Document:

Exhibit 10.5.2 Second Amendment to Lease Between AGNM Merrill Place and Blue Nile, Inc

EXHIBIT 10.5.2 
SECOND AMENDMENT TO LEASE
THIS SECOND AMENDMENT TO LEASE (the "Amendment") is made and entered into as of this 14 day of November, 2012, by and between AGNM MERRILL PLACE, LLC, a Delaware limited liability company ("Landlord") successor-in-interest to Merrill Place, LLC, a Washington limited liability company, and BLUE NILE, INC., a Delaware corporation ("Tenant").
RECITALS:
A.WHEREAS, Landlord is the owner of certain real property and the improvements situated thereon having a postal address of 411 First Avenue South, Seattle, King County, Washington 98104 (the "Property").  The improvements on the Property, including the Sellar-Hambach Building, Schwabacher Building, Theatre Building and Merrill Place Parking Garage, are commonly known as Merrill Place (the "Building").

B.WHEREAS, Landlord's predecessor-in-interest Merrill Place, LLC and Tenant entered into a Lease Agreement dated December 29, 2010 (the "Lease") (incorporated herein by reference), which provides for the lease by Landlord to Tenant of certain Premises more particularly described in the Lease, currently covering approximately 32,845 rentable square feet of office space (the “Premises”) on the seventh (7th) and third (3rd) floors of the Building, and 1,804 rentable square feet of server space (“Data Center”) on the first (1st) floor of the Building.

C.WHEREAS, on December 22, 2011, in connection with a financing transaction with Angelo Gordon Real Estate, Inc. and Wells Fargo Bank, N.A., Merrill Place, LLC transferred its interest in the Property, ultimately, to Landlord.

D.WHEREAS, Landlord and Tenant desire amend the Lease in accordance with this Amendment.
NOW, THEREFORE, for and in consideration of the recitals, which are incorporated herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Lease shall be, and the same hereby is amended as follows (terms defined in the Lease shall have the same meaning when used herein):
1.Lease of Suite 304.  Landlord hereby leases to Tenant, and Tenant hereby leases from
Landlord, approximately 4,423 rentable square feet on the third (3rd) floor of the Sellar‐Hambach Building ("Suite 304").  Suite 304 is located adjacent to the original third floor premises in the south-center portion of the third floor, and is shown on the map, as is shown in the diagram attached hereto as Exhibit A.  Suite 304 shall be used for the Permitted Uses defined in the Lease.

2.Rent for Suite 304.  Tenant's lease of Suite 304 shall commence on February 1, 2013, Base Rent shall commence for Suite 304 on February 1, 2013. Rent for Suite 304 shall be the applicable rent per square footage Tenant is then obligated to pay under the Lease on the respective commencement date for such space.

		
	a.
	The Rent for the Premises, including Suite 304, is described in the schedule below and payable in equal monthly installments on or before the first day of each month:

1

	
									
	 Premises Period
	 Monthly Rent
	 Annual Rent
	 Rent/RSF
	 Square Feet

	 02/01/2013 - 04/30/2013 

	75,312.42
	

	903,749.00
	

	24.25
	

	37,268
	

	 05/01/2013 - 04/30/2014 

	77,641.67
	

	931,700.00
	

	25.00
	

	37,268
	

	 05/01/2014 - 04/30/2015 

	79,970.92
	

	959,651.00
	

	25.75
	

	37,268
	

	 05/01/2015 - 04/30/2016 

	82,300.17
	

	987,602.00
	

	26.50
	

	37,268
	

	 05/01/2016 - 04/30/2017 

	84,629.42
	

	1,015,553.00
	

	27.25
	

	37,268
	

	 05/01/2017 - 04/30/2018 

	86,958.67
	

	1,043,504.00
	

	28.00
	

	37,268
	

	 05/01/2018 - 04/30/2019 

	89,287.92
	

	1,071,455.00
	

	28.75
	

	37,268
	

	 05/01/2019 - 04/30/2020
	91,617.17
	

	1,099,406.00
	

	29.50
	

	37,268
	

	 05/01/2020 - 08/31/2021
	93,946.42
	

	1,127,357.00
	

	30.25
	

	37,268
	

b.The Rent for the Data Center is described in the schedule below and payable in equal monthly installments on or before the first day of each month:    	
									
	 Data Center Period
	 Monthly Rent
	 Annual Rent
	 Rent/RSF
	 Square Feet

	 02/01/2013 - 04/30/2013 
	1,841.58
	

	22,099.00
	

	12.25
	

	1,804
	

	 05/01/2013 - 04/30/2014 

	1,879.17
	

	22,550.00
	

	12.50
	

	1,804
	

	 05/01/2014 - 04/30/2015
	1,916.75
	

	23,001.00
	

	12.75
	

	1,804
	

	 05/01/2015 - 04/30/2016 

	1,954.33
	

	23,452.00
	

	13.00
	

	1,804
	

	 05/01/2016 - 04/30/2017
	1,991.92
	

	23,903.00
	

	13.25
	

	1,804
	

	 05/01/2017 - 04/30/2018 

	2,029.50
	

	24,354.00
	

	13.50
	

	1,804
	

	 05/01/2018 - 04/30/2019 

	2,067.08
	

	24,805.00
	

	13.75
	

	1,804
	

	 05/01/2019 - 04/30/2020 

	2,104.67
	

	25,256.00
	

	14.00
	

	1,804
	

	 05/01/2020 - 08/31/2021 

	2,142.25
	

	25,707.00
	

	14.25
	

	1,804
	

3.Tenant Improvement Allowance.  Tenant shall be entitled to the same pro-rated Tenant
Improvement Allowance for Suite 304 as is applicable under the Lease as of the date the Tenant takes possession of Suite 304 ($58.15 per rentable square foot if possession is February 1, 2013).

4.Total Leased Space.   As a result of the additional space leased by Tenant as described herein, the combined total square footage of the Premises (excluding all leased First Floor Space) after the lease of Suite 304 shall be 37,268.

5.All Other Terms Remain Unchanged.  Except as amended herein, all other terms and conditions of the Lease shall remain unchanged and in full force and effect.

6.Conflict of Provisions.  Any inconsistencies or conflicts between the terms and provisions of the Lease and the terms and provisions of this Amendment shall be resolved in favor of the terms and provisions of this Amendment.

7.Binding Agreement.  This Amendment shall inure to the benefit of and shall be binding upon the successors and assigns of the parties hereto.

8.Counterpart.  This Amendment may be executed in one or more counterparts, and all of the counterparts shall constitute but one and the same agreement, and will be effective when at least one counterpart has been executed by each party hereto, notwithstanding that all parties hereto are not signatories to the same or original counterpart.
[Signature Page Follows.]

2

Signature Page to First Amendment to Lease

IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year above set forth.
"LANDLORD"                AGNM MERRILL PLACE, L.L.C.,
a Delaware limited liability company
 
By: Nitze-Stagen & Co., Inc., a Washington corporation, Its Agent
                                      
By: /s/Kevin Daniels_____________
Kevin Daniels
                                                       Its Authorized Representative
            

		
	"TENANT"
	BLUE NILE, INC.,

a Delaware corporation

By /s/ David Binder_______________      
    Its CFO

3

Notary Acknowledgments

STATE OF WASHINGTON        )
) ss.
COUNTY OF KING            )
I certify that I know or have satisfactory evidence that KEVIN DANIELS is the person who appeared before me, and said person acknowledged that he signed this instrument, on oath stated that he was authorized to execute the instrument and acknowledged it as an Authorized Representative of Nitze Stagen & Co., Inc, in its capacity as the Agent of AGNM MERRILL PLACE L.L.C., to be the free and voluntary act and deed of each of said limited liability companies, for the uses and purposes mentioned in the instrument.
WITNESS my hand and official seal hereto affixed this 8th day of November, 2012.
/s/ Ashley Lex                                                                          
(Signature of Notary)
Ashley Lex                                                                        
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington
My Appointment Expires: 5/30/16                                           

STATE OF WASHINGTON        )
) ss.
COUNTY OF KING            )
I certify that I know or have satisfactory evidence that David Binder is the person who appeared before me, and said person acknowledged that he/she signed this instrument, on oath stated that he/she was authorized to execute the instrument and acknowledged it as the CFO of BLUE NILE, INC., to be the free and voluntary act and deed of such corporation, for the uses and purposes mentioned in the instrument.
WITNESS my hand and official seal hereto affixed this 17th day of September, 2012.
/s/ Cheryl Wollin                                                             
(Signature of Notary)
Cheryl Wollin                                                                            
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State
of Washington
My Appointment Expires: 12/28/2015                            

4

EXHIBIT A

MAP OF SUITE 304

5Exhibit 10.17 2013 Compensation Program for Non-Employee Directors

EXHIBIT 10.17
BLUE NILE, INC. 

Compensation Program for Non-Employee Directors (the “DIRECTOR COMPENSATION PROGRAM”)
Effective Date:   July 31, 2012
Annual Cash Compensation
- Retainer: $40,000 (may elect to receive stock in lieu of cash)
- Committee Fee: $3,000
- Audit Committee Chair Fee: $10,000                
- Compensation Committee Chair Fee: $5,000
- Nominating and Corporate Governance Committee Fee: $5,000
- Non-Employee Chair Fee: $100,000
- Lead Independent Director Fee: $10,000

Retainer.  The $40,000 retainer (the “Retainer”) is earned in quarterly installments, with each quarterly installment of the Retainer becoming fully vested and payable on the date of the first regular Board meeting of that quarter, subject to continued service on the Board as of such date.  In lieu of cash, and prior to the start of each fiscal year, a director may elect to receive 100% of the Retainer for that next fiscal year as four quarterly fully vested stock awards under our 2004 Equity Incentive Plan (the “EIP”), with each award covering a number of shares that have a Fair Market Value (as defined in the EIP) on the date of grant equal to $10,000.  The stock award is granted on the third trading day following our quarterly public announcement of our financial earnings, subject to continued service through such date. 

Committee Fee.  A single $3,000 committee fee is earned in quarterly installments, each quarterly installment of such fee becoming fully vested and payable on the date of the first regular Board meeting of that quarter, subject to continued service on the Board as of such date, to each non-employee director who serves on one or more committees in that quarter.     

Committee Chair Fees.  Due to the time commitment involved in serving as a chair of a committee, in addition to the $3,000 committee fee, each committee chair receives an additional fee that is earned in quarterly installments, with each quarterly installment of such fee becoming fully vested and payable on the date of the first regular Board meeting of that quarter, subject to continued service on the Board as of such date.  The Audit Committee Chair fee is $10,000 annually, and the Compensation Committee Chair fee and the Nominating and Corporate Governance Committee Chair fee are each $5,000 annually.  

Non-Employee Board Chair Fee.  Due to the time commitment involved in serving as the non-employee Chairman of the Board, the non-employee Chairman of the Board receives an additional $100,000 fee annually, and such fee is earned in quarterly installments, with each quarterly installment of such fee becoming fully vested and payable on the date of the first regular Board meeting of that quarter, subject to continued service on the Board as of such date. 

Lead Independent Director Fee.  Due to the time commitment involved in serving as the lead independent director of the Board, if the Board appoints a lead independent director, the lead independent director of the Board receives an additional $10,000 fee annually, and such fee is earned in quarterly installments, with each quarterly installment of such fee becoming fully vested and payable on the date of the first regular Board meeting of that quarter, subject to continued service on the Board as of such date. 

Prorated Payments for New Directors:  Each non-employee director who is elected or appointed after the start of the fiscal year will earn and be paid quarterly amounts of the Retainer and applicable committee or Chairman fees for each quarter in which he or she attends at least one regular Board meeting, with such amount(s) paid on the date of 

the first such meeting such Director attends in that quarter. No payments will be made for quarters prior to the first day of service.  
Equity Compensation
- Annual Equity Grant: an award with a value of $63,000
- Annual Non-Employee Board Chair Grant: an award with a value of $100,000 
- Initial Grant of Restricted Stock Units (“Initial RSU Grant”):  an award with a value of $100,000
- Stock Option Grant Upon Full Vesting of Initial Option Grant:  non-employee directors appointed to the Board before     
  July 31, 2012 will receive a one-time option to purchase 9,000 shares.  Directors appointed to the Board after July   
  31, 2012 will not receive a second grant following the vesting of his/her Initial RSU Grant. 

Annual Equity Grant.  Each non-employee director will be granted an annual equity grant for a number of shares having a value equal to $63,000 on the first trading day following the first regular Annual Meeting of stockholders for that year.  The annual grant vests every three (3) months from the date of the grant for one year.  These grants cease vesting as of the date a non-employee director no longer serves on the Board of Directors.    
Each Non-Employee Director shall elect, prior to the start of the fiscal year in which the Annual Meeting is to take place, or such later date as may be determined by the Compensation Committee in its sole discretion, to receive the Annual Equity Grant in the form of either (i) 100% as RSUs or (ii) 100% as Options.  In the absence of a timely election, the Annual Stock Retainer will be granted as 100% Options.  Individuals who become a non-employee director on or after the start of the fiscal year must make an election on or before the date he or she is appointed or elected as a non-employee director, or such later date as may be determined by the Compensation Committee in its sole discretion. 
The number of shares subject to the RSUs will be equal to the value of the Annual Stock Retainer divided by the Fair Market Value as of the grant date.  The number of shares subject to the Options will be equal to the number of shares having a grant date fair value equal to the value of the Annual Stock Retainer, as calculated in accordance with Topic 718 of the Financial Accounting Standards Board Accounting Standards Codification.  
Annual Non-Employee Board Chair Grant.  The non-employee Chairman of the Board will be granted an annual equity grant for a number of shares having a value equal to $100,000 on the first trading day following the first regular Annual Meeting of stockholders for that year.  The annual grant vests every three (3) months from the date of the grant for one year and ceases vesting as of the date a non-employee director no longer serves on the Board of Directors.  
The non-employee Chairman of the Board shall elect, prior to the start of the fiscal year in which the Annual Meeting is to take place, or such later date as may be determined by the Compensation Committee in its sole discretion, to receive this grant in the form of either (i) 100% as RSUs or (ii) 100% as Options.  In the absence of a timely election, this grant will be granted as 100% Options.  The number of shares subject to the RSUs will be equal to the value of the Annual Stock Retainer divided by the Fair Market Value as of the grant date.  The number of shares subject to the Options will be equal to the number of shares having a grant date fair value equal to the value of the Annual Stock Retainer, as calculated in accordance with Topic 718 of the Financial Accounting Standards Board Accounting Standards Codification. 
Initial RSU Grant.  Each director will be granted, on the date of his or her election or appointment, an Initial RSU Grant valued at $100,000.  The number of shares subject to the restricted stock units will be equal to $100,000 divided by the Fair Market Value as of the grant date.  The Initial RSU Grant vests every three (3) months from the date of the grant for four years.  This Initial RSU Grant ceases vesting as of the date a non-employee director no longer serves on the Board of Directors.  
Directors Elected to the Board Prior to July 31, 2012: One Time Stock Option Grant Upon Full Vesting of Initial Option Grant.  On the fourth anniversary of the grant of an initial stock option grant, non-employee director appointed or elected to the Board of Directors prior to July 31, 2012 will be granted a new stock option covering 9,000 shares.  This grant vests monthly from the date of the grant for four years.  These options cease vesting as of the date a non-employee director no longer serves on our Board of Directors.  Non-employee directors elected or 

appointed to the Board of Directors after July 31, 2012 will not receive a new equity grant upon the full vesting of his/her Initial RSU Grant.
Additional Terms and Conditions
All options will be granted with an exercise price equal to the Fair Market Value of the Common Stock on the date of grant, will have a 10 year term and a general post-termination exercise period of 12 months, subject to earlier termination or extension as provided in the EIP and the Applicable Award Agreement.
The vesting of the equity awards granted to non-employee directors under this Director Compensation Program will become fully vested as of the earlier to occur of: (x) the date of the Non-Employee Director's termination of service due to death or Disability and (y) immediately prior to a Change in Control (subject to continued service as of such time).  The unvested portions of any RSUs or Options are forfeited upon any other termination.
Section 409A:  Notwithstanding anything to the contrary in this Director Compensation Program, if a Director is deemed by the Company at the time of such director's Separation from Service to be a “specified employee” for purposes of Code Section 409A(a)(2)(B)(i), and if any of the payments upon Separation from Service set forth herein and/or under any other agreement with the Company are deemed to be “deferred compensation,” then to the extent delayed commencement of any portion of such payments is required to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Code Section 409A, such payments shall not be provided to such Director prior to the earliest of (i) the date that is six months and one day after the date of such Director's Separation from Service, (ii) the date of the Director's death, or (iii) such earlier date as permitted under Code Section 409A without the imposition of adverse taxation.  On the first business day following the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments deferred pursuant to this paragraph shall be paid in a lump sum to the Director, and any remaining payments due shall be paid as otherwise provided herein or in the applicable agreement.
Capitalized Terms:  Capitalized terms that are not defined herein will have the meaning set forth in the EIP, and, if not defined therein, in the Applicable Award Agreement.
Forms of Award Agreement:  The General Counsel of the Company has the authority to make such clarifying changes to the form of stock option agreement and restricted stock unit award agreement as are necessary to conform such forms for use under this Director Compensation Program. 
To ensure compliance with Internal Revenue Service Circular 230, you are hereby notified that any discussion of tax matters set forth in this notice was written in connection with the promotion or marketing of the transactions or matters addressed herein and was not intended or written to be used, and cannot be used by you, for the purpose of avoiding tax-related penalties under federal, state or local tax law.  You should seek advice based on your particular circumstances from an independent tax advisor.

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