Exhibit 10.2
SUBLEASE
1. PARTIES. This Sublease, dated July 31, 2006 (the “Effective Date”), is made by and between
MarketTools Inc., a Delaware corporation (“Sublessor”), and Redwood Trust, Inc., a Maryland
corporation (“Sublessee”).
This Sublease is made in reference to the Master Lease (as defined in Section 7.1 below) entered
into between the Master Lessor and Sublessor as of May 23, 2000 as amended as of February 1, 2002,
June 14, 2002, September 30, 2003 and May 1, 2004 (as amended, the “Master Lease”). Capitalized
terms used herein and not defined will have the same meanings as set forth in the Master Lease.
2. PREMISES. Sublessor hereby subleases to Sublessee and Sublessee hereby subleases from Sublessor
for the term, at the rental, and upon all of the conditions set forth herein, that certain real
property, including all improvements therein, which is covered by the Master Lease and commonly
known by the street address of Suite 200, One Belvedere Place, located in the City of Mill Valley,
County of Marin, State of California, and generally described as aproximately 21,300 rentable
square feet, second floor office space (“Premises”).
In consideration of Sublessee’s obligations hereunder, Sublessor hereby transfers, assigns and
delivers to Sublessee certain workstations, chairs, tables, and other personal property located on
the Premises and designated for assignment and delivery to Sublessee and all of Sublessor’s right,
title and interest therein and thereto (collectively, the “Personal Property”) on the terms set
forth in that certain Bill of Sale signed and delivered by Sublessor to Sublessee on the
Commencement Date. Following the Effective Date, Sublessor will have no further interest in or
responsibility or liability for the Personal Property.
3. TERM.
3.1 Term. The term of this Sublease (“Term”) shall be for seventeen (17) months commencing on
August 1, 2006 (the “Commencement Date”) and ending on December 31, 2007, unless sooner terminated
pursuant to any provision hereof.
3.2 Delay in Commencement. Sublessor agrees to use its best commercially reasonable efforts to
deliver possession of the Premises to Sublessee by the Commencement Date. If, despite said efforts,
Sublessor is unable to deliver possession of the Premises by the Commencement Date, the Term of
this Sublease shall commence on the date that possession of the Premises is actually delivered to
Sublessee (the “Delivery Date”) and Sublessee shall be entitled to one day of free Base Rent for
each day from the Commencement Date to the Delivery Date.
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3.3 No Subletting. Sublessee may not assign this Sublease, sublet the
Premises, transfer any interest of Sublessee therein or permit any use of the Premises by another
party (collectively, “Transfer”) without the prior written consent of Sublessor and, as set forth
in Section 9 below, Master Lessor and subject to any restrictions set forth in the Master Lease.
Any Transfer without such consent shall be void and, at Sublessor’s option, shall terminate this
Sublease; provided that no Transfer shall release Sublessee of its obligations or alter its primary
liability to pay Rent and perform Sublessee’s Assumed Obligations hereunder.
4. RENT.
4.1 Base Rent. Sublessee shall pay to Sublessor as Base Rent for the Premises equal monthly
payments of Forty Seven Thousand Nine Hundred Twenty Five and 00/100 dollars ($47,925.00) in
advance, no less than three business days prior to the first day of each calendar month during the
Term, except that Sublessee shall pay Sublessor upon the execution hereof Forty Seven Thousand Nine
Hundred Twenty Five and 00/100 dollars ($47,925.00) as Base Rent for the first month of the Term.
Base Rent for any period during the term hereof which is for less than one month shall be a pro
rata portion of the monthly installment. Notwithstanding anything to the contrary in the Master
Lease, the Base Rent will not increase during the Term. During the Term, Base Rent shall be
inclusive of Tenant’s Proportionate Share of the Actual Operating Expenses for the Project in
accordance with Section 4 of the Master Lease. However, Sublessee will pay and be fully liable
for any and all other operating expenses incurred by Sublessee with respect to the Premises which
are not included in the Actual Operating Expenses, i.e., telecommunications services, office
equipment and supplies. In addition, Sublessee shall obtain and keep in full force and effect, at
Sublessee’s sole cost and expense, during the Term, the insurance which Sublessor is required to
obtain and maintain under the Master Lease.
4.2 Rent Defined. All monetary obligations of Sublessee to Sublessor under the terms of this
Sublease (except for the Security Deposit) are deemed to be rent (“Rent”). Rent shall be payable in
lawful money of the United States to Sublessor at the address stated herein or to such other
persons or at such other places as Sublessor may designate in writing.
5. SECURITY DEPOSIT. Sublessee shall deposit with Sublessor upon execution hereof of Forty Seven
Thousand Nine Hundred Twenty Five and 00/100 dollars ($47,925.00) as security for Sublessee’s
faithful performance of Sublessee’s obligations hereunder. Sublessor shall have the right to use
or apply all or part of the Security Deposit for (a) the payment of any Base Rent, additional rent
or other sum in default; (b) the payment of any costs or expenses incurred by Sublessor by reason
of Sublessee’s default; (c) any other amounts necessary to compensate Sublessor for all detriment
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proximately caused by Sublessee’s failure to perform its obligations under the
Sublease or which in the ordinary course of things would be likely to result therefrom, (d) any
other amounts which Sublessor may be entitled to recover under Section 1951.2 of the California
Civil Code (and/or (e) as otherwise set forth in the Master Lease. Subject to deduction or other
adjustment as set forth above, Sublessor shall return the Security Deposit to Sublessee within
thirty (30) days after the expiration or sooner termination of this Sublease.
6. USE.
6.1 Agreed Use. The Premises shall be used and occupied only for general office purposes and
for no other purpose. Sublessee shall not do or permit anything to be done in or about the Premises
which would injure or damage the Premises.
6.2 Compliance. Exept as may be specifically provided herein, Sublessor shall deliver and
sublease the Premises to Sublessee strictly in their present (as of the Effective Date) “as-is” and
“with all faults” condition. However, to Sublessor’s actual knowledge, the electrical, plumbing,
HVAC and other building systems and equipment serving the Premises are in good working order and
condition as of the Effective Date, although Sublessor does not represent that any particular
capacity is available at the Premises. Any and all repairs to and maintenance of the Premises
during the Term will be as set forth in Section 7 of the Master Lease. Sublessee, by acceptance of
possession of the Premises, conclusively acknowledges that it has otherwise satisfied itself as to
the condition of the Premises.
6.3 Acceptance of Premises. Sublessee acknowledges that, except as expressly set forth in this
Sublease, neither Sublessor, Sublessor’s agents, nor any Broker has made any representations or
warranties with respect to the Premises.
Sublessor acknowledges that: (a) Broker has made no representations, promises or warranties
concerning Sublessee’s ability to honor the Sublease or suitability to occupy the Premises, and (b)
it is Sublessor’s sole responsibility to investigate the financial capability and/or suitability of
all proposed tenants.
6.4 No Improvements. No alteration or improvements shall be made to the Premises, except in
accordance with the Master Lease, including but not limited to Section 8 (a) therein, and with the
prior written consent of both Master Lessor and Sublessor, which approval by Sublessor shall not be
unreasonably withheld or denied.
7. MASTER LEASE.
7.1 Sublessor is the lessee of the Premises by virtue of a lease, hereinafter the
“Master Lease,” a copy of which is attached hereto marked Exhibit 1, wherein Bently
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Holdings, California LP, a California Limited Partnership , as successor in interest to
LB Strawberry, LLC, is the lessor, hereinafter the “Master Lessor.”
7.2 This Sublease is and shall be at all times subject and subordinate to the Master Lease.
7.3 Except as provided in this Sublease, all terms and conditions of the Master Lease are
incorporated into and made a part of this Sublease as if Sublessor were the “Lessor” thereunder and
Sublessee the “Lessee” thereunder, except that (i) the following shall be excluded: paragraphs
l(b), 2(a), 2(b), 3(b), 5, 30, and 40; (ii) all references to “Lessor” in paragraphs 7(a),
16,17,19, and 21(a), 22, 24, 38, and 41(e) of the Master Lease shall be deemed to refer to Master
Lessor only; (iii) all references to “Lessor” in paragraphs 8(a), 8(c) (except that the second
sentence of paragraph 8(c) shall be applicable to Master Lessor only), 10,12,13,18, and 20 of the
Master Lease shall be deemed to refer to both Master Lessor and Sublessor; and (iv) in the event
that any term or condition contained in this Sublease conflicts with any term or condition of the
Master Lease incorporated herein, then, as between Sublessor and Sublessee, the term or condition
in this Sublease shall control. Notwithstanding the fact that a provision of the Master Lease is
not made a part of this Sublease, this Sublease is nevertheless subject and subordinate to all of
the terms of the Master Lease.
7.4 Sublessee agrees to observe, comply with, and perform, all of the terms and conditions
applicable to Sublessor as Lessee under the Master Lease as the same have been incorporated by
reference herein and which accrue on and after the Commencement Date of this Sublease.
7.5 Sublessee shall hold Sublessor free and harmless from all liability, judgments, costs,
damages, claims or demands, including reasonable attorneys fees, arising out of Sublessee’s failure
to comply with or perform any of its obligations under this Sublease.
7.6 Sublessor agrees to maintain the Master Lease during the entire term of this Sublease,
subject, however, to any earlier termination of the Master Lease without the fault of the
Sublessor, and to comply with or perform its obligations under the Master Lease and to hold
Sublessee free and harmless from all liability, judgments, costs, damages, claims or demands
arising out of Sublessor’s failure to comply with or perform any of its obligations under the
Master Lease. Neither party will be liable to the other party hereunder for any incidental,
consequential or punitive damages incurred or suffered by such other party hereunder, including
damages arising out of any business interruption or loss of use. In addition, neither Sublessor
nor any of its shareholders, officers, directors, employees, contractors, representatives and
agents shall have or incur any personal liability whatosever with respect to this Sublease.
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7.7 Sublessor represents to Sublessee that the Master Lease is in full force and effect
and has not been further amended since May 1, 2004 and that no default exists on the part of any
Party to the Master Lease.
8. ASSIGNMENT OF SUBLEASE AND DEFAULT.
8.1 Sublessor hereby assigns and transfer to Master Lessor the Sublessor’s interest in this
Sublease, subject, however, to the provisions of Paragraph 8.2 hereof.
8.2 Master Lessor, by executing this document, agrees that until a Default shall occur in the
performance of Sublessor’s Obligations under the Master Lease, the Sublessor may receive, collect
and enjoy the Rent accruing under this Sublease. However, if Sublessor shall Default in the
performance of its obligations to Master Lessor then Master Lessor may, at its option, receive and
collect, directly from Sublessee, all Rent owing and to be owed under this Sublease. Master Lessor
shall not, by reason of this assignment of the Sublease nor by reason of the collection of the Rent
from the Sublessee, be deemed liable to Sublessee for any failure of the Sublessor to perform and
comply with Sublessor’s Remaining Obligations.
8.3 Sublessor hereby irrevocably authorizes and directs Sublessee upon receipt of any written
notice from the Master Lessor stating that a Default exists in the performance of Sublessor’s
obligations under the Master Lease, to pay to Master Lessor the Rent due and to become due under
the Sublease. Sublessor agrees that Sublessee shall have the right to rely upon any such statement
and request from Master Lessor, and that Sublessee shall pay such Rent to Master Lessor without any
obligation or right to inquire as to whether such Default exists and notwithstanding any notice
from or claim from Sublessor to the contrary and Sublessor shall have no right to claim against
Sublessee for any such Rent so paid by Sublessee.
8.4 No changes or modifications shall be made to this Sublease without the consent of Master
Lessor, which consent shall not be unreasonably withheld or delayed.
8.5 Default by Sublessee; Remedies. Sublessee shall be in material default of its
obligations under this Sublease if any of the events set forth in Section 27(a)(l) — (3) of the
Master Lease occur. On any default by Sublessee hereunder, Sublessor shall have all remedies
provided to Master Lessor under the Master Lease and under law or in equity which Sublessor may
pursue cumulatively or in the alternative.
9. CONSENT OF MASTER LESSOR.
9.1 This Sublease shall not be effective unless, within 15 days of the date hereof, Master
Lessor signs this Sublease thereby giving its consent to this Subletting.
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9.2 In the event that Master Lessor does give such consent then:
(a) Such consent shall not release Sublessor of its obligations or alter the primary liability
of Sublessor to pay the Rent and perform and comply with all of the obligations of Sublessor to be
performed under the Master Lease.
(b) The acceptance of Rent by Master Lessor from Sublessee or anyone else liable under the
Master Lease shall not be deemed a waiver by Master Lessor of any provisions of the Master Lease.
(c) The consent to this Sublease shall not constitute a consent to any subsequent subletting
or assignment.
(d) In the event of any Default of Sublessor under the Master Lease, Master Lessor may proceed
directly against Sublessor, any guarantors or anyone else liable under the Master Lease or this
Sublease without first exhausting Master Lessor’s remedies against any other person or entity
liable thereon to Master Lessor.
(f) In the event that Sublessor shall Default in its obligations under the Master Lease, then
Master Lessor, at its option and without being obligated to do so, may require Sublessee to attorn
to Master Lessor in which event Master Lessor shall undertake the obligations of Sublessor under
this Sublease from the time of the exercise of said option to termination of this Sublease but
Master Lessor shall not be liable for any prepaid Rent nor any Security Deposit paid by Sublessee,
nor shall Master Lessor be liable for any other Defaults of the Sublessor under the Sublease.
9.3 The signatures of the Master Lessor at the end of this document shall constitute its
consent to the terms of this Sublease.
9.4 Master Lessor acknowledges that, to the best of Master Lessor’s knowledge, no Default
presently exists under the Master Lease of obligations to be performed by Sublessor and that
the Master Lease is in full force and effect.
9.5 In the event that Sublessor Defaults under its obligations to be performed under the
Master Lease by Sublessor, Master Lessor agrees to deliver to Sublessee a copy of any such notice
of default. Sublessee shall have the right, but not the obligation, to cure any Default of
Sublessor described in any notice of default within ten days after service of such notice of
default on Sublessee. If such Default is cured by Sublessee then Sublessee shall have the right of
reimbursement and offset from and against Sublessor.
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10. BROKERS FEE.
10.1 Upon execution hereof by all parties, Sublessor shall pay to Spallino & Associates
Commercial Real Estate a licensed real estate broker
(“Broker”), a fee as set forth in a separate
agreement between Sublessor and Broker, or in the event there is no such separate agreement, the
sum of Six Percent (6%) of the rental income for the sublease term for brokerage services
rendered by Broker to Sublessor in this transaction.
10.2 —Any transferee of Sublessor’s interest in this Sublease, by accepting an assignment
thereof, shall be deemed to have assumed the obligations of Sublessor under this Paragraph 10.
Broker shall be deemed to be a third-party beneficiary of this Paragraph 10.
11. ATTORNEY’S FEES. If any party or the Broker named herein brings an action to enforce the terms
hereof or to declare rights hereunder, the prevailing party in any such action, on trial and
appeal, shall be entitled to his reasonable attorney’s fees to be paid by the losing party as fixed
by the Court.
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| Executed at: San Francisco, CA |
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MARKETTOOLS, INC. |
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on: 8/9/2006
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By
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/s/ Casey Eichler |
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Address:
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By
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Casey Eichler, CFO |
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“Sublessor” |
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| Executed at: Mill Valley, CA |
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REDWOOD TRUST, INC., a Maryland corporation |
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on: 8/9/2006
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By
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/s/ Loren Picard |
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Address:
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By
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Loren Picard |
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“Sublessee” |
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Executed at: San Francisco, CA |
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on: 8/9/06
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By
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/s/ Chris Bently |
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Address:
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By
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/s/ Amber Marie Bently |
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“Master Lessor” |
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MarketTools |
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Philip R Strauss |
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VP & General Counsel |
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8/9/2006 |
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Page 1 of 1
Philip Strauss
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From:
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Loren Picard [[email protected]] |
Sent:
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Wednesday, August 09, 2006 1:23 PM |
To:
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Brandt, Nancy L; Philip Strauss; csalomon |
Subject:
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RE: Belvedere Place/MarketTools Sublease to Redwood Trust |
All,
The change is acceptable to Redwood. Jack Spallino is currently circulating 4 sets of the sublease
for signature. Feel free to substitute the appropriate pages to align with the below email.
Thanks,
Loren
From: Brandt, Nancy L [mailto:
[email protected]]
Sent: Wednesday, August 09, 2006 12:46 PM
To: [email protected]; csalomon
Cc: Loren Picard
Subject: Belvedere Place/MarketTools Sublease to Redwood Trust
Importance: High
Phil and Charlotte,
Attached is an unmarked copy of the corrected sublease. Please print and sign three (3) originals
of this copy. As the parties have agreed that section 12 of the sublease is no longer applicable,
it is my understanding that Phil will strike out this paragraph on the originals and initial the
change. I will ask that Loren Picard confirm to both of you by e-mail that this change is
acceptable to Redwood Trust. Please let me know if you have any further questions.
Thanks for your assistance in wrapping this up.