriate to Landlord's
business). Direct Expenses include but are not limited to the following: 

        6.1.1    All
taxes, payments in lieu of taxes, excises, assessments, levies, fees or charges, general and special, ordinary and extraordinary, unforeseen as well as foreseen,
of any kind which are assessed, levied, charged, confirmed, or imposed by any public authority upon the Project, its operations or the rent provided for in this Lease (excluding any income taxes
payable by Landlord). It is agreed that Tenant will be responsible for all taxes and assessments or payments in lieu thereof on Tenant's Personal Property, Tenants Improvements, and initial leasehold
improvements to the premises made by either party, except the Standard Leasehold Improvements described in Exhibit 3 of this Lease; 

        6.1.2    Costs
of all insurance, including but not limited to fire, casualty, liability and rental abatement insurance applicable to the Project and Landlord's equipment and
other property used in connection therewith; 

        6.1.3    All
supplies, material and equipment used in the operation and maintenance of the Project; 

        6.1.4    Wages,
salaries and related expenses and benefits of all employees engaged in the operation, maintenance and security of the Project; 

        6.1.5    Costs
of repairs, replacements and general maintenance (excluding repairs and general maintenance paid by proceeds of insurance or by Tenant or third parties, and
alterations attributable solely to tenants of the Project other than Tenant); 

6

 

        6.1.6    Costs
of utilities, including water and power, heating, lighting, air conditioning and ventilating the entire Project (except specific costs which are separately
billed to and paid by specific tenants); 

        6.1.7    Management
costs and the costs of all maintenance, janitorial and service agreements for the Project and the equipment therein, including, without limitation, alarm
service (if any), window cleaning (if any), and elevator maintenance (if any); 

        6.1.8    Amortization
of capital improvements made to the Project subsequent to the execution of this Lease which will improve the operating efficiency of the Project or which
may be required by governmental authorities: 

        6.1.9    Any
license, permit, and inspection fees; 

        6.1.10    Reasonable
reserves as determined by Landlord to cover costs of long-term programmed maintenance, including but not limited to air conditioning (if any),
heating (if any), and elevator maintenance (if any). 

        6.2    The
estimated Direct Expenses for any particular calendar year shall be the Direct Expenses for such calendar year as estimated by the Landlord prior to the commencement
of such calendar year (the "Estimated Direct Expenses"), which Estimated Direct Expenses shall be due and payable in twelve (12) equal monthly installments in advance on the first day of each
calendar month during such calendar year. 

        6.3    In
the event that the actual Direct Expenses for any calendar year during the Term of this Lease exceed the Estimated Direct Expenses for such calendar year, Tenant
shall pay to Landlord pursuant to Landlord's billing therefor, as additional rent for such year, a sum (the "Direct Expense Adjustment") equal to Tenant's proportionate share of the difference between
the actual Direct Expenses for that year and the Estimated Direct Expense for that year. Should this Lease commence or terminate at any time other than the first day of a calendar year, the Direct
Expense adjustment shall be prorated, such
that Tenant shall pay the Direct Expense Adjustment only for the calendar days during such calendar year for which Tenant is obligated to pay Tenant's Share of Estimated Direct Expenses. 

        6.4    Tenant's
proportionate share for purposes of Estimated Direct Expenses and the Direct Expense Adjustment, ("Tenant's Share") initially shall be equal to 41.0%, which is
Tenant's percentage of the Building as set forth in Section 1.2.4; and shall at all times be computed as the percentage which the Net Rentable Area of the Premises bears to the Net Rentable
Area of the Building. 

        6.5    For
calendar year 1985 Tenant's Share of Estimated Direct Expenses shall be Two Thousand Seven Hundred Forty-Two and 66/100 Dollars ($2,742.66) per month,
payable in advance on the first day of each calendar month during the Term of this Lease. 

        6.6    Within
a reasonable period of time following the end of any calendar year with respect to which a Direct Expense Adjustment is due from Tenant, Landlord shall furnish to
Tenant a statement showing actual Direct Expenses, and a calculation of the Direct Expense Adjustment due from Tenant. Tenant shall pay said Adjustment within thirty (30) days after receipt of
the statement. Tenant will be reimbursed the amount of any overpayment. 

        6.7    Landlord
shall keep, at the address stated in Section 28 hereof, full and accurate books of account covering Direct Expenses. During the term of this Lease,
Tenant shall have the right to inspect such books of account annually at a reasonable time on ten (10) days' prior written notice to Landlord. Should Tenant dispute Landlord's calculation of
the Direct Expense adjustment or Landlord's method of allocating Direct Expenses within the Project, such dispute shall be resolved by arbitration in the manner set forth in Section 6 of the
Addendum to this Lease. 

7

 

SECTION 7  

 COMMON AREAS  

        7.1    The
term "Common Areas" means those parts of the Building in which the Premises are located and related areas and facilities outside the Premises that are provided and
designated by Landlord from time to time for the general use and convenience of Tenant and of other tenants of the Building and their respective authorized representatives, guests and invitees. Common
areas may include,
without limitation, designated pedestrian walkways and patios, landscaped areas, public lobbies, elevators, sidewalks, loading areas, parking areas, service corridors, restrooms, stairways, arcades,
and roads. 

        7.2    Landlord
gives to Tenant and its authorized representatives, invitees and guests, the nonexclusive right to use the Common Areas, with others who are entitled to use the
Common Areas, subject to Landlord's rights set forth in Section 6.3. 

        7.3    Landlord
shall have the right to: 

        7.3.1    Establish
and enforce reasonable rules and regulations applicable to all tenants concerning the maintenance, management, use, and operation of the Common Areas. 

        7.3.2    Close
any of the Common Areas to the extent required in the opinion of Landlord's counsel to prevent a dedication of any of the Common Areas or the accrual of any
rights of any person or of the public to the Common Areas. 

        7.3.3    Close
temporarily any of the Common Areas for purposes of cleaning, maintenance, alterations, improvements or additions. 

        7.3.4    Designate
other property to become part of the Common Areas. 

        7.3.5    Make
changes to the Common Areas including, without limitation, changes in the location of driveways, entrances, exits, vehicular parking spaces and parking area.
Notwithstanding the provisions of this subsection 6.3.5, however, Landlord shall insure at all times that a minimum of ninety (90) parking spaces are regularly available for public use within
the Project as defined in Section 1.3. 

SECTION 8  

 INITIAL LEASEHOLD IMPROVEMENTS  

        8.1    The
Premises shall include the standard leasehold improvements described in Exhibit 3 ("Standard Leasehold Improvements"). The Standard Leasehold Improvements
shall be provided at Landlord's cost. The design and construction of all initial leasehold improvements to the Premises beyond those described in Exhibit 3 shall be at Tenant's sole cost and
expense. 

        8.2    Tenant
shall deliver to Landlord, no later than February 15, 1985 ("Plan Submittal Date"), a detailed floor plan layout, together with final plans, specifications
and working drawings for initial leasehold improvements to the Premises desired by Tenant, and the name of Tenant's proposed contractor ("Tenant's Plans"). Tenant shall provide Landlord with a
certificate of public liability and property damage insurance carried by Tenant's purposed contractor naming Landlord as an additional insured. Landlord shall, within 15 days after receipt
thereof, notify Tenant in writing of Landlord's approval of Tenant's Plans or Landlord's disapproval together with the reasons for disapproval. If Landlord disapproves Tenant's Plans, Tenant shall
revise and resubmit Tenant's Plans for Landlord's approval within fifteen (15) days after notice of disapproval; and this process shall continue until Tenant's plans are approved by Landlord.
If Tenant's Plans are not submitted by the Plan Submittal Date, or if Tenant's Plans are not approved by the fortieth (40th) Business Day (a "Business Day" begin a day other than a Saturday, Sunday or
public holiday) after the Plan Submittal Date, Landlord may, at its option, terminate this Lease. 

8

 

        8.3    After
approval of Tenant's Plans by Landlord, Tenant shall be responsible for completing the initial leasehold improvements in accordance with said Plans and in
compliance with all of the terms and conditions set forth in Sections 9 and 10 of this Lease (except that the time for Tenant to submit Tenant's Plans to Landlord and the time for Landlord to approve
or disapprove said Plans shall be as provided in Section 7.2). 

SECTION 9  

 ALTERATIONS, ADDITIONS AND IMPROVEMENTS BY TENANT  

        9.1    On
and subject to the terms and conditions set forth in this Section and in Section 10, Tenant may make, at its expense, such alterations, additions and
improvements (collectively called "Tenant Improvements") to the interior of the Premises during the term of this Lease that Tenant requires in order to use the Premises for the uses permitted in
Section 4, provided that the following requirements have first been satisfied: 

        9.1.1    Tenant
shall submit to Landlord reasonably detailed final plans and specifications and working drawings of the proposed Tenant Improvements, the name of Tenant's
proposed contractor who must provide Landlord with a Certificate of Insurance covering Contractor's Liability and Property Damage, and naming Landlord as additional insured. Said Certificate to be
issued prior to the commencement of the Tenant improvement work. 

        9.1.2    Landlord
shall have given Tenant written notice of Landlord's approval of said final plans, specifications, working drawings, the proposed contractor, and insurance
carried by the proposed contractor. Landlord shall be deemed to have approved said plans, specifications, drawings, contractor and insurance if Landlord has not disapproved the same within ten
(10) Business Days after Landlord receives them. Landlord may withhold its approval for any reason which Landlord deems sufficient; Landlord shall give Tenant written notice of the reasons for
Landlord's disapproval. 

        9.1.3    The
Tenant Improvements shall be approved by all appropriate government agencies, and all applicable permits and authorizations shall be obtained before commencement
of any Tenant Improvements. 

        9.2    All
Tenant Improvements shall be completed with due diligence in compliance with all applicable laws, with the plans and specifications and working drawings approved by
Landlord, and by the contractor approved by Landlord. 

        9.3    All
work by Tenant or Tenant's contractor shall be done with union labor in accordance with all collective bargaining agreements applicable to the trades employed to do
the work; provided that Landlord may, at its sole option and discretion, waive this requirement at any time. Landlord expressly waives the requirements of Section 9.3, provided, however, that
if the use of non-union labor shall cause a threatened or implied strike by other union labor in any part of the RiverPlace development during the construction of Tenant Improvements,
Landlord may, at its sole option and discretion, reimpose such requirements. 

        9.4    All
debris, trash, refuse and waste materials shall be stored only within the Premises and shall be regularly removed therefrom by Tenant at its cost. 

        9.5    Tenant
Improvements shall be made in a manner that will not unreasonably disturb or interfere with other tenants in the Building. 

        9.6    All
Tenant Improvements shall become the property of Landlord and shall remain on and be surrendered with the Premises on the expiration or earlier termination of the
Lease, except that Landlord may elect within thirty (30) days before the expiration of this Lease or within thirty (30) days after the termination of this Lease, to require Tenant to
remove any Tenant Improvements, including 

9

 

but
not limited to initial leasehold improvements different from or in addition to the Standard Leasehold Improvements described in Exhibit 3. If Landlord so elects, Tenant at its cost shall
restore the Premises to standard condition before the last day of the term or within thirty (30) days after notice of Landlord's election is given, whichever is later. For purposes of this
Section 8.6, "standard condition" means the Premises with the Standard Leasehold Improvements described in Exhibit 3. 

        9.7    Tenant
shall not make changes to locks on doors or add to, disturb or in any material way change any plumbing or wiring without the prior written consent of Landlord and
in accordance with the requirements of this section. Landlord's consent shall not be unreasonably withheld or delayed. 

SECTION 10  

 LIENS  

        Except as otherwise provided in Section 8.1 with respect to Standard Leasehold Improvements, Tenant shall pay all costs for construction done by it or
caused to be done by it on the Premises as permitted by this Lease. Tenant shall keep the Premises and the Project free and clear from any liens or lien claims arising out of work performed, materials
furnished or obligations incurred by or on behalf of Tenant, and Tenant shall indemnify and hold Landlord harmless from any liability for losses or damages resulting directly or indirectly from any
such liens or lien claims. If Tenant shall desire to contest the correctness or the validity of any such lien or claim of lien, it shall furnish Landlord adequate security of the value or in the
amount of the claim, plus estimated costs and interest, or a bond of a responsible corporate surety authorized to do business in the State of Oregon and approved by Landlord in such amount,
conditioned on the discharge of the lien. If a final judgment establishing the validity or existence of a lien for any amount is entered, Tenant shall pay and satisfy the same immediately. 

SECTION 11  

 HOLD HARMLESS  

        Landlord, its agents and employees shall not be liable to Tenant or its officers, contractors, licensees, agents, servants, employees, customers, guests, invitees
or visitors, or to any third party for any damage
to person or property caused by or arising from or in connection with any act, omission or neglect of Tenant. Tenant agrees to indemnify Landlord and hold it harmless from and against any and all
liability, claims, causes of action, damages, costs and expenses (including, without limitation, attorneys' fees), arising from or in connection with any act, omission, or neglect of Tenant or its
officers, contractors, licensees, agents, servants, employees, guests, invitees, or visitors; any breach or default under this Lease by Tenant; or any accident, injury or damage, howsoever and by
whomsoever caused, to any person or property, occurring in or about the Premises. Tenant's obligations under this Section 10 arising by reason of any events occurring during the Term of this
Lease or any extensions or renewals thereof shall survive the expiration or termination of this Lease. The foregoing provisions shall not be construed to make Tenant responsible for loss, damage,
liability, claims, causes of action or expense resulting from injuries to third parties caused by the negligence of Landlord, or its officers, contractors, licensees, agents, employees, or invitees. 

SECTION 12  

 INSURANCE  

        12.1    Tenant
at its cost shall obtain and maintain in full force and effect during the Term of this Lease and any extensions or renewals thereof a policy of comprehensive
public liability insurance with minimums limits of: 

$500,000
per occurrence and

$1,000,000 aggregate bodily injury &

$500,000 property damages

or

$1,000,000 combined single limits 

10

 

        Such
policies shall insure performance by Tenant of Tenant's obligations set forth in Section 10. Landlord shall be named as an additional insured and the policies shall contain
cross liability endorsements. 

        12.2    Tenant
at its cost shall maintain on all of Tenant's Personal Property, and Tenant's Improvements a policy or policies of standard fire and extended coverage insurance
with vandalism and malicious mischief endorsement to the extent of replacement value and flood insurance to the extent available
through the National Flood Insurance Program as a minimum requirement. At its cost, Tenant shall also maintain such a policy or policies on the initial leasehold improvements provided by either party,
including laminated glass windows and tempered glass doors described in Exhibit 3 but excluding other Standard Leasehold Improvements described in Exhibit 3. The proceeds from any such
policy shall belong to and be paid to Tenant and shall be used by Tenant for the repair and replacement of Tenant's Personal Property and/or the restoration of Leasehold Improvements. "Tenant's
Personal Property" includes Tenant's movable equipment, furniture, furnishings, merchandise, and other movable personal property including trade fixtures. 

        12.3    Each
policy of insurance required under this Lease shall: 

        12.3.1    Be
issued by an insurance company satisfactory to Landlord; 

        12.3.2    Contain
an endorsement requiring thirty (30) days written notice from the insurance company to both parties and Landlord's lender (if any) before cancellation
or change in the coverage, scope or amount of any such policy. 

        12.4    Each
policy of insurance required under this Lease, or a certificate of such policy, together with evidence of payment of premiums, shall be deposited with the Landlord
at the commencement of the Term; and on renewal of the policy, not less than five (5) days before expiration of the term of the policy. 

SECTION 13  

 CASUALTY, DAMAGE OR DESTRUCTION  

        13.1    In
the event a fire or other casualty renders the Premises totally or partially untenantable, Tenant shall immediately give Landlord written notice thereof ("Tenant's
First Notice"). 

        13.2    If
the Premises or the Building are totally or partially damaged or destroyed by fire or other casualty so as to render the Premises totally or partially untenantable,
Landlord may at its option, restore the Premises to a tenantable condition as determined by Landlord. Within sixty (60) days from the date Landlord receives Tenant's First Notice, Landlord
shall give Tenant written notice (the "Landlord's Notice") stating: 

        13.2.1    Landlord
elects to restore the Premises; or 

        13.2.2    Landlord
elects not to restore the Premises; or 

        13.2.3    Landlord
elects to terminate this Lease. 

        13.3    If
Landlord elects to restore the Premises, then this Lease shall remain in full force and effect except that, during the period from damage or destruction until
restoration, the Minimum Rent and Tenant's Share of Direct Expenses shall be abated in proportion to Tenant's loss of use as determined by Landlord. Should Tenant dispute Landlord's decision regarding
the amount of the abatement, the amount shall be determined by arbitration in the manner set forth in Section 6 of the Addendum hereto; provided that there shall be no such abatement if the
damage or destruction is due in whole or in part to the act, omission or neglect of Tenant, its agents, employees, contractors, invitees or visitors. If Landlord elects to terminate this Lease, then
all Rent owed up to the time of such damage or destruction shall be paid by Tenant and this Lease shall terminate and be at an end as of 

11

 

the
date of such damage or destruction. If Landlord's Notice states that Landlord elects not to restore the Premises, then Tenant shall have the opportunity to terminate this Lease by delivering
written notice thereof ("Tenant's Section Notice") to Landlord within thirty (30) days from the date Tenant receives Landlord's Notice. If Tenant so delivers Tenant's Second Notice, then all
Rent owed up to the time of such damage or destruction shall be paid by Tenant and this Lease shall terminate and be at an end as of the date of such damage or destruction. If Tenant does not so
deliver Tenant's Section Notice, then this Lease shall remain in full force and effect, except that, from and after the date of such damage or destruction, Rent shall be abated in the same manner and
to the same extent as is provided in this Section 12.3 in the case of Landlord's election to restore the Premises. 

        13.4    If
the Building shall be so damaged or destroyed by fire or other casualty that Landlord shall decide not to rebuild or restore the Building, but such damage or
destruction shall not render the Premises totally or partially untenantable, Landlord may, at its option, terminate this Lease by notice in writing to Tenant within sixty (60) days after such
damage or destruction. Such notice shall be effective sixty (60) days after receipt thereof by Tenant. All Rent owed up to the time of the effective date of such notice shall be paid by Tenant
and this Lease shall terminate as of the effective date of such notice: 

        13.5    The
proceeds of any insurance policies carried by Landlord on the Project and any part thereof shall belong to and be paid to Landlord. Tenant shall have no interest in
or right to such proceeds and shall make no claims against Landlord or Landlord's insurer for any such proceeds. 

        13.6    Nothing
in this Section and no termination of the Lease pursuant to this Section shall relieve Tenant of any liability under Section 30.2 of this Lease. 

SECTION 14  

 CONDEMNATION  

        14.1    Definitions    

        14.1.1    "Condemnation"
means (a) the exercise of any governmental power, whether by legal proceedings or otherwise by a Condemnor and (b) a voluntary sale or
transfer by Landlord to any Condemnor, either under threat of Condemnation or while legal proceedings for Condemnation are pending. 

        14.1.2    "Date
of Taking" means the date the Condemnor has the right to possession of the property being condemned. 

        14.1.3    "Condemnor"
means any public or quasi-public authority, or private corporation or individual, having the power of Condemnation. 

        14.2    If
all or part of the Premises are taken by Condemnation, this Lease shall terminate as to the part so taken as of the Date of Taking and all Rent shall be paid to that
date. If a portion of the Premises is taken and the remaining portion is unsuitable for Tenant's continued use, Tenant may by written notice to Landlord within ten (10) days after notice of
such Condemnation (or absent such notice, within ten (10) days after the Date of Taking), terminate this Lease as of the Date of Taking. Except as provided in Section 13.3, if Tenant
does not have or does not exercise the option to terminate, this Lease shall remain in full force and effect as to that portion of the Premises not taken by Condemnation, except that Minimum Rent
shall be reduced, effective on the Date of Taking, by an amount that is in the same ratio to the Minimum Rent as the total number of square feet in the Premises taken bears to the Net Usable Area of
the Premises immediately before the Date of Taking (provided that if circumstances make abatement based on square footage unreasonable, the Minimum Rent shall abate by a reasonable amount to be
determined by Landlord) and Tenant's Share of Direct Expenses shall be recalculated, effective on the date of Taking, in accordance with Section 5.4. 

12

 

        14.3    If
any part of the Project is taken by Condemnation, whether or not such Condemnation shall affect the Premises, Landlord shall have the option to terminate this Lease
effective as of the Date of Taking, by written notice to Tenant within sixty (60) days after the nature and extent of the taking by Condemnation shall have been finally determined. 

        14.4    Landlord
reserves all rights to damages to the Premises for any partial or total taking by Condemnation and Tenant hereby assigns to Landlord any right Tenant may have
to such damages or award Tenant shall make no claim against Landlord or Condemnor for damages for termination of Tenant's leasehold interest or interference with Tenant's business. Tenant shall have
the right to claim and recover from the Condemnor compensation for any cost and expense to which Tenant may be put for Tenant's moving expenses or taking of Tenant's Personal Property, subject to the
provisions of the condemnation laws of the State of Oregon. 

SECTION 15  

 DAMAGE FROM OTHER CAUSES  

        15.1    Landlord
shall not be liable or responsible to Tenant for any loss or damage to any property or person occasioned by theft, burglary, act or neglect of any tenant or
occupant of the Building or of any other person, fire or other casualty, act of God, public enemy, injunction, riot, strike, insurrection, war, court order, requisition or order of governmental body
or authority. 

        15.2    Notwithstanding
anything in this Lease. Landlord shall in no event be liable to Tenant for any damage to the Premises or for any loss, damage or injury to any property
in or on the Premises or the Project occasioned by bursting, rupture, leakage or overflow of any plumbing or other pipes (including but not limited to water, steam and/or refrigerant lines),
sprinklers, tanks, drains, drinking foundations or washstands, or other similar cause in, above, upon or about the Premises or the Project. 

SECTION 16  

 ASSIGNMENT AND SUBLETTING  

        16.1    Tenant
shall not (voluntarily or otherwise) assign, encumber, transfer or dispose of all or any part of its interest in this Lease or in the Premises, or sublease all
or any part of the Premises, or allow any other person or entity (except Tenant's authorized representative) to occupy or use all or any part of the Premises, without first obtaining Landlord's
written consent. 

        16.2    If
Tenant wishes to assign this Lease or sublet the Premises or any part thereof, Tenant shall notify Landlord in writing by registered or certified mail in accordance
with Section 28, at least ninety (90) days in advance of the date on which Tenant desires to make such assignment or sublease, Landlord shall have a period of thirty (30) days
following receipt of such notice within which to notify Tenant in writing that Landlord elects either: 

        16.2.1    To
terminate this Lease as to the space so affected as of the date so specified by Tenant, in which event, Tenant will be relieved of all further obligations
hereunder as to such space; or 

        16.2.2    To
permit Tenant to assign or sublet such space subject, however, to subsequent written approval of the proposed assignee or sublessee by Landlord, such consent not
to be unreasonably withheld, so long as (1) the use of the Premises by such proposed assignee or sublessee would be substantially the same as Tenant's use of the Premises, (2) the
proposed assignee or sublessee is of sound financial condition, (3) the operations of the proposed assignee or sublessee would be managed in a manner and by persons whose qualifications and
experience are acceptable to Landlord, and (4) the merchandise and/or services to be sold from the Premises by the proposed assignee or sublessee and the manner and methods of merchandising
(including but not limited to advertising) are of a first-class quality, all as determined solely by Landlord. In 

13

 

the
event Landlord determines that one or more of the foregoing requirements has not been satisfied, Landlord may withhold its consent to the proposed assignment or subletting, and shall have no
obligation to exercise the option described in Section 15.2.1. 

        16.3    If
Landlord should fail to notify Tenant in writing of such election within said thirty (30) day period, Landlord shall be deemed to have elected the option
described in Section 15.2.2 above, but subsequent written approval by Landlord of the proposed assignee or sublessee shall be required as provided in that Section. No assignment or subletting
by Tenant shall relieve Tenant of any obligation under this Lease. Any assignee or sublessee approved by Landlord shall be jointly and severally liable with Tenant for the payment of Rents and for the
performance of all covenants, terms, and conditions of this Lease and of any approved sublease. If Tenant requests Landlord's consent to a proposed assignment, sublease, mortgage or other transfer,
Tenant shall pay to Landlord whether or not consent is ultimately given a sum equal to the actual costs incurred by Landlord in connection therewith (including but not limited to attorneys' fees) plus
twenty percent (20%) of such actual costs to cover Landlord's overhead expenses. 

        16.4    No
consent to any assignment, encumbrance, transfer, disposition or sublease shall constitute a further waiver of the provisions of this Section 15. 

        16.5    Subject
to the foregoing provisions, this Lease shall be binding upon and inure to the benefit of the parties and their respective successors. 

SECTION 17  

 DEFAULT  

        17.1    Events of Default.    The occurrence of any of the following shall constitute a default by Tenant under this
Lease: 

        17.1.1    Abandonment
and vacation of the Premises (failure to occupy and operate the Premises as required in Section 4.6 for ten (10) consecutive Business Days
shall be deemed an abandonment and vacation). 

        17.1.2    Failure
by Tenant to make any payment of Rent as and when due, where such failure shall continue for seven (7) days after receipt of written notice of
Landlord. 

        17.1.3    Failure
by Tenant to perform any of Tenant's obligations under Section 11 hereof. 

        17.1.4    Except
as provided in Section 16.1.6 any assignment, encumbrance, transfer, disposition or sublease made in violation of Section 15. 

        17.1.5    Failure
by Tenant to perform or observe any other provision of this Lease by it to be performed or observed if the failure is not cured within thirty (30) days
after notice has been given by Landlord to Tenant. If the default cannot reasonably be cured within thirty (30) days, Tenant shall not be in default if Tenant commences to cure the default
within the 15-day period and diligently and in good faith continues to cure the default. Notices given under this Section 16.1.5 shall specify the alleged default and the applicable
Lease provisions, and shall demand that Tenant perform the provisions of the Lease within the applicable period of time. 

        17.1.6    Any
writ of attachment or writ of execution is levied upon any right or interest of Tenant under this Lease, or any petition is filed by or against Tenant to declare
Tenant a bankrupt or insolvent or to delay, reduce or modify Tenant's debt or obligations; or any petition is filed or other action taken to reorganize or modify Tenant's structure; or Tenant is
declared insolvent according to law; or an assignment of Tenant's property is made for the benefit of creditors; or a receiver or trustee is appointed for Tenant or its property (provided that no such
levy or petition filed against Tenant shall constitute a default if Tenant shall vigorously contest the same by 

14

 

appropriate
proceedings and shall remove or vacate the same within thirty (30) days from the date of its creation, service, or filing). 

        17.2    Tenant
shall notify Landlord promptly of any event not by its nature necessarily known to Landlord which, with the giving of notice or the passage of time or both,
would constitute default by Tenant hereunder. 

SECTION 18  

 LANDLORD'S REMEDIES  

        18.1    In
the event of a default by Tenant, Landlord may have any one or more of the following described remedies in addition to all other rights and remedies now or hereafter
available at law or in equity: 

        18.1.1    Landlord
may terminate this Lease and forthwith repossess the Premises and remove all persons and property therefrom, and shall be entitled to recover forthwith as
damages the sum of money equal to the total of (a) the cost of recovering the Premises, (b) the unpaid Rent owed at the time of termination, plus interest on the unpaid Rent from due
date at the rate provided in Section 3.7, (c) the amount by which the balance of the Rent for the remainder of the term exceeds the amount of the loss of rent that Tenant proves could
have been reasonably avoided, and (d) any other sum of money and damages owed by Tenant to Landlord; or 

        18.1.2    Landlord
may continue this Lease in full force and effect. Landlord may, but shall not be obligated to, reenter the Premises and relet the same or any part thereof,
for the account of Tenant. Such reletting may be for a period shorter or longer than the remaining term of this Lease, and may be upon such terms and for such rent as shall be satisfactory to Landlord
Tenant shall be liable to Landlord for all costs incurred by Landlord in reletting all or any part of the Premises, including but
not limited to: all costs and expenses of re-entering and recovering possession of the Premises; all costs and expenses of decorations, repairs, changes, alterations and additions to the
Premises required by the reletting; brokers' commissions; all costs and expenses incurred by Landlord in collecting the rent accruinging from such reletting. If a sufficient sum shall not be realized
from reletting to pay (a) all costs and expenses of reletting, (b) Rent due at the time of reletting together with interest thereon at the rate provided in Section 3.7, and
(c) Rent coming due hereunder, then Tenant shall satisfy and pay any such deficiency upon demand therefor from time to time. If the Premises are not relet, then Tenant shall pay to Landlord the
Rent reserved in this Lease upon demand therefor from time to time. Tenant agrees that Landlord may file suit to recover any sums coming due under the terms of this Section 17.1.2 from time to
time, on one or more occasions, and Landlord shall not be obligated to wait until the expiration of the term of this Lease. Any such reletting shall not be construed as an election on the part of
Landlord to terminate this Lease unless a written notice of such intention is given to Tenant by Landlord. Notwithstanding any such reletting without termination, Landlord may at any time thereafter
elect to terminate this Lease for Tenant's previous default. 

15

  

        18.1.3    Landlord,
at any time after Tenant commits a default, may but shall not be obligated to cure the default at Tenant's cost. If Landlord at any time, by reason of
Tenant's default, pays any sum or does any act that requires the payment of any sum, the sum paid by Landlord shall be due immediately from Tenant to Landlord at the time the sum is paid by Landlord,
and if repaid by Tenant at a later date, shall bear interest at the rate provided in Section 3.7 until repaid. 

        18.1.4    Notwithstanding
any other provision hereof, if this Lease is terminated by Landlord or by operation of law, Tenant's liability to Landlord for damages shall survive
such termination. 

SECTION 19  

 ACCESS  

        Landlord and its authorized representatives shall have the right to enter the Premises at reasonable times to inspect, clean, make repairs, alterations or
additions to the Premises, to show the Premises to prospective tenants, purchasers or others, and for other reasonable purposes deemed necessary or desirable by Landlord provided that Landlord shall
not unreasonably interfere with Tenant's business operation. Tenant shall not be entitled to any abatement or reduction in Rent by reason thereof. Nothing in this Section shall be deemed to impose any
obligation upon Landlord not expressly stated elsewhere in this Lease. 

SECTION 20  

 SURRENDER OF PREMISES AND HOLDING OVER  

        20.1    On
expiration or earlier termination of this Lease, Tenant shall surrender to Landlord the Premises and all leasehold improvements made by either party (except those
improvements that Tenant is obligated to remove pursuant to Section 8.6) in good condition, ordinary wear and tear excepted. 

        20.2    If
Tenant, with Landlord's written consent, remains in possession of the Premises after termination of this Lease, such possession by Tenant shall be deemed to be a
month-to-month tenancy terminable as provided by law. During such month-to-month tenancy, Tenant shall pay all Rent provided in this Lease; and all
provisions of this Lease shall apply to the month-to-month tenancy, except those pertaining to term and option to extend (if any). 

        20.3    If
Tenant, without Landlord's written consent, remains in possession of the Premises after the termination of this Lease, Tenant shall pay, as liquidated damages, the
greater of: 

        20.3.1    125%
of the Rent which Tenant was obligated to pay for the month immediately preceding the end of the Term of this Lease for each month or any part thereof of any
such holdover; or 

        20.3.2    If
Landlord has leased all or part of the Premises to other tenants effective upon the termination of this Lease, the total rent which such other tenants have agreed
to pay for the Premises. In the event of any unauthorized holding over, Tenant shall also indemnify Landlord against all claims for damages by any other tenants to whom Landlord may have leased all or
any part of the Premises effective upon the termination of this Lease. 

        20.3.3    Landlord
and Tenant acknowledge, represent and agree that the amount fixed as liquidated damages pursuant to this Section 19.3 is a reasonable forecast of the
just compensation to Landlord for the harm that would be caused by Tenant's breach and that the harm that would be caused by such a breach, while extremely difficult to estimate, would be severe. The
amount of such liquidated damages has been arrived at through negotiation between the Landlord and Tenant. 

16

 

SECTION 21  

 COMPLIANCE WITH LAW  

        21.1    Tenant
shall not use the Premises or the Project, or permit anything to be done in or about the Premises or the Project which will in any way conflict with any law. 

        21.2    Tenant
shall, at its sole cost and expense, comply with any judicial decision, statute, constitution, ordinance, resolution, rule, administrative order, or other
requirement of any municipal, county, state, federal or other government agency or authority having jurisdiction over the parties or the Premises or both in effect either at the time of execution of
the Lease or at any time during the term of the Lease (including without limitation, any regulation or order of a quasi-official entity or body) which relates to or affects the condition, use or
occupancy of the Premises (collectively called "law" or "laws"). Without limiting the foregoing, Tenant shall have the obligation, at Tenant's cost, to alter and modify the Premises in compliance and
conformity with all laws relating to the condition, use or occupancy of the Premises during the term, except that Tenant shall not be obligated to comply with any law that requires structural
alterations or modifications to the Premises unless such alterations or modifications are required as the result of Tenant's particular and specific use of the Premises at the time. Landlord shall
make such required structural alterations or modifications to the Premises that Tenant is not obligated to make. 

        21.3    The
judgment of any court of competent jurisdiction or the admission of Tenant in any action against Tenant, whether Landlord is a party thereto or not, that Tenant has
violated any law shall be conclusive of the fact as between Landlord and Tenant. 

SECTION 22  

 RULES AND REGULATIONS  

        The rules and regulations attached to this Lease as Exhibit 4 and the Signage Criteria attached as Exhibit 5 are made a part of this Lease and
Tenant shall comply with them. Landlord shall have the right from time to time to promulgate amendments and additional rules and regulations for the safety, care and cleanliness of the Premises, the
Project, or for the preservation of good order, provided, however, that such amendments, rules and regulations shall be nondiscriminatory and shall not diminish or interfere with Tenant's use of the
Premises as defined in Section 4.1. On delivery of a copy of such amendments and additional rules and regulations to Tenant, Tenant shall comply with them, and a violation of any of them shall
constitute a default by Tenant under this Lease. If there is a conflict between the rules and regulations, or the Signage Criteria, and any of the provision of this Lease, the provisions of the Lease
shall prevail. Landlord shall not be liable to Tenant or to any third parties for failure of other tenants or occupants of the Building to perform or observe such rules and regulations, or the Signage
Criteria. 

SECTION 23  

 ESTOPPEL CERTIFICATES  

        Tenant shall from time to time, upon written request of Landlord, execute, acknowledge and deliver to Landlord or its designee a written statement stating: The
date this Lease was executed and the date it expires; the date Tenant entered into occupancy of the Premises; the amount of Rent and the date to which Rent has been paid; that this Lease is in full
force and effect and has not been assigned, modified, supplemented or amended in any way (or specifying the date and terms of any agreement so affecting this Lease); that this Lease represents the
entire agreement between the parties; that all obligations under this Lease to be performed by the Landlord have been satisfied (or specifying in what respect Landlord has failed to perform); that
there are no existing defenses or offsets which the Tenant has against the enforcement of this Lease by the Landlord (or specifying any defenses or offsets claimed by Tenant); that no Rent has been
paid more than one month in advance, and that no security 

17

 

has
been deposited with Landlord (or, if so, the amount thereof). It is agreed that any such statement delivered pursuant to this Section may be relied upon by a prospective purchaser of Landlord's
interest or a mortgagee of Landlord's interest or assignee of any mortgage upon Landlord's interest in the Land or the Building. If Tenant shall fail to respond within 10 days after receipt by
Tenant of a written request by Landlord as herein provided, Tenant shall be deemed to have given such statement as above provided without modification; and shall be deemed to have admitted; the
accuracy of any information supplied by Landlord to a perspective purchaser or mortgagee; that this Lease is in full force and effect; that there are no uncured defaults in Landlord's performance;
that the security deposit is as stated in this Lease; and that not more than one month's Rent has been paid in advance. 

SECTION 24  

 SUBORDINATION  

        Tenant agrees that this Lease shall be subordinate to all present and future mortgages, deeds of trust, ground leases and other encumbrances for security
affecting the Premises, the Building and/or the Land, and to all renewals and modifications, supplements, replacements, consolidations and extensions thereof, provided the mortgagee or trustee named
in such mortgages or trust deeds shall agree in writing that, if by foreclosure or otherwise, such mortgagee, trustee or its successor in interest shall come into possession or become the owner of the
leased Premises, it will not disturb the possession, use or enjoyment by Tenant of the Premises or disaffirm this Lease or any of Tenant's rights hereunder so long as all Tenant's obligations are
fully performed in accordance with the provisions of this Lease. Landlord reserves the right to subordinate such mortgages, deeds of trust, ground leases or encumbrances to this Lease. Tenant agrees
to execute, acknowledge and deliver any and all instruments requested by Landlord which are necessary or proper to effect such subordination or to make this Lease prior to the lien of any ground
lease, mortgage, deed of trust, or other encumbrance for security;
and if Tenant shall fail to do so within 10 days after receipt of written demand therefor by Landlord, Tenant shall be deemed to have appointed Landlord as Tenant's attorney in fact, in
Tenant's name and place to do so. If the premises should be purchased or otherwise acquired by any person in connection with any sale or other proceeding under the terms of such mortgage, deed of
trust, ground lease or other encumbrance, Tenant shall, on request, attorn to any such transferee. 

SECTION 25  

 TENANT'S PROPERTY  

        Tenant's movable equipment, furniture, furnishings, merchandise and other movable property including trade fixtures (collectively called "Tenant's Personal
Property") installed or located at the Premises shall be and remain the property of Tenant. On expiration of the Lease term, Tenant shall remove all such property. Tenant shall repair or reimburse
Landlord for the cost of repairing any damage to the Premises or the Project resulting from the installation or removal of such personal Property of Tenant. 

SECTION 26  

 REMOVAL OF PROPERTY  

        All Tenant's Personal Property remaining on the Premises or in the Project at the expiration or earlier termination of this Lease shall conclusively be deemed
abandoned and may be removed by Landlord. Except as otherwise required by law, Landlord may store such property in any place selected by Landlord including but not limited to a public warehouse, at
the expense and risk of Tenant, with the right to sell any or all of such stored property at public or private sale, in such manner and at such times and places as Landlord in its sole discretion may
deem proper, without notice to Tenant; and the proceeds of such sale shall be applied first to the cost of such sale, second to payment of the costs of 

18

 

removal
and storage, and third to payment of any other sums which may then be due from Tenant to Landlord under any of the terms of this Lease with the balance, if any, to be paid over to Tenant. 

SECTION 27  

 PROPERTY TAXES  

        Tenant shall pay or cause to be paid, before delinquency, any and all taxes or charges in lieu thereof levied or assessed and which become payable during the Term
hereof upon the initial leasehold improvements to the Premises made by either party (excluding the Standard Leasehold Improvements described in Exhibit 3); upon Tenant's Improvements; and upon
Tenant's Personal Property located on the Project. In the event any or all such improvements or Personal Property shall be assessed and taxed with the Building, Tenant shall pay to Landlord Tenant's
share of such taxes within ten (10) days after delivery to Tenant by Landlord of a statement in writing setting forth the amount of such taxes owed by Tenant. 

SECTION 28  

 NOTICES  

        28.1    Any
notice, demand, request, consent, approval, or other communication that either party desires or is required to give to the other party or any other person shall be
in writing and shall be sent by U.S. certified mail, addressed to the party at the address set forth below, unless such address is changed by ten (10) days' written notice given to the other
party: 

	28.1.1	Landlord:	CORNERSTONE/WEYERHAEUSER COMPANY

1011 Western Avenue, Suite 500

Seattle, Washington 98104
	

28.1.2	

Tenant:	

Prior to commencement of the term of the Lease:

HARBORSIDE RESTAURANT

c/o Spring Street, Inc.

401 Southwest 12th Street

Portland, Oregon 97205
	

After commencement of the term of the Lease; or when Tenant opens for business on Premises.
	

 	

 	

HARBORSIDE RESTAURANT

0309 Southwest Montgomery Street

Portland, Oregon 97201

        28.2    All
such notices and communications shall be deemed given on the day of actual receipt at the applicable address as evidenced by the return receipt. 

SECTION 29  

 LANDLORD MAINTENANCE  

        29.1    Except
as otherwise provided is this Lease, Landlord shall maintain in reasonably good order and condition: 

        29.1.1    The
foundation, bearing and exterior walls, subflooring, and roof of the Building; 

        29.1.2    The
unexposed electrical, plumbing, and sewage systems in the Building lying outside the Premises; 

        29.1.3    Window
frames, gutters and downspouts on the Building; 

19

 

        29.1.4    The
central heating, ventilating and air conditioning system installed in the Building by Landlord; and 

        29.1.5    The
Common Areas. 

        29.2    In
the event any repair or maintenance described in Section 28.1 is occaisioned by the act, omission, or neglect of Tenant or any persons who may be in or upon
the Premises or the Project with the express or implied consent of Tenant (including Tenant's officers, contractors, agents, invitees, guests, employees), Tenant shall pay to Landlord the costs of
such maintenance and repair on demand by Landlord. 

        29.3    Landlord
shall not be in default under this Lease and shall not be liable to Tenant for any loss or damage to person or property, or any inconvenience or interference
with Tenant's business caused by or resulting from Landlord's failure to perform its obligations under Section 28.1 unless such failure shall persist, due to Landlord's negligence, for an
unreasonable period of time after written notice of the need for repair or maintenance has been given by Tenant to Landlord. 

        29.4    There
shall be no abatement of rent (except as provided in Sections 12 and 13), and Landlord shall not be liable or responsible to Tenant for any loss or damage to
person or property or for inconvenience to, or interference with Tenant which may arise through repair, maintenance or alteration of any part of the Project. 

        29.5    See
Addendum Section 7. 

SECTION 30  

 TENANT MAINTENANCE  

        30.1    Tenant's
taking possession of the Premises on Commencement of the term shall constitute Tenant's acknowledgement that the Premises are in good condition and repair.
Tenant, at its sole cost and expense, shall keep the Premises and every part thereof (including but not limited to initial leasehold improvements made by either party and Tenant Improvements) and
Tenant's Personal Property in good condition and repair, ordinary wear and tear excepted. 

        30.2    Tenant
shall be liable for any damage to the Project caused by or resulting from the act, omission or neglect of Tenant, its agents, employees, contractors, invitees or
visitors. 

SECTION 31  

 SERVICES AND UTILITIES  

        31.1    Landlord
shall provide the facilities necessary to bring utility services identified in Exhibit 3 to the Premises, but all means of distributing such services
within the Premises shall be supplied by Tenant at Tenant's cost. 

        31.2    Provided
that Tenant is not in default hereunder and subject to the provisions of Sections 30.3, Landlord agrees to cause utilities to furnish services utilized in
operating the facilities identified in Exhibit 3. 

        31.3    If
Tenant's utilities are separately metered and Tenant has arranged to obtain services directly from a utility company serving the Building, Landlord shall have no
obligation or responsibility to furnish such services or to cause the utility companies to furnish such services. 

        31.4    Landlord
does not warrant that any of the services and utilities described above will be free from variation, interruption, or failure. Should any of the facilities
utilized in bringing the above-described services to the Premises break down, or for any cause cease to function properly, Landlord shall use reasonable diligence to repair the same promptly, but
Tenant shall have no right to terminate this Lease, and shall have no claim for rebate of Rent or for damages directly or indirectly caused by 

20

 

or
resulting from any such breakdown or malfunction or any variations, interruptions or failures in service. 

SECTION 32  

 TENANT'S REMEDIES  

        If Landlord shall be in default under this Lease, Tenant's sole remedy shall be to institute suit against Landlord. If Tenant shall recover a judgment against
Landlord, Tenant agrees to look solely to Landlord's interest in the Project for the satisfaction of said judgment. It is agreed that Landlord (or if
Landlord is a partnership, its partners (whether general or limited), or if Landlord is a corporation, its officers, directors and shareholders) shall never be personally liable for any such judgment
or for the performance or observance of the terms, covenants, conditions and obligations of this Lease to be performed or observed by Landlord. Said terms, covenants, conditions and obligations are
not binding upon the assets of Landlord except Landlord's interest in the Project. 

SECTION 33  

 WAIVER OF SUBROGATION RIGHTS  

        Anything in this Lease to the contrary notwithstanding, Landlord and Tenant each hereby waive any and all rights of recovery, claim action or cause of action
against the other, its agents, officers, directors, shareholders, or employees, for loss or damage to the Premises or any improvements thereto, or the Project or any improvements thereto, or any
personal property of such party therein, that is caused by or results from fire and other perils as are included in the provisions of the normal extended coverage clauses of fire insurance policies.
Each party shall cause each insurance policy obtained by it to provide that the insurance company waives all right to recovery by way of subrogation against either parry in connection with any such
damage or loss. 

SECTION 34  

 ATTORNEYS' FEES  

        If either party commences an action against the other party arising out of or in connection with this Lease, the prevailing party in any such action, at trial or
on appeal, shall be entitled to have and recover from the other party, in addition to costs, such sums as the court may adjudge reasonable as attorneys' foes. 

SECTION 35  

 WAIVER  

        35.1    No
delay or omission in the exercise of any right or remedy of Landlord on any default by Tenant shall impair such right or remedy or be construed a waiver of any
default. The receipt and acceptance by Landlord of delinquent Rent shall not constitute a waiver of any other default; but shall constitute only a waiver of timely payment for the particular Rent
payment involved. 

        35.2    No
act or conduct of Landlord, including without limitation the acceptance of the keys to the Premises shall constitute an acceptance of the surrender of the Premises
by Tenant before the expiration of the Term. Only notice from Landlord to Tenant shall constitute acceptance of the surrender of the Premises and accomplish a termination of the Lease. 

        35.3    Landlord's
consent to or approval of any act by Tenant requiring Landlord's consent or approval shall not be deemed to waive or render unnecessary Landlord's consent to
or approval of any subsequent act by Tenant. 

        35.4    Any
waiver by Landlord of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Lease. 

21

 

SECTION 36  

 MISCELLANEOUS PROVISIONS  

        36.1    Time
of Essence. Time is of the essence of each provision of this Lease. 

        36.2    Authority.
Each party represents and warrants to the other that it has authority to enter into this Lease and that its execution and delivery of this Lease has been
duly authorized. Each individual executing this Lease on behalf of each party represents and warrants that he/she is duly authorized to execute and deliver this Lease on behalf of said party. 

        36.3    Commissions.
Each party represents that it has not had dealings with any real estate broker, finder or other person with respect to this Lease in any manner except n/a.
Each party shall bold harmless the other party from all damages resulting from any claims that may be asserted against the other party by any broker, finder or other person with whom the party giving
the indemnity has or purportedly has dealt except n/a.                        shall pay any commissions or fees that are payable
to the above-named broker or finder with respect to this Lease. 

        36.4    Exhibits.
All exhibits referred to are attached to this Lease and incorporated by reference, with the exception of Section 5, "Signage Criteria," which shall be
furnished by Landlord to Tenant upon approval thereof by the Portland Development Commission and the City of Portland, but in no case later than one hundred and twenty (120) days after the
execution of this Lease. 

        36.5    Interpretation
and Construction. This Lease shall be governed by and construed and interpreted in accordance with the laws of the State of Oregon. 

        36.6    Integrated
Agreement and Modifications. This Lease contains all covenants and agreements between Landlord and Tenant relating in any manner to the rent, use and
occupancy of the Premises, Tenant's use of the Building, and all other matters set forth in this Lease. No prior agreements or understanding pertaining to the same shall be valid or of any force or
effect; and the covenants and agreements of this Lease shall not be altered, modified or added to except in writing signed by Landlord and Tenant. 

        36.7    Use
of Definitions. The definitions contained in this Lease shall be used to interpret this Lease. 

        36.8    Captions.
The captions of this Lease shall have no effect on its interpretation. 

        36.9    Singular
and Plural. When required by the context of this Lease, the singular shall include the plural. 

        36.10    Joint
and Several Obligations. "Party" shall mean Landlord or Tenant; and if more than one person or entity is Landlord or Tenant, the obligations imposed on that
party shall be joint and several. 

        36.11    Severability.
The unenforceability, invalidity, or illegality of any provision of this Lease shall not render any other provisions unenforceable, invalid, or illegal. 

        36.12    Recordation.
This lease shall not be recorded except that, at the request of either party, the parties shall execute a memorandum of this Lease in recordable form. 

        36.13    Transfer
and Assignment of Premises by Landlord. Landlord shall have the right to transfer and assign, in whole or in part, all of its rights and obligations hereunder
and in the Premises, the Building, and/or the Land. In the event of any such transfer or transfers, other than a transfer for security purposes only, the transferor shall be automatically relieved of
any and all obligations and liabilities on the part of Landlord accruing from and after the effective date of the transfer and Tenant agrees to attorn to the transferee. So long as there is no default
by Tenant hereunder, this Lease shall remain in full force and effect for the term hereof. 

22

 

        36.14    Name.
Tenant shall not use the name of the Building for any purpose other than as an address of the business to be conducted by the Tenant on the Premises. 

        36.15    Cumulative
Remedies. All rights and remedies of Landlord under this Lease shall be cumulative and shall not exclude any rights or remedies otherwise available. 

SECTION 37  

 CONDOMINIUM CONVERSION  

        See Addendum. 

SECTION 38  

 MINIMUM RENT INCREASE  

        See Addendum. 

	LANDLORD	 	TENANT
	

CORNERSTONE DEVELOPMENT COMPANY, dba

CORNERSTONE/WEYERHAEUSER COMPANY	
 	

CORNERSTONE-McCORMICK JOINT VENTURE, dba

HARBORSIDE RESTAURANT
	

 	

 	
 	

By:	

SPRING STREET, INC.
	

 	

 	
 	

By:	

/s/  WILLIAM P. MCCORMICK      
 Its President
	 	 	 	 	By:	CORNERSTONE DEVELOPMENT COMPANY
	

By	

/s/  PAUL E.S. SCHELL      
 Its President	
 	

By	

/s/  PAUL E.S. SCHELL      
 Its President

STATE
OF OREGON

COUNTY OF 

        On
this day personally appeared before me Paul E.S. Schell to me known to be the president of Cornerstone Development Company, dba Cornerstone/Weyerhaeuser Company, the corporation that
executed the within and foregoing instrument as Property Manager for Cornerstone/Weyerhaeuser Company and acknowledged the instrument to be voluntary act and deed of said corporation and said limited
partnership, for the uses and purposes therein mentioned, and on oath stated that affiant is authorized to execute said instrument on behalf of said corporation for said corporation and of said
limited partnership. 

        GIVEN
UNDER MY HAND AND OFFICIAL SEAL this 14th day of February, 1985. 

	 	 	/s/

Notary Public in and for the State of Oregon

residing at
	 	 	My commission expires:

23

 

STATE
OF OREGON

COUNTY OF 

        On
this day personally appeared before me William McCormick, to me known to be the General Partner of Cornerstone-McCormick Joint Venture, dba Harborside Restaurant, a general
partnership that executed the within and foregoing instrument, and acknowledged the instrument to be the free and voluntary act and deed of said limited or general partnership for the uses and
purposes therein mentioned, and on oath stated that affiant is authorized to execute said instrument on behalf of said general partnership. 

        GIVEN
UNDER MY HAND AND OFFICIAL SEAL this 14th day of February, 1985. 

	 	 	

Notary Public in and for the State of Oregon

residing at
	 	 	My commission expires:

STATE
OF OREGON

COUNTY OF 

        On
this day personally appeared before me Paul Schell, to me known to be the General Partner of Cornerstone-McCormick Joint Venture, dba Harborside Restaurant, the general partnership
that executed the within and foregoing instrument, and acknowledged the instrument to be the free and voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on
oath stated that he is authorized to execute said instrument on behalf of said general partnership. 

        GIVEN
UNDER MY HAND AND OFFICIAL SEAL this 14th day of February, 1985. 

	 	 	

Notary Public in and for the State of Oregon

residing at
	 	 	My commission expires:

24

 
RETAIL LEASE AGREEMENT

Dated February 14, 1985

between

CORNERSTONE/WEYERHAEUSER COMPANY, Landlord

and

McCORMICK JOINT VENTURE, dba HARBORSIDE RESTAURANT, Tenant  

 ADDENDUM  

        This Addendum is incorporated and made a part of that certain Retail Lease Agreement (the "Lease"), dated February 14, 1985 by and between
Cornerstone/Weyerhaeuser Company, a corporation in the State of Washington as Landlord, and McCormick Joint Venture, dba Harborside Restaurant, a general partnership in the State of Oregon as Tenant.
The defined terms in the Lease shall have the
same meaning herein. The provisions of this Addendum shall supersede any inconsistent provisions of the Lease. 

        1.    Minimum Rent Increases.    

        1.1    Definitions.    For purposes of this Section and as used hereafter, the following terms shall have the meanings
herein set forth: 

        1.1.1    "Lease Year" means each 12-month period during the Lease Term, commencing on the first day of the first
full calendar month of the Lease Term and ending on the last day of the twelfth month thereafter. 

        1.1.2    "Consumer Price Index" ("CPI") means the Consumer Price Index for the Portland Standard Metropolitan Statistical Area,
All Urban Consumers—All Items, published by the United States Department of Labor, Bureau of Labor Statistics (Minimum Year 1967 equals 100). If the CPI is discontinued or revised, such
other government index or computation with which it is replaced shall be used in order to obtain substantially the same results as would have been obtained if the CPI had not been discontinued or
revised. 

        1.1.3    "Base CPI" means the most recent CPI published prior to the Commencement Date. 

        1.1.4    "Extension CPI" means the most recent CPI published prior to the Adjustment Date, defined in Section 1.2. 

        1.2    Amount of Increase and Effective Dates.    Effective on the first day of the sixth Lease Year
("Adjustment Date"), the monthly Minimum Rent payable by Tenant shall be increased by an amount computed by multiplying the Minimum Rent set forth in
Section 3.1 of the Lease by the percentage, it any, by which the Extension CPI exceeds the Base CPI. For purposes of this Section, the Extension CPI shall be deemed to be no lower than the Base
CPI. Should Landlord lack sufficient data to make the proper calculations on the Adjustment Date, Tenant shall continue to pay the monthly Minimum Rent payable immediately prior to the Adjustment
Date. As soon as Landlord obtains the necessary data, it shall determine the monthly Minimum Rent payable from and after the Adjustment Date and notify Tenant of the adjustment in writing. Should the
monthly Minimum Rent for the period following the Adjustment Date exceed the amount of monthly Minimum Rent previously paid by Tenant for that period, Tenant shall forthwith pay the difference to the
Landlord. Landlord shall not be obligated to make any adjustment or recomputations, retroactive or otherwise, by reason of any revision which may later be made in the CPI figures first published for
any period. 

        2.     Section 2.4
of the Lease is deleted in its entirety. 

        3.     Section 3.3
of the Lease is deleted in its entirety. 

25

 

        4.     Section 4
of the Lease is deleted in its entirety. 

        5.     Section 8.4
of the Lease is deleted in its entirety. 

        6.    Arbitration and Appraisal.    Any dispute between the parties which by the terms of this Lease is to be resolved
by arbitration or by appraisal shall be resolved in accordance with the provisions of this Section 6. As used in this Section 6, the term "arbitration" shall include appraisal. Either
party may request arbitration of the matter in dispute. The party requesting arbitration shall do so by giving notice to that effect to the other party. Both parties shall apply to the presiding judge
of the Multnomah County Circuit Court for the appointment of an arbitrator or appraiser, but if one party should refuse to join in the application, the other party nevertheless may make such
application alone. Any arbitrator chosen or appointed pursuant to this Section 6, shall be actively engaged in and have knowledge of Downtown Portland office and retail leasing. Any appraiser
chosen or appointed pursuant to this Section 6 shall be a member of the American Institute of Real Estate Appraisers or the Society of Real Estate Appraisers and shall be expert in the
appraisal of buildings in the Portland, Oregon downtown area. Arbitration proceedings shall be conducted under ORS 33.210 to 33.340, inclusive. Lessor and Lessee shall share equally in the payment of
the costs and expenses of the arbitrator or appraiser. The arbitrator or appraiser shall render his or her decision and award not later than thirty (30) days after his or her appointment. The
decision and award shall be in writing and counterpart copies thereof shall be delivered to each of the parties. In rendering the decision and award, the arbitrator or appraiser shall have no power to
modify any of the provisions of this Lease, and the jurisdiction of the arbitrator or appraiser is limited accordingly. The decision of the arbitrator or appraiser shall be final and binding on the
parties. Judgment may be had on the decision and award of the arbitrator or appraiser and may be enforced in accordance with the laws of the State of Oregon. 

        7.    Self Help.    Section 29.5 of the Lease is deleted in its entirety and the following language is inserted
in its place: 

"29.5
If Landlord fails after ten (10) days' written notice by Tenant to proceed with due diligence to make repairs to be made by Landlord under Section 29.1, Tenant may give written
notice of Tenant's intention to make such repairs at Landlord's expense ("Tenant's Notice of Intent to Repair"). If Landlord's failure persists for a further ten (10) days beyond Tenant's
Notice of Intent to Repair, Tenant may proceed to make repairs at Landlord's expense. In the event that the Premises are damaged so as
to affect Tenant's ability to do business in the Premises as defined under Section 1.1.9, Tenant may give Tenant's Notice of Intent to Repair two (2) days after the first written notice
to Landlord of the defect or damage, and, if Landlord's failure to repair persists, may proceed to make such repairs at Landlord's expense two (2) days thereafter." 

        8.    Sale of Condominium Units.    Section 37 of the Lease is deleted in its entirety and the following
language is inserted in its place: 

"The
Building is a multi-unit condominium under the Oregon Condominium Act. It is understood and agreed that, in the event Landlord or any person or firm with Landlord's consent shall
sponsor the sale of condominium units in the Building, including a unit or units which include or are adjacent to the Premises, the Landlord or any person or firm acting with the Landlord's consent
may do any and all things which may be necessary to prepare the Building for sale to prospective purchasers of condominium units, including but not limited to advertising, and showing, repairing,
renovating, reconstructing and surveying the Building, including the Premises; provided, however, that Tenant shall have the right to approve the sale of a condominium unit that includes the Premises.
Tenant's consent may not be unreasonably withheld or delayed. 

26

   RETAIL LEASE AGREEMENT

Dated February 14, 1985

between

CORNERSTONE/WEYERHAEUSER COMPANY, Landlord

and

McCORMICK JOINT VENTURE, dba HARBORSIDE RESTAURANT, Tenant  

EXHIBIT 6

OPTION TO EXTEND  

        Tenant is given the option to extend the Initial Term on all of the terms and conditions contained in this Lease except for Minimum Rent for four
(4) additional consecutive terms of five (5) years each ("Extended Terms") following expiration of the Initial Term (or the Extended Term then in effect). The option shall be exercised
by Tenant's giving written notice of exercise of the option ("Option Notice") to Landlord not more than two hundred and ten (210) days and not less than one hundred and fifty (150) days
before the expiration of the Initial Term (or the Extended Term then in effect). Provided that Tenant is not in default on the date of giving the Option Notice or on the date the Extended Term is to
commence, the Extended Term shall commence the day following the expiration of the Initial Term (or the Extended Term then in effect). The words "Term" or "Lease Term" shall mean the aggregate of the
Initial Term and any Extended Term with respect to which Tenant has effectively exercised the foregoing option(s). 

        9.    Minimum Rent for the Extended Term(s).    Effective on the first day of each Extended Term, the monthly Minimum
Rent in effect for the Term immediately preceding such Extended Term shall be increased by the method set forth in Section 1.2 of the Addendum hereto, and the defined terms in the Addendum
shall have the same meaning herein. In no event shall the monthly Minimum Rent payable during any Lease Year be less than the monthly Minimum Rent payable during the immediately preceding Lease Year. 

        10.    Rent Increases During Extended Term.    Effective on the first day of the second Lease Year of each Extended
Term and on the first day of each succeeding Lease Year during each Extended Term, the monthly Minimum Rent payable by Tenant shall be increased as provided in Section 6 of the Lease. 

        11.    Non-Assignability.    The terms of this Option may not be assigned or transferred by Tenant to any
other party. Should Tenant assign or transfer its interest under this Lease, the terms of this Option shall become void. 

27

 
AMENDMENT NO. 4 TO LEASE AGREEMENT  

        THIS AMENDMENT NO. 4 TO LEASE AGREEMENT ("Fourth Lease Amendment") is made ON August 17, 2001 between RiverPlace Associates, L.L.C. an Oregon limited
liability company ("Landlord") and McCormick and Schmick Restaurant Corporation, a Delaware corporation ("Tenant"). 

RECITALS  

        A.    Landlord
and Cornerstone-McCormick Joint Venture ("CMJV") entered into a written lease ("Lease") dated February 14, 1985, in which Landlord leased to CMJV and CMJV
leased from Landlord premises consisting of Commercial Unit 1 in RiverPlace Condominium No. 1 located in Portland, Multnomah County, Oregon, and created by the recording of the Condominium
Declaration for RiverPlace Condominium No. 1 made pursuant to the Oregon Condominium Act, on June 27, 1985, at Book 1833, Page 1317 (the "Premises"). The Premises were originally
described as located on the ground floor of the Esplanade South Building of Phase I of the RiverPlace project located at 0309 SW Montgomery Street, Portland, Oregon 97201. The Lease was amended by the
parties pursuant to Amendment No. 1 to the Lease dated July 24, 1985, further amended pursuant to Amendment No. 2 to Lease dated April 3, 1992, and last amended pursuant to
Amendment No. 3 to Lease Agreement in December, 1993. 

        B.    The
Lessee's interest in the Lease was assigned by CMJV to Spring St., Inc. pursuant to Assignment and Assumption of Lease in December 1993. Spring
Street, Inc. was dissolved in September 1995, and its assets and liabilities were assigned to and assumed by Apple South, Inc., which later became Avado Brands, Inc. due to
a name change. Pursuant to an Assignment and Assumption of Lease of even date herewith, Avado Brands, Inc. is assigning its interest under the Lease to Tenant, and Tenant is assuming all
obligations of Avado Brands, Inc. under the Lease effective as of the Effective Date set forth in the Assignment and Assumption of Lease. In connection with such assignment and assumption,
Tenant has
requested that Avado Brands, Inc. be released from liability under the Lease in consideration of a lease guaranty to be executed by McCormick & Schmick Acquisition Corp. 

        C.    Tenant
desires to extend the Lease term by exercising an option available to Tenant under the Lease at this time, and also would like to add one additional option to the
Lease. 

        D.    The
parties therefore desire to document these modifications to the Lease: 

TERMS AND CONDITIONS  

        1.    Term and Extension Options.    Pursuant to the Option to Extend contained in the Lease, Tenant elects to extend
the Term of the Lease for the third Extension Term which shall commence on July 1, 2005 and expire on June 30, 2010, unless terminated earlier pursuant to the term of the Lease, and
Landlord hereby accepts such election. The rent for the third Extension Term shall be calculated in accordance with Section 1.2 of the Addendum to the Lease, and Exhibit 6 to the Lease,
referred to as Option to Extend. Tenant shall at that time have one additional Extension Term of five (5) years remaining under the original Lease terms. Landlord grants to Tenant one
additional Extension Term of five (5) years, exercisable in the manner otherwise provided for in the Lease, resulting in Tenant having two (2) remaining Extension Terms, the first of
which will commence July 1, 2010, if properly exercised by Tenant. 

        2.    Consent and Release.    Landlord hereby consents to the Assignment and Assumption of the Lease to Tenant
referenced in Recital B above, which shall be in the form attached hereto as 

28

 

Attachment
A, conditioned upon the terms hereof and the terms of the Assignment and Assumption. This Consent is subject to the following: 

        (a)   Except
as expressly set forth in this Consent, this Consent shall not impose any additional liabilities or obligations on Landlord or otherwise affect any of the rights
or remedies of Landlord under the Lease. 

        (b)   This
Consent shall not constitute Landlord's consent to any further assignment, subletting or other transfer which requires Landlord's consent under the Lease except as
follows; notwithstanding anything
to the contrary contained in the Lease, Landlord's consent shall not be required for any transfer or assignment of the Lease to, or sublease or use of the Premises by Assignee's parent, McCormick and
Schmick Acquisition Corp. However, sixty (60) days advance written notice of any such assignment must be provided to Landlord. 

        (c)   Landlord
hereby releases Assignor Avado Brands, Inc. from any and all liability of Tenant under the Lease from and after the later of the Effective Date of this
Amendment No. 4 or the effective date of the Assignment and Assumption of Lease by Tenant. In consideration therefore, McCormick and Schmick Acquisition Corp. shall enter into a Guaranty of
Lease in the form attached hereto as Attachment B and subject to any limitations on Guarantor's liability expressly provided in the Guaranty of Lease ("New Guaranty"). 

        (d)   Landlord
acknowledges and agrees that Assignor and Assignee will rely on this Consent in entering into the Assignment. 

        3.    Estoppel.    Tenant acknowledges that Landlord is not in default under the Lease and that Tenant has no claims
against Landlord under the Lease on the date hereof. 

        4.    Effectiveness of Lease Amendment.    The effectiveness of this Lease Amendment shall be conditioned upon full
execution and delivery of this Fourth Lease Amendment by Landlord and Tenant, effective execution of the Assignment and Assumption of the Lease to Tenant and the execution and delivery of the New
Guaranty. 

        5.    Miscellaneous.    

        5.1    Effectiveness of Lease.    Except as expressly amended hereby, all terms of the Lease, as previously amended,
shall remain in full force and effect. Any modification set forth in this Fourth Lease Amendment shall supersede and control over any conflicting terms in the Lease or prior modifications. 

        5.2    Defined Terms.    Any undefined capitalized terms used in this Agreement shall have the same meaning as defined
in the Lease. 

29

 

        5.3    Counterpart Signatures.    This Fourth Lease Amendment may be executed in counterpart and if executed in that
manner shall be fully effective and binding. 

	 	 	LANDLORD:
	

 	
 	
RIVERPLACE ASSOCIATES, L.L.C.,

an Oregon limited liability company
	

 	
 	

By:	

RIVER PLACE MANAGEMENT, INC.,

a Washington corporation, Manager
	

 	
 	

 	

By:	

/s/  MELVIN I. BRADY      
 Melvin I. Brady, President
	

 	
 	

 	

Date:	

July 13, 2001
	

 	
 	
TENANT:
	

 	
 	
MCCORMICK AND SCHMICK RESTAURANT CORPORATION,

a Delaware corporation
	

 	
 	

By:	

/s/  DOUGLAS L. SCHMICK      

	 	 	 	Its:	President
	

 	
 	

Date:	

 
	 	 	 	 	 

30

 
AMENDMENT NO. 5 TO LEASE AGREEMENT  

        THIS FIFTH AMENDMENT TO LEASE (this "Fifth Amendment") is made as
of March 17, 2004, by and between HARBORSIDE PARTNERS, LLC, as successor in interest to RIVER PLACE ASSOCIATES, L.L.C. ("Landlord"), and  McCORMICK & SCHMICK
RESTAURANT CORP., a Delaware corporation, as successor in interest to AVADO BRANDS, INC.
("Tenant"). 

RECITALS  

        This Fifth Amendment is made and entered into on the basis of the following facts and understandings: 

        A.    Landlord
and Cornerstone-McCormick Joint Venture ("CMJV") entered into a written lease
("Lease") dated February 14, 1985, in which Landlord leased to CMJV and CMJV leased from Landlord premises consisting of Commercial Unit 1 in
RiverPlace Condominium No. 1 located in Portland, Multnomah County, Oregon, and created by the recording of the Condominium Declaration for RiverPlace Condominium No. 1 made pursuant to the
Oregon Condominium Act, on June 27, 1985, at Book 1833, Page 1317 (the "Premises"). The Premises were originally described as located on the
ground floor of the Esplanade South Building of Phase I of the River Place project located at 0309 SW Montgomery Street, Portland, Oregon 97201. The Lease was amended by the parties pursuant to
Amendment No. 1 to the Lease dated July 24, 1985, further amended pursuant to Amendment No. 2 to Lease dated April 3, 1992, and further amended pursuant to Amendment
No. 3 to Lease Agreement in December, and last amended pursuant to Amendment No. 4 to Lease Agreement dated August 17, 2001. 

        B.    The
Lessee's interest in the Lease was assigned by CMJV to Spring St., Inc. pursuant to Assignment and Assumption of Lease in December 1993. Spring
St., Inc. was dissolved in September 1995, and its assets and liabilities were assigned to and assumed by Apple South, Inc., which later became Avado Brands, Inc. due to a
name change. Avado Brands, Inc. assigned its interest under the Lease to Tenant and Tenant assumed all obligations of Avado Brands, Inc. under the Lease effective as of the 17th day of
August 2001. Avado Brands, Inc. was released from liability under the Lease in consideration of a lease guaranty executed and delivered by McCormick & Schmick Acquisition Corp.
("Guarantor"). 

        C.    The
parties desire to amend certain provisions of the Lease and extend its term, such amendment to be effective upon the acquisition by Landlord of the Premises. 

        D.    Capitalized
terms used herein but not defined shall have the meanings set forth in the Lease. 

AGREEMENT  

        NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
Lessor and Lessee agree as follows: 

        1.    Term.    The Term of the Lease is extended through December 31, 2023, unless terminated earlier pursuant
to the terms of the Lease. The monthly Minimum Rent for the period January 1, 2004 through December 31, 2008 shall be $20,000.00. The Minimum Rent for the periods January 1, 2009
through December 31, 2014; January 1, 2015 through December 31, 2019; and January 1, 2016 through December 31, 2023 shall be calculated in the following manner: 

        (a)   Effective
on January 1, 2009, January 1, 2014, and January 1, 2019 (each an "Adjustment Date" and
together, the "Adjustment Dates") the monthly Minimum Rent shall be increased by an amount computed by multiplying the monthly Minimum Rent for the
immediately preceding December (i.e., December 31, 2008 for the January 1, 2009 Adjustment Date, December 31, 2013 

31

 

for
the January 1, 2014 Adjustment Date and December 31, 2018 for the January 1, 2019 Adjustment Date) by the percentage, if any, by which the Extension CPI exceeds the Base CPI.
For purposes hereof, the Extension CPI shall be deemed to be no lower than the Base CPI. The Base CPI for each Adjustment Date means the most recent CPI published prior to the previous Adjustment Date
(i.e., for the January 1, 2014 Adjustment Date, the Base CPI shall be the most recent CPI published prior to January 1, 2009, for the January 1, 2019 Adjustment Date, the Base CPI
shall be the most recent CPI published prior to January 1, 2014, and for the January 1, 2009 Adjustment Date, the Base CPI shall be the most recent CPI published prior to
January 1, 2004). The Extension CPI means the most recent CPI published prior to the applicable Adjustment Date. 

        2.    Option to Extend.    Tenant is given the option to extend the Term of the Lease for two (2) additional
consecutive terms of five (5) years each (each an "Extended Term" and together, the "Extended
Terms"). The option shall be exercised by Tenant given written notice of exercise of the option ("Option Notice") to Landlord
not more than two hundred ten (210) days and not less than one hundred fifty (150) days before the expiration of the Initial Term (or the Extended Term then in effect). Provided the
Tenant is not in default on the date of giving the Option Notice or on the date the Extended Term is to commence, the Extended Term shall commence the day following the expiration of the Initial Term
(or the Extended Term then in effect). Effective on the first day of the each Extended Term, the monthly Minimum Rent in effect for the Term immediately preceding such Extended Term shall be increased
by the method set forth in Section 1(a) of this Fifth Amendment, the first day of each Extended Term being the Adjustment Date. In no event shall the monthly Minimum Rent payable during any
Lease Year be less than the monthly Minimum Rent payable during the immediately preceding Lease Year. 

        3.    Permitted Assignment.    Tenant, without Landlord's consent, upon written notice to Landlord may:
(i) transfer substantially all of its assets in connection with a change of control, transfer, or other disposition of a majority of the McCormick & Schmick Seafood Restaurants,
(ii) transfer its equity interests in connection with a change of control transfer or other disposition of the equity interests of a majority of the McCormick & Schmick Seafood
Restaurants, (iii) dissolve, merge, consolidate or otherwise reorganize in connection with a change of control, dissolution, merger, consolidation or other reorganization of a majority of the
McCormick & Schmick Seafood Restaurants, or (iv) assign the Lease or sublet the Premises to an "Affiliate of Tenant". In addition, a
change of control, a sale or transfer of all or part of the assets or issued and outstanding equity interests of Tenant or Affiliate of Tenant, (a) in connection with a transfer or other
disposition of a majority of the McCormick & Schmick Seafood Restaurants, or (b) if such transferor or transferee is a corporation whose equity interests are listed on any nationally
recognized securities exchange, or (c) pursuant to a public offering for such equity interests, shall not require Landlord's consent. As used in this Section, the term
"Affiliate of Tenant" means a proprietorship, corporation, partnership, unincorporated association or other person or entity "controlling", "controlled"
by or under common "control" with Tenant. The words "controlling", "controlled" and "control" shall have the meanings given them under the Securities Exchange Act of 1934, as amended. Any transfer of
this Lease permitted under this Section shall be deemed as a "Permitted Transfer". 

        4.    Right of First Refusal to Lease.    No later than one year prior to expiration of the second Extended Term, if
such Extended Term has been exercised, and provided that no default hereunder has occurred and is continuing beyond any applicable grace or cure period, Landlord shall inform Tenant of the proposed
rent, terms and conditions for extension of this Lease for an additional five (5) years (a "Third Extended Term"). Tenant shall notify Landlord
within thirty (30) days after it receives notice of the proposed rent, terms and conditions whether or not Lessee elects to extend for the Third Extended Term at the specified rent, terms and
conditions. Lessee's failure to notify Lessor of an election to extend for the Third Extended Term shall signify Lessee's intent to allow the Lease to expire at the end of the second Extended Term
without further extensions. If Lessee does not extend the term for the 

32

 

Third
Extended Term, Lessor may offer to lease the Premises to other operators at substantially the same rent and on the same terms and conditions as offered to Lessee; provided, however, that if
Lessor materially alters the terms of its offer to lease the Premises to make such offer more favorable to a potential lessee, Lessor shall first offer Lessee the opportunity to lease the Premises at
the more favorable terms." 

        5.    Right of First Refusal to Purchase.    If Landlord, during the Lease Term, or any Extended Term if such Extended
Term has been exercised, elects to sell all or any portion of the Premises, whether separately or as part of a larger parcel, Tenant shall have the right of first refusal to meet any third party
bonafide offer of sale on the same terms and conditions of such offer. Landlord shall submit a written copy of such offer to Tenant. If Tenant fails to notify Landlord of its election to meet such
bonafide offer within thirty (30) days after receipt of notice thereof from Landlord, Landlord may sell the Premises to such third person in accordance with the terms and conditions of its
offer. The Tenant's right of first refusal contained herein shall not be applicable to an offer from any present Member of Landlord or member of such Member's immediate family, or an entity controlled
by any such Member or member or such Member's immediate family, and any such offer shall not be deemed a third party bonafide offer. 

        6.    Effective Date.    Landlord and Tenant acknowledge that this Fifth Amendment shall not become effective until
such date as Landlord becomes the owner of the Premises. Landlord will notify Tenant of such date. 

        7.     Except
as modified by this Fifth Amendment, the Lease shall remain in full force and effect in accordance with its terms. 

        IN
WITNESS WHEREOF, this Fifth Amendment is executed as of the date first set forth above. 

	 	 	HARBORSIDE PARTNERS, LLC,

as Landlord
	

 	
 	

By:	

/s/  SAED MOHSENI      

	 	 	 	Name:	Saed Mohseni
	 	 	 	Title:	Member
	

 	
 	
McCORMICK & SCHMICK RESTAURANT CORP.

as Tenant
	

 	
 	

By:	

/s/  DOUGLAS L. SCHMICK      

	 	 	 	Name:	Douglas L. Schmick
	 	 	 	Title:	President
	

 	
 	
McCORMICK & SCHMICK RESTAURANT CORP.

as Guarantor
	

 	
 	

By:	

/s/  DOUGLAS L. SCHMICK      

	 	 	 	Name:	Douglas L. Schmick
	 	 	 	Title:	President

33

 

	STATE OF OREGON	)	 	 
	 	)ss.	 	 
	COUNTY OF Multnomah	)	 	 

        On
this    day of March, 2004, before me, the undersigned, a Notary Public in and for the State of Oregon, duly commissioned and sworn, personally appeared Saed Mohseni, to
me known to be the person who signed as Member of the HARBORSIDE PARTNERS, LLC, the limited liability company that executed the within and foregoing instrument, and acknowledged said instrument to be
the free and voluntary act and deed of said limited liability company for the uses and purposes therein mentioned, and on oath stated that he was duly elected, qualified and acting as said officer of
the limited liability company that he was authorized to execute said instrument. 

        IN
WITNESS WHEREOF I have hereunto set my hand and official seal the day and year first above written. 

	 	 	/s/  SUSAN THOMPSON      
 (Signature of Notary)
	

 	
 	

 
	 	 	Susan Thompson
 (Print or Stamp Name of Notary)
	

 	
 	

 
	 	 	NOTARY PUBLIC in and for the State of Oregon
	 	 	My appointment expires: 03/07/07.

34

 

	STATE OF OREGON	)	 	 
	 	)ss.	 	 
	COUNTY OF Multnomah	)	 	 

        On
this    day of March, 2004, before me, the undersigned, a Notary Public in and for the State of Oregon, duly commissioned and sworn, personally appeared Douglas L.
Schmick, to me known to be the person who signed as President of McCORMICK & SCHMICK RESTAURANT CORP., the corporation that executed the within and foregoing instrument, and acknowledged said
instrument to be the free and voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on oath stated that he was duly elected, qualified and acting as said officer
of the corporation that he was authorized to execute said instrument and that the seal affixed, if any, is the corporate seal of said corporation. 

        IN
WITNESS WHEREOF I have hereunto set my hand and official seal the day and year first above written. 

	 	 	/s/  SUSAN THOMPSON      
 (Signature of Notary)
	

 	
 	

 
	 	 	Susan Thompson
 (Print or Stamp Name of Notary)
	

 	
 	

 
	 	 	NOTARY PUBLIC in and for the State of Oregon
	 	 	My appointment expires: 03/07/07.

35

 

	STATE OF OREGON	)	 	 
	 	)ss.	 	 
	COUNTY OF Multnomah	)	 	 

        On
this    day of March, 2004, before me, the undersigned, a Notary Public in and for the State of Oregon, duly commissioned and sworn, personally appeared Douglas L.
Schmick, to me known to be the person who signed as President of McCORMICK & SCHMICK ACQUISITION CORP., the corporation that executed the within and foregoing instrument, and acknowledged said
instrument to be the free and voluntary act and deed of said corporation for the uses and purposes therein mentioned, and on oath stated that he was duly elected, qualified and acting as said officer
of the corporation that he was authorized to execute said instrument and that the seal affixed, if any, is the corporate seal of said corporation. 

        IN
WITNESS WHEREOF I have hereunto set my hand and official seal the day and year first above written. 

	 	 	/s/  SUSAN THOMPSON      
 (Signature of Notary)
	

 	
 	

 
	 	 	Susan Thompson
 (Print or Stamp Name of Notary)
	

 	
 	

 
	 	 	NOTARY PUBLIC in and for the State of Oregon
	 	 	My appointment expires: 03/07/07.

36

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