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FORM 8-K
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EHEALTH, INC.
(Exact Name of Registrant as Specified in its Charter)
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Delaware
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001-33071
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56-2357876
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $0.001 per share
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EHTH
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The Nasdaq Stock Market LLC
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Item 1.01
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Entry into a Material Definitive Agreement
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Item 2.03
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
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Item 9.01
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Financial Statements and Exhibits.
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eHealth, Inc.
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Date:
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February 4, 2020
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/s/ Derek N. Yung
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Derek N. Yung
SVP, Chief Financial Officer
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1.
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Premises. The existing Premises is hereby confirmed to consist of approximately forty-four thousand, seven hundred thirty-eight (44,738) rentable square feet in Suite 100 on the first floor of the Building (“Suite 100”), approximately 13,034 rentable square feet in Suite 200 on the second floor of the Building (“Suite 200”), and approximately 5,434 rentable square feet in Suite 290 on the second floor of the Building (“Suite 290”), for a total of 63,206 rentable square feet which represents the entire Building E. The Tenant has maintained the current suite designation of “Suite 100.”
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2.
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Lease Expiration Date and Extension of Term. The term of the Lease is currently scheduled to expire on September 30, 2021 (“Current Term”). The Term of the Lease is hereby extended to December 31, 2027. The period between September 30, 2021 and December 31, 2027 is hereafter referred to as the “Extended Term”.
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3.
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Monthly Base Rent. The Base Rent for the Premises beginning on January 1, 2020 will be as follows:
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MONTH
OF THE TERM
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DATES
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MONTHLY BASE RENT PER SQUARE FOOT
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MONTHLY BASE RENT
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1-2
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1/1/20 to 2/29/20
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$2.17
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$137,157.00
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3-5
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3/1/20 to 5/31/20
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Free
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Free
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6-12
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6/1/20 to 12/31/20
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$2.17
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$137,157.00
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13-24
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1/1/21 to 12/31/21
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$2.22
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$140,317.00
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25-36
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1/1/22 to 12/31/22
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$2.27
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$143,478.00
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37-48
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1/1/23 to 12/31/23
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$2.32
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$146,638.00
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49-60
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1/1/24 to 12/31/24
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$2.37
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$149,798.00
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61-72
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1/1/25 to 12/31/25
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$2.42
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$152,958.00
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73-84
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1/1/26 to 12/31/26
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$2.47
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$156,119.00
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85-96
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1/1/27 to 12/31/27
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$2.52
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$159,279.00
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4.
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Base Year. Effective as of January 1, 2020 the “Base Year” as defined in the Lease shall be the Calendar year of 2020.
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5.
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Parking. The parking to be provided under the Lease to Tenant at no charge shall remain at 252 spaces at the Building (“Base Parking”) with an additional 100 spaces (“Extra Spaces”) at the Tributary Point Site at no charge. The total parking effective January 1, 2020 shall be 352 spaces at no charge to Tenant as provided herein.
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6.
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Tenant Improvements. Landlord, at Landlord’s sole cost and expense shall provide a “one time” refurbishment allowance of $800,000 ($12.66 per square foot) (the “Allowance”) to be used at Tenant’s sole discretion. Landlord and Tenant shall mutually agree on the improvements to be constructed for the Tenant and a construction budget. Landlord will select the contractor to perform the work, subject to Tenant’s approval. Except as provided herein, Tenant shall be responsible for the costs of any work which exceeds the Allowance. Landlord will provide Tenant copies of all statements, bills and other evidence for the work completed. Landlord will provide Tenant a Statement and bills or other invoices for any work which was completed that exceeded the Allowance and Tenant will pay the amounts requested by Landlord within 30 days of the request and approval of the underlying invoices and support materials. Except as provided herein, the Allowance may be used for all hard and soft costs incurred by Landlord for the permitting and construction of the improvements as well as any design or architectural costs incurred by Tenant in connection with the improvements and Tenant’s costs of furniture, fixtures and equipment (“Eligible Costs”). Notwithstanding the foregoing, Tenant may elect to apply all or any portion of the unused Allowance towards future Base Rent, in which event, except as otherwise provided herein, any Eligible Costs incurred by Landlord that exceed the available Allowance shall be paid by Tenant.
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7.
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Option to Renew. Tenant is hereby granted one (1) option to extend the Lease at the end of the Extended Term for either (a) an additional term of six months (the “Six Month Option Term”) or (b) an additional term of five (5) years (the “Five Year Option Term”); in each case, on the same terms and conditions set forth in this Lease, except as modified by the terms, covenants and conditions set forth below. Tenant shall provide written notice of its exercise of the foregoing option and the applicable Option Term at least six (6) months prior to the termination date of the Extended Term, and (ii) the Base Rent for the applicable Option Term will be at Fair Market Rent (as defined below) for the entire Option Term, but in no case will the Base Rent during the Option Term be less than the Base Rent at the expiration of the Extended Term. The Base Rent for each year of the Option Term will be subject to an annual increase of $0.05 per rental square foot. “Option Term” means either the Six-Month Option Term or the Five-Year Option Term, as applicable. The terms of Tenant’s option to renew the Lease as set forth in this Section 7 (the “Option to Renew”) are intended by the Parties to completely replace and supersede any such option contained in the Lease.
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8.
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Additional Lease Modifications. Notwithstanding anything to the contrary in the Lease, effective as of the Eleventh Amendment Effective Date, the Lease is modified as follows:
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a.
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Premises; Common Areas. Since Tenant occupies 100% of the Building, all interior areas of the Building shall be deemed part of the Premises and there shall be no interior common areas or Project Common Areas in the Building. The rentable square footage of the Premises shall be by 63,206 rentable square feet for all purposes under the Lease and shall be binding upon Landlord and Tenant for the Current Term and the Extended Term. The following is added after the third sentence of Section 14(c): “For avoidance of doubt and notwithstanding anything to the contrary herein, amounts payable by Tenant pursuant to this Section 14(c): (a) are limited to Landlord’s actual, direct, metered cost of gas and/or electricity used by Tenant outside of Business Hours (including any taxes on any such utilities) as billed by the applicable utility company, without mark-up or supplement; and (b) shall not be included in Operating Expenses for purpose of any operating expense pass-through.”
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b.
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Proportionate Share. Tenant’s Proportionate Share of the Premises shall be 100%. Tenant’s Proportionate Share of the Project shall be 12.9% and shall not be subject to modification unless the rentable square footage of other buildings in the Project is increased.
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c.
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Operating Expenses. Operating Expenses shall not include (i) the cost of any maintenance, alteration, repair, or improvement of any other building in the Project, (ii) expense reserves, (iii) insurance deductibles, (iv) costs incurred in connection with the presence of any hazardous material, except to the extent caused by the release or emission of the hazardous material in question by Tenant, and (v) the cost of replacing all or any major component of the HVAC units serving the Premises. In addition, Real Estate Taxes included in Operating
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d.
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Repair & Maintenance. Tenant may elect to perform, in lieu of Landlord’s performance, at Tenant’s cost and expense (i) janitorial service to the Premises and (ii) any repair, maintenance or replacement of any or all the plumbing, heating, electrical, air conditioning, ventilation and life safety systems in the Building. If Tenant notifies Landlord of its election to perform any of the foregoing, then Landlord shall no longer be required to perform such item and shall not include the cost of such item in Operating Expenses.
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e.
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Permitted Transfers. The parties agree that clause (i) of the last sentence of the second paragraph of Section 15(a) of the Lease is amended to refer to the trading of the stock of either Tenant or its direct or indirect parent on a national exchange.
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f.
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Surrender. At the expiration or earlier termination of the Lease, Tenant shall not be required to remove (i) any improvements referred to in Section 6 above or (ii) any other leasehold improvements or alterations (including any cabling) existing in the Premises as of the Eleventh Amendment Effective Date.
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g.
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SNDA. Landlord agrees that any non-disturbance agreement from any Superior Lienor shall contain such Superior Lienor’s agreement to be bound by Tenant’s right to apply any unused portions of the Allowance against Base Rent pursuant to Section 6 above.
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h.
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Abandonment. Section 24(a) of the Lease is hereby modified by deleting the parenthetical therein and adding the following: “For purposes of this Section 24(a), “abandonment” shall mean the vacating of the Premises by Tenant without providing a commercially reasonable level of security, or where the coverage of property insurance described in Section 18(f)(iii) of the Lease is jeopardized as a result thereof, or without providing reasonable assurance to minimize potential vandalism.”
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i.
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Rules & Regulations; Landlord’s Reserved Rights. Section 36 of the Lease is hereby amended by deleting clauses (a) through (c) of the first sentence thereof. In addition the Rules & Regulations attached as Exhibit D to the Lease are modified by deleting rules 1, 4, 6, 12, 17 and 20. Rule 7 is hereby modified by adding the following to the end of that Rule: “…or included as part of tenant improvements or otherwise approved by Landlord.” Rule 18 is hereby modified to delete from the first sentence the phase “and such times.” Rule 24 is hereby modified by deleting the first sentence of that Rule and replacing it with the following: “Tenant shall not mark, paint, drill into or in any way deface any part
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9.
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Broker/Dual Representation. Tenant and Landlord each represent and warrant that they have not been represented by any broker or agent in connection with the negotiation or execution of this Eleventh Amendment, except for Avison Young ("Broker") who represented both Landlord and Tenant. Landlord shall pay a commission to Broker pursuant to a separate written agreement. Tenant shall have no obligation to pay any commission in connection with this Eleventh Amendment. Tenant shall indemnify and hold harmless Landlord from and against all claims (including costs of defending against and investigating such claims) of any broker, agent or similar party (other than Broker) claiming by, through or under Tenant in connection with this Eleventh Amendment. Landlord shall indemnify and hold harmless Tenant from and against all claims (including costs of defending against and investigating such claims) of any broker, agent or similar party (including but not limited to Broker) claiming by, through or under Landlord in connection with this Eleventh Amendment.
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10.
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Capitalized Terms. All capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Lease and its amendments.
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10.
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Defenses. There are no existing defenses which Tenant has against the enforcement of the Lease by Landlord, and no offsets or credits against any amounts owned by Tenant pursuant to the Lease.
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11.
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Inconsistencies. This Eleventh Amendment is intended to modify the Lease and shall be deemed to amend any language in the Lease or its amendments which is contrary to the provisions set forth herein. Any covenant or provision of the Lease which is not inconsistent with this Eleventh Amendment shall remain in full force and effect.
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12.
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Counterparts. This Eleventh Amendment may be executed in any number of counterparts all of which taken together shall constitute one and the same instrument. A facsimile signature on this Eleventh Amendment shall be binding as an original.
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13
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Assignment. Tenant has not made any prior assignment, hypothecation or pledge of the Lease or the rents due thereunder.
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By:
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/s/ James R. Carlsen
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Name:
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James R. Carlsen
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Its:
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Managing Member
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Date Signed:
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1/29/2020
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By:
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/s/ David K. Francis
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Name:
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David K. Francis
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Its:
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COO
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Date Signed:
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1/29/2020
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