TARGET SHOPS HONOLULU WEST

Month Day, 2008

Roger Lyons
First Vice President
CB Richard Ellis, Inc.
1003 Bishop Street, 18th Floor
Honolulu, HI 96813
Re:

Letter of Intent to Lease

Space No. *** , Target Shops Honolulu West

Dear Roger:
This Letter of Intent shall serve to outline a proposal for the lease of space at the Target
Shops Honolulu West, at Honolulu, Hawaii. As more fully explained below, this proposal does
not constitute a binding agreement between the parties. It only evidences Tenants offer to negotiate
in good faith with Landlord for a lease of space in the Center. The basic terms of the proposal are as
follows:

A. Landlord:

Target Corporation, a Minnesota corporation,

1000 Nicollet Mall
Minneapolis, Minnesota 55403

B. Tenant: ***
C. Tenant's Trade Name: ***
D. Effective Date: December 5, 2008 (intended date for fully executed lease).
E. Premises:
Space No.*** having approximately *** sq. ft. of Floor Area, shown in
the approximate location identified on the Building Plan attached hereto as Exhibit A.
F. Permitted Use of Premises: Tenant shall use the Premises only for the following
purpose: *** Any changes to said use or the format of Tenants business shall require
the prior written consent of Landlord.
G. Lease Term: ***Years
H. Option: Tenant shall have one (1) successive option to extend the Lease Term for a
period of sixty (60) months (Option Term) at the then fair market rent exercisable in
writing no less than 180 calendar days prior to the expiration of the original lease term.
Option rent shall not be less than the rent paid in the preceding period;

I. Rent Commencement Date: Rent and all other charges shall commence upon sixty (60)
days after Delivery. Tenant agrees upon execution of this Letter of Intent to commence
design drawings and submit plans to Landlord for approval within 45 days. Tenant agrees
to apply for building permit within 5 days after approval of Tenants plans by Landlord.
J. Delivery Date: Landlord shall deliver the Premises for possession to Tenant on or about
December 8, 2008.
K. Minimum Rent:
Minimum
Annual
Rent
***

Minimum Rent Per

Square Foot
Per Annum
***

Lease Year 1 (* Rent Commencement Date)

Minimum Rent shall increase annually at a rate of three percent (3%) for duration of
the initial lease term.
L. Percentage Rent: In addition to the Minimum Rent, Tenant shall pay in excess of $***
to Landlord a percentage rent equal to *** percent (***%) of Tenants gross sales.
Percentage Rent shall be paid monthly, subject to annualization.
M. General Excise Tax Rate: Tenant shall pay the Hawaii General Excise Tax on all rent.
The current effective rate is 4.712%.
N. Taxes and Insurance Expense: Tenant shall reimburse Landlord for all taxes assessed
for any reason and levied on the Premises and the realty underlying the Premises and the
cost to Landlord of Property and Liability insurance maintained by Landlord on the
Center, which amount will be included in the Common Area Expense set forth below.
Tenant shall pay the Hawaii Conveyance Tax assessed as a result of this lease, due upon
execution thereof, directly to the taxing authority. Tenant shall be responsible for
maintaining its own policy of commercial general liability insurance for the Premises and
a policy of property insurance (ISO Special Form) for all furniture, fixtures, inventory
and other improvements made by Tenant within the Premises, together with business
interruption, with Landlord being named as an additional insured thereunder, all in
accordance with the requirements to be set forth in the lease agreement
O. Utilities: Tenant shall pay for its own utilities including but not limited to water, sewer,
gas and electricity consumed within the Premises, including the costs of utilities
furnished by Landlord, if any, to the Premises, whether directly assessed or reasonably
allocable to Tenant. Landlord shall stub utility conduits and air conditioning system to
the Premises, but Tenant shall be responsible for distribution of utilities within the
Premises and for all utility hook-up charges.

P. Common Area Expense: Tenant shall pay its share of the cost of ownership, operation,
maintenance and management of the common areas of the Center. Tenant's share of such
costs shall be that portion of all such expenses equal to the proportion thereof which the
number of square feet of floor area in the Premises bears to the total number of rentable
square feet of floor area in the Center. The estimated monthly Common Area Expense
charge for the first year is $8.40/sf/year.
Q. Landlords Delivery:
a. Storefront with minimum one standard entry door and one rear delivery door
(where applicable) as shown on Landlords plan.
b. Demising walls framed (but not drywalled) or concrete as shown on Landlords
plan.
c. Plumbing stubbed to Premises, in the location shown on Landlords drawings.
Tenant shall install a water sub-meter in a location within the Premises that can
easily be read by Landlord.
d. Air conditioning unit packaged with 1 ton per 250sf. Special requirements or
loads that exceed this configuration are the sole responsibility of the Tenant.
e. Landlord shall provide conduits for electrical power lines extending from the
main electrical room into the demised premises. Landlord shall provide a meter
socket for a maximum service of 200 amps (120/208 volts, 3-phase, 4 wire
service). Tenant shall provide all necessary cabling extending from the main
electrical room within the Landlord supplied conduits into the space and place
Tenant's own electrical panel within the space. Tenant shall make arrangements
with the local utility to provide an electrical meter for the space within the main
electrical room, at Tenants sole cost and expense.
f. Telephone conduit shall be provided by Landlord in a size and location shown on
Landlords plan.
R. Security Deposit: Upon execution of the lease agreement, Tenant shall deposit an
amount equal to 1 months gross rent plus G.E. Tax (4.712%) with Landlord to secure
Tenants performance under the lease agreement. Landlord shall hold the deposit,
without interest, for the term of the lease agreement.
S. Tenants Work. Tenant, at Tenants expense, shall improve the Premises and install trade
fixture and signage suitable to Tenants use of the Premises, subject to Landlords prior
written approval.
It is understood that Tenants plans and specifications for
improvements are subject to the approval of the applicable local government authorities
and Landlord. Signage must be in compliance with Comprehensive Sign Plan.
.
T. Tenant Improvement Allowance. Landlord shall pay to Tenant an improvement
allowance up to an aggregate of, but not more than ****, to reimburse Tenant for the

necessary costs and expenses actually incurred by Tenant in the design and construction
of Tenant's Work, which amount shall be reimbursed to Tenant within fifteen (15) days of
Landlords receipt of said cost certification; provided that payment shall not be made
until the earlier of (a) the date that Tenant has procured unconditional lien waivers and
indemnity forms from all contractors and materialmen performed work in the demised
premises, or (b) the date the "mechanic's lien period" for such construction and materials
acquisition shall have expired.
U. Guarantor: ***
V. Landlord's Broker: CB Richard Ellis
W. Tenant's Broker: ***
i. Landlord has entered into an agreement with Landlord's Broker, and
Landlord shall pay any commissions or fees that are payable to Landlord's
Broker with respect to this Lease in accordance with provisions of a
separate commission contract. Landlord shall have no further or separate
obligation for payment of commissions or fees to any other real estate
broker, finder or intermediary.
X. Lease Agreement. Upon the acceptance by Tenant and Landlord of the terms of this
Letter of Intent, Landlord shall instruct its attorneys to prepare a form of lease agreement
which contains the standard terms and conditions for Landlords leases in the Center,
which conforms with the terms hereof and which contains such other terms and
conditions as may be mutually agreed to by Landlord and Tenant. The lease agreement
shall not be binding on the parties until both of the parties have executed and delivered
the lease agreement.
Y. Financial Contingency: Tenant shall submit a complete set of financials to Landlord.
Any agreement in lease terms shall be subject to review and approval by the Landlord of
the above stated financials.
Z. Nature of this Letter of Intent: As noted above, this Letter of Intent constitutes
Tenants offer to negotiate with Landlord. If the terms of this Letter of Intent are
accepted by Landlord, this Letter of Intent shall only constitute the agreement of Tenant
and Landlord to negotiate with each other in good faith for a lease of space in the Center
having the basic terms set forth in this Letter of Intent. This Letter of Intent may not be
relied upon by any party as evidence of a binding agreement or commitment between
Landlord and Tenant for a lease of space in the Center, and no legal rights and obligations
between the parties shall be created or deemed to exist with respect to the Premises until
the parties have fully executed and delivered the lease agreement described above.
AA.
Confidentiality: The parties shall maintain in the strictest confidence all matters
concerning (1) the terms of this Agreement, (2) any information or documentation related
to the negotiations relating to this Agreement, and (3) the transaction set forth in this

Agreement. If asked about any of the above matters, each party shall respond that it is
not at liberty to discuss these matters because they are the subject of a confidentiality
agreement. Notwithstanding the foregoing, the parties may disclose (i) information
necessary to enforce their rights under this Agreement, (ii) information which the parties
are required to disclose pursuant to due process of law, and (iii) such limited information
concerning this Agreement to such persons required to have knowledge of such
information in order for the parties to comply with the terms and conditions of this
Agreement. Landlord and Tenant agree not to issue any press release or make any public
disclosure concerning the transaction contemplated hereby without the prior written
approval of the other party, and agree not to disclose such matters except to such
attorneys, accountants, lenders and others as are reasonably required in order to
consummate the transaction. A breach of this covenant shall entitle the aggrieved party to
damages caused by such disclosure as well as injunctive relief. The term of this
paragraph shall survive the expiration or termination of this Letter of Intent.
We look forward to your response to the above. Please contact us should you have any
comments or questions.
Very truly yours,
By:
Its:

Exhibit A