Document:

Exhibit 10.13

 

KEY
EMPLOYEE AGREEMENT

 

This
KEY EMPLOYEE AGREEMENT (the “Agreement”) is made and entered into as of the 8th
day of October, 2002, by and between ValueClick, Inc. a Delaware
corporation (the “Company” or “ValueClick”) and Scott Ray (“Executive”).

 

WHEREAS,
the Company is a global Internet advertising network enabling advertisers to
take advantage of the Internet to sell their products and increase brand
awareness;

 

WHEREAS,
Executive possesses unique technical and operational skills which are valuable
to the business and financial prospects of the Company;

 

WHEREAS,
in light of the foregoing, the Company desires to employ Executive as General
Manager, Mediaplex and Adware divisions and Executive desires to accept such
employment;

 

NOW
THEREFORE, in consideration of the mutual promises contained herein, Company
and Executive agree as follows:

 

I.    Description of Employment Position and Responsibilities.    You will serve in the
position of General Manager, Mediaplex and Adware divisions. By executing this
offer letter, you agree to assume and discharge such duties and
responsibilities as are commensurate with this position and such other duties
and responsibilities that are assigned to you from time to time by the Company’s
Chief Executive Officer. During the term of your employment, you shall devote
your full time, skill and attention to your duties and responsibilities and
shall perform them faithfully, diligently and competently. In addition, you
shall comply with and be bound by the operating policies, procedures and
practices of the Company in effect from time to time during your employment. To
the fullest extent permitted by Delaware law, Company shall indemnify and
defend Executive from all costs, expenses and losses whether direct or indirect,
including consequential damages and attorney’s fees, incurred or sustained by
Executive in consequence of the lawful discharge of his duties on Company’s
behalf.

 

II.    Employment Considerations.

 

2.1    At-Will Employment. You acknowledge that
your employment with the Company is for an unspecified duration that
constitutes at-will employment, and that either you or the Company can
terminate this relationship at any time, with or without Cause (as defined
below) and without notice.

 

III.   Compensation.

 

3.1    Base Salary. In consideration of your
services, to be effective on your start date (TBD but no later than November
11, 2002), you will be paid an annual base salary of $235,000 (Two Hundred Thirty
Five Thousand Dollars and no Cents), payable no less frequently than on a
monthly basis in accordance with the Company’s standard payroll practices (“Standard
Payment Schedule”). Your base salary, in conjunction with your performance
evaluation, is normally reviewed annually by the Company’s Chief Executive
Officer.

 

3.2    Incentive Compensation. In addition to
your base salary, you will be entitled to participate in an incentive
compensation plan with the opportunity to receive an annual bonus of $100,000 (One
Hundred Thousand Dollars and no Cents) paid quarterly upon the achievement of
certain milestones as established by the Company’s Chief Executive Office and
ratified by the Company’s Board of Directors or the Compensation Committee of
the Board.

 

 

IV.    Additional Benefits.

 

4.1    Health Insurance/Vacation/Benefit Plans.
You will be entitled to receive the standard employee benefits made available
by the Company to its employees to the full extent of your eligibility therefore.
You shall be entitled to three (3) weeks of paid vacation per year, the
terms and conditions of your vacation benefits shall be in accordance with the
Company’s vacation policy in effect at that time. During your employment, you
shall be permitted, to the extent eligible, to participate in any group
medical, dental, life insurance and disability insurance plans, or similar
benefit plan of the Company that is available to employees generally.
Participation in any such plan shall be consistent with your rate of
compensation to the extent that compensation is a determinative factor with
respect to coverage under any such plan. The Company also agrees to pay for
your COBRA coverage until Executive is eligible for coverage under the Company’s
benefit plans.

 

4.2    Reimbursement of Expenses. The Company
shall reimburse you for all reasonable expenses actually incurred or paid by
you in the performance of your services on behalf of the Company, upon prior
authorization and approval in accordance with the Company’s expense
reimbursement policy as from time to time in effect.

 

4.3    Stock Options. Pursuant to Board approval,
and under the terms and conditions of the Company’s Stock Option Plan and Stock
Option Agreement, including the stock vesting provisions contained therein, you
will be granted an option to purchase 150,000 shares of common stock of the
Company as set forth in a Stock Option Agreement, which will be sent to you
separately. In addition to the options set out in your Stock Option Agreement,
you may be granted an option to purchase additional shares of common stock from
time to time in the Company’s discretion (the options in your Stock Option
Agreement and any and all options you may be granted in the future are
collectively referred to herein as the “Options”).

 

V.    Termination.

 

5.1    Voluntary Termination; Cause. At any time,
if your employment is terminated by the Company with Cause, or if you resign
your employment voluntarily, no compensation or other payments will be paid or
provided to you for periods following the date when such a termination of
employment is effective, provided that any rights you may have under the
benefit plans of the Company shall be determined under the provisions of those
plans. If your employment terminates as a result of your death or disability,
no compensation or payments will be made to you other than those to which you
may otherwise be entitled under the benefit plans of the Company.

 

VI.   Change
of Control Benefits.

 

6.1    Change of Control Compensation. In the
event there should occur a Change of Control (as defined below), and
(i) your employment by the Company terminates for any reason other than
for Cause or on account of your permanent disability or death or
(ii) there occurs a Constructive Termination, the Company will pay to you
as severance, in one lump sum amount (unless you indicate in writing to the
Company prior to the Company’s payment of your election to be paid in
installments over a specified period) an amount equal to six (6) months of
your annual base salary in effect immediately prior to the time of such termination.
Such amount will be paid by the Company as soon as administratively possible
following such termination, but in all events not later than fifteen
(15) days following the effective date of such termination. Such amounts
paid will be reduced by all applicable withholding taxes and other deductions
required by law and any additional amounts authorized by you to be withheld.

 

6.2    Other Change of Control Benefits. In
addition to any amounts payable under Section 6.1 above, upon the
occurrence of a Change of Control and (i) your employment by the Company
terminates for any reason other than for Cause or on account of your permanent
disability or death or (ii) there occurs a Constructive Termination, the
vesting of fifty percent (50%) of the unvested Options shall be immediately
exercisable.

 

 

6.3  Change
in Control Definitions. For purposes of this Agreement:

 

(a)
A “Change in Control” will be deemed to occur upon consummation of any one of
the following:

 

(i)
a sale, lease or other
disposition of all or any material portion of the assets of the Company;

 

(ii)
a merger, consolidation or other reorganization in which the Company is not the
surviving corporation and the stockholders of the Company immediately prior to
the merger, consolidation or other reorganization fail to possess direct or
indirect ownership of more than fifty percent (50%) of the voting power of the
securities of the surviving corporation (or if the surviving corporation is a
controlled affiliate of another Person, then the required beneficial ownership
will be determined with respect to the securities of that Person which controls
the surviving corporation and is not itself a controlled affiliate of any other
Person) immediately following such transaction;

 

(iii)
a merger, consolidation or other
reorganization in which the Company is the surviving corporation and the
stockholders of the Company immediately prior to such merger, consolidation or
other reorganization fail to possess direct or indirect beneficial ownership of
more than fifty percent (50%) of the securities of the Company (or if the
Company is a controlled affiliate of another Person, then the required
beneficial ownership will be determined with respect to the securities of that
Person which controls the Company and is not itself a controlled affiliate of
any other Person) immediately following such transaction;

 

For purposes of Sections 6.3(a)(ii) and
6.3(a)(iii) above, any Person who acquired securities of the Company prior
to the occurrence of the specified transaction in contemplation of such
transaction and who immediately after such transaction possesses direct or
indirect beneficial ownership of at least ten percent (10%) of the securities
of the Company or the surviving corporation, as appropriate (or if the Company
or the surviving corporation is a controlled affiliate, then of the appropriate
Person as determined above), will not be included in the group of stockholders
of the Company immediately prior to such transaction.

 

(b)
A “Constructive Termination”
means any of the following occurring after a Change in Control:

 

(i)
a reduction, without your written consent, in your then current annual base
salary;

 

(c)
“Cause” means (i) a final conviction of a felony or a crime involving
moral turpitude causing material harm to the standing and reputation of the
Company; (ii) refusal to comply with reasonable directives of the Company’s
Board of Directors; (iii) negligence or reckless or willful misconduct in
the performance of Executive’s duties; (iv) failure to perform, or continuing
neglect in the performance of Executive’s duties; (v) misconduct which has
materially adverse effect upon the Company’s business or reputation;
(vi) violation of the Company policies, including, without limitation, the
Company’s policies on equal employment opportunity and prohibition of unlawful
harassment.

 

(d)
“Person” means an individual,
corporation, partnership, limited liability company, association, trust,
unincorporated organization or other legal entity including any governmental
entity.

 

VII.    Assumption.    Prior to or upon consummation of the Change in
Control, the Company shall obtain the assumption of this offer letter by the
surviving corporation of any merger, consolidation or other reorganization (if
such surviving corporation is not the Company) and the ultimate parent of the
Person engaging in the transaction or transactions constituting a Change in
Control.

 

VIII.    Intellectual Property Rights/Confidential
Information.    You
agree that the Company is the owner of valuable trade secrets, client, vendor,
customer and contractor lists and other confidential and proprietary
information. As such, you agree that your employment is contingent upon your
execution of,

 

 

and
delivery to, the Company of a Confidential Information and Invention Assignment
Agreement in the standard form utilized by the Company.

 

IX.    Non-Competition/Conflicting Employment.    You agree that,
during the term of your employment with the Company, you will not engage in any
other employment, occupation, consulting or other business activity directly
related to the business in which the Company and/or its customers are now
involved or become involved during the term of your employment, nor will you
engage in any other activities that conflict with your obligations to the
Company.

 

X.   General
Provisions.

 

10.1    Governing Law. This offer letter will be
governed by the laws of the State of California, applicable to agreements made
and to be performed entirely within such state.

 

10.2    Entire Agreement. This offer letter sets
forth the entire agreement and understanding between the Company and you
relating your employment and supersedes all prior verbal discussion and written
agreements between us. Any subsequent change or changes in your duties, salary
or other compensation will not affect the validity or scope of this agreement.
Any change to the at-will term of this agreement must be executed in writing
and signed by you and the President of the Company.

 

10.3    Successors/Assigns. This agreement will be
binding upon your heirs, executors, administrators and other legal
representatives and will be for the benefit of the Company and its respective
successors and assigns.

 

Please acknowledge and confirm your acceptance of
this letter by signing and returning the enclosed copy of this offer letter. If
you have any questions about this offer letter, please call me directly. 

 

	
   

  	
  VALUECLICK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Lynn
  M. Johnson

  
	
   

  	
   

  	
   

  	
  Vice
  President, Human Resources

  

 

ACCEPTANCE:

 

I
accept the terms of my employment with ValueClick, Inc. as set forth
herein. I understand that this offer letter does not constitute a contract of
employment for any specified period of time, and that my employment
relationship may be terminated by either party, with or without cause and with
or without notice.

 

	
  Mr. Scott
  Ray

  
	
   

  
	
  /s/ Scott H. RayExhibit 10.28

 

AMENDMENT TO LEASE AGREEMENT

[Congressional]

 

THIS AMENDMENT TO LEASE AGREEMENT
(“Amendment”) is made and entered into effective as of the      
day of March, 2005 (the “Effective Date”) by and between Eugene M. Kornblum and
Helen H. Kornblum (hereinafter collectively referred to as “Landlord”) and ST,
LOUIS MUSIC, INC., a corporation, existing under the laws of the State of
Missouri (hereinafter referred to as “Tenant”).

 

RECITALS:

 

A.                                                Landlord
and Tenant entered into that certain Lease Agreement (“Lease”) dated as of September 12,1990,
for land and all appurtenances, buildings and improvements located thereon
situated in the County of St. Louis, State of Missouri as more particularly
described in the Lease.

 

B.                                                  Landlord
and Tenant now wish to amend the Lease as set forth herein.

 

NOW, THEREFORE, in consideration
of the foregoing Recitals, the mutual covenants and obligations contained
herein and for other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged and confessed, Landlord and Tenant agree as
follows:

 

1.                                                    All
capitalized terms used and not otherwise defined herein shall have the meaning
ascribed to them in the Lease. In the event of any conflict or inconsistency
between this Amendment and the Lease, this Amendment shall control.

 

2.                                                    The
ending date of the term of the Lease as described in Paragraph 2 of the Lease
is hereby extended to and shall be February 29,2008, unless sooner
terminated pursuant to other provisions of the Lease, in addition, Tenant shall have no further
renewal or extension options and any such rights in the Lease are deleted.

 

3.                                                    Paragraph
3 of the Lease is hereby stricken in its entirety and replaced with the
following language:

 

“3.                                Use
of the Premises. Tenant shall be entitled to have and to hold the Premises,
subject to the conditions herein contained, for any use permitted by law.
Landlord and Tenant shall comply with, and shall maintain the Premises in
compliance with, all laws and all requirements of all governmental authorities
applicable to the Premises and to the use thereof, and shall maintain the
Premises in compliance with the requirements of the insurance companies
providing the insurance required by subparagraph (b)(3) of Paragraph 4
below.”

 

4.                                                    Paragraph
5 of the Lease is hereby stricken in its entirety and replaced with the
following language:

 

“5.                                Maintenance,
Repairs, Alterations and Restorations.

 

(a)                   Tenant
shall, at its sole cost and expense, maintain and care for the building and
improvements located on the Premises, including landscaped areas, roadways and
the parking areas, except as otherwise provided in subparagraph (b) below.
Tenant shall, at its sole cost and expense, maintain and care for the Interiors
of the building and improvements, including all plumbing, heating, air
conditioning, electrical and sewer systems devices and installations. Tenant
agrees to keep the Premises free from any nuisance or filth upon or adjacent
thereto, Except as otherwise

 

 

provided in subparagraph (b) below, all repairs
and alterations deemed necessary to the exterior and interior of the buildings
and improvements located on the Premises shall be made or constructed by Tenant
with the consent of Landlord; and all repairs, alterations, restorations,
buildings and other improvements so made or constructed shall remain as or
become, as the case may be, a part of the realty.

 

(b)                  Landlord
shall conduct all structural maintenance and repairs to the foundation, the
exterior walls and the roof of the building as may be required for the
preservation, protection or restoration of the Premises, unless any such
maintenance and/or repair is required as a result of damage caused by the gross
negligence or willful acts and/or omissions of Tenant, its employees or
invitees, on or after the Effective Date. Landlord shall also conduct all
maintenance and repairs to the Premises that are required as a result of damage
caused prior to the Effective Date, and shall perform any such alterations
to the Premises as are required by law, except and to the extent such
alterations are so required due to improvements or intended improvements to the
Premises by Tenant.

 

(c)                   All
repairs, alterations, restorations, buildings and other improvements made or
constructed to or on the Premises shall be performed by the responsible party
in a good and workmanlike manner, shall be pursued by the responsible party
with due diligence until the Premises will again be fit for occupancy of
Tenant, or until said construction shall be reasonably deemed completed by
Landlord, and shall be performed in conformity with all applicable laws,
ordinances, rules and regulations. Tenant shall not, under any
circumstances, allow or permit any lien for labor and material to attach to the
Premises.

 

(d)                         Subject
to paragraph 6(b) below, Tenant shall pay for all costs and expenses
incurred by Tenant arising out of Tenant’s obligations to make the repairs,,
alterations or restorations described in subparagraph (a) above. Landlord
shall also pay for all costs and expenses incurred by Landlord arising out of
Landlord’s obligations to make the repairs, alterations or restorations
described in subparagraph (b) above.”

 

5.                                                    Paragraph
6 of the Lease is hereby stricken in its entirety and replaced with the
following language:

 

“6.                                              Indemnification.

 

(a)                                        Tenant
agrees that it will protect, indemnify and save Landlord harmless from and
against any penalty, damage or charge imposed for any violation of any law or
ordinance by Tenant, its agents, employees or anyone acting on behalf of
Tenant. Tenant further agrees that it will protect, indemnify and save Landlord
harmless from and against any and all claims, suits, demands, causes of action,
costs and liabilities arising from Tenant’s use of the Premises on or after the
Effective Date, or from any act permitted, or any omission to act, in or about
the Premises by Tenant or its employees or invitees on or after the Effective
Date, or from any breach or default by Tenant of this Lease, except to the
extent caused by Landlord’s negligence or willful misconduct.

 

(b)                                       Landlord
agrees that it will protect, indemnify and save Tenant harmless from and
against any and all claims, suits, demands, causes of action, costs and
liabilities arising from any breach or default by Landlord of this Lease,
except to the extent caused by Tenant’s negligence or willful misconduct,
Landlord further agrees that

 

2

 

it will protect, indemnify and save Tenant harmless
from and against any and all claims, suits, demands, causes of action, costs
and liabilities associated with, related to, or arising out of (i) the
maintenance and repair of the roof, including without limitation any removal,
disposal or other remediation required by law with respect to any asbestos
containing materials (“ACMs”) or presumed ACMs that may be present in the
roof; (ii) any underground storage tanks that may be or have been
present on the Premises; and (iii) without limitation to item (i) above,
the presence of any ACMs or presumed ACMs on the Promises; provided, however
that Landlord shall have no such indemnification obligation with respect to any
remediation, maintenance, encapsulation, removal, disposal, labeling or other
actions with respect to any ACMs, presumed ACMs or underground storage tanks
except to the extent such action is required under applicable laws.”

 

5.                                                    Paragraph
8 of the Lease is hereby stricken in its entirety and replaced with the
following language:

 

“8.                                              Destruction
and Eminent Domain.

 

(a)                                        Should
the entire area of the Premises, or such portion thereof as to interfere
materially with or curtail the operations of Tenant’s business for a period in
excess of sixty (60) days, be destroyed by fire or other cause or be acquired
or taken by condemnation by any public or quasi-public authority or under the
power of eminent domain, this Lease may, at the option of Tenant, be terminated
and of no further force and effect from and after the date of such total
destruction or the effective date of the taking by such public or quasi-public
authority. Tenant shall have no interest in nor shall it share in any insurance
proceeds or condemnation award received by Landlord for the Premises.

 

(b)                                       Should
only a portion of the Premises be so destroyed, acquired or condemned, and the
portion thus destroyed or taken be of such an amount as not to interfere
materially with or curtail the operations of Tenant’s business for a period in
excess of sixty (60) days, then this Lease shall continue in full force and
effect as to the portion not so destroyed or taken with a reduction in the
fixed annual rent proportionate to the area of the Premises so destroyed or
taken for a period up to, but not exceeding, six (6) months, provided that
Landlord has in force business interruption insurance payable to the lender of
any indebtedness of Landlord which is secured by the premises in an amount
sufficient to pay the debt service on such indebtedness during the period of
rent reduction. The parties shall make all of the repairs and improvements
deemed necessary in order to restore the Premises to its original condition and
shall perform, pursue and complete said repairs and improvements in accordance
with the terms and provisions of Paragraph 5 above. The costs and expenses
incurred by Tenant in making said repairs and improvements shall be paid for by
Tenant and shall be reimbursed by Landlord, but only to the extent paid for by
the insurance proceeds or condemnation award received by Landlord. Upon
completion of said repairs and improvements in accordance with and as
determined by the terms and provisions of Paragraph 5 above, the fixed annual
rent, if reduced under the terms of this subparagraph (b), shall be increased
to the amount set forth in Paragraph 4.”

 

(c)                                               The
fact of whether such destruction, acquisition or condemnation has materially
interfered with or curtailed the operations of Tenant’s business for a period
in excess of sixty (60) days shall be determined by the mutual decision of
Landlord and Tenant. If

 

3

 

Landlord and Tenant cannot agree as to whether such
destruction, acquisition or condemnation has materially interfered with or
curtailed the operations of Tenant’s business for a period in excess of sixty
(60) days, the fact shall be determined by arbitration in accordance with and
as provided by the Missouri Uniform Arbitration Act, Section 435.350
et. seq. R.S. Mo. 1994.”

 

6.                                                    Paragraph
9 of the Lease is hereby stricken in its entirety and replaced with the
following language:

 

“9.                                              Default.

 

(a)                                 In
the event that Tenant shall fail to pay any installment of rent within ten (10) days
from the date that the same shall become due hereunder or shall fail to pay any
insurance premiums or taxes and assessments within ten (10) days after
written notice from Landlord that the same shall be due, or in the event that
Tenant shall fail in the observance of performance of any of the other terms,
conditions and provisions of this Lease for more than thirty (30) days after
written notice of such default shall have been mailed to Tenant (provided,
however, that if Tenant shall promptly proceed to correct such failure upon
notice thereof then said thirty (30) day period if insufficient, shall be
extended for such reasonable time as may be necessary), or in the event
that Tenant shall be adjudicated insolvent or bankrupt pursuant to the
provisions of any state or federal insolvency or bankruptcy act, or if Tenant
shall make a general assignment for the benefit of creditors, or if a receiver
of the property of Tenant shall be appointed and such appointment shall not be
vacated within 120 days after it is made, or if Tenant shall allow or permit
any lien for labor or material to attach to the Premises, then Landlord,
besides other rights or remedies Landlord may have, shall have the
immediate right to pursue any one or more of the following remedies without
notice or demand whatsoever, which remedies are cumulative and not alternative;

 

(i)                                           Landlord
shall have the right to remedy or attempt to remedy any default of Tenant, and
in so doing to make any payments due or alleged to be due by Tenant to third
parties and to enter upon the Premises to do any work or other things therein,
and in such event all reasonable expenses of Landlord in remedying or
attempting to remedy such default shall be payable by Tenant to Landlord on
demand. All sums so paid by Landlord and all expenses in connection therewith,
shall bear interest thereon at the rate of fifteen percent (15%) per annum or
the highest legal rate if less and if not otherwise demanded by Landlord shall
be deemed additional rent;

 

(ii)                                        Landlord
shall have the right to terminate this Lease or terminate Tenant’s right to
possession of the Premises without terminating this Lease forthwith by leaving
upon the Premises or by affixing to on entrance door to the Premises notice
terminating the Lease or possession. Upon the giving by the Landlord of a
notice in writing terminating this Lease or terminating Tenant’s right to
possession of the Premises, Tenant shall remain liable for and shall pay on
demand by Landlord (A) the full amount of all Rent which accrues or which
would have accrued until the date on which this Lease would have expired had
termination not occurred, and any and all damages and expenses incurred by
Landlord in re-entering and repossessing the Premises in making good any
default of Tenant, in making any alterations, remodeling or new tenant finish
to the Premises, and any and all expenses which the Landlord may incur
during the occupancy of any new tenant, legs (B) the net proceeds of any
re-letting of the Premises which has occurred at the time of the aforesaid
demand by Landlord to Tenant. Landlord shall be

 

4

 

entitled to any excess with no credit to Tenant.
Landlord may, in its sole, discretion, make demand on Tenant as aforesaid on
any one or more occasions, and any suit brought by Landlord to enforce
collection of such difference for any subsequent month or months. Tenant’s
liability shall survive the institution of summary proceedings and the issuance
of any warrant hereunder; and

 

(iii)                                     Landlord shall
have the right of injunction and the right to invoke any other remedy allowed
at law or in equity, and mention in this Lease of any particular remedy shall
not preclude Landlord from any other remedy at law or in equity.

 

(b)                                In
the event that Tenant shall fail in the observance of performance of any of the
terms, conditions or provisions of this Lease, including but not limited to
payments or money to Landlord or any other person or entity, and Landlord
engages the services of an attorney to enforce such terms, conditions or
provisions, then and in such event, Landlord shall be entitled to recover from
Tenant the entire cost of collection or other enforcement, including reasonable
attorneys’ fees, which if not otherwise demanded by Landlord shall be deemed
additional rent hereunder. In the event that Landlord shall fail in the
observance or performance of any of the terms, conditions or provision of this
Lease on its part to be performed, and Tenant engages the services of an
attorney to enforce such terms, conditions or provisions, then and in such
event, Tenant shall be entitled to recover from Landlord the entire cost of
enforcement, including reasonable attorneys’ fees.”

 

6.                                                    There is herby added to the Lease a
new Paragraph 13, which reads in its entirety as follows:

 

13.                                Limitation
of Liability. Tenant agrees that it shall look solely to Landlord’s estate
and interest in the Premises (or the proceeds thereof) for the satisfaction of
any right of Tenant for the collection of a judgment or other judicial process
requiring the payment of money by Landlord. No other properly or assets of
Landlord, its partners, its joint venturers or any officers, directors or
employees of any of the foregoing, shall be subject to any enforcement
procedures for the satisfaction of any of Tenant’s rights and remedies under or
as to: (i) the Lease, (ii) the relationship of Landlord and Tenant
under this Lease or under law, (iii) Tenant’s use and occupancy of the
Premises, or (iv) any other liability of Landlord to Tenant. This
provision shall not be deemed, construed or interpreted to be or constitute an
agreement, express or implied, between Landlord and Tenant that Landlord’s
interest hereunder and in the Premises shall be subject to any equitable lien
or other similar lien or charge. From and after the due date upon which
Landlord shall convey the Premises to another party, Landlord shall be released
from its obligations hereunder, provided that such third party shall assume all
obligations of Landlord as set forth herein.

 

7.                                                    There
is hereby added to the Lease a
new paragraph 14, which reads in its entirety as follows:

 

“14.                          Landlord
Agreement. Landlord hereby agrees to execute and deliver to Tenant,
contemporaneously with this Lease, that form of Landlord Agreement
attached hereto as Exhibit A.”

 

8.                                                    There
is hereby added to the Lease a
new paragraph 15, which reads in its entirety as follows:

 

5

 

“15.      Miscellaneous.

 

(a)             Tenant
shall maintain during the term of this Lease the insurance
coverages referenced in paragraph 4(b)(3).

 

(b)            The
terms and provisions of the Lease shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, successors, assigns
and personal representatives provided, however, that no assignment by, from,
through or under Tenant in violation of any provisions hereof shall vest in
such assignee any right, title or interest whatsoever.

 

(c)             Tenant
may not record this Lease or a Memorandum or other notice of this Lease
without Landlord’s prior written consent, which consent shall not be
unreasonably conditioned, delayed or withhold.

 

(d)            This
Lease may not be modified or amended except by a written instrument executed
by both Landlord and Tenant. This Lease shall be governed by and interpreted
pursuant to the laws of the State of Missouri.

 

(e)             The
invalidity of one or more of the provisions of this Lease shall not cause the
invalidity of the remainder of this Lease.

 

(f)               In
the event that either party hereto shall bring legal action against the other
party, then the prevailing party shall be entitled to reimbursement from the
other party for all expenses thus incurred, including a reasonable attorney’s
fee.

 

(g)            The
captions or other headings of any sections of this Lease are inserted for
convenience only and shall not be considered in construing the provision hereof
if any question of intent should arise.

 

(h)            All
rights and remedies of Landlord herein enumerated shall be cumulative and shall
not be construed to exclude any other remedies allowed at law or in equity,
whether or not specified herein. The failure of Landlord to insist in any one
or more cases upon the strict performance of any of the provisions of this
Lease or to exercise any option under this Lease shall not be construed as a
waiver or a relinquishment for the future of any such provision, and one or
more waivers of any breach of any provision shall not be construed as a waiver
of any subsequent breach of the same. The receipt and acceptance by Landlord of
any partial payment under this Lease shall not be deemed a waiver of such
breach or an accord and satisfaction.”

 

9.                                                    This
Amendment shall be binding upon and inure to the benefit of Landlord and Tenant
and their heirs, successors and assigns. The terms and provisions set forth in
this Amendment shall modify and supersede all inconsistent terms and provisions
set forth in the Lease and except as expressly modified and superseded by this
Amendment, the terms and provisions of the Lease are ratified and confirmed and
shall continue in full force and effect. Landlord and Tenant acknowledge and
agree that the Lease as amended hereby shall continue to be legal, valid,
binding and enforceable in accordance with its terms. This Amendment may be
executed in multiple and facsimile counterparts each of which shall be deemed
to be an original and together shall constitute one instrument. This Amendment
shall be governed by and construed in accordance with the laws of the State of
Missouri.

 

6

 

LEASE AGREEMENT

 

LEASE AGREEMENT, made and entered into as of the 12th
day of September, 1990, by and between Eugene M. Kornblum and Helen H. Kornblum
(hereinafter collectively referred to as “Landlord”), and St. Louis Music, Inc.,
a corporation existing under the laws of the State of Missouri (hereinafter
referred to as “Tenant”).

 

1.                            Description
of Premises.

 

Landlord, for and in consideration of the rents,
covenants and agreements hereinafter mentioned and hereby agreed to be paid,
kept and performed by Tenant, has leased and by these presents does lease unto
Tenant the parcel of land described in Exhibit 1 attached hereto and made
a part hereof, together with all appurtenances, buildings and improvements
located thereon, and situated in the County of St. Louis, State of Missouri
(hereinafter referred to as the “Premises”). This lease shall be subject to
that certain lease dated October 12, 1989 by and between Borman Congressional
Partners, a Missouri partnership, as Lessor, and Gerard Packaging Systems, Inc.,
as Lessee (the “Gerard Lease”). The Gerard Lease was assigned by Borman
Congressional Partners to Tenant upon Tenant’s acquisition of the Premises
pursuant to an Assignment and Assumption Agreement dated May 4, 1990, and
further assigned by Tenant to Landlord upon Landlord’s acquisition of the
Premises pursuant to an Assignment and Assumption Agreement dated September 10,
1990.

 

2.                            Lease
Term.

 

This lease (hereinafter referred to as the “Lease”)
shall commence on the 1st day of November, 1990, and shall end on the 31st day
of October, 2005, unless sooner terminated pursuant to other provisions of this
Lease.

 

3.                            Use
of Premises.

 

Tenant shall be entitled to have and to hold the
Premises, subject to the conditions herein contained, for the purposes of
manufacturing, storage, warehousing, shipping and office center and for any
other use permitted by law. Tenant shall comply with, and shall maintain the
Premises in compliance with, all laws and all requirements of all governmental
authorities applicable to the Premises and to the use thereof, and shall
maintain the Premises in compliance with the requirements of the insurance
companies providing the insurance required by subparagraph (b) (3) of
Paragraph 4 below.

 

4.                            Rental.

 

(a)             As
fixed annual rent Tenant shall pay directly to Landlord, or to such other
person as Landlord designates, without previous demand therefor, the sum of One
Hundred Thousand Dollars ($100,000.00) per year, payable in equal monthly
installments of

 

1

 

Eight Thousand Three Hundred Thirty-Three and 33/100 Dollars
($8,333.33) in advance on the first day of each and every month during the term
of this Lease.

 

(b)            As
additional rental during the term of this Lease, Tenant shall fully pay all
costs and charges in connection with or arising out of the following:

 

(1)                          All
taxes, assessments and other governmental charges levied, during the term
hereof, on the Premises or any part thereof, including, but not limited
to, all general and special assessments, sewer taxes, water licenses, and any
other taxes, penalties, fines, interests and costs imposed upon or against the
Premises or against any of the personal property placed upon the Premises;

 

(2)                          All
electricity, water, sewer use, gas, costs of operation of heating and air
conditioning and other utilities used on the Premises during the full term of
this Lease;

 

(3)                          All
insurance premiums for the following described insurance required to be
maintained on the Premises by Tenant, in the name of Landlord or such other
person or entity as Landlord may designate:

 

(A)                                    Insurance
for all risks of direct physical loss or damage to the Premises (subject to
standard policy exclusions) in an amount representing the full replacement
costs of the improvements located on the Premises, in insurance companies
approved by Landlord and authorized to do business in the state of Missouri;
and

 

(B)                                      Insurance
for public liability coverage, protecting both Landlord and Tenant against any
and all claims for personal injury, loss of life or damage to property
sustained or claimed to have been sustained in, on or about the Premises or the
building, improvements and appurtenances located thereon or upon the adjoining
sidewalks, streets or alleyways. Such insurance shall be in such amounts and
contain such coverages as Landlord may reasonably require; and

 

(C)                                      A certificate or certificates of the
insurers that such insurance is in force and effect shall be deposited with
Landlord and shall contain an undertaking by the respective insurers that the
insurance policies shall not be canceled or modified adversely to the interests
of Landlord without at least thirty (30) days’ prior notice to Landlord. Prior
to the expiration of any such policy, Tenant shall furnish Landlord with
evidence satisfactory to Landlord that the policy has been renewed or replaced
or is no longer required by this Lease.

 

(4)                          All
other expenses and charges which shall be incurred or shall be required in
connection with the possession,

 

2

 

occupation, operation, alteration, maintenance, repair, protection,
preservation and use of the Premises, it being intended that this Lease shall be
a net net lease to Landlord and that, except as is otherwise specifically
provided for herein, Landlord shall have no cost or expense in connection with
the Premises subleased hereunder.

 

5.                            Maintenance,
Repairs, Alterations and
Restorations.

 

(a)             Tenant
shall make all structural repairs and alterations to the foundation, exterior
walls and roof of the building and improvements located on the Premises as way
be required for the preservation, protection or restoration of the Premises,
unless any such repair or alteration is required as a result of damage caused
by the acts of Landlord, its employees or invitees.

 

(b)            Tenant
shall, at its sole cost and expense, maintain and care for the building and
improvements located on the Premises, including landscaped areas, roadways and
the parking areas. Tenant shall, at its sole cost and expense, maintain and
care for the interiors of the building and improvements, including all
plumbing, heating, air conditioning, electrical and sewer systems, devices and
installations. Tenant agrees to keep the Premises free from any nuisance or
filth upon or adjacent thereto. Except as otherwise provided in subparagraph (a) above,
all repairs and alterations deemed necessary to the exterior and interior of
the buildings and improvements located on the Premises shall be made or
constructed by Tenant with the consent of Landlord; and all repairs,
alterations, restorations, buildings and other improvements so made or
constructed shall remain as or become, as the case may be, a part of the
realty. All repairs, alterations, restorations, buildings and other
improvements made or constructed by Tenant to or on the Premises shall be
performed by Tenant in a good and workmanlike manner, shall be pursued by
Tenant with due diligence until the Premises will again be fit for occupancy by
Tenant, or until said
construction shall be deemed completed by Landlord, and shall be performed in
conformity with all applicable laws, ordinances, rules and regulations.
Tenant shall not, under any circumstances, allow
or permit any lien for labor and material to attach to the Premises.

 

(c)             Tenant
shall pay for all costs and expenses incurred by Tenant arising out of Tenant’s
obligations to make the repairs, alterations or restorations described in
subparagraphs (a) and (b) above.

 

6.                            Indemnification.

 

Tenant agrees that it will protect, indemnify and save
Landlord harmless from and against any penalty, damage or charge imposed for
any violation of any law or ordinance by Tenant, its agents, employees or
anyone acting on behalf of Tenant. Tenant further agrees that it will protect,
indemnify and save Landlord harmless from and against any and all claims,
suits, demands and

 

3

 

causes of action of any nature whatsoever, and any expense incident to
the defense thereof, for personal injury, loss of life or damage to property
sustained or alleged to have been sustained upon, about or adjacent to the
Premises.

 

7.                            Damage
to Person or Property.

 

Landlord shall not be liable to Tenant or any other
person or corporation, including Tenant’s employees, for any damage to their
person or property caused by water, rain, snow, frost, fire, storm and
accidents, or by breakage, stoppage or leakage of water, gas, heating and
sewer pipes, air conditioning units or plumbing upon about or adjacent to the
Premises.

 

8.                            Destruction
and Eminent Domain.

 

(a)             Should
the entire area of the Premises, or such portion thereof as to interfere
materially with or curtail the operations of Tenant’s business for a period in
excess of sixty (60) days, be destroyed by fire or other cause or be acquired
or taken by condemnation by any public or quasi-public authority or under the
power of eminent domain, and should all indebtednesses of Landlord to all lenders
which are secured by the Premises, be paid in full, this Lease may, at the
option of Tenant, be terminated, and of no further force and effect from and
after the date of such total destruction or the effective date of the taking by
such public or quasi-public authority. Tenant shall have no interest in nor
shall it share in any insurance proceeds or condemnation award received by
Landlord for the Premises.

 

(b)            Should
only a portion of the Premises be so destroyed, acquired or condemned, and the
portion thus destroyed or taken be of such an amount as not to interfere
materially with or curtail the operations of Tenant’s business for a period in
excess of sixty (60) days, or should all indebtednesses of Landlord to all
lenders which are secured by the Premises not be paid in full, then, and in
either of such events, this Lease shall continue in full force and effect as to
the portion not so destroyed or taken with a reduction in the fixed annual rent
proportionate to the area of the Premises so destroyed or taken for a period up
to, but not exceeding, six (6) months, provided that Landlord has in force
business interruption insurance payable to the lender of any indebtedness of
Landlord which is secured by the premises in an amount sufficient to pay the debt
service on such indebtedness during the period of rent reduction. Tenant shall
make all of the repairs and improvements deemed necessary in order to restore
the Premises to its original condition and shall perform, pursue and complete
said repairs and improvements in accordance with the terms and provisions of
subparagraph (b) of Paragraph 5 above. The costs and expenses incurred by
Tenant in making said repairs and improvements shall be paid for by Tenant and
shall be reimbursed by Landlord, but only to the extent paid for by the
insurance proceeds or condemnation award received by Landlord. Upon completion
of said repairs and improvements in accordance with and as determined by

 

4

 

the terms and provisions of subparagraph (b) of Paragraph 5 above,
the fixed annual rent, if reduced under the terms of this subparagraph (b),
shall be increased to the amount set forth in Paragraph 4.

 

(c)             The
fact of whether such destruction, acquisition or condemnation has materially
interfered with or curtailed the operations of Tenant’s business for a period
in excess of sixty (60) days shall be determined by the mutual decision of
Landlord and Tenant. If Landlord and Tenant cannot agree as to whether such
destruction, acquisition or condemnation has materially interfered with or
curtailed the operations of Tenant’s business for a period in excess of sixty
(60) days, the fact shall be determined by arbitration in accordance with and
as provided by the Missouri Uniform Arbitration Act, Section 435.350 et
seq., R.S.Mo. 1980.

 

9.                            Default.

 

(a)             In
the event that Tenant shall fail to pay any installment of rent within ten (10) days
from the date that the same shall become due hereunder or shall fail to pay any
Insurance premiums or taxes and assessments within ten (10) days after
written notice from Landlord that the same shall be due, or in the event that
Tenant shall fail in the observance or performance of any of the other terms,
conditions and provisions of this Lease for more than thirty (30) days after
written notice of such default shall have been mailed to Tenant (provided,
however, that if Tenant shall promptly proceed to correct such failure upon
notice thereof then said thirty (30) day period if insufficient, shall be extended
for such reasonable time as may be necessary), or in the event that Tenant
shall be adjudicated insolvent or bankrupt pursuant to the provisions of any
state or federal insolvency or bankruptcy act, or if Tenant shall make a
general assignment for the benefit of creditors, or if a receiver of the
property of Tenant shall be appointed and such appointment shall not be vacated
within 120 days after it is made, or if Tenant shall allow or permit any lien
for labor or material to attach to the Premises, then Landlord, besides other
rights or remedies Landlord may have, shall have the immediate right to
reenter the Premises and remove all persons and property from the Premises, all
without service of notice or resort to legal process and without being deemed guilty
of trespass or becoming liable for any loss or damage which may be
occasioned thereby.

 

(b)            Should
Landlord elect to reenter the Premises, as herein provided, or should Landlord
take possession pursuant to Legal proceedings or pursuant to any notice
provided by law, Landlord 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 the Premises
or any part thereof as the agent for and in the name of Tenant, for such
term or terms (which may be for a term extending beyond the term of this
Lease) and at such rental or rentals and upon such other terms and conditions
as Landlord in Landlord’s sole

 

5

 

discretion may deem advisable. Upon each such reletting, all
rentals received by Landlord shall be applied first to the payment of any
indebtedness other than fixed annual rent due hereunder from Tenant to
Landlord; second, to the payment of any costs and expenses of such reletting,
including brokerage fees, attorneys’ fees and costs of such alterations and
repairs; third, to the payment of such fixed annual rent under the terms of
this Lease, due and unpaid; and the residue, if any, shall be held by Landlord
and applied in payment of future required payments under the terms of this
Lease as the same may become due and payable. If such rentals received
from such reletting during any month be less than the required payments to be
paid during that month by Tenant under the terms of this Lease, Tenant shall
pay any such deficiency to Landlord.

 

(c)             No
such reentry or taking possession of the Premises by Landlord shall be
construed as an election on Landlord’s part to terminate this Lease unless
a written notice of such intention be given to Tenant or unless the termination
thereof by decreed by a court of competent jurisdiction. Notwithstanding any
such reletting without termination, Landlord may at any time thereafter
elect to terminate this Lease for such previous breach. Should Landlord at any
time terminate this Lease for any breach, then in addition to any other
remedies Landlord may have, Landlord may recover from Tenant all
damages Landlord may incur by reason of such breach, including the cost of
recovering the Premises and reasonable attorneys’ fees, all of which amounts
shall be immediately due and payable from Tenant to Landlord.

 

(d)            In
the event that Tenant shall fail in the observance or performance of any of the
terms, conditions or provisions of this Lease, including but not limited to
payments of money to Landlord or any other person or entity, and Landlord
engages the services of an attorney to enforce such terms, conditions or
provisions, then and in such event, Landlord shall be entitled to recover from
Tenant the entire cost of collection or other enforcement, including reasonable
attorneys’ fees. In the event that Landlord shall fail in the observance or
performance of any of the terms, conditions or provisions of this Lease on its part to
be performed, and Tenant engages the services of an attorney to enforce such
terms, conditions or provisions, then and in such event, Tenant shall be
entitled to recover from Landlord the entire cost of enforcement, including
reasonable attorneys’ fees.

 

10.                      Assignment
and Subletting.

 

Tenant shall not transfer, assign or sublease this
Lease or its interest hereunder, nor permit the same to be transferred or
assigned by operation of law without the consent of Landlord, which consent
shall not be unreasonably withheld by Landlord. No transfer or assignment by
Tenant of this Lease or its interest hereunder and no subletting by Tenant of
the Premises or any portion thereof shall operate to release Tenant from the

 

6

 

fulfillment on Tenant’s part of its obligations under this Lease,
nor affect Landlord’s right to exercise any of Landlord’s rights or remedies
hereunder, without the consent of or notice to any assignee or sublessee.

 

11.                      Waiver
and Severability.

 

(a)             No
waiver of any forfeiture, by acceptance of rent or otherwise, shall waive any
subsequent cause of forfeiture or breach of any condition of this Lease; nor
shall any consent when applicable by Landlord to any assignment or subletting
of the Premises, or any part thereof, be held to waive or release any
assignee or sublessee from any of the foregoing conditions or covenants as
against him or them; but every such assignee and sublessee shall be expressly
subject thereto.

 

(b)            If
any term, covenant or condition of this Lease, or the application thereof to
any person or circumstance shall, to any extent, be invalid or unenforceable,
the remainder of this Lease, or the application of such term, covenant or
condition of this Lease, shall be valid and be enforced to the fullest extent
permitted by law.

 

12.                      Notices;
Amendment.

 

(a)                       Any
notices to be given by Landlord or Tenant to each other for any purpose
connected with this Lease or otherwise, shall be in writing and deemed to have
been properly given if served personally or if sent by United states registered
or certified mail, return receipt request, to the following address of Landlord
and Tenant, respectively, or to such other persons and addresses as Landlord
and Tenant may from time to time designate:

 

	
  Landlord:

  	
  Eugene M. Kornblum and
  Helen H. Kornblum

  
	
   

  	
  7736 W. Biltmore

  
	
   

  	
  Clayton, Missouri 63105

  
	
   

  	
   

  
	
  Tenant:

  	
  St. Louis Music, Inc.

  
	
   

  	
  1400 Ferguson Avenue

  
	
   

  	
  St. Louis, Missouri 63133

  

 

(b)                      So
long as Century Life of America (“Century”) holds any security interest in or
deed of trust encumbering the Premises, this lease shall not be amended without
the prior written consent of Century.

 

7

 

IN WITNESS WHEREOF, the parties have duly executed
this Lease as of the day and year first above written.

 

THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION
WHICH MAY BE ENFORCED BY THE PARTIES.

 

	
   

  	
  Landlord:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Eugene M. Kornblum

  	
   

  
	
   

  	
  Eugene M. Kornblum

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Helen H. Kornblum

  	
   

  
	
   

  	
  Helen H. Kornblum

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Tenant:

  
	
   

  	
   

  
	
   

  	
  ST. LOUIS MUSIC, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eugene M. Kornblum

  	
   

  
	
   

  	
  Title:

  	
  President

  	
   

  
					

 

8

 

EXHIBIT 1

 

Lot 9 of West Plains Industrial Park Plat No. 3,
according to the plat thereof recorded in Plat Book 137 Page 81 of the St.
Louis County Records.

 

9

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