Document:

P-EX10.10L_2015.06.30-Q2

FIRST LEASE MODIFICATION AND TERM EXTENSION AND 
ADDITIONAL SPACE AGREEMENT

FIRST LEASE MODIFICATION AND TERM EXTENSION AND ADDITIONAL SPACE AGREEMENT (this “Agreement”) dated as of the 22nd day of July, 2015 between 125 PARK OWNER LLC, having an office c/o SL Green Realty Corp., 420 Lexington Avenue, New York, New York (hereinafter referred to as “Landlord”) and PANDORA MEDIA, INC., a Delaware corporation, having an office at 2101 Webster Street, Suite 1650, Oakland, California 94612 (hereinafter referred to as “Tenant”). 

WITNESSETH:

WHEREAS, Landlord  and Tenant entered into that certain Lease dated as of June 13, 2013 (the “Original Lease”), covering the entire rentable portion of the nineteenth (19th) and twentieth (20th) floors (hereinafter referred to as the “Original Premises”), in the building known as 125 Park Avenue, New York, New York (the “Building”) under the terms and conditions contained therein for a term scheduled to expire on September 30, 2024 (the “Expiration Date”);

WHEREAS, Tenant wishes to extend the term of the Lease to the date  (the “New Expiration Date”) which is the last day of the month in which occurs the day immediately preceding the tenth (10th) anniversary of the Additional Space Rent Commencement Date (as hereinafter defined), unless the Lease is sooner terminated or expires pursuant to the terms of the Lease or pursuant to law;

WHEREAS, Tenant wishes to add to the Original Premises (i) the entire rentable portion of the 21st floor of the Building (the “21st Floor Premises”), and (ii) the entire rentable portion of the 22nd floor of the Building (the “22nd Floor Premises”), each approximately as shown hatched on the floor plans annexed hereto and made a part hereof as Exhibit A, for a term to commence on the Additional Space Commencement Date (as hereinafter defined) and to expire on the New Expiration Date (as hereinafter defined).  For purposes hereof, the 21st Floor Premises and the 22nd Floor Premises are collectively referred to as, the “Additional Space”.  The Additional Space is deemed by Landlord and Tenant to consist of 51,065 rentable square feet for purposes of the Lease (i.e., 26,256 rentable square feet with respect to the 21st Floor Premises and 24,809 rentable square feet with respect to the 22nd Floor Premises);
        
WHEREAS, Landlord has agreed to extend the term of the Lease to the New Expiration Date and to permit Tenant to add the Additional Space to the Premises for a term as herein provided and, in all cases, otherwise subject to the terms, covenants and conditions of the Lease;

WHEREAS, Landlord and Tenant desire to modify the Lease in accordance with the above and in certain other respects, all as more particularly set forth herein.

N- 

NOW, THEREFORE, in consideration of the agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Article 1 
TERMS
Section 1.1.    Except as otherwise defined herein, all capitalized terms used in this Agreement shall have the meanings given to such terms in the Original Lease.  The Original Lease, as amended and modified by this Agreement, is referred to in this Agreement as the “Lease”.    The Original Premises, together with the Additional Space, is referred to in this Agreement as the “Premises”. 

ARTICLE 2    
EXTENSION OF LEASE
Section 2.1.    The term of the Original Lease shall be extended (the “Extended Term”) under the same terms, covenants and conditions contained in the Original Lease, except to the extent specifically modified by this Agreement, so that the term of the Lease shall expire on the New Expiration Date, or upon such earlier date upon which the term of the Lease shall expire, be canceled or terminated pursuant to any of the conditions or covenants of the Lease or pursuant to law.  Effective as of the date hereof, any reference in the Original Lease to the “Expiration Date” shall be deemed be to be a reference to the New Expiration Date, unless the Lease is sooner terminated or expires pursuant to the terms of the Lease or pursuant to law.
ARTICLE 3    
ADDITIONAL SPACE; CONDITION OF ADDITIONAL SPACE
Section 3.1.    Additional Space.
(a)    The Additional Space shall be added to the Premises under all the applicable terms and conditions of the Original Lease, except as modified herein, for a term (the “Additional Space Term”) commencing on the date (the “Additional Space Commencement Date”) which is the earlier to occur of (i) the date Tenant (or anyone claiming by, through or under Tenant) first occupies the Additional Space for either the performance of Alterations or for the ordinary conduct of Tenant’s business, and (ii) the date Landlord’s Pre-Commencement Additional Space Work (as hereinafter defined) has been substantially completed, and shall end on the New Expiration Date.   Unless the context otherwise requires and, effective as of the Additional Space Commencement Date, references in the Original Lease to the Premises shall be deemed to include the Additional Space.

(b)    The parties acknowledge that Tenant has inspected the Additional Space and the Building and is fully familiar with the physical condition thereof and Tenant agrees to accept the Additional Space at the commencement of the Additional Space Term in its then “as is” condition, subject to the performance by Landlord of Landlord’s Additional Space Work in the 21st Floor Premises.  Except for the performance of Landlord’s Additional Space Work, Tenant acknowledges and agrees that Landlord shall have no obligation to do any work in or to the Additional Space in order to make it suitable and ready for occupancy and use by Tenant.  For purposes of clarification, Tenant expressly acknowledges and agrees that Landlord’s Additional Space Work shall only be performed with respect to the 21st Floor Premises and no such Landlord’s Additional Space Work is required to be performed in the 22nd Floor Premises.  Notwithstanding the foregoing to the contrary, if during the performance of Tenant’s Initial Additional Space Work, it shall be determined that the restrooms located in the 22nd Floor Premises are not in compliance with the Americans with Disabilities Act of 1990 (as defined on the date hereof), then upon notice from Tenant to Landlord thereof, Landlord shall perform such work as shall be  reasonably necessary to cause the restrooms in the 22nd Floor Premises to be in compliance with the Americans with Disabilities Act of 1990 (as defined on the date hereof).  Nothing contained herein shall be or be deemed to relieve Landlord of any ongoing maintenance and repair obligations set forth in the Original Lease with respect to the Building systems serving the Additional Space (including, without limitation, any fire and life safety systems that Landlord is required to repair and maintain pursuant to the terms of the Original Lease). 
(c)    (i)    Following the date hereof, Landlord shall, at its sole cost and expense, perform the work detailed on Exhibit B-1 annexed hereto (the “Landlord’s Pre-Commencement Additional Space Work”) in the 21st Floor Premises pursuant to the terms and conditions detailed therein.  Following the Additional Space Commencement Date, Landlord shall, at its sole cost and expense, perform the work detailed on Exhibit B-2 annexed hereto (the “Landlord’s Post-Commencement Additional Space Work”; and collectively with the Landlord’s Pre-Commencement Additional Space Work, referred to as the “Landlord’s Additional Space Work”) in the 21st Floor Premises pursuant to the terms and conditions detailed therein.  Landlord’s Pre-Commencement Additional Space Work shall be deemed to be “substantially completed” notwithstanding that minor or non-material details of construction, mechanical adjustment or decoration which do not interfere with the performance of Tenant’s Additional Space Work (as hereinafter defined) or the ordinary conduct of Tenant’s business in the 21st Floor Premises (in either case, other than to a de minimis extent)  remain to be performed (the “Additional Space Punch List Items”).  Landlord and Tenant hereby acknowledge and agree that the Additional Space Punch List Items, Landlord’s Post-Commencement Additional Space Work and Tenant’s Additional Space Initial Work shall be performed simultaneously and the parties shall reasonably cooperate with each other with respect to scheduling each portion of said work.
(ii)    If any approvals and/or final signoffs required pursuant to Applicable Laws with respect to Landlord’s Pre-Commencement Work have not been obtained as of the Commencement Date, Landlord shall be required to thereafter pursue and obtain all such approvals and final signoffs if and to the extent that failure to do so 

would prevent or delay Tenant from obtaining a building permit or a final sign-off with respect to Tenant’s Initial Additional Space Work or would otherwise adversely affect Tenant’s ability to use the Additional Space for any of the uses permitted under the Lease.

(d)    (i)    If Landlord shall be unable to give possession of the Additional Space by a certain date because of the retention of possession of any occupant thereof, alteration or construction work, or for any other reason, Landlord shall not be subject to any liability for such failure (except as provided in Section 3.1(d)(ii), (iii) and (iv) below).  In such event, the Original Lease, as modified by this Amendment, shall stay in full force and effect with respect to the Additional Space without further extension of the term of the Lease.  The provisions of this Section 3.1(d) are intended to constitute an “express provision to the contrary” within the meaning of Section 223-a of the New York Real Property Law.
(ii)    Anything to the contrary herein notwithstanding, if the Additional Space Commencement Date has not occurred (or has not been deemed to have occurred) on or before the date that is two hundred forty (240) days following the date of this Agreement (as such date shall be extended due to casualty, condemnation, Unavoidable Delays and/or Tenant Delays, the “Additional Space Outside Date”), then the Additional Space Rent Commencement Date (as hereinafter defined) shall be extended by one day for each day beyond the Additional Space Outside Date that the Additional Space Commencement Date shall occur (or shall be deemed to have occurred).
 
(iii)     Anything to the contrary herein notwithstanding, if Landlord’s Post-Commencement Additional Space Work has not been substantially completed (or has not been deemed to have been substantially completed) on or before the date that is fifteen (15) days following the date Tenant shall have completed Tenant’s Initial Additional Space Work (as hereinafter defined) and commenced business operations in the Additional Space and notice thereof shall have been given to Landlord at least thirty (30) days prior to such commencement of such business operations (as such date shall be extended due to casualty, condemnation, Unavoidable Delays and/or Tenant Delays, the “Additional Space Post-Commencement Work Outside Date”), then Tenant shall receive a credit in the amount of $1,000.00 for each day beyond the Additional Space Post-Commencement Work Outside Date that Landlord’s Post-Commencement Additional Space Work shall have been substantially completed (or shall have be deemed to have been substantially completed), which credit shall be applied to the initial Fixed Annual Rent payment(s) due under the Lease with respect to the Additional Space).

(iv)    Anything to the contrary herein notwithstanding, if the Additional Space Commencement Date has not occurred on or before the date that is three hundred (300) days following the date of this Agreement (as such date shall be extended by one (1) day for each day of delay due to casualty, condemnation, Unavoidable Delay and/or Tenant Delay, the “Additional Space Outside Termination Date”), then within ten (10) days following the Additional Space Outside 

Termination Date, time being of the essence, Tenant may give to Landlord notice of Tenant’s intent to terminate this Lease upon thirty (30) days’ notice to Landlord, which notice of termination must be given on or before the occurrence (or deemed occurrence) of the Additional Space Commencement Date.  If Tenant gives a termination notice pursuant to the preceding sentence and Landlord fails, on or before the expiration of such thirty (30) day period to deliver possession of the Additional Space to Tenant in the condition required hereunder, then the Lease shall terminate in respect of the Additional Space only, on the expiration of such thirty (30) day period, and neither Landlord nor Tenant shall have any further obligation or liability to the other under the Lease with respect to the Additional Space only except under any provision of the Lease that expressly survives the expiration or earlier termination of the Lease.

(e)    Following the Additional Space Commencement Date and Tenant’s submission of plans and specifications for Tenant’s Initial Additional Space Work, Landlord shall deliver to Tenant a form ACP-5 covering the Additional Space.

ARTICLE 4    
CONDITION OF ORIGINAL PREMISES
Section 4.1.    Landlord and Tenant each hereby acknowledge and agree that Tenant is currently in occupancy of the Original Premises, has inspected the same and the Building and is fully familiar with the physical condition thereof and Tenant agrees to accept the Original Premises on the date hereof in their current “as is” condition and Landlord shall not be required to perform any work, to pay any work allowance or any other amount or to render any services to make the Original Premises ready for Tenant’s continued use thereof.

ARTICLE 5      
FIXED RENTAL
Section 5.1.    Original Premises.  
(a)    From and after the date hereof and through and including the Expiration Date (i.e., September 30, 2024), Tenant shall continue to pay the Fixed Annual Rent that is due and payable under the Original Lease with respect to the Original Premises without modification or amendment thereof.
(b)    With respect to the Original Premises, from and after October 1, 2024 through and including the New Expiration Date, Tenant shall pay Fixed Annual Rent (payable at the times and in the manner set forth in the Original Lease) at the rate of $3,671,500.00 per annum ($305,958.33 per month).
Section 5.2.    Additional Space.

(a)    From and after the Additional Space Commencement Date, Tenant shall pay Fixed Annual Rent for the Additional Space as follows:
(i)    $3,319,225.00 per annum ($276,602.08 per month) for the period commencing on the Additional Space Commencement Date and ending on the last day of the month in which occurs the day immediately preceding the fifth (5th) anniversary of the Additional Space Rent Commencement Date (the “1st Additional Space Rent Period”); and 
(ii)    $3,574,550.00 per annum ($297,879.17 per month) for the period commencing on the day immediately following the expiration of the 1st Additional Space Rent Period and ending on the New Expiration Date.
(b)    Subject to the provisions hereof, if and so long as Tenant is not then in monetary or material non-monetary default under the Lease beyond any applicable cure or grace period, the Fixed Annual Rent payable pursuant to Section 5.2(a) above with respect to the Additional Space only shall be abated for the period commencing on the Additional Space Commencement Date and ending on the date (the “Additional Space Rent Commencement Date”) that is three hundred thirty (330) days following the Additional Space Commencement Date.  If, however, during the period (the “Additional Space Rent Abatement Period” ) referenced in the immediately preceding sentence during which Fixed Annual Rent is to be abated, Tenant shall default in the payment of a sum of money or any other of its obligations under the Lease after notice and the expiration of any applicable cure periods, if any, then, notwithstanding the foregoing, the Rent Abatement Period shall be deemed to have ended on the date such default occurred; provided, however, if Tenant cures such default prior to any termination of the Lease by Landlord due to such default pursuant to the terms hereof, then Tenant shall then be entitled to any remaining abatement of Fixed Annual Rent remaining with respect to such initial period that was not previously received by Tenant pursuant to this Section 5.2(b).  

ARTICLE 6     
ADDITIONAL RENT AND ESCALATION RENT
Section 6.1.    Original Premises. 
(c)    From and after the date hereof and through and including the Expiration Date (i.e., September 30, 2024), Tenant shall continue to pay the Additional Rent that is due and payable under the Original Lease (including, without limitation, pursuant to Articles 32 and 49) with respect to the Original Premises without modification or amendment thereof. 
(d)    With respect to the Original Premises only, in addition to the payment of Fixed Annual Rent as hereinabove provided, from and after October 1, 2024 and through and including the New Expiration Date, Tenant shall pay all Additional Rent accruing under the Lease (including, without limitation, pursuant to Articles 32 and 49 of the Original Lease), provided however, that, solely with respect to the Original Premises:

(i)    The term “Base Tax Year”, as defined in Section 32.01(a)(iii) of the Original Lease, shall mean the New York City fiscal tax year commencing on July 1, 2015 and ending on June 30, 2016; and 
(ii)    The term “Base Year”, as defined in Section 49.02(iii) of the Original Lease, shall mean the calendar year 2015”.
Section 6.2.    Additional Space.  
(a)    With respect to the Additional Space only, in addition to the payment of Fixed Annual Rent as hereinabove provided, from and after the Additional Space Commencement Date and through and including the New Expiration Date, Tenant shall continue pay all Additional Rent accruing under the Lease (including, without limitation, pursuant to Articles 32 and 49 of the Original Lease), with respect to the Additional Space, provided however, that, solely with respect to the Additional Space:
(i)    The term “Tenant’s Share”, as defined in Section 32.01(a)(i) of the Original Lease, shall mean 8.9%;

(ii)    The term “Base Tax Year”, as defined in Section 32.01(a)(iii) of the Original Lease, shall mean the New York City fiscal tax year commencing on July 1, 2015 and ending on June 30, 2016; 

(iii)    The term “Base Year”, as defined in Section 49.02(iii) of the Original Lease, shall mean the calendar year 2015; and

(iv)    The term “Percentage, as defined in Section 49.02(v) of the Original Lease, shall mean 8.4%.

ARTICLE 7    
LANDLORD’S ADDITIONAL SPACE CONTRIBUTION
Section 7.1.    Provided that no monetary or material non-monetary default by Tenant after notice and the expiration of any applicable cure period has occurred and is continuing, Landlord, subject to and in accordance with the provisions of this Article 45 of the Original Lease (as amended by this Amendment), shall contribute up to the sum of $3,319,225.00 (“Landlord’s Additional Space Contribution”) towards the cost (the “Additional Space Work Cost”) of Tenant’s Initial Additional Space Work (as hereinafter defined).  For purposes hereof, “Tenant’s Initial Additional Space Work”) shall mean Alterations to be performed in the Additional Space in order to prepare the same for Tenant’s initial occupancy thereof immediately following the Additional Space Commencement Date and the conduct of business therein.  Without limitation, for purposes of this Article, Tenant’s Initial Additional Space Work shall be deemed not to include, and Landlord’s Additional Space Contribution shall not be applied to (except as otherwise expressly permitted 

hereunder), the cost of interest, late charges, or any personal property whatsoever, or to the cost of labor, materials or services used to furnish or provide the personal property.
Section 7.2.    Landlord’s Additional Space Contribution shall be payable by Landlord to Tenant in accordance with, and pursuant to, the terms and conditions of Sections 45.03 and 45.04 of the Original Lease except that the references therein to: (i) “Work Cost” shall mean the Additional Space Work Cost, (ii) the “Premises” shall mean the “Additional Space”, (iii) “Landlord’s Contribution” shall mean Landlord’s Additional Space Contribution, and (iv) “Tenant’s Initial Alteration Work” shall mean Tenant’s Initial Additional Space Work.
Section 7.3.    It is expressly understood and agreed that if the amount of Landlord’s Additional Space Contribution with respect to the Additional Space is less than the cost of Tenant’s Initial Additional Space Work with respect thereto, Tenant shall remain solely responsible for the payment and completion of, and in all events shall complete, at its sole cost and expense, Tenant’s Initial Additional Space Work.  Further, if Tenant fails to submit a requisition for any portion of the Landlord’s Additional Space Contribution by the date which is the two (2) year anniversary of the Additional Space Commencement Date, then Tenant shall have no further right to utilize any such portion of the Landlord’s Additional Space Contribution so not requisitioned and Landlord shall have no obligation to reimburse Tenant for same.  The provisions of Section 45.05(b) shall not be applicable to the Landlord’s Additional Space Contribution.
Section 7.4.    The Landlord’s Additional Space Contribution is being given for the benefit of the Named Tenant (as such term is defined in the Original Lease) only.  No third party shall be permitted to make any claims against Landlord or Tenant with respect to any portion of the Landlord’s Additional Space Contribution.  
ARTICLE 8    
RENEWAL OPTION
Section 8.1.    Landlord and Tenant acknowledge and agree that Tenant’s Extension Right descried in Article 48 of the Original Lease shall remain in full force and effect and all references therein to the “Expiration Date” shall mean the Extended Expiration Date and all references therein to the “Premises” shall mean the entire Premises then being leased by Tenant (including, without limitation, the Original Premises and the Additional Space, if then applicable).

ARTICLE 9    
RIGHT OF FIRST OFFER

Section 9.1     Subject to the provisions of this Article 9, provided and on the condition that (i) the Tenant under this Lease at the time in question is the Named Tenant (as such term is defined in the Original Lease), (ii) no monetary or material non-monetary default after notice and the expiration of any applicable cure period has 

occurred and is continuing at the time of the giving of the Option Response Notice or the ROFO Space Commencement Date, (iii) as of the date Tenant gives the Option Response Notice and as of the ROFO Space Commencement Date, the Named Tenant (as such term is defined in the Original Lease) shall be in actual occupancy of at least ninety (90%) percent of the Premises then leased to Tenant under the Lease, and (iv) there remain at least five (5) years in the Term of the Lease determined as of the Scheduled ROFO Space Commencement Date (or, if less than five (5) years remain in the Term of the Lease (but at least fifteen (15) months remain)), Tenant, simultaneously with the giving of an Option Response Notice, irrevocably exercises any unexpired or unexercised Tenant’s Extension Right so long as Tenant has such right under the Lease), Landlord shall not enter into a lease for the entire ROFO Space (as hereinafter defined) with any party other than Tenant (subject to Section 9.04(a) below) at any time during the Term of the Lease, without first instituting the procedure described in, and subject to the limitations set forth in, this Article 9.  For purposes hereof, “ROFO Space” shall mean the entire rentable area of the twenty-third (23rd) floor of the Building.

Section 9.2    Landlord shall institute the procedure described in this Article 9 by giving notice thereof (the “Option Notice”) to Tenant, which Option Notice shall set forth the date that Landlord reasonably expects that the ROFO Space will be vacant and available for Tenant’s occupancy (such date designated by Landlord being referred to herein as the “Scheduled ROFO Space Commencement Date”).  Landlord shall have the right to give an Option Notice with respect to the ROFO Space at any time if the ROFO Space shall become available for lease or if Landlord reasonably anticipates that the ROFO Space shall become available for lease; provided, however, that Landlord shall not give an Option Notice more than eighteen (18) months prior to the Schedule ROFO Space Commencement Date. 
Section 9.3    Tenant shall have the one-time option with respect to the ROFO Space (the “ROFO Option”) to lease the entire ROFO Space for a term (the “Option Term”) commencing on the ROFO Space Commencement Date and expiring on the New Expiration Date by giving notice thereof (the “Option Response Notice”) to Landlord not later than the twentieth (20th) day after the date that Landlord gives the Option Notice to Tenant.  Time shall be of the essence as to the date by which Tenant must give the Option Response Notice to Landlord.  Tenant may only exercise the ROFO Option with respect to all of the ROFO Space and not merely a portion thereof.  If Tenant does not give the Option Response Notice to Landlord on or prior to the twentieth (20th) day after the date that Landlord gives the Option Notice to Tenant, then, Landlord shall thereafter have the right to lease the applicable ROFO Space (or any part thereof) to any other party on terms acceptable to Landlord in Landlord’s sole discretion without being required to make any other offer to Tenant regarding the ROFO Space under this Article 9 and this Article 9 there thereafter become void and of no further force and effect.
Section 9.4    Tenant shall not have the right to exercise the ROFO Option (and Landlord shall not be required to give an Option Notice) in respect of any ROFO Space prior to Landlord’s leasing such ROFO Space to (i) any party having a renewal right contained 

in such party’s lease with respect to such ROFO Space, (ii) any party whose lease is renewed voluntarily by Landlord (irrespective if such renewal right is contained in such party's lease), (iii) any then occupant of all or any portion of the ROFO Space (irrespective of whether such occupant shall have any right in its occupancy agreement or otherwise to lease such space) or (iv) any party to which Landlord has granted an expansion right, first offer right or other similar right with respect to such ROFO Space as of the date of this Agreement.  Landlord represents that as of the date of this Agreement, Landlord has not granted any expansion right, first offer right or other similar right with respect to the ROFO Space to any party.  Accordingly, (A) Landlord shall have no obligation to give an Option Notice to Tenant with respect to the ROFO Space (or any portion thereof), and (B) Landlord shall have the right to lease the ROFO Space (or any portion thereof) to any such party described in this Section 9.4 without first offering such ROFO Space (or the applicable portion thereof) to Tenant as contemplated by this Article 9.
Section 9.5    (a)    If Tenant timely and properly exercises the ROFO Option in accordance with the terms of this Article 9, then the ROFO Space shall be included within the Premises on the date (the “ROFO Space Commencement Date”) which is the later to occur of (a) the Scheduled ROFO Space Commencement Date and (b) the date on which Landlord delivers to Tenant vacant, broom-clean possession of the applicable ROFO Space, upon the following terms and conditions and all other applicable terms and conditions of the Lease (as extended pursuant to Section 9.9), all of which shall take effect as of the ROFO Space Commencement Date:
(i)    The Fixed Annual Rent for the ROFO Space shall be payable from and after the ROFO Space Commencement Date in an amount equal to the ROFO Space FMRV (as hereinafter defined).  “ROFO Space FMRV” shall mean 100% of the fair market rental value of the ROFO Space that an unaffiliated third party would be willing to pay to Landlord as of the ROFO Space Commencement Date, which ROFO Space FMRV shall be determined in accordance with the provisions of Section 9.7 below taking into account all then relevant factors, whether favorable to Landlord or Tenant;
(ii)    “Tenant’s Share”, as defined in Article 32 of the Original Lease, and the “Percentage”, as defined in Article 49 of the Original Lease, shall be increased to include the rentable square footage of the ROFO Space (as reasonably determined by Landlord); and
(iii)    Landlord shall not be obligated to perform any work or make any installations in the ROFO Space to prepare same for Tenant’s occupancy, grant Tenant any work allowance or rent concession therefor, and Tenant shall accept the ROFO Space in its “as is” condition on the ROFO Space Commencement Date (unless otherwise expressly provided by Landlord to the contrary, in Landlord’s sole discretion, as part of an Option Notice). 
Section 9.6    Landlord shall deliver vacant and exclusive possession of the ROFO Space to Tenant on the Scheduled ROFO Space Commencement Date; provided, 

that (x) if a party remains in occupancy of the ROFO Space (or any portion thereof) on the Scheduled ROFO Space Commencement Date, then Landlord shall use commercially reasonable efforts to cause vacant and exclusive possession of the ROFO Space to be delivered to Tenant as promptly as reasonably practicable thereafter, and (y) Landlord shall have no liability to Tenant, and Tenant shall have no right to terminate or rescind the Lease or Tenant’s exercise of the ROFO Option or reduce the Rent, in each case deriving from Landlord’s failure to deliver vacant and exclusive possession of the ROFO Space to Tenant on the Scheduled ROFO Space Commencement Date.    
Section 9.7    (a)    In the event that Tenant properly and timely exercises the ROFO Option, then within thirty (30) days following the date upon which Tenant gives to Landlord the Option Response Notice, Landlord and Tenant shall commence negotiations in good faith to attempt to agree upon the ROFO Space FMRV for the ROFO Space.  If Landlord and Tenant cannot reach agreement within twenty (20) days thereafter (the “Negotiation Period”), then the ROFO Space FMRV for the ROFO Space shall be determined in accordance with the process and provisions set forth in Section 48.02 of the Original Lease except that (i) Landlord shall select Landlord’s Broker and Tenant shall select Tenant’s Broker no later than ten (10) business days following the expiration of the Negotiation Period, (ii) Landlord’s Broker and Tenant’s Broker shall proceed with the selection of the Independent Broker if they are not able to agree upon the ROFO Space FMRV within fifteen (15) business days after both of them shall have been appointed, (iii) any reference therein to “Renewal FMRV” shall be deemed to be referring to the ROFO Space FMRV, and (iv) any other references therein that shall not be applicable to the determination of the ROFO Space FMRV shall be deemed inapplicable.  
(b)    If the final determination of the ROFO Space FMRV is not made on or before the ROFO Space Commencement Date in accordance with the provisions of this Article 9, then, pending such final determination, the ROFO Space FMRV shall be deemed to be the average of the determination of Landlord’s Broker and the determination of Tenant’s Broker.  If, based upon the final determination hereunder of the ROFO Space FMRV, the payments made by Tenant on account of the Rent for the period prior to the final determination of the ROFO Space FMRV were less than the Rent payable for such period, then Tenant, not later than the thirtieth (30th) day after Landlord’s demand therefor, shall pay to Landlord the amount of such deficiency.  If, based upon the final determination of the ROFO Space FMRV, the payments made by Tenant on account of the Rent for the period prior to the final determination of the ROFO Space FMRV were more than the Rent due hereunder for such period, then Landlord, not later than the thirtieth (30th) day after Tenant’s demand therefor, shall pay or credit such excess to Tenant.
(c)    Promptly after the occurrence of the ROFO Space Commencement Date, Landlord and Tenant shall confirm the occurrence thereof, the inclusion of the ROFO Space in the Premises, by executing an instrument reasonably satisfactory to Landlord and Tenant; provided, that failure by Landlord or Tenant to execute such instrument shall not affect the inclusion of such ROFO Space in the Premises in accordance with this Article 9.

Section 9.8    Anything to the contrary herein notwithstanding, Landlord shall have the right (hereinafter called “Landlord’s Acceleration Right”) to accelerate the exercise of the ROFO Option in advance of the Scheduled ROFO Space Commencement Date by written notice thereof to Tenant (“Landlord’s Acceleration Notice”), and to cause the ROFO Space Commencement Date to occur earlier than the Scheduled Option Commencement Date in the event that the same will become available for delivery to Tenant earlier than the Scheduled Option Commencement Date (the “Acceleration Date”); it being agreed, however, that the Acceleration Date shall not occur on a date that is less than forty-five (45) days following the giving of a Landlord’s Acceleration Notice.  Notwithstanding the foregoing, for purposes of this Article 9, the applicable ROFO Space shall not be deemed to “become available” for Tenant earlier than the Scheduled ROFO Space Commencement Date except in the event that the existing lease(s) for such space shall be terminated by reason of a ROFO Space Termination Event (as such term is hereinafter defined).  As used herein, the term “ROFO Space Termination Event” shall mean one or more of the following: (i) a default by the existing tenant or occupant of such space (hereinafter called the “Existing Tenant”) under the Existing Tenant’s lease (hereinafter called the “Existing Lease”) after the expiration of any applicable notice and cure periods provided for in the Existing Lease; (ii) a voluntary surrender or early termination of the Existing Lease (or a portion thereof); or (iii) a rejection of the Existing Lease in bankruptcy or the filing of a bankruptcy or insolvency proceeding by or against the Existing Tenant.  In the event that Landlord shall exercise Landlord’s Acceleration Right, Tenant shall notify Landlord that it is electing to exercise the ROFO Option by providing an Option Response Notice no later than twenty (20) days following the giving of such Landlord’s Acceleration Notice (time shall be of the essence with respect to such date), and if Tenant exercises the ROFO Option the Scheduled ROFO Space Commencement Date shall be deemed to be the Acceleration Date.  If Tenant does not give the Option Response Notice to Landlord on or prior to the expiration of such 20-day period, then, Landlord shall thereafter have the right to lease the applicable ROFO Space (or any part thereof) to any other party on terms acceptable to Landlord in Landlord’s sole discretion and Tenant shall no longer have any rights under this Article 9 and this Article 9 there thereafter become void and of no further force and effect.
Section 9.10    Notwithstanding anything to the contrary contained in this Article, Landlord shall have the right, in its sole discretion, to waive the conditions which limit or restrict the effectiveness of any exercise by Tenant of the ROFO Option hereunder, without thereby waiving a default, if any, by Tenant, in which event (i) the ROFO Space shall be added to the Premises without execution or delivery of any other or further document in accordance with the provisions of this Article 9 with the same force and effect as if such default did not occur or such conditions had been complied with, and (ii) Landlord shall be entitled to all of the remedies provided by this Lease and at law with respect to any such default.
Section 9.11    Notwithstanding anything to the contrary contained herein, if Tenant does not exercise a ROFO Option in a timely manner as set forth in Section 9.3 hereof, then Landlord shall be under no further obligation with respect to the ROFO Space under this Article 9, and Landlord shall at any and all times thereafter be entitled to lease 

all or any portion of the ROFO Space to others at such rentals and upon such terms and conditions as Landlord in its sole discretion may desire.

ARTICLE 10    
MISCELLANEOUS LEASE MODIFICATIONS
Section 10.1.    The provisions of Section 15.05 of the Original Lease shall be applicable to this Amendment.  In addition, Landlord, at Landlord’s sole cost and expense (but subject to reimbursement, if any, in accordance with Article 49 below), shall comply with all Applicable Laws applicable to Landlord’s Additional Space Work, including, without limitation, the removal of noted Building violations and liens resulting from Landlord’s performance of Landlord’s Additional Space Work that would delay Tenant from obtaining a building permit or a final sign-off on its Alterations or would otherwise adversely affect the use of the Additional Space for any of the uses permitted hereunder in accordance with the certificate of occupancy for the Building, subject, however, to Landlord’s right to contest diligently and in good faith the applicability or legality thereof

Section 10.2.    Effective as of the date hereof, Article 51 of the Original Lease is hereby deleted in its entirety.

Section 10.3.    Effective as of the date hereof, Section 30.03 of the Original Lease is hereby modified to provide that no after hours charge shall be imposed by Landlord with respect to the first one hundred (100) hours of after hours freight elevator usage by Tenant (in the aggregate) in connection with Tenant’s initial move-in to the Additional Space and/or Tenant’s Initial Additional Space Work.

Section 10.4.    Effective as of the date hereof, (i) Section 35.03 of the Original Lease is hereby modified to provide that any portion of the Supplemental Condenser Water allocated to the Original Premises and not yet utilized by Tenant for purposes thereof may, pursuant to the terms of Section 35.03, be utilized by Tenant in connection with the operation by Tenant of supplemental air-conditioning equipment in the Additional Space, and (ii) the CW Outside Date described in Section 35.03 shall mean the date this is five hundred forty (540) days after the Additional Space Commencement Date. 

Section 10.5.    Landlord and Tenant agree that electricity with respect to the Additional Space shall be provided pursuant to Article 41 of the Original Lease except that with respect to the Additional Space only, the second sentence of Section 41.01 shall be deleted and replaced with the following:

“Landlord shall make electricity available during the Term at the combined electrical closets servicing the Additional Space for all purposes (exclusive of electricity required for the operation of the Existing HVAC Equipment serving the Additional Space), with an average capacity of not 

less than six (6) watts connected load per usable square foot of the Additional Space which shall be distributed by Tenant at its sole cost and expense.”

Section 10.6.    Landlord and Tenant acknowledge and agree that notwithstanding anything to the contrary contained in (i) Section 30.01 of the Original Lease, the current rate for non HVAC Period heating service is $243.00  per hour (which rate shall be increased from time to time by Landlord in accordance with the provisions of Section 30.01), and (ii) Section 35.01 of the Original Lease, the current rate for non HVAC Period air conditioning service is $230.00  per hour (which rate shall be increased from time to time by Landlord in accordance with the provisions of Section 35.01).

Section 10.7.    (a)    Landlord and Tenant acknowledge and agree that the amount of the Required Security under the Lease is currently $3,199,450.00, which amount, notwithstanding anything to the contrary contained in the Original Lease, is currently in the form of cash security (and not a Security Letter), which amount shall be held and utilized by Landlord in accordance with the terms of Article 31 of the Original Lease.  

(a)    As of the date hereof, Article 31 of the Original Lease is hereby amended as follows:

(i)    Section 31.01(a) of the Original Lease is amended by increasing the “Required Amount” to $5,975,452.09.  Upon the execution and delivery of this Agreement, Tenant shall deliver to Landlord additional cash security so that the total cash security being held by Landlord is in the amount of the increased Required Amount (i.e., Tenant shall deliver to Landlord additional cash security in the amount of $2,776,002.09).

(ii)    Section 31.07 of the Original Lease is hereby deleted and replaced with the following:
    
“Notwithstanding anything to the contrary herein, provided and on the condition that, as of the date Tenant elects to reduce the amount of security required hereunder, Tenant shall not be in default under this Lease after notice and the expiration of any applicable cure and grace periods, then in such case, (i) on or after the third (3rd) anniversary of the Additional Space Rent Commencement Date, the security required under this Article 31 shall be reduced to $4,345,783.34, and (ii) on or after the fifth (5th) anniversary of the Additional Space Rent Commencement Date, the security required under this Article 31 shall be reduced to $3,259,337.50, in any such case, by Tenant delivering to Landlord notice requesting the return of the amount by which the Required Amount is being reduced pursuant to this Section 31.07 (provided that the Required Amount is then in the form of cash security).”
  
ARTICLE 11    

BROKERAGE
Section 11.1.    Tenant covenants, represents and warrants that Tenant has had no dealings or negotiations with any broker or agent in connection with the consummation of this Amendment other than SL Green Leasing LLC and CBRE, Inc. (collectively, the “Brokers”) and Tenant covenants and agrees to defend, hold harmless and indemnify Landlord from and against any and all cost, expense (including reasonable attorneys’ fees) or liability for any compensation, commissions or charges claimed by any broker or agent with respect to this Amendment or the negotiation thereof.  Landlord covenants, represents and warrants that Landlord has had no dealings or negotiations with any broker or agent in connection with the consummation of this Amendment other than the Brokers and Landlord covenants and agrees to defend, hold harmless and indemnify Tenant from and against any and all cost, expense (including reasonable attorneys’ fees) or liability for any compensation, commissions or charges claimed by any broker or agent (including the Brokers) with respect to this Amendment or the negotiation thereof, based on claims that such broker or agent represented or acted on behalf of Landlord.  Landlord shall pay to the Brokers a commission to be agreed upon between Landlord and the Brokers pursuant to separate agreements.
ARTICLE 12    
MISCELLANEOUS
Section 12.1.    Except as modified, amended and supplemented by this Agreement, the terms and provisions of the Lease shall continue in full force and effect and are hereby ratified and confirmed.
Section 12.2.    This Agreement shall not be binding upon Landlord and Tenant unless and until it is signed by both parties hereto and a signed copy thereof is delivered by Landlord to Tenant.
Section 12.3.    This Agreement constitutes the entire agreement among the parties hereto with respect to the matters stated herein and may not be amended or modified unless such amendment or modification shall be in writing and signed by the party against whom enforcement is sought.
Section 12.4.    The terms, provisions and conditions contained in this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.
Section 12.5.    This Agreement shall be governed in all respects by the laws of the State of New York.
Section 12.6.    This Agreement may be executed in counterparts, each of which shall constitute an original and all of which taken together shall constitute one and the same agreement, and an executed counterpart delivered by “.pdf”, facsimile or email shall be binding upon the parties.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, Landlord and Tenant have duly executed this Agreement as of the day and year first above written.
                    
125 PARK OWNER LLC

By: /s/ Steven M. Durels                                           
Name: Steven M. Durels
Title: Executive Vice President, Director of Leasing and Real Property

PANDORA MEDIA, INC.
                    

By: /s/ Mike Herring                                                
Name: Mike Herring
Title: Chief Financial Officer

EXHIBIT A

Additional Space

[see attached]

N- 

EXHIBIT B-1

Landlord’s Pre-Commencement Additional Space Work

Landlord shall perform the following work in the 21st Floor Premises only in a Building-standard manner utilizing Building-standard materials, finishes and fixtures and in compliance with all Applicable Laws applicable to demolished space (except any signoffs or approvals in connection with Landlord’s Pre-Commencement Additional Space Work shall be obtained by Landlord following substantial completion of Landlord’s Pre-Commencement Additional Space Work, and not as a condition to the substantial completion thereof).

1.    Demolish any existing installations in the 21st Floor Premises.  The 21st Floor Premises shall be delivered in broom clean condition.      

2.    Deliver the main HVAC trunk on the 21st floor complete with smoke and fire dampers at the core.

3.    Delivery fully operational sprinkler infrastructure with the heads turned up, including combination standpipe/sprinkler risers, pumps and valve connections.

4.    All Building Systems serving the 21st Floor Premises and which are expressly required of Landlord to be provided under the Lease shall be in good working order and ready for Tenant’s connection thereto; provided that distribution within the 21st Floor Premises shall be at Tenant’s sole cost and expense.
    
5.    Fireproofing on the core columns as required by code for demolished space.  Landlord will ensure that all shafts and pipe penetrations within the Additional Space are firestopped.

6.    Demolish the existing flooring, (demolishing includes scraping of glue or other adhesives from the installation of all flooring) and patch all holes, core drills and other similar perforations patched (as necessary)   No leveling.

7.     All perimeter and core walls shall be finished, taped and spackled to a reasonable condition.

N- 

EXHIBIT B-2

Landlord’s Post-Commencement Additional Space Work

Landlord shall perform the following work in the 21st Floor Premises in a Building-standard manner utilizing Building-standard materials, finishes and fixtures and in compliance with all Applicable Laws applicable to demolished space (except any signoffs or approvals in connection with Landlord’s Post-Commencement Additional Space Work shall be obtained by Landlord following substantial completion of Landlord’s Post-Commencement Additional Space Work, and not as a condition to the substantial completion thereof).

1.    Provide reasonably sufficient points, for typical office use, for Tenant’s connection to Building Class “E” system; provided that tie-ins to such system shall be at Tenant’s sole cost and expense.

2.    Renovate the core bathrooms on the 21st Floor Premises (in a manner so that such bathrooms shall be substantially consistent with the finishes and fixtures in the core bathrooms located on the 22nd Floor Premises).

3.    Existing electrical panels shall be left in place.  The existing meters and transformers shall be removed.  Landlord shall install new electrical submeters.EX-10.4

 Exhibit 10.4 

NEW BUFFALO SAVINGS BANK 

SALARY CONTINUATION AGREEMENT 

FOR 
 RICHARD C. SAUERMAN

 THIS SALARY CONTINUATION PLAN FOR RICHARD C. SAUERMAN (the “Plan”) is effective as of May 28, 2015, and is
entered into by New Buffalo Savings Bank (the “Bank”) and Richard C. Sauerman (“Executive”).  
 WHEREAS,
the purpose of the Plan is to provide additional retirement benefits to Executive, who, as a member of senior management, has contributed significantly to the success of the Bank, and whose continued services are vital to the Bank’s continued
growth and success; and 
 WHEREAS, this Plan is intended to be an unfunded, non-qualified deferred compensation plan that
complies with Sections 451 and 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations thereunder and is also intended to be a “top hat” pension plan within the meaning of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”). 
 ARTICLE I 

DEFINITIONS 
 When used
herein, the following words and phrases shall have the meanings below unless the context clearly indicates otherwise: 
  

	1.1	“Account” means an account to which the Bank shall credit all contributions allocated thereto. The Account shall be utilized solely as a device for the determination and measurement of the amounts to be paid
to Executive pursuant to the Plan. Executive’s Account shall not constitute or be treated as a trust fund of any kind. 

  

	1.2	“Account Balance” means the balance of Executive’s Account as of the applicable distribution date. 

  

	1.3	“Administrator” means the Bank and/or its Board of Directors, provided, however, the Board of Directors can designate a committee of the Board of Directors (“Committee”) as the Administrator.

  

	1.4	“Bank” means New Buffalo Savings Bank and any successor to its business and/or assets which assumes and agrees to perform the duties and obligations under this Plan by operation of law or otherwise.

  

	1.5	 “Beneficiary” means the person or persons (and, if applicable, their heirs) designated by Executive as the beneficiary to whom the deceased
Executive’s benefits are payable. The beneficiary designation shall be made on the form attached hereto as Exhibit A and filed with the Administrator. If no Beneficiary is so designated, then Executive’s Spouse, if living, will be deemed
the Beneficiary. If Executive’s Spouse is not living at the time of 

	 	
Executive’s death or dies prior to payment to her of the Survivor’s Benefit, then the Children of Executive will be deemed the Beneficiaries and will take on a per stirpes basis. If
there are no living Children, then Executive’s estate will be deemed the Beneficiary. For this purpose, the term “Children” means Executive’s children, or the issue of any deceased Children, then living at the time payments are
due the Children under this Plan. The term “Children” shall include both natural and adopted children, as well as stepchildren. Also, for this purpose, the term “Spouse” means the individual to whom Executive is legally married
at the time of Executive’s death, provided, however, that the term “Spouse” shall not refer to an individual to whom Executive is legally married at the time of death if Executive and the individual have entered into a formal
separation agreement (provided that the separation agreement does not provide otherwise or state that the individual is entitled to a portion of the benefits hereunder) or initiated divorce proceedings. 

 

	1.6	“Benefit Eligibility Date” shall be the date on which Executive is entitled to commencement of benefits under the Plan. 

  

	 	(a)	In the event benefits become payable on account of Executive’s Separation from Service, the Benefit Eligibility Date shall be the first day of the second month following Executive’s Separation from Service,
subject to Section 1.6(d) below. 

  

	 	(b)	In the event the Survivor’s Benefit becomes payable on account of Executive’s death, the Benefit Eligibility Date shall be the first day of the second month following Executive’s death. 

 

	 	(c)	In the event the Account Balance becomes payable pursuant to Section 2.6 of this Plan on account of Executive’s Separation from Service (other than for Cause) coincident with or within two (2) years
following a Change in Control, the Benefit Eligibility Date shall be the first day of the second month following Separation from Service, subject to Section 1.6(d) below. 

 

	 	(d)	Notwithstanding anything in this Section 1.6 to the contrary, if Executive is a Specified Employee of a publicly-traded company and the payment(s) are due to Executive’s Separation from Service (other than due
to death), then the Benefit Eligibility Date shall be the first day of the seventh month following Executive’s Separation from Service (if later than the date otherwise specified as the Benefit Eligibility Date). The payments that otherwise
would have been received from the date of Separation from Service to the Specified Employee’s Benefit Eligibility Date shall be aggregated and shall be paid on the same date as the initial payment (e.g., on the first day of the seventh month)
and all remaining payments shall be made as otherwise scheduled. For purposes of Code Section 409A, the payments due hereunder shall be deemed a single payment. 

 

	1.7	“Board of Directors” shall mean the Board of Directors of the Bank. 

  
 2 

	1.8	“Cause” shall mean Executive’s (i) personal dishonesty; (ii) willful misconduct; (iii) incompetence; (iv) breach of fiduciary duty involving personal profit; (v) intentional
failure to perform his stated duties; or (vi) willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order. 

For purposes of this paragraph, no act or failure to act on the part of Executive shall be considered “willful” unless done, or
omitted to be done, by Executive not in good faith and without reasonable belief that Executive’s action or omission was in the best interest of the Bank. 
  

	1.9	“Change in Control” shall mean any of the following events: (i) a change in the ownership of New Bancorp, Inc. (the “Company”) or Bank; (ii) a change in the effective control of the Company
or Bank; or (iii) a change in the ownership of a substantial portion of the assets of the Company or Bank, as described below: 

  

	 	(a)	A change in ownership occurs on the date that any one person, or more than one person acting as a group (as defined in Treasury Regulations section 1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the Bank or the
Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Bank or the Company. 

 

	 	(b)	A change in the effective control of the Company or Bank occurs on the date that either (A) any one person, or more than one person acting as a group (as defined in Treasury Regulations section
1.409A-3(i)(5)(vi)(B)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company or Bank possessing 30% or more of the total voting power of
the stock of the Company or Bank, or (B) a majority of the members of the Bank’s or the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of
the members of the Bank’s or the Company’s Board of Directors prior to the date of the appointment or election, provided that this subsection is inapplicable where a majority shareholder of the corporation is another corporation.

  

	 	(c)	A change in the ownership of a substantial portion of the Bank’s or the Company’s assets occurs on the date that any one person or more than one person acting as a group (as defined in Treasury Regulations
section 1.409A-3(i)(5)(vii)(C)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company or Bank that have a total gross fair market value equal to or
more than 40% of the total gross fair market value of all of the assets of the Company. For purposes of this Agreement, “gross fair market value” means the value of the assets of the Company or Bank, or the value of the assets being
disposed of, without regard to any liabilities associated with such assets. 

  

	 	(d)	For all purposes hereunder, the definition of Change in Control shall be construed to be consistent with the requirements of Treasury Regulations section 1.409A-3(i)(5), except to the extent that such regulations are
superseded by subsequent guidance. 

  
 3 

	1.10	“Effective Date” of this Plan shall be May 28, 2015. 

  

	1.11	“Executive” means Richard C. Sauerman, who has been selected and approved by the Board of Directors to participate in the Plan. 

 

	1.12	“Payout Period” means the time frame during which benefits payable under the Plan shall be distributed. The Payout Period shall be fifteen (15) years, commencing on Executive’s Benefit Eligibility
Date specified in Section 1.6 of the Plan and payments shall be made annually in approximately equal installments on that date and each anniversary date thereafter. 

 

	1.13	“Separation from Service” (or “Separated from Service”) means Executive’s death, retirement or other termination of employment with the Bank within the meaning of Code Section 409A. No
Separation from Service shall be deemed to occur due to military leave, sick leave or other bona fide leave of absence if the period of the leave does not exceed six months or, if longer, so long as Executive’s right to reemployment is provided
by law or contract. If the leave exceeds six months and Executive’s right to reemployment is not provided by law or by contract, then Executive shall have a Separation from Service on the first date immediately following such six-month period.

 Whether a Separation from Service has occurred is determined based on whether the facts and circumstances indicate that the
Bank and Executive reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services Executive would perform after that date (whether as an employee or as an independent
contractor) would permanently decrease to less than 50% of the average level of bona fide services performed over the immediately preceding 36 months (or the lesser period of time in which Executive performed services for the Bank). The
determination of whether Executive has had a Separation from Service shall be made by applying the presumptions set forth in the Treasury Regulations under Code Section 409A. 

 

	1.14	“Specified Employee” means an individual who also satisfies the definition of “key employee” as that term is defined in Code Section 416(i) (without regard to paragraph (5) thereof). In the
event Executive is a Specified Employee, no distribution shall be made to such Executive upon Separation from Service (other than due to death or Disability) prior to the date which is six (6) months following Separation from Service.

  

	1.15	“Survivor’s Benefit” means the benefit payable to Executive’s Beneficiary following his death in accordance with Section 2.4 of the Plan. 

  
 4 

 ARTICLE II 

BENEFITS 
  

	2.1	Account. The Bank shall maintain an Account for Executive to which it shall credit all amounts allocated thereto in accordance with Section 2.2 of the Plan. Executive’s Account shall be adjusted no less
often than annually to reflect the credits made to the Account. Such adjustments shall be made as long any amount remains credited to the Executive’s Account. The amounts allocated and adjustments made shall comprise of the Account at any time.

  

	2.2	Annual and Discretionary Contributions and Earnings. On December 31st of each 2015, 2016, 2017, 2018 and 2019, the Bank shall credit Executive’s
Account with $21,500. This annual contribution shall only be made if Executive is employed with the Bank as of the last day of the year. The Bank may, but is not obligated to, make discretionary contributions to Executive’s Account from time to
time. Discretionary contributions shall be credited at such times and in such amounts as determined by the Board of Directors of the Bank in its sole discretion. As of the last day of each year, the Bank shall credit the Account with interest equal
to a rate of 4.5%, compounded annually. 

  

	2.3	Benefit on Separation from Service. Upon Executive’s Separation from Service, Executive shall be entitled to the Account Balance. The benefit under this Section 2.3 shall commence on Executive’s
Benefit Eligibility Date specified in Section 1.6(a) of the Plan and shall be payable in installments over the Payout Period specified in Section 1.12 of the Plan. 

 

	2.4	Survivor’s Benefit. 

  

	 	(a)	If Executive dies prior to a Separation from Service, Executive’s Beneficiary shall be entitled to the Account Balance, payable in a single lump sum on the Benefit Eligibility Date specified in Section 1.6(b).

  

	 	(b)	If Executive dies following a Separation from Service but prior to the commencement of benefit payments to Executive, Executive’s Beneficiary shall be entitled to the Account Balance payable in a single lump sum on
the Benefit Eligibility Date specified in Section 1.6(b). If Executive dies following a Separation of Service and after the commencement of benefit payments, Executive’s Beneficiary shall be entitled to the remaining Account Balance,
payable in a single lump sum on the Benefit Eligibility Date specified in Section 1.6(b). 

  

	2.5	Termination for Cause and Voluntary Termination. Notwithstanding any other provision of this Plan to the contrary, if Executive is terminated for Cause, all benefits under this Plan shall be forfeited by
Executive and Executive’s participation in this Plan shall become null and void. 

  

	2.6	Benefit Payable on Separation from Service within Two Years Following a Change in Control. In the event a Change in Control occurs followed by Executive’s Separation from Service within two (2) years
and prior to his separation from service, Executive shall be entitled to the Account Balance, payable commencing on the Benefit Eligibility Date specified in Section 1.6(c), in a lump sum. 

  
 5 

 ARTICLE III 

BENEFICIARY DESIGNATION 

Executive shall make an initial designation of primary and secondary Beneficiaries upon initial participation in the Plan by completion of a
Beneficiary form substantially in the form attached as Exhibit A, and shall have the right to change the designation, at any subsequent time. Any Beneficiary designation shall become effective only when receipt thereof is acknowledged in writing by
the Administrator. 
 ARTICLE IV 

EXECUTIVE’S RIGHT TO ASSETS, 

ALIENABILITY AND ASSIGNMENT PROHIBITION 

At no time shall Executive be deemed to have any lien, right, title or interest in or to any specific investment or asset of the Bank. The
rights of Executive, any Beneficiary, or any other person claiming through Executive under this Plan, shall be solely those of an unsecured general creditor of the Bank. Executive, the Beneficiary, or any other person claiming through Executive,
shall only have the right to receive from the Bank those payments so specified under this Plan. Neither Executive nor any Beneficiary under this Plan shall have any power or right to transfer, assign, anticipate, hypothecate, mortgage, commute,
modify or otherwise encumber in advance any of the benefits payable hereunder, nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance owed by Executive or his Beneficiary, nor be
transferable by operation of law in the event of bankruptcy, insolvency or otherwise. 
 ARTICLE V 

ERISA PROVISIONS 
  

	5.1	Named Fiduciary and Administrator. The Bank shall be the Named Fiduciary and Administrator of this Plan. As Administrator, the Bank shall be responsible for the management, control and administration of the Plan
as established herein. The Administrator may delegate to others certain aspects of the management and operational responsibilities of the Plan, including the employment of advisors and the delegation of ministerial duties to qualified individuals.

  

	5.2	 Claims Procedure and Arbitration. In the event that benefits under this Plan is not paid to Executive (or to his Beneficiary in the case of
Executive’s death) and the claimant(s) feel he or they are entitled to receive the benefits, then a written claim must be made to the Administrator within sixty (60) days from the date payments are refused. The

  
 6 

	 	
Administrator shall review the written claim and, if the claim is denied, in whole or in part, it shall provide in writing, within thirty (30) days of receipt of such claim, its specific
reasons for such denial, reference to the provisions of this Plan upon which the denial is based, and any additional material or information necessary for such claimants to perfect the claim. The written notice by the Administrator shall further
indicate the additional steps which must be undertaken by claimants if an additional review of the claim denial is desired. 

If claimants desire a second review, they shall notify the Administrator in writing within thirty (30) days of the first claim denial.
Claimants may review this Plan or any documents relating thereto and submit any issues and comments, in writing, they may feel appropriate. In its sole discretion, the Administrator shall then review the second claim and provide a written decision
within thirty (30) days of receipt of such claim. This decision shall state the specific reasons for the decision and shall include reference to specific provisions of this Plan upon which the decision is based. 

No claimant shall institute any action or proceeding in any state or federal court of law or equity or before any administrative tribunal or
arbitrator for a claim for benefits under the Plan until the claimant has first exhausted the provisions set forth in this Section 5.2. 

ARTICLE VI 

MISCELLANEOUS 
  

	6.1	No Effect on Employment Rights. Nothing contained herein will confer upon Executive the right to be retained in the service of the Bank nor limit the right of the Bank to discharge or otherwise deal with
Executive without regard to the existence of the Plan. 

  

	6.2	State Law. The Plan is established under, and will be construed according to, the laws of the State of Michigan, to the extent such laws are not preempted by ERISA and valid regulations published thereunder or
any other federal law. 

  

	6.3	 Severability and Interpretation of Provisions. The Bank shall have full power and authority to interpret, construe and administer this Plan and
the Bank’s interpretation and construction thereof and actions thereunder shall be binding and conclusive on all persons for all purposes. No employee or representative of the Bank shall be liable to any person for any actions taken or omitted
in connection with the interpretation and administration of this Plan unless attributable to his own willful misconduct or lack of good faith. In the event that any of the provisions of this Plan or portion hereof are held to be inoperative or
invalid by any court of competent jurisdiction, or in the event that any provision is found to violate Code Section 409A and would subject Executive to additional taxes and interest on the amounts deferred hereunder, or in the event that any
legislation adopted by any governmental body having jurisdiction over the Bank would be retroactively applied to invalidate this Plan or any provision hereof or cause the benefits under this Plan to be taxable, then: (1) insofar as is
reasonable, effect will be given to the intent manifested in the provisions held invalid or inoperative, and (2) the validity and enforceability of the remaining provisions will not be affected thereby. In the event that the intent of any

  
 7 

	 	
provision shall need to be construed in a manner to avoid taxability, this construction shall be made by the Administrator in a manner that would manifest to the maximum extent possible the
original meaning of such provisions. 

  

	6.4	Incapacity of Recipient. If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his property, the Bank may pay such benefit to the guardian,
legal representative or person having the care or custody of such minor, incompetent person or incapable person. The Bank may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit.
The distribution shall completely discharge the Bank for all liability with respect to the benefit. 

  

	6.5	Unclaimed Benefit. Executive shall keep the Bank informed of his or her current address and the current address of his Beneficiaries. If the location of Executive is not made known to the Bank, the Bank shall
delay payment of Executive’s benefit payment(s) until the location of Executive is made known to the Bank; however, the Bank shall only be obligated to hold the benefit payment(s) for Executive until the expiration of three (3) years. Upon
expiration of the three (3) year period, the Bank may discharge its obligation by payment to Executive’s Beneficiary. If the location of Executive’s Beneficiary is not known to the Bank, Executive and his Beneficiary(ies) shall
thereupon forfeit any rights to the balance, if any, of any benefits provided for such Executive and/or Beneficiary under this Plan. 

  

	6.6	Limitations on Liability. Notwithstanding any of the preceding provisions of the Plan, no individual acting as an employee or agent of the Bank, or as a member of the Board of Directors shall be personally liable
to Executive or any other person for any claim, loss, liability or expense incurred in connection with the Plan. 

  

	6.7	Gender. Whenever in this Plan words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply. 

 

	6.8	Effect on Other Corporate Benefit Plans. Nothing contained in this Plan shall affect the right of Executive to participate in or be covered by any qualified or nonqualified pension, profit sharing, group, bonus
or other supplemental compensation or fringe benefit agreement constituting a part of the Bank’s existing or future compensation structure. 

  

	6.9	Inurement. This Plan shall be binding upon and shall inure to the benefit of the Bank, its successors and assigns, and Executive, his successors, heirs, executors, administrators, and Beneficiaries.

  

	6.10	 Acceleration of Payments. Except as specifically permitted under this Section 6.10 or in other sections of this Plan, no acceleration of
the time or schedule of any payment may be made under this Plan. Notwithstanding the foregoing, payments may be accelerated hereunder by the Bank, in accordance with the provisions of Treasury Regulation Section 1.409A-3(j)(4)

  
 8 

	 	
and any subsequent guidance issued by the United States Treasury Department. Accordingly, payments may be accelerated, in accordance with requirements and conditions of the Treasury Regulations
(or subsequent guidance) in the following circumstances: (i) as a result of certain domestic relations orders; (ii) in compliance with ethics agreements with the Federal Government; (iii) in compliance with ethics laws or conflicts of
interest laws; (iv) in limited cash-outs (but not in excess of the limit under Code Section 402(g)(1)(B)); (v) in the case of certain distributions to avoid a non-allocation year under Code Section 409(p); (vi) to apply
certain offsets in satisfaction of a debt of Executive to the Bank; (vii) in satisfaction of certain bona fide disputes between Executive and the Bank; or (viii) for any other purpose set forth in the Treasury Regulations and
subsequent guidance. 

  

	6.11	Headings. Headings and sub-headings in this Plan are inserted for reference and convenience only and shall not be deemed a part of this Plan. 

 

	6.12	12 U.S.C. §1828(k). Any payments made to Executive pursuant to this Plan or otherwise are subject to and conditioned upon compliance with 12 U.S.C. § 1828(k) or any regulations promulgated thereunder.

  

	6.13	Payment of Employment and Code Section 409A Taxes. Any distribution under this Plan shall be reduced by the amount of any taxes required to be withheld from the distribution. This Plan shall permit the
acceleration of the time or schedule of a payment to pay employment-related taxes as permitted under Treasury Regulation Section 1.409A-3(j) or to pay any taxes that may become due at any time that the arrangement fails to meet the requirements
of Code Section 409A and the regulations and other guidance promulgated thereunder. In the latter case, such payments shall not exceed the amount required to be included in income as the result of the failure to comply with the requirements of
Code Section 409A. 

  

	6.14	Successors to the Bank. The Bank, as applicable, will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets
of the Bank to assume expressly and agree to perform the duties and obligations under this Plan in the same manner and to the same extent as the Bank would be required to perform it if no such succession had taken place. 

 

	6.15	Legal Fees. In the event Executive retains legal counsel to enforce any of the terms of the Plan, the Bank will pay his legal fees and related expenses reasonably incurred by him, but only if Executive prevails
in an action seeking legal and/or equitable relief against the Bank. 

 ARTICLE VII 

AMENDMENT/TERMINATION 
  

	7.1	This Plan may be amended or modified at any time, in whole or part, with the mutual written consent of Executive and the Bank. Notwithstanding anything to the contrary herein, the Plan may be amended without
Executive’s consent to the extent necessary to comply with existing tax laws or changes to existing tax laws or to amend or terminate the Plan in accordance with Section 7.2 below. 

  
 9 

	7.2	Termination of Plan. 

  

	 	(a)	Partial Termination. The Board of Directors, at its discretion, may partially terminate the Plan by freezing future accruals if, in its sole judgment, the tax, accounting, or other effects of the continuance of
the Plan, or potential payments thereunder, would not be in the best interests of the Bank. 

  

	 	(b)	Complete Termination. Subject to the requirements of Code Section 409A, in the event of complete termination of the Plan, the Plan shall cease to operate and the Bank shall pay out to Executive his benefits
as if Executive had terminated employment as of the effective date of the complete termination. A complete termination of the Plan shall occur only under the following circumstances and conditions: 

 

	 	(i)	The Board of Directors may terminate the Plan within 12 months of a corporate dissolution taxed under Code Section 331, or with approval of a bankruptcy court pursuant to 11 U.S.C. §503(b)(1)(A), provided that
the benefit is included in Executive’s (or his Beneficiary’s) gross income (and paid to Executive or his Beneficiary) in the latest of (i) the calendar year in which the Plan terminates; (ii) the calendar year in which the amount
is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the payment is administratively practicable. 

  

	 	(ii)	The Board of Directors may terminate the Plan by Board of Directors action taken within the 30 days preceding or 12 months following a Change in Control, provided that the Plan shall only be treated as terminated if all
substantially similar arrangements sponsored by the Bank are terminated so that Executive and all participants under substantially similar arrangements are required to receive all amounts payable under the terminated arrangements within 12 months of
the date of the termination of the arrangements. 

  

	 	(iii)	 The Board of Directors may terminate the Plan at any time provided that (i) the termination does not occur proximate to a downturn in the
financial health of the Bank, (ii) all arrangements sponsored by the Bank that would be aggregated with this Plan under Treasury Regulations Section 1.409A-1(c) if Executive was also covered by any of those other arrangements are also
terminated; (iii) no payments other than payments that would be payable under the terms of the arrangements if the termination had not occurred are made within 12 months of the termination of the arrangement (e.g., Executive’s benefit);
(iv) all payments are made within 24 months of the termination of the arrangements; and (v) the Bank does not adopt a new arrangement that would be aggregated with any terminated

  
 10 

	 	
arrangement under Treasury Regulations Section 1.409A-1(c) if Executive participated in both arrangements, at any time within three years following the date of termination of the
arrangement. 

 ARTICLE VIII 

EXECUTION 
  

	8.1	This Plan sets forth the entire understanding of the Bank and Executive with respect to the transactions contemplated hereby, and any previous agreements or understandings between them regarding the subject matter
hereof are merged into and superseded by this Plan. 

  

	8.2	This Plan shall be executed in duplicate, each copy of which, when so executed and delivered, shall be an original, but both copies shall together constitute one and the same instrument. 

[signature page follows] 

  
 11

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