OFFICE
LEASE
BY AND BETWEEN
235 SECOND STREET LLC,
A CALIFORNIA LIMITED LIABILITY COMPANY
AS LANDLORD
AND
CNET NETWORKS, INC.,
A DELAWARE CORPORATION
AS TENANT
PREMISES:
235 SECOND STREET
SAN FRANCISCO, CALIFORNIA
OFFICE LEASE
SUMMARY OF LEASE TERMS
235 Second Street
San Francisco, California
A.
Date:
May 1, 2000
B.
Landlord:
235 SECOND STREET LLC,
a California limited liability company
Landlord's address for notices:
[Paragraph 26(k)]
c/o Birmingham Builders
1475 Folsom Street, Suite 400
San Francisco, CA 94107
Attention: Robert Birmingham
with a copy to:
John K. Smith, Esq.
Haley, Purchio, Sakai & Smith
P. O. Box 450
Hayward, CA 94543
C.
Tenant:
CNET NETWORKS, INC.,
a Delaware corporation
Tenant's address for notices:
[Paragraph 26(k)]
Before the Commencement Date:
150 Chestnut Street
San Francisco, CA 94111
Attention: Mary Eisner
Following the Commencement Date:
235 Second Street
San Francisco, CA 94105
Attention: Mary Eisner
Tenant Contact Person:
Mary Eisner
D.
Rentable area of Premises:
[Paragraph 1(u)]
283,416 square feet
E.
Tenant's Percentage Share:
[Paragraph 1(aa)]
1
F.
Lease Term:
[Paragraph 2]
The term of this Lease shall before
approximately fifteen (15) years
Target Delivery Date:
July 1, 2001
Outside Delivery Date:
December 1, 2001
Commencement Date:
The Date of Substantial Completion (as
defined in Paragraph 1.6(b) of the Work
Letter) or the date Substantial
Completion of the Base Building
Improvements would have occurred
absent any Tenant Delay (as defined in
Paragraph 1.6(h) of the Work Letter).
Expiration Date:
The last day of the calendar month in
which the fifteenth (15th) year
anniversary of the Commencement
Date shall occur; provided, however,
that if the Commencement Date shall
have occurred on the first day of a
calendar month, the Expiration Date
shall be the last day of the calendar
month immediately preceding the
fifteenth (15th) year anniversary of the
Commencement Date.
G.
Basic Rental:
[Paragraph 3(a)]
Rent Commencement Date:
If the Commencement Date occurs on
or before May 1, 2001, then the Rent
Commencement Date shall be June 1,
2001. If the Commencement Date
occurs after May 1, 2001, then the Rent
Commencement Date shall be the
earlier of (i) sixty (60) days after the
Commencement Date or (ii) the date
Tenant commences business
operations in any portion of the
Premises.
H.
Security Deposit:
[Paragraph 3(e)]
$1,417,080
I.
Landlord's Broker(s):
[Paragraph 26(t)]
Grubb & Ellis Company
J.
Tenant's Broker(s):
[Paragraph 26(t)]
Cushman & Wakefield of California, Inc.
K.
Exhibits and addenda:
[Paragraph 26(y)]
Exhibit A - Floor Plans
Exhibit B - Option Properties
Exhibit C - Work Letter
Exhibit D - Commencement Date
Memorandum
Exhibit E - Contemplated Uses
Exhibit F - Form of Estoppel Certificate
Exhibit G - Building Rules and
Regulations
The provisions of the Lease identified above in brackets are those provisions
where references to particular Lease Terms appear. Each such reference shall
incorporate the applicable Lease Terms. In the event of any conflict between
the Summary of Lease Terms and the Lease, the latter shall control.
LANDLORD:
235 SECOND STREET LLC,
a California limited liability company
By:
Robert Birmingham
Managing Member
TENANT:
CNET NETWORKS, INC.,
a Delaware corporation
By:
David Overmyer
Vice President, Finance and
Administration
235 SECOND STREET
SAN FRANCISCO, CALIFORNIA
OFFICE LEASE
THIS LEASE is dated for reference purposes only as of
May 1, 2000 between 235 SECOND STREET LLC, a California
limited liability company ("Landlord"), and CNET NETWORKS,
INC., a Delaware corporation ("Tenant").
W I T N E S S E T H:
Landlord hereby leases to Tenant and Tenant hereby
leases from Landlord the Premises described in Paragraph 1(u)
below, for the term and subject to the terms, covenants,
agreements and conditions hereinafter set forth.
1. DEFINITIONS. In addition to terms that are defined
elsewhere in this Lease, unless the context otherwise specifies or
requires, the following terms shall have the meanings herein
specified:
(A) The term "Applicable Laws" shall mean all
laws, statutes, ordinances, orders, judgments, decrees,
regulations, permits, and requirements of all courts and
governmental authorities now or hereafter in effect and applicable
to the Real Property, including, without limitation, Title III of the
Americans With Disabilities Act of 1990 and all regulations and
guidelines promulgated thereunder (the "ADA") and Environmental
Laws.
(B) The term "Base Building Improvements"
shall mean the improvements which are to be installed in the
Building by Landlord pursuant to the Work Letter.
(C) The term "Base Building Systems" shall
mean the portions of the heating, ventilation, and air conditioning
("HVAC"), electrical, plumbing, life safety, elevator and sprinkler
systems of the Building installed by Landlord as part of the Base
Building Improvements.
(D) The term "Building" shall mean the office
building located at 235 Second Street in San Francisco, California.
(E) The term "Building Structure" shall mean the
basic structural and exterior elements of the Building, including the
foundations, structural columns, beams, floor slabs, the exterior
curtainwall, windows and the roof.
(F) The term "business day" shall mean any day
other than a Saturday or Sunday or legal holiday in the State of
California.
(G) The term "Common Areas" shall mean all
areas of the Building made available by Landlord from time to time
for the general common use or benefit of the tenants of the Building,
and their employees and invitees. At such time, if any, as the
Building shall become a multi-tenant building, Landlord shall have
the right to change the size, configuration, design, layout and all
other aspects of the Common Areas, and Tenant acknowledges
and agrees that Landlord may, without incurring any liability to
Tenant and without any abatement of Rental under this Lease,
from time to time, close-off or restrict access to the Common Areas
for purposes of permitting or facilitating any construction, alteration,
repairs or improvements, provided that Tenant's access to the
Building, or any other express right of Tenant under this Lease,
shall not be materially impaired.
(H) The term "control" shall mean, with respect
to a corporation or a limited liability company, the right to exercise,
directly or indirectly, more than fifty percent (50%) of the voting
rights attributable to the shares or membership interests of the
controlled entity and, with respect to an entity that is not a
corporation, the possession, directly or indirectly, of the power at all
times to direct or cause the direction of the management of the
controlled entity.
(I) The term "Core Areas" shall mean those
areas in the Building within the core, shaft and mechanical areas,
but excluding the restrooms, useable storage space, janitorial,
electrical and telecommunications closets, and any other areas that
are part of the Premises.
(J) The term "Environmental Laws" shall mean
all laws now or hereafter in force, as amended from time to time, in
any way relating to or regulating human health or safety, or
industrial hygiene or environmental conditions, or protection of the
environment, or pollution or contamination of the air, soil, surface
water or groundwater.
(K) The term "Exempt Transfer" or "Exempt
Transfers" shall mean the transfer of an Option Property or any
interest therein (made in good faith and not for the purpose of
evading the provisions of Paragraphs 29, 30 or 31 hereof) to any
partnership, limited liability company, corporation or other entity in
which the then current Landlord or one or more of the then current
members or partners of Landlord has either singly or in the
aggregate at least a majority interest; transfers by members or
partners of the then current Landlord by way of sale, gift or devise
to lineal descendents, parents, siblings, or spouses, or to a trust for
the benefit of one or more of such persons; transfers to a Landlord
Affiliate; or transfers at a public auction, transfers by deed in lieu of
foreclosure, or transfers in lieu of condemnation.
(L) The term "Expense Year" shall mean each
calendar year in which any portion of the Lease Term falls, through
and including the calendar year in which the Lease Term expires,
provided that Landlord, upon notice to Tenant, may change the
Expense Year from time to time to any other twelve (12)
consecutive month period, and, in the event of any such change,
Tenant's Percentage Share of Real Property Taxes and Operating
Expenses shall be equitably adjusted for any Expense Year
involved in any such change.
(M) The term "Hazardous Material" shall mean by
way of illustration, and without limitation: (i) those substances
included within the definitions of "hazardous substances," "hazardous
materials," "toxic substances" or "solid waste" under all present and
future federal, state and local laws (whether under common law,
statute, rule, regulation or otherwise) relating to the protection of
human health or the environment, including California Senate Bill 245
(Statutes of 1987, Chapter 1302), the Safe Drinking Water and Toxic
Enforcement Act of 1986 (commonly known as Proposition 65) and
the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.,
the Resource Conservation and Recovery Act of 1976, 42 U.S.C.
Section 6901 et seq., and the Hazardous Materials Transportation
Act, 49 U.S.C. Sections 1801, et seq., all as heretofore and hereafter
amended, or in any regulations promulgated pursuant to said laws;
(ii) those substances defined as "hazardous wastes" in
Section 25117 of the California Health & Safety Code or as
"hazardous substances" in Section 25316 of the California Health &
Safety Code, or in any regulations promulgated pursuant to said
laws; (iii) those substances listed in the United States Department of
Transportation Table (49 CFR 172.101 and amendments thereto) or
designated by the Environmental Protection Agency (or any
successor agency) as hazardous substances (see, e.g., 40 CFR Part
302 and amendments thereto); (iv) such other substances, materials
and wastes which are or become regulated under applicable local,
state or federal law or by the United States government or which are
or become classified as hazardous or toxic under federal, state or
local laws or regulations, including California Health & Safety Code,
Division 20, and Title 26 of the California Code of Regulations; and
(v) any material, waste or substance which contains petroleum,
asbestos or polychlorinated biphenyls, is designated as a "hazardous
substance" pursuant to Section 311 of the Clean Water Act of 1977,
33 U.S.C. Sections 1251, et seq. (33 U.S.C. 1321), is listed
pursuant to Section 307 of the Clean Water Act of 1977 (33 U.S.C.
1317), or contains any flammable, explosive or radioactive material.
(N) The term "Land" shall mean the parcel(s) of
land on which the Building is located.
(O) The term "Landlord Affiliate" shall mean any
corporation, limited liability company or other entity (i) which
controls, is controlled by, or is under common control with
Landlord, or (ii) into which or with which Landlord is merged or
consolidated, or (iii) to which all or substantially all (at least ninety
percent (90%)) of Landlord's assets are transferred.
(P) The term "Lease Year" means each
consecutive twelve (12) month period during the Lease Term,
commencing on the Commencement Date.
(A) The term "Net Worth" shall mean the net
worth of an entity based upon financial statements prepared by a
nationally recognized accounting firm in accordance with generally
accepted accounting principles, but excluding amounts allocated to
intangible assets, including goodwill.
(R) (I) The term "Operating Expenses" shall
mean the total costs and expenses incurred by Landlord in
connection with the ownership, management, operation,
maintenance and repair of the Real Property (as defined in
Paragraph 1(v) hereof) and Common Areas (as defined in
Paragraph 1(g) hereof), including, without limitation, the following
costs: (1) premiums and other charges incurred by Landlord with
respect to the insurance Landlord carries pursuant to Paragraph
14(e) below, and costs of repairing an insured casualty to the
extent of the deductible amount under the applicable insurance
policy, provided that in no event shall Tenant be required to pay the
deductible amount under any applicable earthquake policy;
(2) water charges and sewer rents or fees; (3) license, permit and
inspection fees and charges, the reasonable cost of contesting any
governmental enactments which may affect Operating Expenses,
and the costs incurred in connection with any transportation system
management program or similar program; (4) sales, use and excise
taxes on goods and services purchased by Landlord in connection
with the performance of Landlord's maintenance and repair
obligations under this Lease; (5) at such time, if at all, as the
Building shall become a multi-tenant building, reasonable
management fees and expenses, taking into consideration the
scope of management services provided by Landlord or a third
party; (6) the cost of performing Landlord's repair and maintenance
obligations under this Lease, including the repair and replacement
of worn-out equipment, facilities and installations, but excluding
capital expenditures (except as expressly included in clause (11)
below); (7) inspection or service contracts for elevator, electrical,
mechanical, sanitary, HVAC, and other building equipment and
systems; (8) supplies, tools, materials and equipment used in
connection with the performance of Landlord's maintenance and
repair obligations under this Lease; (9) accounting, legal and other
professional, consulting or service fees and expenses; (10) all
costs and expenses for electricity, chilled water, air conditioning,
water for heating, gas, fuel, steam, heat, lights, sewer service,
communications service, power and other energy related utilities
required in connection with the operation, maintenance and repair
of the Real Property; (11) if the extraordinary use of the HVAC
system by Tenant shall result in the necessity to make capital
improvements that would not have been required if Tenant had
utilized the HVAC system in a manner consistent with customary
business hours and practices, the cost of any capital improvements
or repairs made by Landlord to the HVAC system or components
thereof, such cost or allocable portion thereof to be amortized over
the useful life thereof as reasonably determined by Landlord,
together with interest on the unamortized balance at a rate per
annum equal to the Reference Rate (as defined in Paragraph 3(c)
hereof) charged at the time such capital improvements or capital
repairs are made or such higher rate as may have been paid by
Landlord on funds borrowed for the purpose of making such capital
improvements or capital repairs, but in either case not more than
the maximum rate permitted by law at the time such capital
improvements or capital repairs are made (the "Amortization
Rate"); and (12) payments under any easement, license, operating
agreement, declaration, restrictive covenant or instrument
pertaining to the sharing of costs by the Building, provided that any
such instruments entered into after the date of this Lease shall be
approved by Tenant, which approval shall not be unreasonably
withheld or delayed. Operating Expenses shall be determined in
accordance with sound real estate management practices.
(II) To the extent costs and expenses
described above relate to both the Real Property and other
property or relate to the Common Areas, such costs and expenses
shall, in determining the amount of Operating Expenses, be
allocated as Landlord may reasonably determine to be appropriate.
(III) Notwithstanding Paragraph 1(r)(i)
above, Operating Expenses shall not include the following:
(1) depreciation on the Building; (2) debt service; (3) interest
(except as expressly provided in this Paragraph 1(r)), principal, late
charges, default fees, prepayment penalties or premiums on any
debt owed by Landlord, including any mortgage debt; (4) attorneys'
fees and other expenses incurred in connection with lease
negotiations, terminations, or extensions or in proceedings
involving a specific tenant; (5) the cost of any improvements or
equipment which would be properly classified as capital
expenditures (except for any capital expenditures expressly
included in Operating Expenses pursuant to this Paragraph 1(r));
(6) the cost of decorating, improving for tenant occupancy, painting
or redecorating portions of the Building to be demised to tenants;
(7) advertising expenses relating to vacant space; (8) real estate
brokers' or other leasing commissions; (9) amounts paid directly by
Tenant or any other tenant or occupant of the Building, or by
Landlord's or Tenant's insurance carrier or by any other third party;
(10) any bad debt loss, rent loss, or reserves for bad debts or rent
loss, provided that Tenant timely pays all Rental when due
hereunder; (11) expenses of extraordinary services provided to
other tenants in the Building which are made available to Tenant at
cost or for which Tenant is separately charged; (12) costs paid to
Landlord or to affiliates of Landlord for services in the Building to
the extent the same materially exceed the costs for such services if
rendered by unaffiliated third parties on a competitive basis;
(13) electric power costs for which any tenant directly contracts
with the local public service company; (14) expenditures required
solely by reason of the failure of the Base Building Improvements
to comply with Applicable Laws as of the Commencement Date;
(15) the cost of removal or remediation of Hazardous Materials (as
defined by Applicable Laws in effect on the Commencement Date)
in, on, or under the Land or in the Base Building Improvements,
except to the extent such costs are incurred as a result of the
exacerbation of a condition involving Hazardous Materials by
Tenant or Tenant's Agents or Tenant's failure to comply with the
provisions of this Lease; (16) costs of constructing the Base
Building Improvements; (17) costs of correcting any latent defects
in the Base Building Improvements, of which Tenant has notified
Landlord in writing within twelve (12) months after Substantial
Completion thereof; and (18) costs incurred solely by reason of
Landlord's default under this Lease.
(S) The term "Option Property" or "Option
Properties" shall mean the properties designated as Building 1,
Building 2, Building 3, Building 4, and Building 5 on Exhibit B,
which Landlord, Robert Birmingham ("Birmingham"), or an entity in
which Birmingham has an ownership interest, currently owns in fee,
or in which Landlord, Birmingham, or an entity in which Birmingham
has an ownership interest acquires fee title interest or a ground
lessee's interest at any time during the Lease Term, including the
Real Property; provided, however, that nothing contained in this
Section 1(s) or elsewhere in this Lease shall constitute or be
deemed to constitute a covenant, representation, or warranty on
the part of Landlord or Birmingham that Landlord or Birmingham
will in fact acquire an interest in the properties designated on
Exhibit B, and neither Landlord nor Birmingham shall have any
liability whatsoever to Tenant for their failure to do so. Tenant
agrees not to pursue the leasing or purchase of the Option
Property designated as Building 4 on Exhibit B with any party
(other than with Landlord pursuant to Paragraphs 29, 30 and 31
below), unless and until Building 4 is transferred in a bone fide
transaction to a third party in which neither Landlord nor
Birmingham has an ownership interest. Further, Tenant shall not
enter into any substantive discussions regarding Building 4 without
the prior written approval of Landlord, which may be withheld in
Landlord's sole and absolute discretion, unless and until Building 4
is transferred to a third party in which neither Landlord nor
Birmingham has an ownership interest.
(T) The term "Parking Facilities" shall mean the
area on the ground floor of the Premises designated from time to
time by Tenant for the parking of vehicles, subject to Applicable
Laws.
(U) The term "Premises" shall mean the space in
the Building depicted on the floor plans attached hereto as
Exhibit A, together with the appurtenant right to the use, in common
with other tenants of the Building and their employees and invitees,
of the Common Areas. Notwithstanding Paragraph 6(a), Landlord
and Tenant hereby stipulate that the Premises contain the number
of square feet of rentable area specified in Paragraph D of the
Summary of Lease Terms, and Tenant shall have no right to re-
measure the Premises. Except as expressly provided herein,
Landlord reserves the non-exclusive right to all the outside walls
and windows of the Premises and to the extent reasonably
necessary for purposes of operation, maintenance, improvements
and repairs, any space in the Premises used for shafts, stacks,
pipes, conduits (excluding cabling therein installed by Tenant),
ducts, electric or other utilities, or other Building facilities, and the
use thereof and access thereto through the Premises.
(V) The term "Real Property" shall mean,
collectively, the Land, the Building, and the utilities, facilities,
drives, walkways, and other amenities appurtenant to or servicing
the Building.
(W) The term "Real Property Taxes" shall mean
all taxes, assessments (whether general or special), excises,
transit charges, housing fund assessments or other housing
charges, levies or fees, ordinary or extraordinary, unforeseen as
well as foreseen, of any kind, which are assessed, levied, charged
or imposed by the United States of America, the State of California,
the City and County of San Francisco, any political subdivision,
public corporation, district or other political or public entity or public
authority (i) on the Real Property or any part thereof, (ii) on
Landlord with respect to the Real Property, (iii) on the act of
entering into this Lease or any other lease of space in the Real
Property, (iv) on the use or occupancy of the Real Property or any
part thereof, (v) with respect to services or utilities consumed in the
use, occupancy or operation of the Real Property, (vi) on or
attributable to personal property used in connection with the
Building, including the Common Areas, (vii) related to any
transportation plan, fund or system affecting the Building (excluding
the Transit Impact Development Fee imposed pursuant to Chapter
38 of the San Francisco Administrative Code), and (viii) relating to
or on or measured by the rent payable under this Lease or in
connection with the business of renting space in the Real Property,
including, without limitation, any gross income tax, gross receipts
tax or excise tax levied with respect to the receipt of such rent, and
shall also include any other tax, fee or other excise, however
described, which may be levied or assessed in lieu of, as a
substitute (in whole or in part) for, or as an addition to, any other
Real Property Taxes. Real Property Taxes shall include
reasonable attorneys' fees, costs and disbursements incurred in
connection with proceedings to contest, determine or reduce Real
Property Taxes.
Real Property Taxes shall not include income, franchise,
transfer, inheritance or capital stock taxes, unless, due to a change
in the method of taxation, any of such taxes is levied or assessed
against Landlord in lieu of, as a substitute (in whole or in part) for,
or as an addition to, any other charge which would otherwise
constitute a part of Real Property Taxes.
Further, notwithstanding the foregoing, if at any time during
the Lease Term, any sale or change in ownership of the Building is
consummated and, as a result, all or part of the Building is
reassessed ("Reassessment") for real estate tax purposes by the
appropriate government authority under the terms of Proposition 13
(as adopted by the voters of the State of California in the June
1978 election), then Tenant shall not be obligated to pay any
portion of the Tax Increase relating to the Reassessment. For
purposes of this Paragraph, the term "Tax Increase" shall mean
that portion of the Real Property Taxes, as calculated immediately
following the Reassessment, that is attributable solely to the
Reassessment. Accordingly, a Tax Increase shall not include any
portion of the Real Property Taxes that is (i) attributable to the
initial assessment of the value of the Building, the Base Building
Improvements, or the tenant improvements located in the Building;
(ii) attributable to assessments pending immediately before the
Reassessment that were conducted during, and included in, the
Reassessment or that were otherwise rendered unnecessary
following the Reassessment; or (iii) attributable to the annual
inflationary increases in Real Property Taxes, including inflationary
increases calculated on the value of the Real Property following the
Reassessment, whenever occurring, or (iv) changes in tax rates.
(X) The term "Rental" shall mean the Basic
Monthly Rental set forth in Paragraph 3(a) below, all additional
rent, and any other costs or charges payable by Tenant to Landlord
under this Lease or the Work Letter.
(Y) The term "Tenant Affiliate" shall mean any
corporation, partnership, limited liability company or other business
entity which (i) is controlled by, controls, or is under common
control with CNET NETWORKS, INC.; or (ii) is the corporation or
other business entity resulting from a merger, consolidation or
other non-bankruptcy reorganization with CNET NETWORKS,
INC.; or (iii) purchases all or substantially all (at least ninety percent
(90%)) of the assets of CNET NETWORKS, INC. as a going
concern.
(Z) The term "Tenant Improvements" shall have
the meaning set forth in Paragraph 1.6(l) of the Work Letter.
(AA) The term "Tenant's Percentage Share" shall
mean the percentage figure specified in Paragraph E of the
Summary of Lease Terms.
(BB) The term "Work Letter" shall mean Exhibit C
attached hereto and made a part hereof.
2 TERM.
(A) The term of this Lease (the "Lease Term")
shall commence and, unless ended sooner as herein provided,
shall expire on the dates respectively specified in Paragraph F of
the Summary of Lease Terms (respectively referred to hereinafter
as the "Commencement Date" and the "Expiration Date").
Landlord and Tenant hereby agree to confirm the actual
Commencement and Expiration Dates within ten (10) days
following the commencement of the Lease Term by executing and
delivering to each other counterparts of a Commencement Date
Memorandum in the form of Exhibit D attached hereto, but the
Lease Term shall commence on the Commencement Date and end
on the Expiration Date whether or not such Memorandum is
executed. This Lease shall be a binding contractual obligation
effective upon execution and delivery hereof by Landlord and
Tenant, notwithstanding the later commencement of the Lease
Term.
(B) Except as expressly set forth in this Lease,
including the Work Letter, Tenant agrees to accept possession of
the Premises in their "as is" condition, without representation or
warranty by Landlord, express or implied, and with no obligation of
Landlord to repaint, remodel, repair, improve or alter the Premises,
or to perform any construction, remodeling or other work of
improvement upon the Premises, or contribute to the cost of any of
the foregoing. Tenant also acknowledges that neither Landlord nor
any agent of Landlord has made any representation or warranty
regarding the condition of the Premises or the Building or with
respect to the suitability of any of the foregoing for the conduct of
Tenant's business, except as expressly set forth in this Lease.
(C) Tenant agrees that in the event Tenant
enters the Premises prior to the Commencement Date for any
reason, including for the purpose of preparing the Premises for
Tenant's occupancy, such entry shall be pursuant to all of the
terms, covenants and conditions of this Lease, including, without
limitation, Tenant's indemnity obligations contained in
Paragraph 13 below, but excluding the obligation to pay Basic
Monthly Rental or Tenant's Percentage Share of Operating
Expenses and Real Property Taxes, as provided in Paragraph 4
below.
(D) If Landlord does not cause the Base Building
Improvements to be Substantially Complete (as defined in
Paragraph 1.6(g) of the Work Letter) by the Target Delivery Date or
the Outside Delivery Date, this Lease shall not be void or voidable,
and Landlord shall not be deemed in default or otherwise liable to
Tenant for any claims, damages or liabilities in connection
therewith or by reason thereof, except as follows:
(I) If Landlord does not cause the Base
Building Improvements to be Substantially Complete on or before
the Target Delivery Date set forth in Paragraph F of the Summary
of Lease Terms (as the same may be extended), then Tenant shall
be entitled to receive two (2) days of free Monthly Basic Rental for
each day of "Tenant Substantial Completion Delay", which means
the number of days equal to the lesser of (A) the number of days
following the Target Delivery Date that Landlord fails to cause the
Base Building Improvements to be Substantially Complete, or (B)
the number of days Substantial Completion of the Tenant
Improvements is actually delayed as a result of such failure by
Landlord. Such amount shall be credited to Tenant immediately
following the Rent Commencement Date. In the event of any
dispute regarding Tenant Substantial Completion Delay, either
party may elect to submit the matter to arbitration in accordance
with Paragraph 32 below.
(II) If Landlord does not cause the Base
Building Improvements to be Substantially Complete on or before
the Outside Delivery Date set forth in Paragraph F of the Summary
of Lease Terms (as the same may be extended), Tenant shall have
the right to deliver a notice to Landlord (a "Termination Notice")
electing to terminate this Lease effective upon the date occurring
five (5) business days following receipt by Landlord of the
Termination Notice (the "Effective Termination Date"). The
Termination Notice must be delivered by Tenant to Landlord, if at
all, not earlier than the Outside Delivery Date (as the same may be
extended) nor later than five (5) business days after the Outside
Delivery Date.
(A) Upon any termination
pursuant to this Paragraph 2(d)(ii), Landlord shall return to Tenant
any prepaid rent, and Landlord and Tenant shall be relieved from
any and all liability to each other (including with respect to any free
rent accrued pursuant to Paragraph 2(d)(i) above), except for any
obligations which expressly survive the expiration or earlier
termination of this Lease. Tenant's right to terminate this Lease
and Tenant's right to free rent pursuant to Paragraph 2(d)(i) above
shall be Tenant's sole and exclusive remedies at law or in equity
for the failure of Landlord to cause the Base Building Improvements
to be Substantially Complete by the Outside Delivery Date, and
Tenant expressly agrees that Landlord shall have no liability for any
damages (including consequential damages), incurred by Tenant
by reason of or in connection with such failure.
(B) At Landlord's option, the
termination rights contained in this Paragraph 2(d)(ii) shall not be
exercisable, or, if exercised, shall not be effective, if on the date of
exercise of such right Tenant is in default of any monetary
obligation under this Lease beyond any applicable cure period.
Further, the rights contained in this Paragraph 2(d)(ii) are personal
to CNET NETWORKS, INC. and may only be exercised if on the
date of exercise of such right CNET NETWORKS, INC. shall not
have assigned this Lease or sublet any portion of the Premises
other than to a Tenant Affiliate.
(III) The Target Delivery Date and the
Outside Delivery Date shall each be extended to the extent of any
delays attributable to Force Majeure, as defined in
Paragraph 1.6(c) of the Work Letter, and/or any Tenant Delay, as
defined in Paragraph 1.6(h) of the Work Letter.
3 RENTAL; SECURITY DEPOSIT.
(A) Tenant agrees to pay to Landlord as "Basic
Monthly Rental" for the Premises the following sums:
Lease Years
Annual
Basic
Rental/Sq.
Ft.
Annual
Basic
Rental
Monthly
Basic
Rental
Rent Commencement Date
through Lease Year 5
$50.00
$14,170,800.00
$1,180,900.00
Lease Years 6 through 10
$55.00
$15,587,880.00
$1,298,990.00
Lease Years 11 through the
Expiration Date
$60.00
$17,004,960.00
$1,417,080.00
(B) Basic Monthly Rental shall be paid to
Landlord, in advance, on or before the first day of each and every
successive calendar month during the Lease Term, commencing
on the Rent Commencement Date. In the event the Rent
Commencement Date occurs on a day other than the first day of a
calendar month, or the Lease Term ends on a day other than the
last day of a calendar month, then the Basic Monthly Rental for
such first and/or last fractional months shall be appropriately
prorated. All such prorations shall be made on the basis of a 360-
day year consisting of twelve 30-day months.
(C) Except as otherwise expressly provided
herein, Rental shall be paid to Landlord without notice, demand,
deduction or offset in lawful money of the United States in
immediately available funds or by good check as described below
at Landlord's address for payments specified in the Summary of
Lease Terms, or to such other person or at such other place as
Landlord from time to time may designate in writing. Payments
made by check must be drawn either on a California financial
institution or on a financial institution that is a member of the
federal reserve system. All amounts of Rental, if not paid when
due, shall bear interest from the due date until paid at an annual
rate of interest (the "Interest Rate") equal to the sum of five (5)
percentage points over the publicly announced reference rate (the
"Reference Rate") charged on such due date by the San Francisco
Main Office of Bank of America NT & SA (or any successor bank
thereto) (or if there is no such publicly announced rate, the rate
quoted by such bank in pricing ninety (90) day commercial loans to
substantial commercial borrowers); provided, however, Tenant's
total liability for interest payments under this Lease shall not
exceed the limits, if any, imposed on such payments by the usury
laws of the State of California. In addition, Tenant acknowledges
that late payment by Tenant to Landlord of Rental will cause
Landlord to incur costs not contemplated by this Lease, the exact
amount of such costs being extremely difficult to fix. Such costs
include, without limitation, processing and accounting charges, and
late charges that may be imposed on Landlord by the terms of any
encumbrance and/or note secured by an encumbrance covering
the Premises. Therefore, if any installment of Rental due from
Tenant is not received within three (3) days of when due, Tenant
shall pay to Landlord as a late charge an additional sum equal to
the lesser of (i) five percent (5%) of the overdue Rental or (ii) the
amount of the late charge(s) payable by Landlord to Holders of
Superior Interests at the time of Tenant's delinquency. The parties
agree that this late charge represents a fair and reasonable
estimate of the costs that Landlord will incur by reason of late
payment of Rental by Tenant. Acceptance of any late charge shall
not constitute a waiver of Tenant's default with respect to the
overdue amount, or prevent Landlord from exercising any of the
other rights and remedies available to Landlord.
(D) Within two (2) business days after the full
execution of this Lease, Tenant shall pay to Landlord an amount
equal to one-half (1/2) of the Basic Monthly Rental for the first
month of the Lease Term, which amount Landlord shall apply to the
Basic Monthly Rental for such first month. Upon commencement
of construction of the Tenant Improvements, Tenant shall pay to
Landlord an amount equal to the remaining one-half (1/2) of the
Basic Monthly Rental for the first month of the Lease Term, which
amount Landlord shall apply to the Basic Monthly Rental for such
first month.
(E) On the first day of Lease Year 14, Tenant
shall pay to Landlord the amount specified in Paragraph H of the
Summary of Lease Terms (the "Deposit"). The Deposit shall be
held by Landlord as security for the faithful performance by Tenant
of all of the provisions of this Lease to be performed or observed by
Tenant. If Tenant fails to pay any Rental, or otherwise defaults with
respect to any provision of this Lease, Landlord may (but shall not
be obligated to), and without prejudice to any other remedy
available to Landlord, use, apply or retain all or any portion of the
Deposit for the payment of any Rental in default or for the payment
of any other sum to which Landlord may become obligated by
reason of Tenant's default, or to compensate Landlord for any loss
or damage which Landlord may suffer thereby. Tenant waives the
provisions of California Civil Code Section 1950.7, and all other
provisions of law now in force or that become in force after the date
of execution of this Lease, that provide that Landlord may claim
from the Deposit only those sums reasonably necessary to remedy
defaults in the payment of Rental, to repair damage caused by
Tenant, or to clean the Premises. If Landlord uses or applies all or
any portion of the Deposit as provided above, Tenant shall within
ten (10) days after demand therefor deposit cash with Landlord in
an amount sufficient to restore the Deposit to the full amount
thereof, and Tenant's failure to do so shall, at Landlord's option, be
an Event of Default (as defined in Paragraph 18(a)) under this
Lease. Landlord shall not be required to keep the Deposit separate
from its general accounts. If Tenant performs all of Tenant's
obligations hereunder, the Deposit, or so much thereof as has not
theretofore been applied by Landlord, shall be returned, without
payment of interest or other increment for its use, to Tenant (or, at
Landlord's option, to the last assignee, if any, of Tenant's interest
hereunder) at the expiration of the Lease Term and after Tenant
has vacated the Premises. Landlord's return of the Deposit or any
part thereof shall not be construed as an admission that Tenant
has performed all of its obligations under this Lease. No trust
relationship is created herein between Landlord and Tenant with
respect to the Deposit.
4 TENANT'S SHARE OF OPERATING EXPENSES
AND REAL PROPERTY TAXES.
(A) In addition to the Basic Monthly Rental
payable during the Lease Term, Tenant shall pay to Landlord, as
additional rent, Tenant's Percentage Share of Operating Expenses
and Real Property Taxes for each Expense Year. If it shall not be
lawful for Tenant to reimburse Landlord for any Real Property
Taxes as defined herein, then consistent with the parties'
agreement as provided in Paragraph 4(e) below, the Basic Monthly
Rental payable to Landlord hereunder shall be increased to net
Landlord the same amount of Rental as would have been received
by Landlord had Tenant paid Tenant's Percentage Share of such
Real Property Taxes pursuant to this Paragraph 4.
(B) Subject to the provisions of Paragraph 4(d)
below, Tenant shall pay to Landlord, as additional rent, one-twelfth
(1/12th) of Tenant's Percentage Share of Operating Expenses and
Real Property Taxes for each Expense Year on or before the first
day of each calendar month of such Expense Year, in advance, in
an amount estimated by Landlord in notices delivered to Tenant. If
Landlord fails to deliver such an estimate to Tenant prior to the
commencement of any Expense Year, Tenant shall continue to pay
Tenant's Percentage Share of Operating Expenses and Real
Property Taxes on the basis of the prior Expense Year's estimate
until the first day of the next calendar month after such notice is
given, provided that on such date Tenant shall pay to Landlord the
amount of such estimated adjustment payable to Landlord for prior
months during the Expense Year in question, less any portion
thereof previously paid by Tenant. Landlord may revise its estimate
of Tenant's Percentage Share of Operating Expenses and Real
Property Taxes for any Expense Year from time to time by giving
written notice of such revision to Tenant, in which event
subsequent payments by Tenant for such Expense Year shall be
based on Landlord's revised estimate. The failure or delay by
Landlord to provide Tenant with Landlord's estimate of Tenant's
Percentage Share of Operating Expenses and Real Property Taxes
or Landlord's "annual statement" (as defined in Paragraph 4(c)(i)
below) for any Expense Year shall not constitute a default by
Landlord hereunder, or a waiver by Landlord of Tenant's obligation
to pay Tenant's Percentage Share of Operating Expenses or Real
Property Taxes for such Expense Year or of Landlord's right to
send to Tenant such an estimate or annual statement, as the case
may be.
(C) (I) Within one hundred twenty (120)
days after the close of each Expense Year or as soon after such
one hundred twenty (120) day period as practicable, Landlord shall
deliver to Tenant a statement setting forth the actual Operating
Expenses and Real Property Taxes for such Expense Year and
Tenant's Percentage Share thereof (an "annual statement") and,
subject to Paragraph 4(c)(ii) below, such statement shall be final
and binding upon Tenant. If, on the basis of the annual statement
for any Expense Year, Tenant's Percentage Share of Operating
Expenses or Real Property Taxes for such Expense Year is more
than the estimated payments made by Tenant for such Expense
Year, Tenant shall pay the deficiency to Landlord within thirty (30)
days after delivery of the annual statement. If, on the basis of the
annual statement for any Expense Year, Tenant has paid to
Landlord an amount in excess of the actual amounts payable under
Paragraph 4(a) above for such Expense Year and Tenant is not in
default in the performance of any of its monetary covenants under
this Lease, then Landlord, at its option, shall either promptly refund
such excess to Tenant or credit the amount thereof to the Basic
Monthly Rental next becoming due from Tenant until such credit
has been exhausted.
(II) Tenant shall have the right, during
the one hundred eighty (180) day period following delivery of an
annual statement, at Tenant's sole cost to review in Landlord's
offices Landlord's records of Operating Expenses and Real
Property Taxes for the subject Expense Year. Such review shall
be carried out only by regular employees of Tenant, a major
national accounting firm, a certified public accountant, or real
estate professional reasonably satisfactory to Landlord. No person
conducting such an audit shall be compensated on a "contingency"
or other incentive basis. Tenant shall keep any information gained
from its inspection of Landlord's books and records confidential and
shall not disclose any such information to any other party, except
as required by Applicable Laws. If requested by Landlord, Tenant
shall require its employees, agents or contractors inspecting
Landlord's books and records to sign a confidentiality agreement
prior to making Landlord's books and records available to them. If,
as of the one hundred eightieth (180th) day after delivery to Tenant
of an annual statement, Tenant shall not have delivered to
Landlord an objection statement (as defined below), then such
annual statement shall be final and binding upon Landlord and
Tenant, and Tenant shall have no further right to object to such
annual statement. If within such one hundred eighty (180) day
period, Tenant delivers to Landlord a written statement specifying
objections to such annual statement (an "objection statement"),
then Tenant and Landlord shall meet to attempt to resolve such
objection within thirty (30) days after delivery of the objection
statement. Notwithstanding that any such dispute remains
unresolved, Tenant shall be obligated to pay Landlord all amounts
payable in accordance with this Paragraph 4 (including any
disputed amount). If such dispute results in an agreement that
Tenant is entitled to a refund, Landlord shall, at its option, either
pay such refund or credit the amount thereof to the Basic Monthly
Rental next becoming due from Tenant. All expenses of Tenant's
audit shall be paid by Tenant, unless Operating Expenses and Real
Property Taxes for the subject Expense Year shall have been
overstated by more than five percent (5%), in which case Landlord
shall reimburse Tenant for the reasonable out-of-pocket expenses
incurred by Tenant in connection with such audit, up to a maximum
amount of Three Thousand Dollars ($3,000.00), promptly after
Landlord's receipt of invoices or other satisfactory evidence of such
costs.
(D) (I) If the Rent Commencement date
occurs on a day other than the first day of an Expense Year, or this
Lease expires or otherwise terminates on a day other than the last
day of an Expense Year, the amounts payable by Tenant under
Paragraph 4(a) above with respect to the Expense Year in which
such commencement or termination occurs shall be prorated as
follows: (A) with respect to the Expense Year during which the Rent
Commencement Date occurs, such amounts shall be prorated on
the basis which the number of days from the Rent Commencement
Date through and including the last day of such Expense Year,
bears to 360; and (B) with respect to the Expense Year during
which this Lease terminates, such amounts shall be prorated on
the basis which the number of days from the first day of such
Expense Year through and including the date this Lease
terminates, bears to 360. The termination of this Lease shall not
affect the obligations of Landlord and Tenant pursuant to
Paragraph 4(c) above to be performed after such termination.
(II) If the Rent Commencement Date
occurs on a day other than the first day of an Expense Year, or
expires on a day other than the last day of an Expense Year, then,
notwithstanding the provisions of Paragraph 4(b) above, Tenant
shall pay to Landlord, as additional rent, estimated amounts of
Tenant's Percentage Share of Operating Expenses and Real
Property Taxes for such Expense Year(s) as follows: (A) with
respect to the Expense Year during which the Rent
Commencement Date occurs, Tenant shall pay to Landlord on or
before the Rent Commencement Date (as provided in
Paragraph 3(d) above), and on or before the first day of each
calendar month of such Expense Year thereafter, Landlord's
estimate of Tenant's Percentage Share of Operating Expenses and
Real Property Taxes for such Expense Year, divided by the
number of months (including any partial months) in such Expense
Year from the Rent Commencement Date through and including
the last day of such Expense Year; and (B) with respect to the
Expense Year during which the Expiration Date occurs, Tenant
shall pay to Landlord on or before the first day of each calendar
month of such Expense Year, Landlord's estimate of Tenant's
Percentage Share of Operating Expenses and Real Property Taxes
for such Expense Year, divided by the number of months (including
any partial months) in such Expense Year from the first day of such
Expense Year through and including the Expiration Date.
(E) It is the intention of Landlord and Tenant that
the Basic Monthly Rental paid to Landlord throughout the Lease
Term shall be absolutely net of all Real Property Taxes and
Operating Expenses, and the foregoing provisions of this
Paragraph 4 are intended to so provide.
5. OTHER TAXES PAYABLE BY TENANT. Tenant
shall reimburse Landlord upon demand for any and all taxes
payable by Landlord (other than net income taxes) whether or not
now customary or within the contemplation of the parties hereto:
(A) imposed upon, measured by or reasonably
attributable to the cost or value of Tenant's equipment, furniture,
fixtures and other personal property located in the Premises or by
the cost or value of any leasehold improvements made in or to the
Premises by or for Tenant, regardless of whether title to such
improvements shall be in Tenant or Landlord;
(B) imposed upon or measured by the Basic
Monthly Rental payable hereunder, including, without limitation,
any gross income tax or excise tax levied by the City and County of
San Francisco, the State of California, the federal government or
any other governmental body with respect to the receipt of such
rental;
(C) imposed upon or with respect to the
possession, leasing, operation, management, maintenance,
alteration, repair, use or occupancy by Tenant of the Premises or
any portion thereof; or
(D) imposed upon this transaction or any
document to which Tenant is a party creating or transferring an
interest or an estate in the Premises.
In the event that it shall not be lawful for Tenant to so
reimburse Landlord, the Basic Monthly Rental payable to Landlord
under this Lease shall be revised to net Landlord the same income
after imposition of any such tax upon Landlord as would have been
received by Landlord hereunder prior to the imposition of any such
tax.
6. USE
(A) Tenant acknowledges that Landlord has
received approval (the "Approval") by the Planning Commission of
the City and County of San Francisco (the "City") for construction of
a building on the Land containing approximately 180,000 square
feet of office space, 40,000 square feet of light manufacturing and
production space, 24,000 square feet of distribution space, 17,800
square feet of parking for fifty (50) parking spaces, 3,300 square
feet for two (2) loading docks, 1,000 square feet for a retail caf
space and 4,280 square feet of open space in the form of an urban
garden and indoor park. Tenant acknowledges and agrees that
Tenant's use of the Premises, and the submission of plans to the
City for the Tenant Improvements pursuant to the Work Letter, shall
be consistent with the Approval.
(B) Tenant has represented to Landlord that
Tenant contemplates using the Premises for the uses described in
Exhibit E ("Contemplated Uses"). Landlord, at Landlord's expense,
shall diligently endeavor to obtain a determination of the Zoning
Administrator of the City that the Contemplated Uses constitute
non-office uses that are permissible under the Approval. At such
time as Landlord obtains a determination confirming that the
Contemplated Uses are permissible under the Approval, Tenant
shall have no further rights pursuant to this Paragraph 6(b). If
Landlord has not obtained such determination, Tenant shall
exercise commercially reasonable efforts throughout the Lease
Term to utilize the entire Premises for uses permissible under the
Approval, including, without limitation, by relocating non-office uses
in other sites in the City to the Premises, provided that Tenant shall
not be required to relocate its studios to the Premises. If, despite
its commercially reasonable efforts, Tenant is unable to utilize all of
the non-office portions of the Premises for uses permissible under
the Approval, and an officer of Tenant shall certify in writing to
Landlord (i) the location and square footage of the portion of the
Premises which Tenant is unable to use (the "Vacant Space"), (ii)
that Tenant has exercised its commercially reasonable efforts to
utilize the Vacant Space for permissible uses, and (iii) the Vacant
Space is entirely vacant and cannot be used for permissible uses
("Tenant's Vacant Space Notice"), then the Monthly Basic Rental
for the Vacant Space shall abate commencing on the first day of
the first month following Landlord's receipt of Tenant's Vacant
Space Notice and terminating on the date Tenant uses the Vacant
Space for any purpose whatsoever. From time to time within
twenty (20) days after request by Landlord, an officer of Tenant
shall re-certify to Landlord in writing that the information set forth in
Tenant's Vacant Space Notice remains true and correct as of the
date of such re-certification. Further, within ten (10) days after
written request by Landlord, Tenant shall designate in writing to
Landlord an area approximately equal in size to the area of the
Vacant Space ("Termination Space"), which Termination Space
must be in a configuration reasonably re-leasable by Landlord,
including, without limitation, the requirement that the Termination
Space comply with applicable codes relating to exiting
requirements. If Landlord determines in good faith that the
Termination Space proposed by Tenant is not reasonably re-
leasable by Landlord, Landlord shall so notify Tenant within five (5)
business days after receipt of Tenant's designation. In such case,
the parties shall promptly meet and attempt to agree upon the
Termination Space. If the parties are unable to agree upon the
Termination Space within ten (10) business days after Tenant's
receipt of Landlord's objection to the Termination Space
designated by Tenant, either party may submit the matter to
arbitration in accordance with Paragraph 32 below. Tenant shall
vacate and surrender the Termination Space to Landlord within ten
(10) days after the later of (A) expiration of the date for Landlord to
object to the Termination Space designated by Tenant without
objection by Landlord or (B) the date the Termination Space is
determined, either by mutual agreement of the parties or arbitration
in accordance with Paragraph 32. In such event, this Lease shall
be amended to exclude the Termination Space from the Premises
and to make such modifications as are reasonably required to
accommodate conversion of the Building from a single-tenant
building to a multi-tenant building, including, without limitation, the
designation of additional Common Areas to provide reasonable
access for all tenants of the Building and the reallocation of
maintenance and repair responsibilities with respect to the
Common Areas in a manner mutually agreeable to Landlord and
Tenant; and this Lease as so amended shall continue thereafter in
full force and effect. If Landlord and Tenant cannot mutually agree
upon the amendments to this Lease reasonably required to
accommodate conversion of the Building from a single-tenant
building to a multi-tenant building within ten (10) business days
after Tenant's receipt of Landlord's surrender notice, either party
may elect to submit such matters to arbitration in accordance with
Paragraph 32.
(C) Subject to Landlord's prior approval, which
shall not be unreasonably withheld or delayed, Tenant may elect to
convert all or a portion of the parking area of the Premises to
another use. In such case, Tenant, at Tenant's expense, shall be
responsible to obtain, and shall exercise its best efforts to obtain,
all governmental approvals required under Applicable Laws for
such conversion, including, without limitation, under Section 309 of
the Planning Code of the City. Tenant shall keep Landlord
apprised of its actions, and shall provide Landlord with copies of all
applications submitted by Tenant and all correspondence to or from
the City relating to conversion of the parking area. Landlord, at no
out-of-pocket expense to itself, will cooperate with Tenant's efforts.
If, despite its best efforts, including diligently pursuing any
applicable appeal processes, Tenant is unable to convert all or the
desired portion of the parking area to another use, and an officer of
Tenant shall certify in writing to Landlord (i) that despite its best
efforts, Tenant was unable to convert all or the desired portion of
the parking area of the Premises to another use and (ii) the location
and square footage of such parking area (Tenant's Parking
Notice"), then the Annual Basic Rental rate for the portion of the
parking area of the Premises which Tenant has unsuccessfully
attempted to convert to another use shall be reduced to Thirty
Dollars ($30.00) per square foot per annum for the balance of the
Lease Term commencing on the later of (A) the first day of the first
month after the date Landlord receives Tenant's Parking Notice
and (B) the fifth (5th) anniversary of the Rent Commencement
Date. The reduced rental for the parking area shall continue to be
payable at the times and in the manner set forth in Paragraph 3 of
this Lease.
(D) Tenant agrees not to do or permit to be done
in or about the Premises or the Building, nor to bring or keep or
permit to be brought or kept in or about the Premises or the
Building, anything which is prohibited by or will in any way conflict
with any Applicable Laws now or hereafter in effect, or which would
subject Landlord or Landlord's agents to any liability, or which is
prohibited by the standard form of fire insurance policy, or which
will in any way increase the existing rate of (or otherwise affect) fire
or any other insurance on the Building or any of its contents. If any
act or omission of Tenant results in any such increase in premium
rates, Tenant shall pay to Landlord, as additional rent, upon
demand the amount of such increase. Tenant agrees not to do or
permit to be done anything in, on or about the Premises or the
Building which will obstruct or unreasonably interfere with the rights
of other tenants or occupants of the Building, or injure them, or use
or allow the Premises to be used for any unlawful purpose. Tenant
agrees not to cause, maintain or permit any nuisance in, on or
about the Premises or the Building, nor to use or permit to be used
any loudspeaker or other device, system or apparatus which can
be heard outside the Premises without the prior written consent of
Landlord nor to permit any objectionable odors, bright lights or
electrical or radio interference which may unreasonably interfere
with the rights of other tenants of the Building or the public. Tenant
agrees not to commit or suffer to be committed any waste in or
upon the Premises. The provisions of this Paragraph 6 are for the
benefit of Landlord only and shall not be construed to be for the
benefit of any tenant or occupant of the Building.
7. COMPLIANCE WITH LAWS/ENVIRONMENTAL
MATTERS.
(A) Tenant agrees at its sole cost and expense
to promptly comply with all Applicable Laws, with any occupancy
certificate issued for the Premises, and with the provisions of all
recorded documents affecting the Premises, insofar as any thereof
relates to or affects the condition, use or occupancy of the
Premises; provided, however, that subject to reimbursement as an
Operating Expense pursuant to Paragraph 4, Landlord shall make
alterations or improvements to the Building Structure, Core Areas,
or Base Building Systems, unless such alterations or improvements
are necessitated by Tenant's Alterations (excluding the Tenant
Improvements, except as provided in the Work Letter), acts or
particular use of the Premises. In addition, Tenant shall be
responsible, at its sole cost and expense, for (i) ADA compliance in
the Premises, including in connection with any leasehold
improvements or other work to be performed in the Premises under
or in connection with this Lease, (ii) ADA compliance outside the
Premises triggered by Tenant's Alterations (excluding the Tenant
Improvements, except as provided in the Work Letter) in the
Premises, and (iii) ADA compliance outside the Premises
necessitated by the Building being deemed to be a "public
accommodation" instead of a "commercial facility" as a result of
Tenant's use of the Premises. With respect to any ADA compliance
work required outside the Premises for which Tenant is responsible
hereunder, Landlord shall have the right to perform such work, or
require that Tenant perform such work with contractors,
subcontractors, engineers and architects approved by Landlord; and
if Landlord elects to perform such work outside the Premises, Tenant
shall reimburse Landlord for the cost of such work within ten (10)
days following receipt of invoices therefor. The judgment of any
court of competent jurisdiction, or the admission of Tenant in any
action against Tenant (whether Landlord be a party thereto or not),
that Tenant has violated any Applicable Laws or other such
requirements or provisions shall be conclusive of that fact as
between Landlord and Tenant. If Tenant's use or operation of the
Premises or any of Tenant's equipment therein requires a
governmental permit, license or other authorization or any notice to
any governmental agency, Tenant shall promptly provide a copy
thereof to Landlord.
(B) Tenant, at Tenant's expense, agrees to
provide on-site transportation brokerage services and to comply
with the transportation management programs applicable to the
Building. Neither this Paragraph nor any other provision of this
Lease is intended to or shall create any rights or benefits in any
other person, firm, company, governmental entity or the public.
(C) Tenant shall not use, generate, manufacture,
produce, store, release, discharge, or dispose of, on, under or about
the Premises or in or on the Real Property, or transport to or from the
Premises or any part of the Real Property, any Hazardous Material or
allow its employees, agents, contractors, licensees, invitees or any
other person or entity to do so. The foregoing covenant shall not
apply to insignificant amounts of substances typically found or used
in general office applications so long as (i) such substances are
maintained only in such quantities as are reasonably necessary for
Tenant's operations in the Premises, (ii) such substances are used
strictly in accordance with the manufacturers' instructions therefor
and all Applicable Laws, (iii) such substances are not disposed of in
or about the Building or the Real Property in a manner which would
constitute a release or discharge thereof, and (iv) all such substances
are removed from the Building and the Real Property by Tenant upon
the expiration or earlier termination of this Lease. Tenant shall, within
thirty (30) days after demand therefor, provide to Landlord a written
list identifying any Hazardous Material then maintained by Tenant in
the Building, the use of each such Hazardous Material so maintained
by Tenant together with written certification by Tenant stating, in
substance, that neither Tenant nor any person for whom Tenant is
responsible has released or discharged any Hazardous Material in or
about the Building or the Real Property. In addition, Tenant shall
immediately furnish Landlord with any (i) notices received from any
insurance company or governmental agency or inspection bureau
regarding any unsafe or unlawful conditions within the Premises,
and (ii) notices or other communications sent by or on behalf of
Tenant to any person relating to Applicable Laws or Hazardous
Materials. Landlord's right of entry pursuant to Paragraph 16 of this
Lease shall include the right to enter and inspect the Premises for
violations of Tenant's covenants herein.
(D) To the maximum extent permitted by
Applicable Law, Tenant hereby indemnifies, and agrees to protect,
defend and hold Landlord and the other Indemnitees (as defined in
Paragraph 13(b)) harmless, from and against any and all Claims (as
defined in Paragraph 13(b)), arising out of (i) the introduction into the
Real Property by Tenant or any Tenant Party of any Hazardous
Material, (ii) the usage by Tenant or any Tenant Party of Hazardous
Material in or about the Real Property, (iii) the discharge or release in
or about the Real Property by Tenant or any Tenant Party of any
Hazardous Material, (iv) any injury to or death of persons or damage
to or destruction of property resulting from the use by Tenant or any
Tenant Party of Hazardous Material in or about the Real Property,
and (v) any failure of Tenant or any Tenant Party to observe the
covenants of this Paragraph 7. In case of any action or proceeding
brought against Landlord or any other Indemnitees by reason of any
such claim, upon notice from Landlord, Tenant covenants to defend
such action or proceeding by counsel reasonably approved by
Landlord.
(E) Landlord represents and warrants that, to its
knowledge, except as set forth in the Phase I Environmental Site
Assessment dated September 8, 1998, prepared by Treadwell and
Rollo, there are no Hazardous Materials located in the Premises.
For purposes of this paragraph, the knowledge of Landlord shall
mean the actual knowledge of Birmingham, Managing Member of
Landlord, as of the date hereof.
(F) Landlord shall cause the Building Structure,
Core Areas, and Base Building Systems to comply with all
Applicable Laws, subject to the inclusion of the cost thereof in
Operating Expenses.
8. ALTERATIONS; LIENS.
(A) Tenant agrees not to make or suffer to be
made any alteration, addition or improvement to or of the Premises
(hereinafter referred to as "Alterations"), or any part thereof, without
the prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed (except for "Minor Alterations,"
as hereinafter defined, for which such consent shall not be
required); provided, however, Tenant acknowledges that, by way of
example and without limitation, it shall be reasonable for Landlord
to withhold its consent to Alterations affecting the Building
Structure, Core Areas, or Base Building Systems, or Alterations
which require work to be performed in portions of the Real Property
outside the Premises in order to comply with Applicable Laws.
Further, in no event shall Tenant file any permit application that
would change the designated uses in the Approval without
Landlord's prior approval. Landlord shall approve or disapprove of
any proposed Alterations within ten (10) business days following
Landlord's receipt of Tenant's request for approval, accompanied
by detailed plans and specifications for the proposed Alterations (if
required hereunder). If Landlord shall fail to respond within said
ten (10) business day period, Tenant may give Landlord a second
notice which shall specify in capital letters that if Landlord fails to
approve or disapprove of the proposed Alterations within five (5)
business days after receipt of such second notice, Landlord shall
be deemed to have approved the proposed Alterations. If Landlord
then fails to approve or disapprove of the proposed Alterations
within five (5) business days after Landlord's receipt of such
second notice, Landlord shall be deemed to have approved the
proposed Alterations. As a condition of its consent to Alterations
hereunder, Landlord may impose any reasonable requirements that
Landlord considers desirable, including a requirement that Tenant
provide Landlord with a surety bond, a letter of credit, or other
financial assurance that the cost of the Alterations will be paid
when due. Landlord's approval shall not be required for Alterations
which cost in the aggregate less than One Hundred Fifty Thousand
Dollars ($150,000.00), provided that such Alterations do not affect
or require work to be performed on the Building Structure, Core
Areas or Base Building Systems or change the designated uses set
forth in the Approval ("Minor Alterations"). Minor Alterations shall
be subject to all of the other provisions of this Section 8, except as
otherwise provided herein. Alterations made by Tenant, including
without limitation any partitions (movable or otherwise) or
carpeting, shall become a part of the Building and belong to
Landlord; provided, however, that equipment, trade fixtures and
movable furniture shall remain the property of Tenant. If Landlord
consents to the making of any Alterations, the same shall be
designed and constructed or installed by Tenant at Tenant's
expense (including expenses incurred in complying with Applicable
Laws). All Alterations shall be performed only by contractors or
mechanics approved by Landlord, which approval shall not be
unreasonably withheld; provided, however, that Landlord may, in its
sole discretion, specify engineers, general contractors,
subcontractors, and architects to perform work affecting the
Building Structure, Core Areas, or Base Building Systems; or
Landlord may elect to perform such work at Tenant's expense. All
Alterations shall be made in accordance with complete and detailed
architectural, mechanical and engineering plans and specifications
approved in writing by Landlord (excluding Minor Alterations which
do not require a building permit) and shall be designed and
diligently constructed in a good and workmanlike manner and in
compliance with all Applicable Laws. No review by Landlord of
such plans and specifications shall be deemed to create any
liability of any kind on the part of Landlord or to constitute a
representation on the part of Landlord or any professional
consulted by Landlord in connection with such review and
approval, that such plans and specifications are accurate or
correct, or comply with Applicable Laws. The construction of any
Alterations shall be performed in accordance with Landlord's
applicable rules, regulations and requirements. Tenant shall cause
any Alterations to be made in such a manner and at such times so
that any such work shall not unreasonably disrupt or interfere with
the use or occupancy of other tenants or occupants of the Building.
Under no circumstances shall Landlord be liable to Tenant for any
damage, loss, cost or expense incurred by Tenant on account of
Tenant's plans and specifications, Tenant's contractors or
subcontractors, design of any work, or construction of any work.
(B) Subsequent to obtaining Landlord's consent
and prior to commencement of the Alterations, Tenant shall deliver
to Landlord (i) any building or other permit required by Applicable
Laws in connection with the Alterations; and (ii) a copy of the
executed construction contract(s) In addition, Tenant shall require
its general contractor to carry and maintain the following insurance
(or in the case of Minor Alterations, such lesser insurance
requirements as Landlord shall reasonably prescribe) at no
expense to Landlord, and Tenant shall furnish Landlord with
satisfactory evidence thereof prior to the commencement of
construction: (A) Commercial General Liability Insurance with limits
of not less than $2,000,000 combined single limit for bodily injury
and property damage, including personal injury and death, and
Contractor's Protective Liability, and Products and Completed
Operations Coverage in an amount not less than $500,000 per
incident, $1,000,000 in the aggregate; (B) Comprehensive
automobile liability insurance with a policy limit of not less than
$1,000,000 each accident for bodily injury and property damage,
providing coverage at least as broad as the Insurance Services
Office (ISO) Business Auto Coverage form covering Automobile
Liability, code 1 "any auto", and insuring against all loss in
connection with the ownership, maintenance and operation of
automotive equipment that is owned, hired or non-owned; (C)
Worker's Compensation with statutory limits and Employer's
Liability Insurance with limits of not less than $100,000 per
accident, $500,000 aggregate disease coverage and $100,000
disease coverage per employee; and (D) "Builder's All Risk"
insurance in an amount approved by Landlord covering the
Alterations, including such extended coverage endorsements as
may be reasonably required by Landlord. All such insurance
policies (except Workers' Compensation insurance) shall be
endorsed to add Landlord, the Holder of any Superior Interest and
Landlord's designated agents as additional insureds with respect to
liability arising out of work performed by or for Tenant's general
contractor, to specify that such insurance is primary and that any
insurance or self-insurance maintained by Landlord shall not
contribute with it, and to provide that coverage shall not be reduced,
terminated, cancelled or materially modified except after thirty (30)
days prior written notice has been given to Landlord. Landlord may
inspect the original policies of such insurance coverage or require
complete certified copies at any time. Tenant's general contractor
shall furnish Landlord with evidence of insurance for its
subcontractors as reasonably required by Landlord.
(C) Landlord shall have the right (but not an
obligation) to inspect the construction work during the progress
thereof, and to require corrections of faulty construction or any
material deviation from the plans for such Alterations as approved
by Landlord; provided, however, that no such inspection shall be
deemed to create any liability on the part of Landlord, or constitute
a representation by Landlord or any person hired to perform such
inspection that the work so inspected conforms with such plans or
complies with any Applicable Laws, and no such inspection shall
give rise to a waiver of, or estoppel with respect to, Landlord's
continuing right at any time or from time to time to require the
correction of any faulty work or any material deviation from such
plans. Promptly following completion of any Alterations, Tenant
shall (i) furnish to Landlord "as-built" plans therefor (but in the case
of Minor Alterations only if Tenant has as-built plans prepared for
its own purposes), (ii) cause a timely notice of completion to be
recorded in the Office of the Recorder of the City and County of
San Francisco in accordance with California Civil Code Section
3093 or any successor statute, and (iii) deliver to Landlord
evidence of full payment and unconditional final waivers from
Tenant's general contractor and each person who gave a
preliminary 20-day notice pursuant to California Civil Code
Section 3097 or any successor statute. All trash which may
accumulate in connection with Tenant's construction activities shall
be removed by Tenant at its own expense from the Premises and
the Building.
(D) Tenant shall reimburse Landlord, within thirty
(30) days after request, for all out-of-pocket expenses incurred by
Landlord in connection with review of plans and specifications for
proposed Alterations. All sums due to Tenant's contractors, if paid
by Landlord due to Tenant's failure to pay such sums when due,
shall bear interest payable to Landlord at the Interest Rate until
fully paid. Upon the expiration or sooner termination of this Lease,
Tenant, at its expense, shall promptly remove any Alterations made
by Tenant if designated by Landlord so to be removed at the time
Landlord approved such Alterations, or in the case of Minor
Alterations for which Tenant did not obtain Landlord's approval,
then prior to, or within thirty (30) days following, such expiration or
earlier termination of this Lease, and repair any damage to the
Premises caused by such removal. Tenant shall use the general
contractor designated by Landlord for such removal and repair.
(E) If Tenant shall desire to install any
equipment or make any Alteration which involves any Hazardous
Material ("Hazardous Installation"), such installation shall be
subject to, and in accordance with, such terms and conditions as
Landlord may reasonably impose, including without limitation, the
following:
(I) Tenant shall deliver to Landlord
copies of all permits and other governmental registrations and
approvals required by Applicable Laws, including, without limitation,
applicable requirements of the San Francisco Fire Department,
San Francisco Department of Public Health, and the Bay Area Air
Quality Management District;
(II) Tenant shall comply with all
Applicable Laws relating to the design, installation, location,
maintenance, operation, removal and closure of the Hazardous
Installation, and in the event of a release from the Hazardous
Installation, Tenant shall be the responsible party for all purposes
under Applicable Laws;
(III) Tenant shall respond to any release
of Hazardous Materials from the Hazardous Installation
immediately after Tenant becomes aware of such release,
regardless of the amount of the release, and shall make all
required governmental notifications. In the event of any release
from the Hazardous Installation, Tenant shall notify Landlord in
writing of such release within twenty-four (24) hours after Tenant
becomes aware thereof;
(IV) Tenant shall provide a Pollution Legal
Liability Policy or other insurance naming Landlord and the Holder
of any Superior Interests (if so designated by Landlord) as
additional insureds in such amounts and otherwise in a form and
issued by companies reasonably satisfactory to Landlord; and
(V) In the event the Hazardous
Installation is no longer desirable for Tenant's use, and in any
event prior to the expiration of the Lease Term, Tenant shall
(A) remove and close the Hazardous Installation in accordance
with Applicable Laws and to the reasonable satisfaction of
Landlord, and, to the extent practicable at commercially reasonable
expense, restore the area in the vicinity of the Hazardous
Installation to the condition existing prior to installation of the
Hazardous Installation, and (B) if applicable, provide Landlord with
a copy of a certificate of closure issued for the Hazardous
Installation by the City and/or other applicable governmental
agency.
(VI) Tenant acknowledges that the
provisions of this Paragraph 8(e) shall survive the expiration or
sooner termination of this Lease, and may be enforced by Landlord
as well as any successor-in-interest of Landlord.
(F) Tenant agrees to keep the Premises and the
Real Property free from any liens arising out of any work
performed, materials furnished or obligations incurred by Tenant.
Tenant shall promptly and fully pay and discharge all claims on
which any such lien could be based. In the event that Tenant does
not, within twenty (20) days following the recording of notice of any
such lien, cause the same to be released of record, Landlord shall
have, in addition to all other remedies provided herein and by law,
the right, but not the obligation, to cause the same to be released
by such means as it shall deem proper, including payment of the
claim giving rise to such lien. All sums paid by Landlord for such
purpose, and all expenses incurred by it in connection therewith,
shall be payable to Landlord by Tenant, as additional rent, on
demand, together with interest at the Interest Rate from the date
such expenses are incurred by Landlord to the date of the payment
thereof by Tenant to Landlord. Landlord shall have the right at all
times to post and keep posted on the Premises any notices
permitted or required by law, or which Landlord shall deem proper
for the protection of Landlord, the Premises, the Building, or the
Real Property, from mechanic's and materialmen's and like liens.
Tenant shall give Landlord at least ten (10) days' prior written
notice of the date of commencement of any construction on the
Premises in order to permit the posting of such notices.
9. MAINTENANCE AND REPAIR.
(A) Subject to Landlord's performance of its
obligations under the Work Letter to be performed after delivery of
the Premises to Tenant, by taking possession of the Premises,
Tenant accepts the Premises as being in the condition in which
Landlord is obligated to deliver the Premises. Except for
Landlord's obligations pursuant to Paragraph 9(b) below, Tenant,
at its expense, shall at all times keep the Real Property and every
part thereof and all equipment, fixtures and improvements therein
in good and sanitary order, condition and repair, damage thereto by
fire, the perils of the extended coverage endorsement, and
earthquake excepted, and Tenant waives all rights under, and
benefits of, subsection 1 of Section 1932 and Sections 1941 and
1942 of the California Civil Code and under any similar law or
ordinance now or hereafter in effect. Without limiting the generality
of the foregoing, Tenant, at Tenant's expense, shall (i) promptly
replace all broken or cracked glass in the windows or entry doors
with glass of equal quality, (ii) maintain the garden area and indoor
park (except repair and maintenance of the fountain, which is
Landlord's obligation as provided in Paragraph 9(b) below) in good
and clean condition and repair, including, without limitation, regular
maintenance and replacement of landscaping, (iii) maintain the
sidewalks on the Real Property in good condition and repair, and
(iv) maintain the roof deck, if any, in good and clean condition and
repair. Prior to the Rent Commencement Date, Landlord, at
Landlord's expense, shall apply an anti-graffiti spray to the lower
portion of the exterior surface of the Building. Tenant, at Tenant's
expense, shall promptly remove all graffiti in, on, or about the
Building, including, without limitation, in the garden area. In
addition, if Tenant elects to install a service elevator, Tenant, at
Tenant's expense, shall be responsible for maintaining such
service elevator in good working order and repair and in
compliance with all Applicable Laws. Tenant shall enter into and
keep in full force and effect a maintenance contract for the service
elevator with a company and in a form reasonably satisfactory to
Landlord. Upon the expiration or sooner termination of this Lease,
Tenant shall surrender the Premises and, unless designated by
Landlord to be removed in accordance with Paragraph 8 above, the
Tenant Improvements and Alterations to Landlord in the same
condition as when installed, ordinary wear and tear (except to the
extent Tenant is obligated to repair to keep the Premises in good
condition and repair) and damage thereto by fire, the perils of the
extended coverage endorsement, and earthquake excepted. It is
agreed that Landlord has no obligation, and has made no
promises, to alter, add to, remodel, improve, repair, decorate or
paint the Premises or any part thereof and that no representations
respecting the condition of the Premises, the Building or the Real
Property have been made by Landlord to Tenant except as may be
specifically set forth herein. No representation or warranty,
express or implied, is made with respect to (i) the condition of the
Premises or the Building, (ii) the fitness of the Premises for
Tenant's intended use, (iii) the degree of sound transfer within the
Building, (iv) the absence of electrical or radio interference in the
Premises or the Building, (v) the condition, capacity or performance
of electrical or communications systems or facilities, or (vi) the
absence of objectionable odors, bright lights or other conditions
which may affect Tenant's use and enjoyment of the Premises or
the Building.
(B) Except as otherwise provided in
Paragraph 19, Landlord agrees to make all necessary repairs to
the Building Structure (excluding the repair of cracked or broken
glass, which is Tenant's obligation as provided in Paragraph 9(a)
above), Core Areas and Base Building Systems and the fountain
located in the garden area and lobby of the Building, and to
maintain the same in reasonably good order and condition, subject
to inclusion of the costs thereof in Operating Expenses, and subject
to the following sentence. Subject to the provisions of
Paragraph 14(e) below, any damage arising from the acts of
Tenant, or any person or entity claiming through or under Tenant,
including any Transferee, or any of their respective members,
partners, employees, contractors, agents, customers, visitors,
licensees or other persons in or about the Building by reason of
Tenant's occupancy of the Premises (individually, a "Tenant Party"
and collectively, "Tenant Parties") shall be repaired by Landlord at
Tenant's sole expense, and Tenant shall pay Landlord on demand
the cost of any such repair.
(C) If Tenant provides written notice to Landlord
and the Holder of any Superior Interest of an Emergency Situation
(as hereinafter defined), and Landlord fails to commence repairs or
maintenance which are Landlord's obligation hereunder within a
reasonable period of time after the receipt of such notice, given the
circumstances, then Tenant may perform necessary repairs or
maintenance, subject to the provisions of this Paragraph. For
purposes of this Paragraph, the phrase "Emergency Situation" shall
mean Landlord's failure to perform Landlord's repair or
maintenance obligations under this Lease, which failure (i) creates
a condition which threatens imminent injury to persons or damage
to property or (ii) materially and adversely affects Tenant's use of
the Premises. If any repairs or maintenance undertaken by Tenant
pursuant to this Paragraph will affect the Building Structure, Core
Areas or Base Building Systems, Tenant shall use only those
contractors used by Landlord in the Building for work on the
Building Structure, Core Areas or Base Building Systems unless
such contractors are unwilling or unable to perform, or timely
perform, such work, in which event Tenant may utilize the services
of any other qualified contractors who regularly perform similar
work in comparable buildings. Further, any work performed by
Tenant pursuant to this Paragraph shall be performed in
accordance with all Applicable Laws. Landlord shall reimburse
Tenant for the reasonable costs incurred by Tenant pursuant to this
Paragraph within thirty (30) days after Landlord's receipt of invoices
or other reasonably satisfactory evidence of such costs; provided,
however, that if Landlord delivers to Tenant within thirty (30) days
after receipt of Tenant's invoice, a written objection to the payment
of such invoice, setting forth with reasonable particularity the basis
of Landlord's objection, then either party may submit the matter to
arbitration in accordance with Paragraph 32 below. If Landlord fails
to pay the amount, if any, determined to be owing to Tenant
pursuant to the arbitration proceeding within thirty (30) days after
the arbitration award becomes final, Tenant shall have the right to
offset the amount of the award (together with interest at the Interest
Rate from the date the arbitration award becomes final until paid)
against the Monthly Basic Rental installment(s) next coming due
under this Lease, provided that in no event shall Tenant be entitled
to offset more than ten percent (10%) of the Monthly Basic Rental
in any month. Tenant shall not have the right to terminate this
Lease as a result of Landlord's failure to perform any repair or
maintenance obligations.
10. SERVICES.
(A) So long as Tenant shall lease the entire
rentable area of the Building, Tenant shall arrange for the bills for
all water, electricity, sewer, gas, telephone and other utilities
furnished to the Real Property to be sent directly to Tenant, and
Tenant shall pay the companies furnishing utilities to the Real
Property all amounts owing prior to delinquency. At such time, if at
all, as the Building shall become a multi-tenant building, Tenant, at
Tenant's expense, shall cause the Premises to be separately
metered, and Tenant shall pay directly to the applicable utility
companies the cost of all utilities furnished to the Premises, and
shall pay to Landlord, as an Operating Expense, Tenant's
Percentage Share of utilities serving the Real Property outside the
Premises. Tenant shall pay all utility deposits and fees, and all
monthly service charges for water, electricity, sewer, gas,
telephone and any other utility services furnished to the Building
during the Lease Term. Tenant shall also be responsible for the
payment of any tapping, connection and use charges and fees
imposed by any governmental units or utility companies in
connection with providing any utility service to the Building.
(B) Tenant, at Tenant's expense, shall arrange
for (i) janitorial service on a daily basis, Monday through Friday
(excluding holidays) consistent with customary janitorial services
provided in comparable buildings, (ii) refuse (including trash and
garbage) pick up, which shall be performed on a regular scheduled
basis so that accumulated refuse does not exceed the capacity of
Tenant's refuse bins, and (iii) exterior window washing at least
twice a year.
(C) Tenant's use of electric current shall at no
time exceed the capacity of the wiring, feeders and risers providing
electric current to the Premises. Tenant acknowledges that
Landlord's sole obligation shall be to provide the Base Building
Improvements, and Tenant shall be responsible for designing an
HVAC system and electrical system adequate for Tenant's use of the
Premises. Tenant, at Tenant's expense, shall be responsible for
installing any supplement HVAC systems or electrical capacity that
may be necessary as a result of any machines or equipment used by
Tenant in the Premises or the occupancy of the Premises, which in
no event shall exceed one (1) person per one hundred (100) square
feet of rentable area.
11. SECURITY SERVICES AND ACCESS CONTROL.
(A) So long as Tenant shall lease the entire
rentable area of the Building, Tenant shall be solely responsible for
designing and implementing its own security system. At such time,
if at all, as the Building shall become a multi-tenant building,
Landlord shall have the right from time to time to adopt such
policies, procedures and programs as it shall, in Landlord's sole
discretion, deem necessary or appropriate for the security of the
Building, and Tenant shall cooperate with Landlord in the
enforcement of, and shall comply with, the policies, procedures and
programs adopted by Landlord insofar as the same pertain to
Tenant or any Tenant Parties. Tenant acknowledges that the safety
and security devices, services and programs provided by Landlord
from time to time, if any, may not prevent theft or other criminal
acts, or insure the safety of persons or property, and Tenant
expressly assumes the risk that any safety device, service or
program may not be effective or may malfunction or be
circumvented. In all events and notwithstanding any provision of
this Lease to the contrary, Landlord and the other Indemnitees
shall not be liable to Tenant, and Tenant hereby waives any claim
against the Indemnitees to the maximum extent permitted by law,
for (i) any unauthorized or criminal entry of third parties into the
Premises or the Building, (ii) any injury to or death of persons, or
(iii) any loss of property in and about the Premises or the Building
by or from any unauthorized or criminal acts of third parties,
regardless of any action, inaction, failure, breakdown, malfunction
and/or insufficiency of the security services provided by Landlord,
or any allegation of active or passive negligence on the part of
Landlord or the other Indemnitees. Tenant shall obtain insurance
coverage to the extent Tenant desires protection against criminal
acts and other losses.
(B) In no event shall Landlord be liable for
damages resulting from any error with regard to the admission to or
the exclusion from the Building of any person. In the case of
invasion, mob, riot, public demonstration or other circumstances
rendering such action advisable in Landlord's opinion, Landlord
reserves the right to prevent access to the Building during the
continuance of the same by such action as Landlord may deem
appropriate, including closing doors.
(C) In the event of any picketing, public
demonstration or other threat to the security of the Building that is
attributable in whole or in part to Tenant, Tenant shall reimburse
Landlord for any costs incurred by Landlord in connection with such
picketing, demonstration or other threat in order to protect the
security of the Building, and Tenant shall indemnify and hold
Landlord harmless from and protect and defend Landlord against
any and all Claims incurred in connection therewith, arising out of
or relating to any such picketing, demonstration or other threat.
Tenant agrees not to employ any person, entity or contractor for
any work in the Premises (including moving Tenant's equipment
and furnishings in, out or around the Premises) whose presence
may give rise to a labor or other disturbance in the Building and, if
necessary to prevent such a disturbance in a particular situation,
Landlord may require Tenant to employ union labor for the work.
12. ASSIGNMENT AND SUBLETTING.
(A) Restriction on Transfers. Except as provided
in Paragraph 12(j) below, Tenant shall not, without the prior written
consent of Landlord, which consent Landlord shall not
unreasonably withhold: (i) assign, mortgage, pledge, hypothecate,
encumber, or permit any lien to attach to, or otherwise transfer, this
Lease or any interest hereunder, by operation of law or otherwise;
(ii) sublet the Premises or any part thereof; or (iii) permit the use of
the Premises by any persons (as referenced in Paragraph 26(n))
other than Tenant and its employees (all of the foregoing are
hereinafter sometimes referred to collectively as "Transfers" and
any person to whom any Transfer is made or sought to be made is
hereinafter sometimes referred to as a "Transferee").
(B) Notice of Proposed Transfer. If Tenant shall
desire Landlord's consent to any Transfer, Tenant shall notify
Landlord in writing ("Notice of Proposed Transfer"). Any such
Notice of Proposed Transfer shall include: (i) the proposed effective
date (which shall not be less than thirty (30) days after the date of
Tenant's Notice of Proposed Transfer); (ii) the portion of the
Premises to be Transferred (herein called the "Subject Space");
(iii) the terms of the proposed Transfer and the consideration
therefor, the name and address of the proposed Transferee, a
signed original of the proposed assignment or sublease
documents, together with copies of all other documentation
pertaining to the proposed Transfer, and an estimated calculation
of the "Transfer Premium" (as that term is defined in
Paragraph 12(d) below) in connection with such Transfer;
(iv) financial statements of the proposed Transferee for the three
(3) year period immediately preceding the Notice of Proposed
Transfer (or, if the proposed Transferee has been in existence for
less than three (3) years, for such shorter period as may be
applicable) certified by an officer, partner or owner thereof and any
other information reasonably necessary to enable Landlord to
determine the financial responsibility (including, without limitation,
bank references and contacts at other of Tenant's funding
sources), character and reputation of the proposed Transferee, the
nature of such Transferee's business and proposed use of the
Subject Space; and (v) such other information as Landlord may
reasonably require, provided that Landlord must request such
additional information within five (5) business days after receipt of
the information described in clauses (i) through (iv) above. Any
Transfer made without complying with this Paragraph shall, at
Landlord's option, be null, void and of no effect, and/or shall
constitute an Event of Default under this Lease. Whether or not
Landlord shall grant consent, Tenant shall pay, within thirty (30)
days after written request by Landlord, Five Hundred Dollars
($500.00) towards Landlord's review and processing expenses,
plus any reasonable out-of-pocket legal fees incurred by Landlord
in connection with any proposed Transfer.
(C) Reasonable Conditions. By way of example
and without limitation, the parties hereby agree that it shall be
deemed to be reasonable under this Lease and under any
Applicable Laws for Landlord to withhold consent to any proposed
Transfer where, in the good-faith judgment of Landlord, one or
more of the following apply (or where Landlord has not been
provided with sufficient information to determine that none of the
following apply):
(I) The proposed Transferee does not
have the financial strength to perform all of the obligations of the
Tenant under this Lease (as they apply to the Subject Space) as
and when they fall due; or
(II) The Transferee is of a character or
reputation or is engaged in a business which is not consistent with
the quality of the Building; or
(III) The proposed use of the Premises by
the proposed Transferee would (1) be unlawful; (2) cause Landlord
to be in violation of another lease or agreement to which Landlord
is a party, or would give an occupant of the Building a right to
cancel its lease; (3) cause an increase in insurance premiums for
insurance policies applicable to the Building (unless Tenant is
responsible for or agrees to pay the entire amount of such
increase); (4) require new tenant improvements that Landlord
would be entitled to disapprove pursuant to Paragraph 8 hereof;
(5) create any increased burden in the operation of the Building, or
in the operation of any of its facilities or equipment; or (6) increase
the type or quantity of Hazardous Materials in the Building; or
(IV) The proposed use of the Premises
would result in the division of any full floors of the Premises into
more than one (1) tenant space (unless Tenant agrees in writing to
restore the Premises at the expiration or early termination of the
Lease Term to the condition existing prior to such division); or
(V) At the time of the requested consent
to the Transfer, an Event of Default shall have occurred hereunder;
or
(VI) The proposed Transferee is a
governmental entity, or is entitled, directly or indirectly, to
diplomatic or sovereign immunity, or is not subject to the service of
process in, or the jurisdiction of the courts of, the State of
California, or holds any exemption from the payment of ad valorem
or other taxes which would prohibit Landlord from collecting from
such Transferee any amounts otherwise payable under this Lease;
or
(VII) Either the proposed Transferee, or
any person or entity which directly or indirectly, controls, is
controlled by, or is under common control with, the proposed
Transferee, is negotiating with Landlord to lease space in the
Building or any other Option Property at such time, as evidenced
by the submission of written proposals to lease space in the
Building or any other Option Property to or from such proposed
transferee during the three (3) month period immediately preceding
Tenant's request for consent.
(D) Transfer Premium. If Landlord consents to a
Transfer, as a condition thereto which the parties hereby agree is
reasonable, Tenant shall pay Landlord a percentage of any
Transfer Premium derived by Tenant from such Transfer in
accordance with this Paragraph 12(d). The Transfer Premium (as
defined below) derived from any Transfer shall be allocated
between the parties as follows: during Lease Years 1 through 3,
Tenant shall be entitled to seventy-five percent (75%) of the
Transfer Premium, and Landlord shall be entitled to twenty-five
percent (25%) of the Transfer Premium; commencing at the
beginning of Lease Year 4 and continuing thereafter during the
balance of the Lease Term, Landlord and Tenant shall each be
entitled to fifty percent (50%) of the Transfer Premium, including
with respect to Transfers that were entered into during Lease Years
1 through 3. Tenant agrees that the rental or other consideration
payable by a subtenant shall remain constant or increase over the
term of the sublease, and Tenant shall not manipulate such rental
or other consideration to cause a higher Transfer Premium to be
realized during Lease Years 1 through 3. "Transfer Premium" shall
mean all rent, additional rent or other consideration paid by such
Transferee (including, but not limited to, payments in excess of fair
market value for Tenant's assets, trade fixtures, equipment and
other personal property), in excess of the Rental payable by Tenant
under this Lease (on a monthly basis during the Term, and on a per
rentable square foot basis, if less than all of the Premises is
transferred), after deducting Permitted Transfer Costs. As used
herein, "Permitted Transfer Costs" means the actual costs incurred
and paid by Tenant for (i) any customary leasing commissions,
marketing fees, and reasonable legal fees and expenses in
connection with the Transfer and (ii) any Alterations to the Subject
Space made by Tenant in connection with the Transfer, provided
that Tenant shall furnish Landlord with copies of bills or other
documentation substantiating such costs. For purposes of
calculating the Transfer Premium when the Transfer Premium is
not paid to Tenant in a lump sum, all Permitted Transfer Costs shall
be amortized on a straight-line basis, without interest, over the
relevant term of the Transfer. If part of the consideration for such
Transfer shall be payable other than in cash, Landlord's share of
such non-cash consideration shall be in such form as is reasonably
satisfactory to Landlord. If Tenant shall enter into multiple
Transfers, the Transfer Premium payable to Landlord shall be
calculated independently with respect to each Transfer. The
Transfer Premium due Landlord hereunder shall be paid within
thirty (30) days after Tenant receives any Transfer Premium from
the Transferee. Landlord or its authorized representatives shall
have the right at all reasonable times to audit the books, records
and papers of Tenant relating to any Transfer, and shall have the
right to make copies thereof. If the Transfer Premium respecting
any Transfer shall be found to be understated, Tenant shall within
thirty (30) days after demand pay the deficiency, and if understated
by more than five percent (5%), Tenant shall pay Landlord's costs
of such audit.
(E) Recapture. Notwithstanding anything to the
contrary contained in this Paragraph 12, Landlord shall have the
option, by giving written notice to Tenant within thirty (30) days
after receipt of Tenant's Notice of Proposed Transfer, to recapture
the Subject Space if (i) the proposed Transfer, at any time during
the Lease Term, applies to the entire Premises or (ii) the proposed
Transfer, for which Tenant requests Landlord's consent at any time
during Lease Years 13 through 15, would result in the subleasing,
individually or in the aggregate (i.e., the sublease in question,
together with all prior subleases then in effect), of eighty-five
percent (85%) or more of the rentable area of the Premises. Such
recapture notice shall cancel and terminate this Lease with respect
to the Subject Space as of the date stated in Tenant's Notice of
Proposed Transfer as the effective date of the proposed Transfer
(or, at Landlord's option, shall cause the Transfer to be made to
Landlord or its agent, in which case the parties shall execute the
Transfer documentation promptly thereafter). If this Lease shall be
cancelled with respect to less than the entire Premises, the Rental
reserved herein shall be prorated on the basis of the number of
rentable square feet retained by Tenant in proportion to the number
of rentable square feet contained in the Premises; Tenant's
Percentage Share shall be appropriately reduced; this Lease shall
be amended as reasonably required to accommodate conversion
of the Building from a single tenant building to a multi-tenant
building, including, without limitation, the designation of additional
Common Areas to provide reasonable access for all tenants of the
Building and the reallocation of maintenance and repair
responsibilities with respect to the Common Areas in a manner
mutually agreeable to Landlord and Tenant; and this Lease as so
amended shall continue thereafter in full force and effect; and
Landlord shall have the right to negotiate directly with Tenant's
proposed Transferee and to enter into a direct lease or occupancy
agreement with any such party on such terms as shall be
acceptable to Landlord in its sole and absolute discretion, and
Tenant hereby waives any claims against Landlord related thereto,
including, without limitation, any claims for compensation or profit
related to such lease or occupancy agreement. If Landlord and
Tenant cannot mutually agree upon the amendments to this Lease
reasonably required to accommodate conversion of the Building
from a single tenant building to a multi-tenant building within ten
(10) business days after Tenant's receipt of Landlord's recapture
notice, either party may elect to submit the matter to arbitration in
accordance with Paragraph 32.
(F) Terms of Consent. If Landlord consents to a
Transfer: (i) the terms and conditions of this Lease, including
among other things, Tenant's liability for the Subject Space, and
Rental with respect thereto, shall in no way be deemed to have
been released, waived or modified, (ii) such consent shall not be
deemed consent to any further Transfer by either Tenant or the
Transferee, (iii) no Transferee shall succeed to any rights provided
in this Lease or any amendment hereto to extend the Term of this
Lease, expand the Premises, or lease additional space, any such
rights being deemed personal to Tenant, (iv) Tenant shall deliver to
Landlord promptly after execution, originals of all documentation
pertaining to the Transfer in form reasonably acceptable to
Landlord, and (v) Tenant shall furnish upon Landlord's request a
complete statement, certified by an independent certified public
accountant, or Tenant's chief financial officer, setting forth in detail
the computation of any Transfer Premium Tenant has derived and
shall derive from such Transfer. In addition, if Landlord consents to
a Transfer, but the terms of the proposed Transfer materially
change from those set forth in Tenant's Notice of Proposed
Transfer, Tenant shall submit a new Notice of Proposed Transfer,
requesting Landlord's consent, and the Subject Space shall again
be subject to Landlord's rights under Paragraph 12(e). Each
Transferee under an assignment of this Lease, other than
Landlord, must expressly assume all of the provisions, covenants
and conditions of this Lease on the part of Tenant to be kept and
performed. Any sublease hereunder shall be subordinate and
subject to the provisions of this Lease, and if this Lease shall be
terminated during the term of any sublease, Landlord shall have
the right to: (1) treat such sublease as cancelled and repossess
the Subject Space by any lawful means, or (2) require that the
subtenant attorn to and recognize Landlord as its landlord under
any such sublease. If Tenant shall default in any monetary
obligation under this Lease and fail to cure such default within the
time permitted for cure under Paragraph 18(a), Landlord is hereby
irrevocably authorized to direct any Transferee to make all
payments under or in connection with the Transfer directly to
Landlord (which Landlord shall apply towards Tenant's obligations
under this Lease) until such default is cured.
(G) Subsequent Consents. Consent by Landlord
to any Transfer made pursuant to this Lease shall not operate to
relieve Tenant from any covenant or obligation hereunder or be
deemed to be a consent to or relieve Tenant from obtaining
Landlord's consent to any subsequent Transfer by Tenant or
anyone claiming by, through or under Tenant.
(H) Certain Transfers. For purposes of this
Lease, the term "Transfer" shall also include (i) if Tenant is a
partnership, the withdrawal or change, voluntary, involuntary or by
operation of law, of a general partner or a majority of the partners,
or a transfer of a majority of partnership interests, or the dissolution
of the partnership; (ii) if Tenant is a limited liability company, the
withdrawal or change, voluntary, involuntary, or by operation of law,
of a majority of members, or a transfer of a majority of the
membership interests, or the dissolution of the limited liability
company; and (iii) if Tenant is a corporation, the dissolution,
merger, consolidation or other reorganization of Tenant, or the sale
or other transfer of more than an aggregate of 50% of the voting
shares of Tenant (other than (A) sales on a public stock exchange
or (B) transfers to immediate family members by reason or gift or
death), or the sale, mortgage, hypothecation or pledge of more
than an aggregate of 50% of Tenant's assets.
(I) Tenant Remedies. Notwithstanding anything
to the contrary in this Lease, if Tenant claims that Landlord has
unreasonably withheld or delayed its consent under this
Paragraph 12 or otherwise has breached or acted unreasonably
under this Paragraph 12, Tenant's sole remedies shall be
declaratory judgment and an injunction for the relief sought and
monetary damages, and Tenant hereby waives all other remedies,
including, without limitation, any right provided under California
Civil Code Section 1995.310 or other Applicable Laws to terminate
this Lease. Tenant shall indemnify, defend and hold harmless
Landlord from any and all Claims involving any third party or parties
(including without limitation Tenant's broker or proposed
Transferee) who claim they were damaged by Landlord's wrongful
withholding or conditioning of Landlord's consent.
(J) Transfers to Tenant Affiliate.
Notwithstanding anything to the contrary contained in this
Paragraph 12, so long as Tenant is not in default under this Lease,
and such proposed Transfer is made for a good faith operating
business purpose and not to evade compliance with the provisions
of this Paragraph 12, Tenant shall have the right, without the prior
written consent of Landlord, and without any right of recapture by
Landlord or payment of any Transfer Premium, to assign this Lease
to a Tenant Affiliate or to sublease the Premises or any part thereof
to a Tenant Affiliate, provided that each of the following conditions
shall be complied with: (i) Landlord receives fifteen (15) days' prior
written notice of such assignment or sublease; (ii) the Net Worth of
the proposed assignee or subtenant is adequate to satisfy its
obligations under this Lease in the event of an assignment or under
the applicable sublease in the event of a sublease, as reasonably
determined by Tenant; (iii) the proposed assignee or subtenant
shall at all times use the Premises in compliance with the
provisions of this Lease; (iv) promptly after Landlord's written
request, Tenant and the Tenant Affiliate provide such documents or
information which Landlord reasonably requests for the purpose of
substantiating whether the proposed assignment or sublease falls
within the parameters of this Paragraph 12(j); (v) Landlord receives
no later than the effective date of the Transfer a fully executed
duplicate original assignment or sublease in form and substance
reasonably satisfactory to Landlord; (vi) no such subtenant shall
have the right to further transfer its interest in the Subject Space
without the prior written consent of Landlord; (vii) no Transfer to a
Tenant Affiliate shall release Tenant from its obligations under this
Lease; and (viii) Tenant shall pay Landlord's reasonable attorneys'
fees and costs incurred in connection with any Transfer to a Tenant
Affiliate. In addition, Tenant shall have the right, subject to the
provisions of this Paragraph 12(j) (other than clause (ii) above), to
sublease in the aggregate up to twenty thousand (20,000) rentable
square feet of the Premises to corporations, limited liability
companies or other business entities in which at the time CNET
NETWORKS, INC. enters into the sublease, CNET NETWORKS,
INC. has the right to acquire a controlling interest pursuant to
warrants or other binding written agreements; provided, however,
that if CNET NETWORKS, INC. fails to exercise such rights and
acquire a controlling interest in such business entity within the
shorter of (A) the period for exercise of such warrants or other
rights at the time the sublease is executed or (B) the expiration of
the Lease Term, or if Tenant shall otherwise fail to obtain a
controlling interest in the business entity for any reason, Tenant
shall pay to Landlord, within thirty (30) days after expiration of the
time period set forth in clause (A) or (B) above, as applicable, the
Transfer Premium that would have been payable with respect to
such transaction if it had not been exempt from the provisions of
Paragraph 12(d). Such Transfer Premium shall be calculated and
paid with respect to the entire term of the sublease, commencing
as of the commencement date thereof, not just for the period
commencing after expiration of the time period set forth in
clause (A) or (B) above, as applicable.
13. WAIVER; INDEMNIFICATION.
(A) Neither Landlord nor the other Indemnitees
(as defined below) shall be liable to Tenant, and Tenant waives all
claims against Landlord and such other Indemnitees, for any injury
to or death of any person or for loss of use of or damage to or
destruction of property in or about the Premises or the Building by
or from any cause whatsoever, including without limitation,
earthquake or earth movement, gas, fire, oil, electricity or leakage
from the roof, walls, basement or other portion of the Premises or
the Real Property, except only, with respect to any Indemnitee, to
the extent such injury, death or damage is caused by the gross
negligence or willful misconduct of such Indemnitee and not
covered by the insurance required to be carried by Tenant
hereunder or except to the extent such limitation on liability is
prohibited by law.
(B) Tenant agrees to protect, indemnify and hold
Landlord, the Holder of any Superior Interest, Landlord's agents,
the shareholders, constituent partners, members, and other direct
or indirect owners of Landlord or any agent of Landlord, and all
contractors, officers, directors and employees of any thereof
(collectively, "Indemnitees"), and each of them, harmless from and
to protect and defend each Indemnitee against any and all
obligations, losses, claims, actions (including remedial or
enforcement actions of any kind and administrative or judicial
proceedings, suits, orders or judgments), causes of action,
liabilities, penalties, damages (including consequential and punitive
damages), costs and expenses (including reasonable attorneys'
and consultants' fees and expenses) (collectively, "Claims"),
(i) arising out of the use or occupancy or manner of use or
occupancy of the Premises by Tenant or any person claiming
through or under Tenant; or (ii) arising out of any injury or death of
any person or damage to or destruction of property occurring in, on
or about the Premises (including the Parking Facilities), from any
cause whatsoever, except only, with respect to any Indemnitee, to
the extent such injury, death or damage is caused by the gross
negligence or willful misconduct of such Indemnitee and not
covered by the insurance required to be carried by Tenant
hereunder or except to the extent such indemnity obligation is
prohibited by law, or (iii) occurring in, on or about any Common
Areas (including without limitation elevators, stairways,
passageways or hallways), or elsewhere in or about or in the
vicinity of the Building, when such claim, injury or damage is
caused in whole or in part by the act, neglect, default, or omission
of any duty by Tenant or any Tenant Parties, or otherwise by any
conduct of any Tenant Parties in or about the Premises or the
Building; or (iv) arising from any failure of Tenant to observe or
perform any of its obligations hereunder; or (v) arising from any act
or omission of Tenant or Tenant's Agents (as defined in
Paragraph 1.6(i) of the Work Letter) in, on or about the Building in
connection with the construction of the Tenant Improvements,
including acts or omissions occurring prior to the Commencement
Date; or (vi) arising in connection with Landlord's approval of the
Proposed Plans (as defined in Paragraph 3.1(a) of the Work Letter)
and revisions thereto or Landlord's coordination of construction of
the Tenant Improvements pursuant to Paragraph 4.9 of the Work
Letter. If any action or proceeding is brought against any of the
Indemnitees by reason of any such claim or liability, Tenant, upon
notice from Landlord, covenants to resist and defend at Tenant's
sole expense such action or proceeding by counsel reasonably
satisfactory to Landlord. Tenant's obligations under this
Paragraph 13 shall not be construed as in any way restricting,
limiting, or modifying Tenant's insurance or other obligations under
this Lease. Further, Tenant's compliance with the insurance
requirements and other obligations of this Lease shall not in any
way restrict, limit or modify Tenant's obligations under this
Paragraph 13. The provisions of this Paragraph 13 shall survive the
expiration on earlier termination of this Lease with respect to any
claims or liability occurring or arising prior to such termination.
(C) Tenant's duty to defend Landlord and the
other Indemnitees is separate and independent of Tenant's duty to
indemnify the Indemnitees. The duty to defend includes claims for
which the Indemnitees may be liable without fault or strictly liable.
The duty to defend applies regardless of whether the issues of
negligence, liability, fault, default, or other obligation on the part of
Tenant Parties have been determined. The duty to defend applies
immediately, regardless of whether Landlord Parties have paid any
sums or incurred any detriment arising out of or relating (directly or
indirectly) to any Claims. It is the express intention of the parties
that Landlord Parties be entitled to obtain summary adjudication or
summary judgment regarding Tenant's duty to defend Landlord
Parties at any stage of any claim or suit within the scope of this
Paragraph.
14. INSURANCE.
(A) At Tenant's expense, Tenant shall procure,
carry and maintain in effect throughout the Lease Term, in a form
and with deductibles reasonably acceptable to Landlord and with
such insurance companies as are acceptable to Landlord (which
companies shall have a Best's rating of A-X or better), the following
insurance coverages:
(I) Commercial General Liability
insurance (and commercial umbrella insurance, if necessary to
provide required limits), at least as broad as the Insurance Services
Office (ISO) occurrence policy form CG 00 01 (11/85), or a
substitute form providing equivalent coverage as reasonably
approved by Landlord, with limits of not less than $5,000,000.00
per occurrence and annual aggregate, covering bodily injury,
property damage and personal and advertising injury and including,
but not limited to, coverage for, premises and operations (including
the use of owned and non-owned equipment), and contractual
liability (including tort liability of another party and Tenant's liability
in Paragraph 13 above);
(II) Property insurance at least as broad
as the most commonly available ISO Special Form Causes of Loss
("all risk") policy form CP 1030 with an agreed amount
endorsement, covering Tenant's equipment, furniture, fixtures and
other personal property located in the Premises, and including,
without limitation, coverage for vandalism, malicious mischief,
sprinkler leakage and earthquake sprinkler leakage, in an amount
equal to 100% of the full insurable replacement cost thereof
(WITHOUT DEDUCTION FOR DEPRECIATION);
(III) Workers' compensation insurance, in
accordance with applicable law;
IV) Business Income insurance and extra
expense coverage with coverage amounts that shall reimburse
Tenant for all rental, expense and other payment obligations of
Tenant under this Lease for a period of not less than one year,
including, without limitation, Basic Rental and adjustments thereto
and Real Property Taxes, Operating Expenses and all other costs,
fees, charges and payments which would be borne by or due from
Tenant under this Lease if the Premises and Tenant's business
were fully open and operating; and
(V) Media Liability insurance in the
amount of not less than $1,000,000.00.
(B) Not more often than every year and upon not
less than sixty (60) days' prior written notice, Landlord, in its
reasonable discretion, may require Tenant to increase the
insurance limits set forth in Paragraphs 14(a)(i) and 14(a)(ii) above,
and/or provide other forms of insurance, provided that such
coverage is then generally being required of comparable tenants in
comparable buildings with institutional owners or lenders.
(C) All policies of liability insurance so obtained
and maintained, including any umbrella liability insurance policies,
shall (i) be carried in the name of Tenant, (ii) name Landlord, the
Holder of any Superior Interest and Landlord's designated agents
as additional insureds, pursuant to an endorsement providing
coverage at least as broad as ISO form CG 2011 (01/96) or
equivalent (except the Media Liability insurance shall not name
Landlord as an additional insured), (iii) be the primary insurance
providing coverage for Landlord (any other liability insurance
maintained by Landlord to be excess and non-contributing),
(iv) contain a cross-liability endorsement stating that the rights of
insureds shall not be prejudiced by one insured making a claim or
commencing an action against another insured, and (v) include a
"per location" endorsement or equivalent reasonably acceptable to
Landlord so that the general aggregate and other limits apply
separately and specifically to the Premises. At Landlord's election,
such policies shall name the Holder of any Superior Interest or any
other interested party as an insured party under a standard
mortgagee endorsement. The insurance requirements in this
Paragraph 14 shall not in any way limit, in either scope or amount,
the indemnity obligations separately owed by Tenant to Landlord
under this Lease, or the liability of Tenant for nonperformance of its
obligations or for loss or damage for which Tenant is responsible
hereunder. No endorsement limiting or excluding a required
coverage is permitted.
(D) All insurance policies required to be carried
by Tenant under this Lease shall provide that the insurer shall not
cancel such coverage without thirty (30) days' prior written notice to
Landlord. Prior to the Commencement Date, and no less than
fifteen (15) days prior to the expiration any required coverage,
Tenant shall deliver to Landlord certificates of insurance,
evidencing compliance with the insurance requirements hereunder.
In addition, within ten (10) days after the effective date of each of
Tenant's insurance policy or policies, Tenant shall deliver to
Landlord certified copies thereof, together with the endorsements
referred to in this Paragraph 14. In the event Tenant does not
comply with the requirements of this Paragraph 14, Landlord may,
at its option and at Tenant's expense, purchase such insurance
coverage to protect Landlord. The cost of such insurance shall be
paid to Landlord by Tenant, as additional rent, immediately upon
demand therefor, together with interest at the Interest Rate until
paid.
(E) Subject to reimbursement as an Operating
Expense, Landlord will maintain throughout the Lease Term a
policy of property insurance at least as broad as the most
commonly available ISO special form causes of loss ("all risk")
policy form CP 1030 with an agreed-amount endorsement,
covering the Building, including the Base Building Improvements
and the Tenant Improvements, in an amount equal to one hundred
percent (100%) of the full insurable replacement cost thereof,
subject to a commercially reasonable deductible, business income
(rental loss) and extra expense coverage for a period of at least
eighteen (18) months, and such liability, theft, boiler and
machinery, and other insurance as is generally carried by
institutional owners of comparable buildings or required by
institutional lenders encumbering comparable buildings, provided
that in any event Landlord shall be entitled to carry earthquake
insurance, without regard to the practices of owners of or lenders
encumbering comparable buildings.
(F) Landlord and Tenant hereby waive and
release any and all rights of recovery against the other party,
including officers, employees, agents and authorized
representatives (whether in contract or tort) of such other party,
that arise or result from any and all loss of or damage to any
property of the waiving party located within or constituting part of
the Building, including the Premises (whether or not the party
suffering the loss or damage actually carries any insurance,
recovers under any insurance or self-insures the loss or damage).
Each party shall have their insurance policies issued in such form
as to waive any right of subrogation as might otherwise exist. This
mutual waiver is in addition to any other waiver or release
contained in this Lease.
15. PROTECTION OF LENDERS AND GROUND
LESSORS.
(A) This Lease shall be subject and subordinate
at all times to all ground or underlying leases which may now or
hereafter exist affecting the Building or the Real Property, or both,
and to the lien of any mortgage or deed of trust in any amount or
amounts whatsoever now or hereafter placed on or against the
Building or the Real Property, or both, or on or against Landlord's
interest or estate therein (such mortgages, deeds of trust and
leases are referred to herein, collectively, as "Superior Interests"),
all without the necessity of any further instrument executed or
delivered by or on the part of Tenant for the purpose of effectuating
such subordination. However, Tenant covenants and agrees to
execute and deliver, upon demand, such further instruments
evidencing such subordination of this Lease to any such Superior
Interest as may be required by Landlord or by the Holder of such
Superior Interest. Notwithstanding the foregoing, within thirty (30)
days after the execution of this Lease, Landlord shall deliver to
Tenant a nondisturbance agreement, duly executed in recordable
form, from each holder of any Superior Interest in existence on said
date, which agreement shall incorporate the terms of
Paragraph 15(f) below and shall otherwise be in a commercially
reasonable form.
(B) Notwithstanding anything to the contrary in
this Paragraph 15 or otherwise in this Lease, the holder of any
mortgage or deed of trust now or hereafter placed on or against the
Building or the Real Property, or both ("Lender") may at any time
subordinate such mortgage or deed of trust to this Lease in whole
or in part, without any need to obtain Tenant's consent, by
execution of a written document subordinating such mortgage or
deed of trust to this Lease to the extent set forth in such document
and thereupon this Lease shall be deemed prior to such mortgage
or deed of trust to the extent set forth in such document without
regard to this Lease, such mortgage or deed of trust, or their
respective dates of execution, delivery and/or recording. In that
event, to the extent set forth in such document, such mortgage or
deed of trust shall have the same rights with respect to this Lease
as would have existed if this Lease had been executed, and a
memorandum thereof recorded prior to the execution, delivery and
recording of such mortgage or deed of trust.
(C) Within ten (10) days after Landlord's written
request, Tenant shall deliver to Landlord, or to any actual or
prospective holder of a Superior Interest ("Holder") that Landlord
designates, such financial statements as are reasonably required
by such Holder to verify the financial condition of Tenant (or any
assignee, subtenant or guarantor of Tenant). Tenant represents
and warrants to Landlord and such Holder that each financial
statement delivered by Tenant shall be accurate in all material
respects as of the date of such statement. All financial statements
shall be confidential and used only for the purposes stated herein.
(D) Tenant agrees to give any Holder, by
certified mail, a copy of any notice of default served upon Landlord
by Tenant, provided that prior to such notice Tenant has received
notice (by way of service on Tenant of a copy of an assignment of
rents and leases, or otherwise) of the address of such Holder.
Tenant further agrees that if Landlord shall have failed to cure such
default within the time provided for in this Lease, then each Holder
shall have an additional fifteen (15) days after receipt of notice
thereof within which to cure such default or if such default cannot be
cured within that time, then such additional time as may be
necessary, if, within such fifteen (15) days, any Holder has
commenced and is diligently pursuing the remedies necessary to
cure such default (including commencement of foreclosure
proceedings or other proceedings to acquire possession of the Real
Property, if necessary to effect such cure). Such period of time shall
be extended by any period within which such Holder is prevented
from commencing or pursuing such foreclosure proceedings or other
proceedings to acquire possession of the Real Property by reason of
Landlord's bankruptcy. Until the time allowed as aforesaid for Holder
to cure such defaults has expired without cure, Tenant shall have no
right to, and shall not, terminate this Lease on account of Landlord's
default. Further, this Lease may not be modified or amended so as
to reduce the Rental or shorten the Lease Term, or so as to
adversely affect in any other respect to any material extent the rights
of Landlord, nor shall this Lease be canceled or surrendered, without
the prior written consent, in each instance, of all Holders.
(E) Intentionally omitted.
(F) enant agrees with Lender that if Lender or
any foreclosure sale purchaser shall succeed to the interest of
Landlord under this Lease, Lender shall not be (i) liable for any
action or omission of any prior Landlord under this Lease (except
that the foregoing shall not relieve Lender from the maintenance
and repair obligations of Landlord under this Lease to the extent
such obligations are required to be performed after Lender
succeeds to Landlord's interest hereunder), or (ii) subject to any
offsets or defenses which Tenant might have against any prior
Landlord, or (iii) bound by any Rental which Tenant might have
paid for more than the current month to any prior Landlord, or
(iv) liable for any Deposit not actually received by such Lender, or
(v) bound by any future modification of this Lease not consented to
by such Lender.
(G) From and after Tenant's receipt of written
notice from a Lender or from a receiver appointed pursuant to the
terms of such Lender's mortgage or deed of trust (a "Rent Payment
Notice"), Tenant shall pay all Rental under this Lease to such
Lender or as such Lender shall direct in writing. Tenant shall
comply with any Rent Payment Notice notwithstanding any contrary
instruction, direction or assertion from Landlord. A Lender's
delivery to Tenant of a Rent Payment Notice, or Tenant's
compliance therewith, shall not be deemed to: (i) cause such
Lender to succeed to or to assume any obligations or
responsibilities of Landlord under this Lease, all of which shall
continue to be performed and discharged solely by Landlord unless
and until such Lender or a foreclosure sale purchaser succeeds to
Landlord's interest hereunder, or (ii) relieve Landlord of any
obligations under this Lease. Landlord irrevocably directs Tenant
to comply with any Rent Payment Notice, notwithstanding any
contrary direction, instruction, or assertion by Landlord. Tenant
shall be entitled to rely on any Rent Payment Notice.
16. ENTRY BY LANDLORD.
(A) Landlord reserves, and shall at all times
have, the right upon reasonable prior notice (except in the event of
an emergency or in connection with the repair or maintenance
obligations of Landlord hereunder) to enter the Premises (excluding
secure areas reasonably designated in advance in writing by
Tenant) for the following purposes: to inspect them; to show the
Premises to prospective purchasers or mortgagees or during the
last twenty-four (24) months of the Lease Term to prospective
tenants; to post notices of nonresponsibility; and to alter, improve
or repair the Premises and any portion of the Building as permitted
or provided hereunder, all without abatement of Rental; and may
erect scaffolding and other necessary structures in or through the
Premises or the Building where reasonably required by the
character of the work to be performed; provided, however, that any
such entrance or work shall not unreasonably interfere with
Tenant's use of the Premises. If Landlord desires to show the
Premises to prospective purchasers, mortgagees, or tenants,
Landlord's notice shall identify the prospective purchaser,
mortgagee or tenant. Tenant hereby waives any claim for
damages for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the
Premises, and any other loss occasioned by such entry, except for
damage to property or injuries to persons to the extent caused by
the gross negligence or willful misconduct of Landlord and not
covered by the insurance required to be carried by Tenant
hereunder or except to the extent such waiver is prohibited by law,
provided that in no event shall Landlord be liable for any
consequential damages or for any injury or damage to or
interference with Tenant's business, including, but not limited to,
loss of profits or other revenues or loss of business opportunity.
For each of the foregoing purposes, Landlord shall at all times have
and retain a key and/or other access device with which to unlock all
of the doors in, on and about the Premises (excluding Tenant's
vaults, safes and similar areas designated in writing by Tenant in
advance and approved by Landlord); and Landlord shall have the
right to use any and all means which Landlord may deem proper to
open said doors in an emergency in order to obtain entry to the
Premises, and any entry to the Premises obtained by Landlord by
any of said means, or otherwise, shall not under any circumstances
be construed or deemed to be a forcible or unlawful entry into or a
detainer of the Premises, or any portion thereof.
(B) At such time, if at all, as the Building shall
become a multi-tenant building, Landlord shall have the right to
change the arrangement or location or times of access of
entrances or passageways, doors and doorways, and corridors,
elevators, stairs, toilets or other public parts of the Building, and
none of the foregoing shall be deemed an actual or constructive
eviction of Tenant, nor shall it entitle Tenant to any reduction of
Rental hereunder or result in any liability of Landlord to Tenant.
17. VACATION AND ABANDONMENT; REMOVAL OF
PERSONAL PROPERTY. Tenant shall not vacate or abandon the
Premises or any part thereof at any time during the Lease Term.
Tenant understands that if Tenant leaves the Premises or any part
thereof vacant, the risk of fire, other casualty and vandalism to the
Premises and the Building will be increased. Accordingly, such
action by Tenant shall constitute an Event of Default hereunder
regardless of whether Tenant continues to pay Basic Monthly
Rental and other Rental under this Lease. Notwithstanding the
foregoing, Tenant shall have the right, upon reasonable prior
written notice to Landlord, to vacate up to seventy-five percent
(75%) of the rentable square feet of the Premises for a maximum of
sixty (60) days, and such vacation shall not constitute a breach of
this Lease by Tenant, provided that Tenant continues to pay Basic
Monthly Rental and other Rental and to perform all of its other
obligations under this Lease. After the Expiration Date or earlier
termination of this Lease, any movable furniture, equipment, trade
fixtures, or other personal property left on the Premises shall, at the
option of Landlord, be deemed to be abandoned and, whether or
not the property is deemed abandoned, Landlord shall have the
right to remove such property from the Premises and charge
Tenant for the removal and any restoration of the Premises as
provided in Paragraph 8(d). Landlord may charge Tenant for the
storage of Tenant's property left on the Premises at such rates as
Landlord may from time to time reasonably determine, or, Landlord
may, at its option, store Tenant's property in a public warehouse at
Tenant's expense. Notwithstanding the foregoing, neither the
provisions of this Paragraph 17 nor any other provision of this
Lease shall impose upon Landlord any obligation to care for or
preserve any of Tenant's property left upon the Premises, and
Tenant hereby waives and releases Landlord from any claim or
liability in connection with the removal of such property from the
Premises and the storage thereof and specifically waives the
provisions of California Civil Code Section 1542 with respect to
such release. Landlord's action or inaction with regard to the
provisions of this Paragraph 17 shall not be construed as a waiver
of Landlord's right to require Tenant to remove its property, restore
any damage to the Building caused by such removal, and make
any restoration required pursuant to Paragraph 8(d) hereof.
18. DEFAULT AND REMEDIES.
(A) The occurrence of any one or more of the
following events (each, an "Event of Default") shall constitute a
breach of this Lease by Tenant:
(I) Tenant fails to pay any Basic Monthly
Rental or any additional monthly rent payable under Paragraph 4
hereof as and when such rent becomes due and payable and such
failure continues for more than three (3) days after Landlord gives
written notice thereof to Tenant; provided, however, that after the
second such failure in a calendar year, only the passage of time,
but no further notice, shall be required to establish an Event of
Default in the same calendar year; or
(II) Tenant fails to pay any additional rent
or other amount of money or charge payable by Tenant hereunder
as and when such additional rent or amount or charge becomes
due and payable and such failure continues for more than ten (10)
days after Landlord gives written notice thereof to Tenant;
provided, however, that after the second such failure in a calendar
year, only the passage of time, but no further notice, shall be
required to establish an Event of Default in the same calendar year;
or
(III) Tenant fails to immediately remove,
abate or remedy any Hazardous Material located in, on or about
the Premises or the Building in connection with any failure by
Tenant to comply with Tenant's obligations under Paragraph 7(c);
or
(IV) Tenant fails to deliver the estoppel
certificate or the financial statements to Landlord or a Lender, as
the case may be, within the time periods required by
Paragraph 26(c) and Paragraph 26(d), respectively; or Tenant fails
to maintain the policies of insurance required to be provided in
Paragraph 14 or Tenant fails to deliver to Landlord the policies of
insurance required to be provided in Paragraph 14 within five (5)
days after Landlord gives written notice to Tenant requesting same;
or
(V) Tenant fails to perform or breaches
any agreement or covenant of this Lease to be performed or
observed by Tenant (except for those described in clauses (i)
through (iv) above) as and when performance or observance is due
and such failure or breach continues for more than fifteen (15) days
after Landlord gives written notice thereof to Tenant; provided,
however, that if, by the nature of such agreement or covenant,
such failure or breach cannot reasonably be cured within such
period of fifteen (15) days, an Event of Default shall not exist as
long as Tenant commences with due diligence and dispatch the
curing of such failure or breach within such period of fifteen (15)
days and, having so commenced, thereafter prosecutes with
diligence and dispatch and completes the curing of such failure or
breach within sixty (60) days; or
(VI) Tenant (A) is generally not paying its
debts as they become due, (B) files, or consents by answer or
otherwise to the filing against it of, a petition for relief or
reorganization or arrangement or any other petition in bankruptcy
or for liquidation or to take advantage of any bankruptcy,
insolvency or other debtors' relief law of any jurisdiction, (C) makes
an assignment for the benefit of its creditors, (D) consents to the
appointment of a custodian, receiver, trustee or other officer with
similar powers of Tenant or of any substantial part of Tenant's
property, or (E) takes action for the purpose of any of the foregoing;
or
(VII) Without consent by Tenant, a court or
government authority enters an order, and such order is not
vacated within thirty (30) days, (A) appointing a custodian, receiver,
trustee or other officer with similar powers with respect to Tenant or
with respect to any substantial part of Tenant's property, or
(B) constituting an order for relief or approving a petition for relief or
reorganization or arrangement or any other petition in bankruptcy
or for liquidation or to take advantage of any bankruptcy,
insolvency or other debtors' relief law of any jurisdiction, or
(C) ordering the dissolution, winding-up or liquidation of Tenant; or
(VIII) This Lease or any estate of Tenant
hereunder is levied upon under any attachment or execution and
such attachment or execution is not vacated within thirty (30) days;
or
(IX) Tenant vacates (except as expressly
permitted in Section 17) or abandons the Premises (as defined in
Section 1951.3 of the California Civil Code).
(B) If an Event of Default occurs, Landlord shall
have the right at any time to give a written termination notice to
Tenant and, on the date specified in such notice, Tenant's right to
possession shall terminate and this Lease shall terminate. Upon
such termination, Landlord shall have the right to recover from
Tenant:
(I) The worth at the time of award of all
unpaid rent which had been earned at the time of termination;
(II) The worth at the time of award of the
amount by which all unpaid rent which would have been earned
after termination until the time of award exceeds the amount of
such rental loss that Tenant proves could have been reasonably
avoided;
(III) The worth at the time of award of the
amount by which all unpaid rent for the balance of the Lease Term
after the time of award exceeds the amount of such rental loss that
Tenant proves could be reasonably avoided; and
(IV) All other amounts necessary to
compensate Landlord for all the detriment proximately caused by
Tenant's failure to perform all of Tenant's obligations under this
Lease or which in the ordinary course of things would be likely to
result therefrom.
The "worth at the time of award" of the amounts
referred to in clauses (i) and (ii) above shall be computed by
allowing interest at the Interest Rate set forth in Paragraph 3(c).
The "worth at the time of award" of the amount referred to in
clause (iii) above shall be computed by discounting such amount at
the discount rate of the Federal Reserve Bank of San Francisco at
the time of award plus one percent (1%). For the purpose of
determining unpaid rent under clauses (i), (ii) and (iii) above, the
rent reserved in this Lease shall be deemed to be the total Rental
payable by Tenant under Paragraphs 3 and 4 hereof; and for
purposes of computing Tenant's Percentage Share of Operating
Expenses and Real Property Taxes for the calendar year in which
the default occurs and each future calendar year or portion thereof
in the Lease Term, Tenant's Percentage Share of Operating
Expenses and Real Property Taxes shall be assumed to be equal
to the amount thereof for the calendar year prior to the year in
which the default shall occur, increased annually at a rate equal to
the average rate of increase, if any, in such items from the
Commencement Date through the time of award.
(C) Even though Tenant has breached this
Lease, this Lease shall continue in effect for so long as Landlord
does not terminate Tenant's right to possession, and Landlord shall
have all of its rights and remedies, including the right, pursuant to
California Civil Code Section 1951.4, to recover all rent as it
becomes due under this Lease, if Tenant has the right to sublet or
assign, subject only to reasonable limitations. Acts of maintenance
or preservation or efforts to relet the Premises or the appointment
of a receiver upon initiative of Landlord to protect Landlord's
interest under this Lease shall not constitute a termination of
Tenant's right to possession unless written notice of termination is
given by Landlord to Tenant.
(D) The remedies provided for in this Lease are
in addition to all other remedies available to Landlord at law or in
equity by statute or otherwise.
(E) Landlord shall not be in default under this
Lease unless Landlord fails to perform any obligation required to be
performed by Landlord hereunder within thirty (30) days after
written notice of such failure by Tenant to Landlord, specifying in
reasonable detail the nature of Landlord's alleged default, or, if the
nature of Landlord's obligation is such that more than thirty (30)
days are required for performance, then Landlord shall not be in
default if Landlord commences performance within such thirty (30)
day period and thereafter diligently prosecutes such cure to
completion. In no event shall Tenant have the right to terminate or
rescind this Lease as a result of Landlord's default, and Tenant
hereby waives such remedies of termination and rescission and
hereby agrees that Tenant's remedies for Landlord's default
hereunder and for breach of any promise or inducement shall be
limited to a suit for damages and/or injunction. In addition, Tenant
hereby covenants that, prior to exercise of any such remedies, it
will give all Holders notice and an opportunity to cure any default by
Landlord in accordance with Paragraph 15(d). If and when a
Holder has performed on behalf of Landlord, such default shall be
deemed cured.
19. DAMAGE BY FIRE OR OTHER CASUALTY.
(A) Repair Obligations. If the Premises or any
Common Areas of the Building providing access to the Premises
are damaged by fire, earthquake or other peril (a "Casualty"),
Landlord shall, subject to the provisions of Paragraphs 19(b), 19(c)
and 19(d) below, proceed with reasonable promptness to repair
such damage and restore the Premises (including the Tenant
Improvements and Alterations approved by Landlord) and such
Common Areas to substantially the same condition as existed
before the Casualty to the extent reasonably practicable
(collectively, "Restore" or "Restoration"); provided, however, that
any such Restoration shall be subject to (i) modifications required
by zoning or building codes and other Applicable Laws and, in the
case of Restoration to the Common Areas, to modifications then
considered desirable by Landlord; and (ii) delays resulting from a
failure to promptly receive insurance proceeds or to obtain
necessary governmental approvals, or any other delay beyond
Landlord's reasonable control. Notwithstanding the foregoing,
Landlord shall have no obligation with respect to, and if Landlord
elects or is required to perform any Restoration hereunder, Tenant
shall be responsible for and shall, repair and replace at its sole cost
all of Tenant's equipment, furniture, fixtures and other personal
property in the Premises and any Telecommunications Lines in or
serving the Premises.
(B) Landlord's Termination Rights. In the event
of any of the following circumstances, Landlord may elect either to
terminate this Lease or to perform the Restoration, as more
particularly described in Paragraph 19(c) below:
(I) If the Casualty occurs during Lease
Years 1 through 12 and the Restoration cannot, in Landlord's good
faith judgment, be completed within eighteen (18) months following
the date of the Casualty (when such Restoration is made without
the payment of overtime or other premiums), or
(II) If the Casualty occurs during Lease
Year 13 and Restoration cannot, in Landlord's good faith judgment,
be completed within one hundred eighty (180) days following the
date of the Casualty (when such Restoration is made without the
payment of overtime or other premiums), or
(III) If the Casualty occurs during Lease
Year 14 and Restoration cannot, in Landlord's good faith judgment,
be completed within ninety (90) days following the date of the
Casualty (when such Restoration is made without payment of
overtime or other premiums), or
(IV) If the Casualty occurs during Lease
Year 15 and Restoration cannot, in Landlord's good faith judgment,
be completed within thirty (30) days following the date of the
Casualty (when Restoration is made without payment of overtime
in other premiums), or
(V) If the Casualty is uninsured (a
Casualty shall not be deemed uninsured by reason of a deductible
amount under the applicable insurance policy), or
(VI) If insurance proceeds sufficient to
complete the Restoration are not available due to the exercise of
rights of any Holder to collect such proceeds, or
(VII) If governmental approval cannot
reasonably be obtained to perform the Restoration, or if
Restoration of the Building cannot be completed except in a
substantially different structural or architectural form than existed
before the Casualty.
(C) Landlord's Repair Notice. Landlord shall,
within ninety (90) days of the date of a Casualty, provide a written
notice to Tenant ("Landlord's Casualty Notice") indicating
Landlord's election (i) to perform the Restoration, including
Landlord's good faith estimate of the period to complete the
Restoration, in which event this Lease will continue in full force and
effect, subject to Tenant's termination rights pursuant to Section
19(d) below, and provided that the Basic Monthly Rental and
Tenant's Percentage Share of Operating Expenses and Real
Property Taxes shall be reduced as provided in Paragraph 19(e)
below, or (ii) to terminate this Lease as of a date specified in
Landlord's Casualty Notice, which date shall not be more than thirty
(30) days after the date of such notice. If Landlord elects to
terminate this Lease as provided above, this Lease and all interest
of Tenant in the Premises shall terminate on the termination date
specified in Landlord's Casualty Notice, and the Basic Monthly
Rental and Tenant's Percentage Share of Operating Expenses and
Real Property Taxes, reduced (subject to the conditions set forth in
Paragraph 19(e) below) in proportion to the area of the Premises
rendered untenantable by the damage, shall be paid up to the date
of such termination, Landlord hereby agreeing to refund to Tenant
any Rental theretofore paid for any period of time subsequent to
the termination date. Landlord shall have no liability to Tenant, and
Tenant shall not be entitled to terminate this Lease except as
expressly provided in Paragraph 19(d) below, if the Restoration is
not in fact completed within the anticipated Restoration period set
forth in Landlord's Casualty Notice, so long as Landlord proceeds
with reasonable diligence to complete the Restoration.
(D) Tenant's Termination Rights. If the Premises
are damaged by a Casualty, Tenant may elect to terminate this
Lease in the event of any of the following circumstances:
(I) If the Casualty occurs during Lease
Years 1 through 12 and the Restoration cannot, in Landlord's good
faith judgment, be completed within eighteen (18) months following
the date of the Casualty (when such Restoration is made without
the payment of overtime or other premiums), or
(II) If the Casualty occurs during Lease
Year 13 and Restoration cannot, on Landlord's good faith
judgment, be completed within one hundred eighty (180) days
following the date of the Casualty (when such Restoration is made
without the payment of overtime or other premiums), or
(III) If the Casualty occurs during Lease
Year 14 and Restoration cannot, in Landlord's good faith judgment,
be completed within ninety (90) days following the date of the
Casualty (when such Restoration is made without payment of
overtime or other premiums), or
(IV) If the Casualty occurs during Lease
Year 15 and Restoration cannot, in Landlord's good faith judgment,
be completed within thirty (30) days following the date of the
Casualty (when Restoration is made without payment of overtime
in other premiums), or
(V) If the Restoration is not substantially
completed within six (6) months after Landlord's good faith
estimate of the time period necessary to complete Restoration set
forth in Landlord's Casualty Notice; provided, however, that said six
(6) month period shall be extended to the extent of any delays
attributable to Force Majeure, as defined in Paragraph 1.6(c) of the
Work Letter, and/or any delays attributable to the acts or omissions
of Tenant or any Tenant Parties.
Tenant's termination notice under Paragraphs 19(d)(i)
through 19(d)(iv) above must be given in writing to Landlord, if at
all, within ten (10) days after Tenant's receipt of Landlord's
Casualty Notice. Tenant's termination notice under
Paragraph 19(d)(v) above must be given in writing to Landlord, if at
all, within ten (10) days after expiration of said six (6) month period
(as the same may be extended). If Tenant elects to terminate this
Lease as provided above, this Lease and all interest of Tenant in
the Premises shall terminate on the termination date specified in
Tenant's termination notice, which date shall not be more than
thirty (30) days after the date of Tenant's termination notice, and
the Basic Monthly Rental and Tenant's Percentage Share of
Operating Expenses and Real Property Taxes, reduced (subject to
the conditions set forth in Paragraph 19(e) below) in proportion to
the area of the Premises rendered untenantable by the damage,
shall be paid up to the date of such termination, Landlord hereby
agrees to refund to Tenant any Rental theretofore paid for any
period of time subsequent to the termination date. If both Landlord
and Tenant shall elect to terminate the Lease as a result of a
Casualty, this Lease shall terminate on the earlier of the
termination dates set forth in Landlord's and Tenant's termination
notices.
(E) Rent Abatement. If neither party elects to
terminate this Lease under Paragraphs 19(c) or 19(d) above, this
Lease shall remain in full force and effect, provided that Tenant
shall be entitled to a reduction of Basic Monthly Rental and
Tenant's Percentage Share of Operating Expenses and Real
Property Taxes in the proportion that the area of the Premises
rendered untenantable by such damage bears to the total area of
the Premises, but only to the extent that Landlord is reimbursed
from the proceeds of rental interruption insurance. Tenant shall be
entitled to such rent abatement from the date of the Casualty for as
long as any portion of the Premises remains untenantable due to
the Casualty. Tenant's right to a reduction of Basic Monthly Rental
and Tenant's Percentage Share of Operating Expenses and Real
Property Taxes under this Paragraph 19(e) and Tenant's right to
terminate this Lease under Paragraph 19(d) above shall be
Tenant's sole remedies in connection with any such Casualty.
Tenant shall not be entitled to any compensation or damages from
Landlord for damage to any of Tenant's leasehold improvements or
personal property, for loss of use of the Premises or any part
thereof, for damage to Tenant's business or profits, for any
disturbance caused by a Casualty, for or in connection with any
Restoration hereunder, or for any direct, indirect or consequential
damages, whether or not caused by the negligence or Landlord or
any Landlord Parties due to, arising out of, or as a result of a
Casualty.
(F) Waiver of Statutory Provisions. The
provisions of this Lease, including this Paragraph 19, constitute an
express agreement between Landlord and Tenant with respect to
any and all damage to, or destruction of, all or any part of the
Premises or the Building, and any statute or regulation of the State
of California, including, without limitation, subsection 2 of Section
1932, subsection 4 of Section 1933, and Sections 1941 and 1942
of the California Civil Code, with respect to any rights or obligations
concerning damage or destruction in the absence of an express
agreement between the parties, and any other statute or regulation,
now or hereafter in effect, shall have no application to this Lease or
any damage or destruction to all or any part of the Premises or the
Building.
20. EMINENT DOMAIN.
(A) If all or part of the Premises shall be taken by
any public or quasi-public authority under the power of eminent
domain or conveyance in lieu thereof, this Lease shall terminate as
to any portion of the Premises so taken or conveyed on the date
when title or the right to possession vests in the condemnor.
(B) If (i) a part of the Premises shall be taken by
any public or quasi-public authority under the power of eminent
domain or conveyance in lieu thereof; and (ii) Tenant is reasonably
able to continue the operation of Tenant's business in that portion
of the Premises remaining; and (iii) Landlord elects to restore the
Premises to an architectural whole, then this Lease shall remain in
effect as to said portion of the Premises remaining, and the Basic
Monthly Rental and Tenant's Percentage Share of Operating
Expenses and Real Property Taxes payable from the date of the
taking shall be reduced in the same proportion as the area of the
Premises taken bears to the total area of the Premises. If, after a
partial taking, Tenant is not reasonably able to continue the
operation of its business in the Premises or Landlord elects not to
restore the Premises as hereinabove described or if any material
portion of the Premises is taken during the last twelve (12) months
of the Lease Term, this Lease may be terminated by either
Landlord or Tenant by giving written notice to the other party within
thirty (30) days of the date of the taking. Such notice shall specify
the date of termination which shall be not less than thirty (30) nor
more than sixty (60) days after the date of said notice.
(C) If a portion of the Building is taken, whether
any portion of the Premises is taken or not, and Landlord
determines that it is not economically feasible to continue operating
the portion of the Building remaining, then Landlord shall have the
option for a period of thirty (30) days after such determination to
terminate this Lease. If Landlord determines that it is economically
feasible to continue operating the portion of the Building remaining
after such taking, then this Lease shall remain in effect, with
Landlord, at Landlord's cost, restoring the Building to an
architectural whole.
(D) All compensation awarded or received in
connection with a taking or conveyance described in this
Paragraph 20 shall be the property of Landlord, and Tenant hereby
assigns to Landlord any and all elements of said compensation
which Tenant would, in the absence of said assignment, have been
entitled to receive. Specifically, and without limiting the generality
of the foregoing, said assignment is intended to include: (i) the
"bonus value" represented by the difference, if any, between Rental
under this Lease and market rent for the unexpired Lease Term,
(ii) the value of improvements to the Premises, whether said
improvements were paid for by Landlord or by Tenant, (iii) the
value of any trade fixtures, and (iv) the value of any and all other
items and categories of property for which payment of
compensation may be made in any such proceeding.
Notwithstanding the foregoing, Tenant shall be entitled to receive
any award of compensation for loss of or damage to the goodwill of
Tenant's business (but only to the extent the same does not
constitute "bonus value") and for any moving or relocation
expenses which Tenant is entitled under Applicable Laws to
recover directly from the public agency which acquires the
Premises. In addition, Tenant shall be entitled to seek directly from
the public agency acquiring the Premises a separate award for the
unamortized cost of the Tenant Improvements or Alterations
installed at Tenant's expense, provided that such award does not
reduce any award otherwise allocable or payable to Landlord.
(E) Tenant hereby waives Sections 1265.110
through 1265.160 of the California Code of Civil Procedure.
21. HOLDING OVER. Any holding over after the
expiration or other termination of this Lease with the written
consent of Landlord delivered to Tenant shall be construed to be a
tenancy from month to month at the Basic Monthly Rental in effect
on the date of such expiration or termination on the terms,
covenants and conditions herein specified so far as applicable.
Any holding over after the expiration or other termination of this
Lease without the written consent of Landlord shall be construed to
be a tenancy at sufferance on all the terms set forth herein, except
that the Basic Monthly Rental shall be an amount equal to one
hundred fifty percent (150%) of the Basic Monthly Rental payable
by Tenant immediately prior to such holding over. Acceptance by
Landlord of Rental after the expiration or termination of this Lease
shall not constitute a consent by Landlord to any such tenancy from
month to month or result in any other tenancy or any renewal of the
term hereof. Tenant acknowledges that if Tenant holds over without
Landlord's consent, such holding over may compromise or
otherwise affect Landlord's ability to enter into new leases with
prospective tenants regarding the Premises. Therefore, if Tenant
fails to surrender the Premises upon the expiration or other
termination of this Lease, then, in addition to any other liabilities to
Landlord accruing therefrom, Tenant shall protect, defend,
indemnify and hold Landlord harmless from all Claims resulting
from such failure, including, without limiting the generality of the
foregoing, any claims made by any succeeding tenant founded
upon such failure to surrender and any lost profits to Landlord
resulting therefrom. The provisions of this Paragraph are in addition
to, and do not affect, Landlord's right to re-entry or other rights
hereunder or provided by law.
22. SIGNAGE. Subject to compliance with Applicable
Laws, so long as CNET NETWORKS, INC. and/or Tenant Affiliates
shall occupy at least forty-five percent (45%) of the rentable square
feet in the Building, Tenant shall be entitled during the Lease Term
to maintain one sign identifying Tenant on the exterior of the
Building. The size, location, and method of installing such sign
shall be subject to Landlord's prior approval, which shall not be
unreasonably withheld or delayed. Tenant, at Tenant's expense,
shall fabricate, install, repair and maintain such sign in good
condition and repair. Upon the expiration or earlier termination of
this Lease, Tenant shall cause such sign to be removed and shall
restore the exterior of the Building to the condition existing prior to
the installation of such sign. Tenant shall have no right to transfer,
assign, license or otherwise grant signage rights to any third
parties.
23. COMMUNICATIONS AND COMPUTER LINES.
(A) Tenant Responsibilities. Subject to the
terms and conditions of this Paragraph 23, Tenant shall, at
Tenant's sole cost and expense, be solely responsible for installing,
securing, maintaining and repairing such telephone and other
electronic telecommunications service to the Premises as Tenant
may require for its use and occupancy thereof, and Landlord shall
have no obligations or liability whatsoever to Tenant with respect to
the provision of such services to the Premises. Tenant may install,
replace, remove or modify telecommunications and data lines
("Lines") within the Building as Tenant deems necessary for its
operations in the Premises; provided that at the time of installation,
Tenant shall label all of its Lines, on each floor through which they
pass, with an identification system reasonably approved by
Landlord and Tenant shall use, maintain and operate Tenant's
Lines in accordance with and subject to all Applicable Laws.
(B) Multi-Tenant Building. At such time, if at all,
as the Building shall become a multi-tenant building, Tenant shall
reasonably cooperate to accommodate the telephone and
telecommunications requirements of other tenants of the Building.
(C) Removal. Landlord reserves the right to
require that Tenant, at Tenant's sole cost and expense, remove
any Lines located in or serving the Premises which are at any time
in violation of any Applicable Laws or present a dangerous or
potentially dangerous condition (whether such Lines were installed
by Tenant or any other party). In addition, Landlord reserves the
right to require Tenant to remove any or all Lines installed by or for
Tenant within or serving the Premises upon the expiration or earlier
termination of this Lease, provided Landlord gives Tenant notice of
such requirement prior to, or within thirty (30) days following, such
expiration or earlier termination of this Lease. Any Lines not
removed by Tenant shall, at Landlord's option, become the
property of Landlord (without payment by Landlord). If Tenant fails
to remove such Lines as required by Landlord, Landlord may, after
thirty (30) days' written notice to Tenant, remove such Lines or
remedy such other violation at Tenant's expense (without limiting
Landlord's other remedies available under this Lease or Applicable
Laws).
(D) Waiver of Claims. Except to the extent
arising from the willful or criminal misconduct of Landlord or
Landlord's employees or agents, Landlord shall have no liability for
damages arising from, and Landlord does not warrant that Tenant's
use of any Lines will be free from the following (collectively called
"Line Problems"): (i) any shortages, failures, variations,
interruptions, disconnections, loss or damage caused by the
installation, maintenance, replacement, use or removal of Lines by
or for other tenants or occupants of the Building, by any failure of
the environmental conditions or the power supply for the Building to
conform to any requirements for the Lines or any associated
equipment, or any other problems associated with any Lines by any
other cause; (ii) any failure of any Lines to satisfy Tenant's
requirements; or (iii) any eavesdropping or wire-tapping by
unauthorized parties. Without limiting the generality of any other
provision of this Lease, in no event shall Landlord be liable for
damages by reason of loss of profits, business interruption or other
consequential damage arising from any Line Problems. Tenant
further waives any right to claim that any Line Problems constitute
grounds for a claim of abatement of Rent, actual or constructive
eviction or termination of this Lease.
24. PARKING. Tenant shall have the right, during the
Lease Term, to the exclusive use of all of the parking spaces in the
Parking Facilities. Tenant acknowledges that the Parking Facilities
are exclusively within Tenant's control, and Tenant, at Tenant's
expense, shall be responsible for operating and managing the
Parking Facilities. Landlord agrees that Tenant shall be entitled to
permit third parties to use the Parking Facilities upon such terms
and conditions as Tenant shall determine. Tenant expressly
releases Landlord from all liability, and shall protect, indemnify,
defend and hold Landlord and the Indemnitees harmless from any
Claims relating to the Parking Facilities, including, without
limitation, Claims resulting from theft or other criminal activities,
except to the extent caused by the gross negligence or willful
misconduct of Landlord and not covered by the insurance required
to be carried by Tenant hereunder or except to the extent such
release and/or indemnity obligation is prohibited by law.
25. QUIET ENJOYMENT. Landlord covenants, in lieu
of any implied covenant of quiet possession or quiet enjoyment, that
so long as Tenant is in compliance with the covenants and
conditions set forth in this Lease, Tenant shall have the right to quiet
enjoyment of the Premises without hindrance or interference from
Landlord or those claiming through Landlord, and subject to the
covenants and conditions set forth in this Lease and to the rights of
any Holders of Superior Interests.
26. MISCELLANEOUS.
(A) Limitation of Landlord's Liability. Any liability
of Landlord (including, without limitation, Landlord's direct or
indirect partners, shareholders, members, affiliates, or agents, and
the officers, directors, members and employees of Landlord or any
such other person) (collectively, "Landlord Parties") to Tenant
under this Lease shall be limited to the equity interest of Landlord
in the Building and Tenant agrees to look solely to such interest for
the recovery of any judgment, it being intended that Landlord and
such other persons shall not be personally liable for any deficiency
or judgment. Notwithstanding any other provision of this Lease,
Landlord shall not be liable for loss of or damage to artwork,
currency, jewelry, bullion, unique or valuable documents, securities
or other valuables, or for other property not in the nature of ordinary
fixtures, furnishings and equipment used in general administrative
and executive office activities and functions. Wherever in this
Lease Tenant (i) releases Landlord from any claim or liability,
(ii) waives or limits any right of Tenant to assert any claim against
Landlord or to seek recourse against any property of Landlord or
(iii) agrees to indemnify Landlord against any matters, the relevant
release, waiver, limitation or indemnity shall run in favor of and
apply to Landlord and Landlord Parties. Further, in no event shall
Landlord or Landlord Parties be liable under any circumstances for
any consequential damages or for injury or damage to, or
interference with, Tenant's business, including but not limited to,
loss of profits, loss of rents or other revenues, loss of business
opportunity, loss of goodwill, or loss of use, however occurring.
(B) Sale by Landlord. In the event of a sale or
conveyance of the Real Property, Landlord shall thereby be
released from any further liability upon any of the terms, covenants
or conditions (express or implied) herein contained in favor of
Tenant, and in such event, Tenant agrees to look solely to the
successor in interest of Landlord. Tenant agrees to attorn to the
successor in interest of Landlord. If Tenant provides Landlord with
any security for Tenant's performance of its obligations hereunder,
and Landlord transfers, or provides a credit with respect to, such
security to the grantee or transferee of Landlord's interest in the
Real Property, Landlord shall be released from any further
responsibility or liability for such security.
(C) Estoppel Letter. From time to time, upon
written request of Landlord, Tenant shall execute, acknowledge
and deliver to Landlord or its designee, an Estoppel Certificate in
substantially the form attached hereto as Exhibit F and with any
other statements reasonably requested by Landlord or its
designee. Any such Estoppel Certificate delivered pursuant to this
Paragraph 26(c) may be relied upon by a prospective purchaser or
a mortgagee of all or any portion of the Real Property. If Tenant
shall fail to provide such certificate within fifteen (15) days after
receipt by Tenant of a written request by Landlord, such failure
shall, at Landlord's election, constitute an Event of Default under
this Lease, and Tenant shall be deemed to have admitted the
accuracy of any information supplied by Landlord to a prospective
purchaser or mortgagee. In addition, from time to time, upon
written request of Tenant, Landlord shall execute, acknowledge
and deliver to Tenant, an Estoppel Certificate in substantially the
form attached hereto as Exhibit F and with any other statements
reasonably requested by Tenant.
(D) Financial Statements. On or before April 1 of
each year, Tenant shall deliver to Landlord Tenant's financial
statements ("Financial Statements") for the fiscal year of Tenant
ended on the previous December 31, which Financial Statements
shall include a combined balance sheet of Tenant and its combined
subsidiaries as at the end of such fiscal year, a combined
statement of operations of Tenant and its combined subsidiaries for
such fiscal year, and a certificate of Tenant's auditor (or, if audited
Financial Statements are not available, then a certificate of
Tenant's Chief Financial Officer) to the effect that such Financial
Statements were prepared in accordance with generally accepted
accounting principles consistently applied and fairly present the
financial condition and operations of Tenant and its combined
subsidiaries for and as at the end of such fiscal year.
(E) Right of Landlord To Perform. All terms and
covenants of this Lease to be performed or observed by Tenant
shall be performed or observed by Tenant at Tenant's expense and
without any reduction of Rental. If Tenant fails to pay any Rental
hereunder or fails to perform any other term or covenant hereunder
on its part to be performed after notice and expiration of applicable
cure periods, if any, and such failure shall continue for ten (10)
days (or such shorter period as may be reasonable under
emergency circumstances) after written notice thereof by Landlord,
Landlord, without waiving or releasing Tenant from any obligation
of Tenant hereunder, may make any such payment or perform any
such other term or covenant on Tenant's part to be performed but
shall not be obligated to do so. All sums so paid by Landlord and
all necessary costs of such performance by Landlord, together with
interest thereon at the Interest Rate from the date of such payment
or performance by Landlord, shall be paid (and Tenant covenants
to make such payment) to Landlord on demand by Landlord, and
Landlord shall have (in addition to any other right or remedy of
Landlord) the same rights and remedies in the event of
non-payment thereof by Tenant as in the case of failure by Tenant
in the payment of Rental hereunder.
(F) Rules and Regulations. Tenant agrees to
faithfully observe and to comply with the Building Rules and
Regulations attached hereto as Exhibit G and incorporated herein
by this reference, and all modifications of and additions thereto
from time to time put into effect by Landlord of which Tenant shall
have notice. Landlord shall not be responsible to Tenant for the
non-performance by any other tenant or occupant of the Building of
any of said Building Rules and Regulations. In the event any of the
Building Rules and Regulations conflict with any express provision
of this Lease, the provisions of this Lease shall govern. At such
time, if at all, as the Building shall become a multi-tenant building,
Landlord agrees that it will not enforce the Building Rules and
Regulations in a discriminatory manner.
(G) Attorneys' Fees. In case any suit or other
proceeding shall be brought for an unlawful detainer of the
Premises or for the recovery of any Rental due under the
provisions of this Lease or because of the failure of performance or
observance of any other term or covenant herein contained on the
part of Landlord or Tenant, the unsuccessful party in such suit or
proceeding shall pay to the prevailing party therein reasonable
attorneys' fees and costs which shall include fees and costs of any
appeal, all as fixed by the Court. Any such attorneys' fees and
other expenses incurred by either party in enforcing a judgment in
its favor under this Lease shall be recoverable separately from and
in addition to any other amount included in such judgment, and
such attorneys' fees obligation is intended to be severable from the
other provisions of this Lease and to survive and not be merged
into any such judgment. In addition, if Landlord utilizes the
services of an attorney for the purpose of collecting any Rental due
and unpaid by Tenant or in connection with any other breach of this
Lease by Tenant, Tenant agrees to pay Landlord actual attorneys'
fees for such services, regardless of the fact that no legal action
may be commenced or filed by Landlord.
(H) Waiver of Jury Trial; Venue and Jurisdiction.
Each party hereto shall not seek a jury trial, hereby waives trial by
jury, and hereby further waives any objection to venue in the City
and County of San Francisco, and agrees and consents to personal
jurisdiction of the courts of the State of California, in any action or
proceeding or counterclaim brought by any party hereto against the
other on any matter whatsoever arising out of or in any way
connected with this Lease, the relationship of Landlord and Tenant,
Tenant's use or occupancy of the Premises, or any claim of injury or
damage, or the enforcement of any remedy under any statute,
emergency or otherwise, whether any of the foregoing is based on
this Lease or on tort law. No party will seek to consolidate any such
action in which a jury has been waived with any other action in which
a jury trial cannot or has not been waived. It is the intention of the
parties that these provisions shall be subject to no exceptions. By
execution of this Lease the parties agree that this provision may be
filed by any party hereto with the clerk or judge before whom any
action is instituted, which filing shall constitute the written consent to
a waiver of jury trial pursuant to and in accordance with Section 631
of the California Code of Civil Procedure. No party has in any way
agreed with or represented to any other party that the provisions of
this Paragraph 26(h) will not be fully enforced in all instances. The
provisions of this Paragraph 26(h) shall survive the expiration or
earlier termination of this Lease.
(I) Waiver. The failure of Landlord to object to
or to assert any remedy by reason of Tenant's failure to perform or
observe any covenant or term hereof or its failure to assert any
rights by reason of the happening or non-happening of any
condition hereof shall not be deemed a waiver of its right to assert
and enforce any remedy it may have by reason of such failure on
the part of Tenant or the happening or non-happening of such
condition or a waiver of its rights to enforce any of its rights by
reason of any subsequent failure of Tenant to perform or observe
the same or any other term or covenant or by reason of the
subsequent happening or non-happening of the same or any other
condition. No custom or practice which may develop between the
parties hereto during the Lease Term shall be deemed a waiver of,
or in any way affect, the right of Landlord to insist upon
performance and observance by Tenant in strict accordance with
the terms hereof. The acceptance of Rental hereunder by Landlord
shall not be deemed to be a waiver of any preceding failure of
Tenant to perform or observe any term or covenant of this Lease,
other than the failure of Tenant to pay the particular Rental so
accepted, irrespective of any knowledge on the part of Landlord of
such preceding failure at the time of acceptance of such Rental,
and no endorsement or statement on any check or any letter
accompanying any check or payment of Rental shall be deemed an
accord and satisfaction, and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance
of such installment or payment of Rental or pursue any other
remedies available to Landlord. No receipt of money by Landlord
from Tenant after the termination of this Lease or Tenant's right of
possession of the Premises shall reinstate, continue or extend the
Lease Term. Receipt or acceptance of payment from anyone other
than Tenant, including a Transferee, is not a waiver of any breach of
Paragraph 12, and Landlord may accept such payment on account
of the amount due without prejudice to Landlord's right to pursue any
remedies available to Landlord.
(J) Light, Air and View. Tenant agrees that no
diminution or shutting off of light, air or view by any structure which
may be erected (whether or not by Landlord) on property adjacent
to the Building shall in any way affect this Lease, entitle Tenant to
any reduction of Rental hereunder or result in any liability of
Landlord to Tenant.
(K) Notices. All notices, demands, requests or
other communications (collectively, "Notices") which may be or are
required to be given by either party to the other hereunder shall be
in writing. All Notices by Landlord to Tenant shall be sufficiently
given, made or delivered if personally served on Tenant, or if sent
by United States certified or registered mail, postage prepaid, or by
a reputable overnight courier service addressed to Tenant at
Tenant's address for notices as set forth in Paragraph C of the
Summary of Lease Terms. All Notices by Tenant to Landlord shall
be sufficiently given, made or delivered if personally served on
Landlord, or sent by United States certified or registered mail,
postage prepaid, or by a recognized air carrier service addressed
to Landlord at Landlord's address for notices specified in
Paragraph B of the Summary of Lease Terms. Each Notice shall
be deemed received upon the earlier of receipt or three (3) days
after the date it was mailed as provided in this Paragraph 26(k), if
sent by registered or certified mail, or, one (1) business day after
delivery to the overnight courier specifying "next business day"
delivery, or upon the date personal delivery is made; provided,
however, that any refusal to accept delivery shall be deemed to
constitute receipt. Either party may change it address for notices
by giving the other party notice thereof in accordance with this
Paragraph 26(k).
(L) Name. Tenant agrees that it shall not,
without first obtaining the written consent of Landlord (which
consent may be withheld in Landlord's sole and absolute
discretion): (i) use the name of the Building for any purpose other
than as the address of the business conducted by Tenant in the
Premises, or (ii) use for any purpose any image of, rendering of, or
design based on, the exterior appearance or profile of the Building.
(M) Governing Law; Severability; Construction.
This Lease shall in all respects be governed by and construed in
accordance with the laws of California. If any provision of this
Lease shall be invalid, unenforceable or ineffective for any reason
whatsoever, all other provisions hereof shall be and remain in
effect. The language in all parts of this Lease shall be construed
according to its normal and usual meaning and not strictly for or
against either Landlord or Tenant. This Lease shall be construed as
though the covenants between Landlord and Tenant are
independent. Except as set forth in Paragraph 9(c), Tenant
expressly waives the benefit of any statute to the contrary and
agrees that if Landlord fails to perform its obligations under this
Lease, Tenant shall not be entitled to make any repairs or perform
any acts at Landlord's expense; or to any setoff of the Rental under
this Lease against Landlord. The foregoing, however, shall in no
way impair Tenant's right to bring a separate action against
Landlord for any violation by Landlord of the provisions of this
Lease if notice is first given to Landlord and any Holder, and an
opportunity is granted to Landlord and that Holder to correct those
violations as provided in Paragraph 15 hereof.
(N) Definitions and Paragraph Headings;
Successors. The words "include," "includes" and "including" shall
be deemed to be followed by the phrase "without limitation." The
term "Landlord" or any pronoun used in place thereof includes the
plural as well as the singular and the successors and assigns of
Landlord. The term "Tenant" or any pronoun used in place thereof
includes the plural as well as the singular and individuals, firms,
associations, partnerships and corporations, and their and each of
their respective heirs, executors, administrators, successors and
permitted assigns, according to the context hereof. The provisions
of this Lease shall inure to the benefit of and bind Landlord and
Tenant and their respective heirs, executors, administrators,
successors and permitted assigns. The term "person" includes the
plural as well as the singular and individuals, firms, associations,
partnerships and corporations. The term "Lease" shall mean this
Lease, and the exhibits and any addenda attached hereto, as the
same may from time to time be supplemented, amended or
modified. Words used in any gender include other genders. If
there be more than one Tenant the obligations of Tenant hereunder
are joint and several. The paragraph headings of this Lease are for
convenience of reference only and shall have no effect upon the
construction or interpretation of any provision hereof.
(O) Time. Time is of the essence of this Lease
with respect to the payment of Rental and the performance of all
obligations.
(P) Examination of Lease. Submission of this
instrument for examination or signature by Tenant does not
constitute a reservation of or option for a lease, and this instrument
is not effective as a lease or otherwise until its execution and
delivery by both Landlord and Tenant.
(Q) Waiver Of Redemption By Tenant. Tenant
hereby waives, for Tenant and for all those claiming under Tenant,
any and all rights now or hereafter existing to redeem by order or
judgment of any court or by any legal process or writ, Tenant's right
of occupancy of the Premises after any termination of this Lease.
(R) Recordation. Neither this Lease, nor any
notice or memorandum regarding the terms hereof, shall be
recorded by Tenant. Any such unauthorized recording shall be an
Event of Default for which there shall be no cure or grace period.
(S) Survival. The waivers of the right of jury trial,
the other waivers of claims or rights, the releases and the
indemnification obligations of Landlord and Tenant under this Lease
shall survive the expiration or termination of this Lease, and so shall
all other obligations or agreements of Landlord or Tenant which by
their terms survive expiration or termination of this Lease.
(T) Brokerage. Landlord and Tenant covenant
and represent to each other that they have dealt with no brokers in
connection with this Lease other than Landlord's Broker(s) and
Tenant's Broker(s) listed on the Summary of Lease Terms.
Landlord and Tenant agree to protect, defend, indemnify and hold
each other harmless from any and all Claims resulting from a
breach of the foregoing representation.
(U) Confidentiality. Tenant acknowledges that
the content of this Lease and any related documents are
confidential information. Tenant shall keep such confidential
information strictly confidential and shall not, without the prior
written consent of Landlord, which shall not be unreasonably
withheld, disclose such confidential information to any person or
entity other than Tenant's financial, legal and space planning
consultants, or as required by Applicable Laws.
(V) Authority. If Tenant is a corporation (or other
business organization), Tenant and each person executing this
Lease on behalf of Tenant represents and warrants to Landlord
that (i) Tenant is duly incorporated (or organized) and validly
existing under the laws of its state of incorporation (or
organization), (ii) Tenant is qualified to do business in California,
(iii) Tenant has full right, power and authority to enter into this
Lease and to perform all of Tenant's obligations hereunder, and
(iv) the execution, delivery and performance of this Lease has been
duly authorized by Tenant and each person signing this Lease on
behalf of the Tenant is duly and validly authorized to do so.
Concurrently with signing this Lease, Tenant shall deliver to
Landlord a true and correct copy of resolutions duly adopted by the
board of directors or constituent partners or members of Tenant,
certified by the secretary of Tenant to be true and correct,
unmodified and in full force, which authorize and approve this
Lease and authorize each person signing this Lease on behalf of
Tenant to do so.
(W) First Source Hiring Program. The City and
County of San Francisco adopted a City-wide "First Source Hiring
Program" on August 3, 1998 by Ordinance No. 264-98, codified at
San Francisco Administrative Code Sections 83.1-83.18. The First
Source Hiring Program ("FSHP") is designed to identify entry level
positions associated with commercial activities and provide first
interview opportunities to graduates of City-sponsored training
programs. Tenant acknowledges that its activities on the Premises
are subject to FSHP. Although Landlord makes no representation
or warranty as to the interpretation or application of FSHP to the
Premises, or to Tenant's activities thereon, Tenant acknowledges
that (i) FSHP may impose obligations on Tenant, including good
faith efforts to meet requirements and goals regarding interviewing,
recruiting, hiring and retention of individuals for entry level
positions; (ii) FSHP requirements could also apply to certain
contracts and subcontracts entered into by Tenant regarding the
Premises, including construction contracts; and (iii) FSHP
requirements, if applicable, may be imposed as a condition of
permits, including building permits, issued for construction or
occupancy of the Premises.
(X) Amendments. This Lease may not be
amended or modified in any respect whatsoever except by an
instrument in writing signed by Landlord and Tenant.
(Y) Exhibits and Addenda; Entire Agreement.
The Exhibits and Addenda referenced in the Summary of Lease
Terms are a part of this Lease and are incorporated herein by this
reference. In the event of any discrepancy between this Lease and
any such Exhibit or Addendum, the Exhibit or Addendum shall
control. This Lease is the entire and integrated agreement
between Landlord and Tenant with respect to the subject matter of
this Lease, the Premises and the Building. There are no oral
agreements between Landlord and Tenant affecting this Lease,
and this Lease supersedes and cancels any and all previous
negotiations, arrangements, brochures, offers, agreements and
understandings, oral or written, if any, between Landlord and
Tenant or displayed by Landlord to Tenant with respect to the
subject matter of this Lease, the Premises or the Building. There
are no representations between Landlord and Tenant or between
any real estate broker and Tenant other than those expressly set
forth in this Lease and all reliance with respect to any
representations is solely upon representations expressly set forth in
this Lease.
27. USE OF ROOF.
(A) Landlord hereby grants to Tenant a non-
exclusive license, subject to the terms and conditions of this
Paragraph 27, at Tenant's sole cost and expense, to install and
maintain on the roof of the Building, during the Lease Term,
communications equipment used in the conduct of Tenant's
business at the Premises ("Communications Equipment"). Tenant
shall obtain Landlord's prior written approval, which shall not be
unreasonably withheld or delayed, with respect to the type, size,
number and location of the Communications Equipment, as well as
the method of installation of the Communications Equipment.
Landlord may require that the Communications Equipment be
located to minimize its visibility (including from neighboring
buildings), and/or that screens or walls be installed, at Tenant's
expense, to reduce the visibility of the Communications Equipment.
In no event shall any of Tenant's installations be made through the
roof surface of the Building without the prior written consent of
Landlord. Further, in installing the Communications Equipment,
Tenant shall protect (and pay the cost of repairing any damage
caused to) the roof of the Building, and shall perform such
installation (including any roof penetrations) in a manner so as to
keep in full force and effect any warranty concerning the roof of the
Building. Tenant shall not install any Communications Equipment
the weight of which exceeds the structural loading capacities of the
roof of the Building.
(B) Tenant shall give Landlord at least 48 hours'
prior written notice each time Tenant, or any Tenant Parties,
intends to go onto the roof of the Building for the purpose of
installing or removing Communications Equipment, and Tenant
shall comply with all reasonable requirements imposed by Landlord
for the protection of the roof. Without limiting the generality of the
foregoing, Landlord may require that Tenant or any Tenant Parties
be accompanied by a representative of Landlord while on the roof
of the Building. Tenant, at its sole cost and expense shall comply
with all Applicable Laws in connection with the installation,
maintenance and use of the Communications Equipment,
including, without limitation, procuring and maintaining all permits
and approvals from governmental agencies having jurisdiction.
Promptly after request by Landlord, Tenant shall provide Landlord
with copies of all such permits and approvals. In addition, Tenant
shall pay all federal, state and local taxes applicable to the license
granted herein or to installation, maintenance or operation of the
Communications Equipment. Landlord makes no representations
or warranties whatsoever with respect to Tenant's ability to install
the Communications Equipment in compliance with Applicable
Laws or the fitness or suitability of the roof of the Building for the
installation, maintenance and operation of the Communications
Equipment, including, without limitation, the quality and clarity of
any receptions and transmissions to or from the Communications
Equipment or the presence of any interference with such signals.
Notwithstanding anything to the contrary in this Paragraph 27,
Landlord agrees not (i) to permit third parties to install equipment
on the roof of the Building that would interfere with Tenant's
Communications Equipment or Tenant's use of its roof deck, or
(ii) to voluntarily enter into private agreements with adjoining
property owners to limit the height or otherwise restrict the
equipment that may be placed on the roof of the Building. Upon
the expiration or earlier termination of the Lease Term, Tenant, at
its sole cost and expense, shall remove the Communications
Equipment and all related cabling, and shall repair all damage to
the roof or other damage to the Building caused by such removal.
(C) To the maximum extent permitted by law,
Tenant shall protect, defend, indemnify and hold Landlord and the
other Indemnitees, and each of them, harmless from and against
any and all Claims arising from or connected in any way with the
installation, operation, maintenance, repair, use or removal of the
Communications Equipment, or any acts or omissions of Tenant or
any Tenant Party pursuant to the license granted herein, except to
the extent caused by the gross negligence or willful misconduct of
Landlord and not covered by the insurance required to be carried
by Tenant hereunder or except to the extent such release and/or
indemnity obligation is prohibited by law. Landlord shall have no
responsibility for the Communications Equipment, and shall not be
liable for any damage to the Communications Equipment no matter
how caused. Tenant shall cause the insurance policies maintained
by Tenant pursuant to Paragraph 14 to cover damage to the
Communications Equipment and Tenant's indemnification
obligations hereunder. The foregoing indemnity shall survive
expiration or earlier termination of this Lease and the license
granted herein.
28. Intentionally omitted.
29. OPTION TO LEASE. Tenant shall have an option
to lease ("Lease Option") the Option Properties, in accordance
with, and subject to, the terms and conditions set forth in this
Paragraph 29.
(A) At any time within thirty (30) days after
Landlord obtains approval by the Planning Commission of the City
to construct an office building on an Option Property (other than the
Land), and prior to leasing all or any portion of such Option
Property to any third party for office purposes, Landlord shall notify
Tenant of the availability of such Option Property for lease (the
"Lease Availability Notice"). Tenant shall exercise the Lease
Option, if at all, by delivering written notice to Landlord (the "Lease
Acceptance Notice") within ten (10) days following its receipt of
Landlord's Availability Notice. If Tenant fails to deliver its Lease
Acceptance Notice within said ten (10) day period, Landlord may
thereafter lease the Option Property identified in the Lease
Availability Notice on such terms and conditions as Landlord may
determine in its sole discretion, and Tenant shall have no further
right to lease such Option Property pursuant to this Paragraph 29.
(B) If Tenant timely exercises the Lease Option
as set forth herein, Landlord and Tenant shall promptly enter into a
lease for the subject Option Property on substantially the same
terms and conditions as contained in this Lease, including, without
limitation, an average rental rate of Fifty-Five Dollars ($55.00) per
rentable square foot, on a "triple net" basis, except that the term of
the new lease shall expire on the later of (i) ten (10) years after the
commencement date thereof and (ii) the Expiration Date of this
Lease. If Landlord and Tenant cannot mutually agree upon the
terms and conditions of the new lease within thirty (30) days after
Tenant's exercise of the Lease Option, either party may elect to
submit the matter to arbitration in accordance with Paragraph 32.
(C) The Lease Option is a one-time right with
respect to each Option Property. If Tenant fails to timely deliver the
Lease Acceptance Notice to Landlord, Landlord may thereafter
lease such Option Property on such terms and conditions as
Landlord may determine in its sole discretion, and Tenant shall
have no further right to lease such Option Property pursuant to this
Paragraph 29.
(D) The Lease Option contained in this
Paragraph 29 shall not be exercisable, or, if exercised, shall not be
effective, if on the date of exercise of such right or on the date the
Option Property would otherwise be leased to Tenant (i) Tenant is
in default under this Lease beyond any applicable cure period, or
(ii) Tenant has previously been in default of its monetary
obligations under this Lease beyond any applicable cure period,
more than once. Further, the Lease Option is personal to CNET
NETWORKS, INC. and may only be exercised if on the date of
exercise of such right and on the date the Option Property would
otherwise be leased to Tenant, CNET NETWORKS, INC. shall not
have assigned this Lease or sublet any portion of the Premises
other than to a Tenant Affiliate.
(E) The Lease Option shall apply to any Option
Property only if and so long as Robert Birmingham shall have any
ownership interest therein. The Lease Option is not binding on
successors or assigns, does not run with the land, and shall
automatically terminate with respect to each Option Property at
such time as Robert Birmingham shall no longer have an interest in
such Option Property. From time to time, upon request, Tenant
shall promptly execute such documentation as shall be reasonably
requested by Landlord to acknowledge termination of the Lease
Option with respect to any one or more Option Properties.
(F) Nothing contained in this Paragraph 29 or
elsewhere in this Lease shall constitute or be construed to
constitute a covenant, representation or warranty on the part of
Landlord that Landlord will pursue or obtain any approval by the
Planning Commission to construct an office building on any of the
Option Properties, or the timing of such approval, and Landlord
shall have no liability whatsoever to Tenant for its failure to obtain
such approvals.
30. OPTION TO PURCHASE. Landlord hereby grants
to Tenant an option (the "Purchase Option") to purchase the Option
Properties in accordance with, and subject to, the terms and
conditions set forth in this Paragraph 30.
(A) If at any time during the Lease Term
Landlord determines to sell an Option Property, Landlord shall give
Tenant written notice ("Purchase Option Notice") of such
determination. Tenant shall exercise the Purchase Option, if at all,
by delivery of written notice to Landlord (the "Purchase Option
Exercise") within sixty (60) days following its receipt of Landlord's
Purchase Option Notice. If Tenant fails to deliver its Purchase
Option Exercise within said sixty (60) day period, Landlord may
thereafter transfer the Option Property on such terms and
conditions as Landlord may determine in its sole discretion, and
Tenant shall have no further right to purchase the Option Property
identified in the Purchase Option Notice pursuant to this
Paragraph 30.
(B) The "Purchase Price" for the subject Option
Property shall be the "fair market value" of the Option Property,
unencumbered by this Lease or any other lease with Tenant or a
Tenant Affiliate. Following Tenant's exercise of the Purchase
Option, Landlord and Tenant shall attempt in good faith to agree on
the fair market value of the Option Property. If Landlord and
Tenant fail to reach agreement on the fair market value of the
Option Property within thirty (30) days following Tenant's delivery to
Landlord of the Purchase Option Notice ("Outside Agreement
Date"), then the Purchase Price shall be determined in accordance
with the following procedures:
(I) Landlord and Tenant shall each
appoint one appraiser ("Landlord's Appraiser" and "Tenant's
Appraiser," respectively) who shall be a member of the American
Institute of Real Estate Appraisers or, in the absence thereof, of
any other similar independent organization reasonably designated
by Landlord and Tenant (in either case, the "Appraisal Institute").
Each appraiser shall have been active over the five (5) year period
ending on the date of such appointment in the appraisal of
commercial properties in San Francisco.
(II) Landlord's Appraiser and Tenant's
Appraiser shall, within forty-five (45) days after the date of
appointment of the last appointed appraiser, independently
determine and state, in writing, his or her determination of the fair
market value of the Option Property, supported by their reasons
therefor, and shall deliver counterpart copies to Landlord and
Tenant. If both appraisers independently arrive at the same
determination of the fair market value, such determination shall be
the Purchase Price. If the fair market value of the Option Property,
as determined by Landlord's Appraiser, is no greater than one
hundred ten percent (110%) of the fair market value of the Option
Property as determined by Tenant's Appraiser, then the Purchase
Price shall be the average of the two determinations. If the fair
market value of the Option Property, as determined by Landlord's
Appraiser, is greater than one hundred ten percent (110%) of the
fair market value of the Option Property as determined by Tenant's
Appraiser, then Landlord, Tenant, Landlord's Appraiser and
Tenant's Appraiser shall promptly meet and attempt to reach
agreement upon the fair market value of the Option Property. If the
parties are unable to agree upon the fair market value of the Option
Property within ten (10) business days after receipt of the two
determinations, then Landlord, Tenant, Landlord's Appraiser and
Tenant's Appraiser shall meet within five (5) business days after
expiration of said ten (10) business day period and appoint a third
appraiser (the "Third Appraiser"). The Third Appraiser shall be a
member of the Appraisal Institute with at least five (5) years of full-
time appraisal experience immediately prior to his or her
appointment, who is familiar with the fair market values of
commercial properties located in San Francisco, but who has had
no prior business or personal relationship with either party. If the
parties and the two appraisers are unable to agree upon the Third
Appraiser within three (3) business days after expiration of such
five (5) business day period, then either party, on behalf of both,
may request appointment of the Third Appraiser by the San
Francisco Bay Area Chapter of the Appraisal Institute.
(III) The Third Appraiser shall, within thirty
(30) days after his or her appointment, independently determine
and state, in writing, his or her determination of the fair market
value of the Option Property, supported by the reasons therefor,
and deliver counterpart copies to Landlord, Tenant, Landlord's
Appraiser, and Tenant's Appraiser. The two (2) determinations of
the fair market value of the Option Property which are the closest
shall then be averaged, and such average shall constitute the
Purchase Price. The third determination shall be disregarded.
(IV) The appraisers shall have no power
to modify the provisions of this Lease. In the event of a failure,
refusal or inability of any appraiser to act, his or her successor shall
be appointed by the party appointing him or her, but in the case of
the Third Appraiser, his or her successor shall be appointed in the
same manner as that set forth herein with respect to the
appointment of the original Third Appraiser. Each party shall pay
the fees and expenses of its appraiser and shall share equally the
fees and expenses of the Third Appraiser.
(V) Notwithstanding the foregoing,
Tenant may elect to terminate the sale of the Option Property to
Tenant by giving written notice of such election to Landlord within
ten (10) days after determination of the Purchase Price pursuant to
the appraisal procedure set forth above. In such case, Tenant shall
pay all costs of the appraisal procedure, including the costs and
fees of Landlord's appraiser, and Landlord shall have no further
obligation to sell the Option Property to Tenant, and Tenant shall
have no further obligation to purchase the Option Property from
Landlord.
(C) The following provisions shall apply to the
sale of the Option Property to Tenant:
(I) The closing shall occur no later than
sixty (60) days after the Purchase Price is determined.
(II) Tenant shall purchase the Option
Property in an "as is" condition, with all faults, as of the date of the
closing, and Landlord shall have no obligation to repair or correct
any conditions or defects or to compensate Tenant for same.
(III) Tenant shall accept title to the Option
Property in its then existing condition, without any obligation on the
part of Landlord to remove any exceptions to title.
(IV) Landlord shall make no
representations or warranties whatsoever, express or implied,
regarding the Option Property.
(V) Closing costs shall be allocated
between the parties as is customary in the City and County of San
Francisco.
(VI) Tenant shall cooperate with Landlord
in the event Landlord decides to conduct a tax-deferred exchange
of properties in accordance with Paragraph 1031 of the Internal
Revenue Code, as amended, or a successor statute.
(D) The Purchase Option contained in this
Paragraph 30 shall not be exercisable, or, if exercised, shall not be
effective, if on the date of exercise of such right or on the date the
Option Property would otherwise be sold to Tenant, Tenant is in
default under this Lease beyond any applicable cure period.
Further, the Purchase Option is personal to CNET NETWORKS,
INC. and may only be exercised if on the date of exercise of such
right and on the date the Option Property would otherwise be sold
to Tenant, CNET NETWORKS, INC. shall not have assigned this
Lease or sublet any portion of the Premises other than to a Tenant
Affiliate.
(E) The Purchase Option is a one-time right with
respect to each Option Property. If Tenant fails to timely deliver its
Purchase Option Exercise with respect to any Option Property, or if
Tenant timely delivers its Purchase Option Exercise but Tenant
elects to terminate sale of the Option Property to Tenant pursuant
to Paragraph 30(b)(v), Tenant shall have no further right to
purchase that Option Property pursuant to this Paragraph 30.
(F) Intentionally omitted.
(G) Notwithstanding any other provision of this
Paragraph 30, the Purchase Option is intended to apply only to the
sale of an Option Property to an unrelated third party and shall not
apply to Exempt Transfers.
(H) The Purchase Option shall apply to any
Option Property only if and so long as Robert Birmingham shall
have any ownership interest therein. The Purchase Option is not
binding on successors or assigns, does not run with the land, and
shall automatically terminate with respect to each Option Property
at such time as Robert Birmingham shall no longer have an interest
in such Option Property. From time to time, upon request, Tenant
shall promptly execute such documentation as shall be reasonably
requested by Landlord to acknowledge termination of the Purchase
Option with respect to any one or more Option Properties.
31. RIGHT OF FIRST REFUSAL TO PURCHASE. If
during the Lease Term, Landlord receives an unsolicited Bona Fide
Offer (defined below) for the purchase of any of the Option
Properties, which Landlord intends to accept, the following
provisions shall apply:
(A) Landlord shall give Tenant written notice of
the applicable Option Property, the purchase price, and the other
material terms and conditions of such offer ("Landlord's Notice").
Tenant shall have the right ("Right of First Refusal") to elect to
purchase the Option Property for the purchase price and on the
other terms and conditions specified in Landlord's Notice, subject
to the provisions of this Paragraph 31. Tenant shall exercise the
Right of First Refusal, if at all, by delivery of written notice to
Landlord (the "Acceptance") within ninety (90) days after receipt of
Landlord's Notice. Tenant's failure to deliver its Acceptance within
said ninety (90) day period shall conclusively be deemed to be a
rejection by Tenant of the offer set forth in Landlord's Notice. If
Tenant rejects or is deemed to have rejected the offer set forth in
Landlord's Notice, Landlord may thereafter sell the Option Property
on such terms and conditions as Landlord in its sole discretion shall
determine, provided that if the purchase price shall be reduced
more than five percent (5%) below the purchase price set forth in
Landlord's Notice, Landlord shall "re-offer" the Option Property by
giving Tenant a new Landlord's Notice ("Landlord's Modified
Notice"), but in such case Tenant must exercise the Right of First
Refusal, if at all, by delivering written notice to Landlord within ten
(10) days after receipt of Landlord's Modified Notice.
(B) If Tenant elects to purchase the Option
Property, the terms and conditions set forth in Landlord's Notice
shall constitute a binding agreement of purchase and sale between
Landlord and Tenant; provided, however, that the time of
performance shall be appropriately extended to take into account
the time elapsed between presentation to Tenant of Landlord's
Notice and Tenant's Acceptance. Within five (5) business days
after Tenant's Acceptance of the offer contained in Landlord's
Notice, an escrow shall be opened with a reputable title company
of Tenant's choice and reasonably approved by Landlord (the
"Escrow") and within said five (5) business day period Tenant shall
deliver or cause to be delivered to the Escrow a copy of Landlord's
Notice and Tenant's Acceptance, along with any deposit specified
in Landlord's Notice.
(C) A "Bona Fide Offer" shall be an offer stating
the price (payable in U.S. dollars), the manner of payment, the
closing date, and the other material terms and conditions of the
proposed sale of the subject Option Property from a proposed
purchaser of good business character and reputation, capable of
carrying out all of the obligations of the Bona Fide Offer.
(D) The Right of First Refusal contained in this
Paragraph 31 shall not be exercisable, or, if exercised, shall not be
effective, if on the date of exercise of such right or on the date the
Option Property would otherwise be sold to Tenant, Tenant is in
default under this Lease beyond any applicable cure period.
Further, the Right of First Refusal is personal to CNET
NETWORKS, INC. and may only be exercised if on the date of
exercise of such right and on the date the Option Property would
otherwise be sold to Tenant, CNET NETWORKS, INC. shall not
have assigned this Lease or sublet any portion of the Premises
other than to a Tenant Affiliate.
(E) Notwithstanding any other provision of this
Paragraph 31, the Right of First Refusal is intended to apply only to
the sale of an Option Property to an unrelated third party and shall
not apply to Exempt Transfers.
(F) The Right of First Refusal shall apply to any
Option Property only if and so long as Robert Birmingham shall
have any ownership interest therein. The Right of First Refusal is
not binding on successors or assigns, does not run with the land,
and shall automatically terminate with respect to each Option
Property at such time as Robert Birmingham shall no longer have
an interest in such Option Property. From time to time, upon
request, Tenant shall promptly execute such documentation as
shall be reasonably requested by Landlord to acknowledge
termination of the Right of First Refusal with respect to any one or
more Option Properties.
32. ARBITRATION.
(A) If arbitration is agreed upon hereunder as a
dispute resolution procedure, the arbitration shall be conducted as
provided in this Paragraph 32. During an arbitration proceeding
pursuant to this Paragraph 32, the parties shall continue to perform
and discharge all of their respective obligations under this Lease.
(B) Unless arbitration is specified as a dispute
resolution procedure as to a particular matter hereunder, disputes
hereunder shall not be resolved by arbitration unless both parties
agree in writing to do so, and the dispute shall be resolved as
otherwise provided by law. The following matters shall be subject
to arbitration hereunder: (i) any dispute arising under Paragraph
2(d)(i) with respect to Tenant Substantial Completion Delay; (ii) any
dispute arising under Paragraph 6(b) with respect to whether the
Termination Space designated by Tenant is reasonably re-leasable
by Landlord; (iii) any dispute arising under Paragraph 6(b) or
Paragraph 12(e) with respect to amendments to this Lease
reasonably required to accommodate conversion of the Building
from a single tenant building to a multi-tenant building; (iv) any
dispute arising under Paragraph 9(c) with respect to Tenant's right
to perform repairs or maintenance on Landlord's behalf and offset
the cost thereof against Monthly Basic Rental; (v) any dispute
arising under Paragraph 29(b) with respect to the terms and
conditions of a new lease for an Option Property; and (vi) any
dispute arising under this Lease or the Work Letter with respect to
the Date of Substantial Completion, the Commencement Date, the
Rent Commencement Date, or the validity of any claim of Tenant
Delay or Force Majeure.
(C) All disputes that may be arbitrated in
accordance with this Article shall be raised by notice to the other
party ("Arbitration Demand"), which Arbitration Demand shall state
with particularity the nature of the dispute, making specific
reference to the provisions of this Lease which have given rise to
the dispute.
(D) After delivery of an Arbitration Demand,
Landlord and Tenant shall attempt to mutually and promptly select
one person to act as arbitrator hereunder. The parties agree that in
the event of a dispute described in Paragraph 32(b)(iii), 32(b)(iv) or
32(b)(v) above, the arbitrator shall be a member of the State Bar of
California, actively engaged in the practice of law in the San
Francisco Bay Area for at least the ten (10) years immediately
preceding appointment, with experience in commercial leasing.
The parties agree that in the event of a dispute described in
Paragraph 32(b)(i), Paragraph 32(b)(ii), or 32(b)(vi) above, the
arbitrator shall be a licensed architect, actively engaged in the
architectural profession in the San Francisco Bay Area for at least
the ten (10) years immediately preceding appointment, with
experience in the design and construction of commercial projects of
comparable size to the Building. The arbitrator shall have at no
time represented or acted on behalf of either Landlord or Tenant,
and neither party may consult with the arbitrator, prior to selection,
to determine the arbitrator's position on the issue which is the
subject of the dispute.
(E) If the parties are unable to mutually agree
upon an arbitrator within ten (10) days after the Arbitration Demand
was made, upon the request of either party, the arbitrator shall be
appointed by the San Francisco office of the American Arbitration
Association (the "AAA"). If the AAA shall cease to provide
arbitration for commercial disputes in the San Francisco Bay Area,
the arbitrator shall be appointed by any successor organization
providing substantially the same services, and in the absence of
such an organization, by the presiding judge of the California
Superior Court for San Francisco County.
(F) If the parties mutually agree upon an
arbitrator, the parties shall proceed in accordance with such
procedures as the arbitrator shall determine, with the
understanding that the parties wish to resolve the dispute as
expeditiously as is commercially reasonable. If the parties are
unable to mutually agree upon an arbitrator, the arbitration shall
proceed under the Expedited Procedures of the Commercial Rules
of the AAA, regardless of the amount in dispute.
(G) The arbitration proceeding shall take place at
a mutually acceptable location in San Francisco.
(H) In resolving any dispute, the arbitrator shall
apply the pertinent provisions of this Lease, without departure
therefrom in any respect. The arbitrator shall not have the power to
change any of the provisions of this Lease, but this paragraph shall
not prevent in any appropriate case the interpretation and
determination by the arbitrator of the applicable provisions of this
Lease to the extent necessary in applying the same to the matters
to be determined by arbitration. The determination of the arbitrator
shall be final and binding on the parties.
(I) Each party shall bear its own costs and
expenses of arbitration, including, but not limited to, filing fees and
attorneys' fees. The costs and fees of the arbitrator shall be borne
equally by the parties.
IN WITNESS WHEREOF, Landlord and Tenant have
executed and delivered this Lease as of the day and year first
above written.
LANDLORD:
235 SECOND STREET LLC,
a California limited liability
company
By:
Robert Birmingham
Managing Member
TENANT:
CNET NETWORKS, INC.
a Delaware corporation
By:
David Overmyer
Vice President, Finance
and Administration
EXHIBIT A
FLOOR PLANS
EXHIBIT C
WORK LETTER
EXHIBIT D
COMMENCEMENT DATE MEMORANDUM
THIS MEMORANDUM is entered into as of _______________ __, 20___
by and between 235 SECOND STREET LLC, a California limited liability
company ("Landlord"), and CNET NETWORKS, INC., a Delaware corporation
("Tenant"), with respect to that certain Office Lease dated as of May 1,
(the"Lease") respecting certain premises (the "Premises") located in the
building known as 235 Second Street, San Francisco, California.
Pursuant to Paragraph 2(a) of the Lease, Landlord and Tenant hereby
confirm and agree that the Commencement Date (as defined in the Lease) is
__________________, 20___, the Rent Commencement Date (as defined in the
Lease) is ______________________, and that the Expiration Date
(as defined inthe Lease) is _________________, 20__.
This Memorandum supplements, and shall be a part of, the Lease.
IN WITNESS WHEREOF, Landlord and Tenant have executed and
delivered this Memorandum as of the day and year first above written.
LANDLORD: 235 SECOND STREET LLC,
a California limited liability company
By:
Robert Birmingham
Managing Member
TENANT: CNET NETWORKS, INC.,
a Delaware corporation
By:
Name:
Title:
EXHIBIT E
CONTEMPLATED USES
Commercial Office Uses
Conference Rooms
Studios for Television Production
Studios for Radio Production
Sound Rooms
Testing Laboratories
Server Rooms
Multi-Media Rooms/Auditorium
Recreational Spaces
Kitchenettes
Showers
Lounge for Nursery Rooms
EXHIBIT F
FORM OF ESTOPPEL CERTIFICATE
TO:
Lease of Space of 235 Second Street, San Francisco (the "Property")
________________________________ ("Tenant") hereby certifies to
___________________ and its successors and assigns as follows:
1. Tenant leases from ___________________________________
("Landlord") office space (the "Premises") pursuant to that certain
Office Lease dated ___________________ by and between Landlord and Tenant,
as amended by ___________________ (collectively, the "Lease"). A true and
correct copy of the Lease (together with all addenda, riders, amendments
and supplements thereto) is attached hereto as Exhibit A.
2. The Lease is in full force and effect and has not been
modified,supplemented or amended, except as set forth in Paragraph 1 above.
The Lease represents the entire agreement between the parties with respect
to Tenant's right to use and occupy the Premises.
3. The Premises are comprised of _______ square feet. Tenant
is in actual occupancy of the Premises under the Lease and Tenant has
accepted the same; Landlord has performed all obligations under the Lease
to be performed by Landlord, including, without limitation, completion of
all improvements required
under the Lease and the making of any required payments or contributions
therefor. Tenant is not entitled to any further payment or credit for
tenant work.
4. The term of the Lease commenced on ______________, and will
expire on __________.
5. Tenant has not paid any rent or other payments more than
one (1) month in advance, except as follows:
_____________________________________.
6. Tenant's obligation to pay Basic Rental under the Lease
commenced on _______________. The Monthly Basic Rental currently payable
under the Lease is $_____________. Monthly Basic Rental and additional
rental have been paid through ______________. There currently exist no
claims, defenses, rights of set-off or abatement to or against the
obligations of Tenant to pay Basic Rental or additional rental or to
perform any other term, covenant or condition under the Lease.
7. Tenant is required to pay _________ percent (___%) of the
operating expenses and taxes. Tenant is currently paying $______ per month
for estimated operating expenses and taxes under the Lease.
8. Tenant is not owed any monies by Landlord, and there are no
concessions, bonuses, free months' rent, rebates or other matters affecting
the rental payable under the Lease, except as follows:
______________________________________________________.
9. No security or other deposit has been paid with respect to
the Lease, except as follows:
________________________________________________________________
_.
10. Landlord is not currently in default under the Lease and
there are no events or conditions existing which, with or without notice
or the lapse of time, or both, could constitute a default of the Landlord
under the Lease or entitle Tenant to offsets or defenses against the prompt
payment of rental, except as follows: __________________________________.
Tenant is not in default under any of the terms and conditions of the
Lease nor is there now any fact or condition which, with notice or lapse
of time or both, will become such a default,except as follows:
________________________________.
11. Tenant has not assigned, transferred, mortgaged or otherwise
encumbered its interest under the Lease, nor subleased any of the Premises
nor permitted any person or entity to use the Premises, except as follows:
_______________________________________.
12. To the best of Tenant's knowledge: (a) the Premises comply
with all applicable laws, (b) there are no structural or mechanical defects
in the Premises, and (c) except for the storage and use of substances of the
type and quantity customarily used in the operation of a business office,
there are no hazardous materials on, in, under or about the Premises.
13. Tenant has no rights of first refusal, options to purchase
or rights of first offer, except as follows:
_____________________________________________.
14. There are no pending actions, voluntary or involuntary,
under any bankruptcy or insolvency laws of the United States or any State
against Tenant or any guarantor of Tenant's obligations under the Lease.
The undersigned individual certifies that he or she is duly authorized to
sign and deliver this Estoppel Certificate on behalf of Tenant. Tenant
acknowledges that the parties to whom this Estoppel Certificate is addressed
will be relying upon the accuracy of this Certificate in connection with
their acquisition and/or financing of the Property.
IN WITNESS WHEREOF, Tenant has caused this Certificate to be
executed as of the date set forth below.
"TENANT"
By:
_______________________
_________
(TYPE OR PRINT NAME)
Title:
___________________________
___________________________
EXHIBIT G
BUILDING RULES AND REGULATIONS
1. Sidewalks, halls, passages, exits, entrances, elevators, escalators
and stairways shall not be obstructed by tenants or used by them for any
purpose other than for ingress to and egress from their respective premises.
The halls, passages, exits, entrances, elevators, escalators and stairways are
not for the use of the general public and at such time as the Building
shall become a multi-tenant building, Landlord shall in all cases retain
the right to control and prevent access thereto by all persons whose
presence, in the judgment of Landlord, would be prejudicial to the safety,
character, reputation and interests of the Building and its tenants.
2. Except as provided in Paragraph 22 of the Lease, no sign,
placard, picture, name, advertisement or notice, visible from the exterior
of leased premises shall be inscribed, painted, affixed or otherwise
displayed by any tenant either on its premises or any part of the Building,
and Landlord shall have the right to remove any such sign, placard, picture,
name, advertisement, or notice without notice to and at the expense of the
tenant.
3. No curtains, draperies, blinds, shutters, shades, screens or other
coverings, hangings or decorations shall be attached to, hung or placed in,
or used in connection with, any window on any premises without the prior
written consent of Landlord. No articles shall be placed or kept on the
window sills so as to be visible from the exterior of the Building.
4. At such time as the Building shall become a multi-tenant building,
Landlord reserves the right to exclude from the Building between the hours
of 6 P.M. and 6 A.M. and at all hours on Saturdays, Sundays and holidays
all persons who do not present a pass to the Building issued by Landlord.
Landlord will furnish passes to persons for whom any tenant requests the
same in writing. Each tenant shall be responsible for all persons for
whom it requests passes and shall be liable to Landlord for all acts of
such persons.
5. Each tenant shall see that the doors of its premises are closed
and securely locked and must observe strict care and caution that all
water faucets or water apparatus are entirely shut off before the tenant
or its
employees leave such premises, and that all utilities shall likewise be
carefully shut off, so as to prevent waste or damage, and for any default
or carelessness the Tenant shall make good all injuries sustained by other
tenants or occupantsof the Building or Landlord. On multiple-tenancy
floors all tenants shall keep the door or doors to the Building corridors
closed at all times except for ingress and egress.
6. No tenant shall alter any lock or install a new or additional lock
or any bolt on any exterior door of its premises without prior written
notice to Landlord. The tenant shall in each case furnish Landlord with a
key for any such lock.
7. Tenant will furnish Landlord without charge with two (2) keys to
each door in its premises. Each tenant, upon the termination of the
tenancy, shall deliver to Landlord all the keys of or to the Building,
offices, rooms and toilet
rooms which shall have been furnished to the Tenant or which the Tenant
shall have had made.
8. The toilet rooms, toilets, urinals, wash bowls and other apparatus
shall not be used for any purpose other than that for which they were
constructed and no foreign substance of any kind whatsoever shall be thrown
therein, and the expense of any breakage, stoppage or damage resulting from
the violation of this rule shall be borne by the tenant who, or whose
employees or invitees, shall have caused it.
9. No tenant shall use or keep in its premises or the Building any
kerosene, gasoline or inflammable or combustible fluid or material or use
any method of heating or air conditioning other than that supplied by
Landlord.
10. No tenant shall use, keep or permit to be used or kept in its
premises any foul or noxious gas or substance or permit or suffer such
premises to be occupied or used in a manner offensive or objectionable to
Landlord or other occupants of the Building by reason of noise, odors and/or
vibrations or interfere in any way with other tenants or those having business
therein, nor shallany animals or birds be brought or kept in or about any
premises or the Building.
11. No tenant shall permit its premises to be used for lodging.
12. Except with the prior written consent of Landlord, which consent
shall not be unreasonably withheld or delayed, no tenant shall sell, or
permit the sale, at retail of newspapers, magazines, periodicals, theater
tickets or any other goods or merchandise in or on any premises, nor shall
any tenant carry on, or permit or allow any employee or other person to
carry on, any business or activity other than that specifically provided
for in such tenant's lease.
13. No boring or cutting for wires or cabling will be allowed without
the prior written consent of Landlord. The location of telephones, call
boxes and other office equipment affixed to all premises shall be subject
to the written approval of Landlord. All electrical appliances must be
grounded and must meet UL Label Standards.
14. Except as expressly provided in such tenant's lease, no tenant
shall install any radio or television antenna, loudspeaker or any other
device on the exterior walls of the Building.
15. No tenant shall lay linoleum, tile, carpet or any other floor
covering so that the same shall be affixed to the floor of its premises in
any manner except as approved in writing by Landlord. The expense of
repairing any damage resulting from a violation of this rule or the removal
of any floor covering shall be borne by the tenant by whom, or by whose
contractors, employees or invitees,the damage shall have been caused.
16. At such time, if at all, that the Building shall become a multi-
tenantbuilding, no furniture, freight, equipment, packages or merchandise
will be received in the Building or carried up or down the elevators, except
between such hours, through such entrances and in such elevators as shall
be designated by Landlord; and Landlord shall have the right to require that
moves be scheduled and carried out during non-business hours of the Building
. Landlord shall have the right to prescribe the weight, size and position
of all safes and other heavy equipment brought into the Building. Landlord
will not be responsible for loss of or damage to any such safe or property
from any cause, and all damage done to the Building by moving or
maintaining any such safe or other property shall be repaired at the
expense of the Tenant.
17. No tenant shall overload the floor of its premises or mark, or in
any way deface such premises or any part thereof.
18. There shall not be used in any space, or in the public areas of the
Building, either by any tenant or others, any hand trucks except those
equipped with rubber tires and side guards. No other vehicles of any kind
shall be brought by any tenant into or kept in or about any premises in
the Building.
19. Each tenant shall store all its trash and garbage within the
interior of its premises. No material shall be placed in the trash boxes
or receptacles if such material is of such nature that it may not be
disposed of in the ordinary and customary manner of removing and disposing
of trash and garbage in the City of San Francisco without violation of any
law or ordinance governing such disposal. All trash, garbage and refuse
disposal shall be made only through entryways and elevators provided for
such purposes and at such times as Landlord shall designate.
20. Canvassing, soliciting, distribution of handbills and other written
materials and peddling in the Building are prohibited and each tenant shall
cooperate to prevent the same.
21. Employees of Landlord will not perform any work or do anything
outside of their regular duties unless under special instructions from
Landlord.
22. These Rules and Regulations may be changed from time to time,
as Landlord may deem appropriate, upon prior written notice to Tenant,
provided that such changes shall not materially increase Tenant's
obligations under the Lease or adversely affect its rights thereunder.
These Rules and Regulations are in addition to, and shall not be construed
to in any way modify, alter or amend, in whole or in part, the terms,
covenants and conditions of the Lease. In the event of any conflict
between the provisions of the Lease and these Rules and Regulations,
the Lease shall govern.
TABLE OF CONTENTS
Page
1 DEFINITIONS 1
2 TERM 7
3 RENTAL; SECURITY DEPOSIT 8
4 TENANT'S SHARE OF OPERATING EXPENSES AND REAL PROPERTY TAXES 10
5 OTHER TAXES PAYABLE BY TENANT 12
6 USE 13
7 COMPLIANCE WITH LAWS/ENVIRONMENTAL MATTERS 15
8 ALTERATIONS; LIENS 17
9 MAINTENANCE AND REPAIR 20
10 SERVICES 22
11 SECURITY SERVICES AND ACCESS CONTROL 22
12 ASSIGNMENT AND SUBLETTING 23
13 WAIVER; INDEMNIFICATION 28
14 INSURANCE 29
15 PROTECTION OF LENDERS AND GROUND LESSORS 31
16 ENTRY BY LANDLORD 33
17 VACATION AND ABANDONMENT; REMOVAL OF PERSONAL PROPERTY 33
18 DEFAULT AND REMEDIES 34
19 DAMAGE BY FIRE OR OTHER CASUALTY 36
20 EMINENT DOMAIN 39
21 HOLDING OVER 40
22 SIGNAGE 41
23 COMMUNICATIONS AND COMPUTER LINES 41
24 PARKING 42
25 QUIET ENJOYMENT 42
26 MISCELLANEOUS 42
27 USE OF ROOF 48
29 OPTION TO LEASE 49
30 OPTION TO PURCHASE 50
31 RIGHT OF FIRST REFUSAL TO PURCHASE 53
32 ARBITRATION 54
EXHIBIT A FLOOR PLANS
EXHIBIT B OPTION PROPERTIES
EXHIBIT C WORK LETTER
EXHIBIT D COMMENCEMENT DATE MEMORANDUM
EXHIBIT E CONTEMPLATED USES
EXHIBIT F FORM OF ESTOPPEL CERTIFICATE
EXHIBIT G BUILDING RULES AND REGULATIONS
(..continued)
08781.001.0085.f
08781.001.0085.f 13
08781.001.0085.f Exhibit A
06320.999.0006.a
08781.001.0085.f Exhibit C
Exhibit D
08781.001.0085.f Exhibit F, Page 2
08781.001.0085.f Exhibit G, Page 3
TABLE OF CONTENTS
(CONTINUED)
08781.001.0085.f v
08781.001.0085.f iv