EXHIBIT 10.18
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SUBLEASE
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THIS SUBLEASE (this "SUBLEASE") is entered into as of this 7th day of
April, 1998, by and between CNET, INC., a Delaware corporation ("SUBLESSOR"),
and PREVIEW TRAVEL, INC. a Delaware corporation ("SUBLESSEE").
RECITALS
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A. Pursuant to that certain Office Lease (the "LEASE") dated as of
September 24, 1997, No. 1 Beach Street, LLC, a California limited liability
company ("LANDLORD"), as landlord, leased to Sublessor the entire space (the
"MASTER PREMISES") in the office building commonly known as ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ (the "BUILDING"), as more particularly described in
the Lease.
B. Sublessor now desires to sublease to Sublessee and Sublessee
desires to sublease from Sublessor a portion of the Master Premises consisting
of approximately thirteen thousand fifty-five (13,055) rentable square feet,
shown outlined in red on the floor plan attached hereto as Exhibit "A" (the
"PREMISES"), situated on the eastern portion of the third floor of the Building.
NOW, THEREFORE, Sublessor and Sublessee agree as follows:
1. Premises.
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(a) Sublessor leases to Sublessee and Sublessee hires from
Sublessor the Premises. The Premises include the appurtenant right to the use,
in common with others, of the ground floor reception area and elevator lobby,
the third floor elevator lobby and the restrooms located on the third floor.
Except as may be expressly permitted by this Sublease, Sublessee shall have no
right of access to any other portion of the Building.
(b) Sublessee acknowledges that it has inspected the Premises,
and is thoroughly familiar with its condition. Subject to Sublessor's
obligations under Paragraph 3(c) hereof, Sublessee accepts the Premises in its
present, improved, "AS IS" condition, with any and all latent defects, and
Sublessee acknowledges that, except for the covenant of Sublessor contained in
Paragraph 3(c) hereof, neither Sublessor nor any of its agents or
representatives has made, and does not hereby make, any representations,
warranties, or covenants of any kind or character whatsoever with respect to
the condition of the Premises, whether express or implied. Sublessee agrees
that, except as expressly provided in Paragraph 3(c) hereof, Sublessee has
made no promise to alter, remodel, improve, repair or bring into compliance
with applicable law any portion of the Premises, or any portion of the
Building (or common areas within the Building) outside the Premises.
Notwithstanding anything to the contrary in the foregoing, Sublessor agrees to
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enforce Sublessor's rights and remedies under the Lease as against Landlord
with respect to the condition of the Premises upon notice by Sublessee of any
defect in the condition of the Premises.
(c) Sublessor and Sublessee acknowledge and agree that the square
footage of the Premises noted in this Sublease is final and binding on the
parties.
2. Master Lease.
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(a) Except for the Excluded Lease Provisions (as hereinafter
defined), the Sublease is subject to all of the terms and conditions of the
Lease, a copy of which has been provided to Sublessee under cover of letter
dated March __, 1998. Sublessee hereby assumes and agrees to perform each and
every obligation of Sublessor, as lessee, under the Lease, to the extent such
terms and conditions are applicable to the Premises, except for the Excluded
Lease Provisions. Sublessee shall not commit or permit to be committed on the
Premises any act or omission which shall violate any term or condition of the
Lease. Sublessor represents and warrants to Sublessee that Sublessor has
received no written notice of any default under the Lease.
(b) Except for the Basic Lease Information, Sections 1.1, 1.2,
1.4, 1.5 (to the extent inconsistent with this Sublease), 2.1(a), (c) and (d),
2.2, 2.3, 2.4, 3.1, 3.2, 3.3, 3.5, 3.6, 3.7, 4.2(d), 4.4, 5.1, Article 6, 7.1,
7.2(b), 7.3, 7.4, 8.1(c), 8.4 (to the extent inconsistent with this Sublease),
Article 13, Article 14, Sections 16.1, 16.5(b), 16.6, 16.9, 16.18, 16.19,
16.22, Exhibits A - E of the Lease (all of which shall be deemed "EXCLUDED
LEASE PROVISIONS"), all of the terms and conditions contained in the Lease are
incorporated herein as terms and conditions of this Sublease (with each
reference therein to "Landlord" and "Tenant" to be deemed to refer to
Sublessor and Sublessee, respectively) and, along with all of the paragraphs
contained in this Sublease, shall be the complete terms and conditions of this
Sublease. To the extent that the Lease provides that the Landlord will provide
services, utilities, insurance, repairs, maintenance or any and all other
Landlord obligations rendered in connection with the Premises or the Building
(including, without limitation, any representations and warranties of
Landlord), Sublessee shall seek recourse from the Landlord only, and Sublessor
shall not be liable for any breach by the Landlord under the Lease. Any costs
incurred by Sublessor as a result of the provision of any services, or the
exercise of any rights, under the Lease for the benefit of Sublessee shall be
reimbursed to Sublessor by Sublessee within twenty (20) days of receipt of
invoice therefor.
(c) Sublessor agrees to cooperate with Sublessee, at no out-of-
pocket cost or expense to Sublessor, in obtaining any required consents or
authorizations of Landlord reasonably requested by Sublessee in connection
with its use and occupancy of the Premises. Sublessee shall communicate to
Landlord with respect to any services or work requested or required by
Sublessee in the Premises only through Sublessor unless Sublessor authorizes
Sublessee in writing to directly communicate with Landlord. Subject to the
terms of this Sublease, Sublessor agrees not to unreasonably
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withhold its consent in connection with any work or services requested by
Sublessee of Landlord in or to the Premises, to the extent the consent of
Sublessor is required or requested.
(d) Sublessor covenants and agrees not to do anything that would
cause the Lease to be canceled or terminated or that would adversely affect
the rights of Sublessee under this Sublease or in or to the Premises.
Sublessor shall not amend or modify the terms of the Lease insofar as the same
may materially adversely affect Sublessee's rights and obligations under this
Sublease without the prior written consent of Sublessee. Subject to the
foregoing, in the event the Lease is terminated for any reason, this Sublease
shall automatically cease and terminate as of the date the Lease is so
terminated, and upon such termination, for reasons other than Sublessee's
default under this Sublease, all rent and other charges and sums due and owing
hereunder shall terminate. Sublessor shall send to Sublessee promptly
following receipt thereof from the Landlord all notices of default under the
Lease, and all notices affecting the Premises received. Notwithstanding
anything in the foregoing to the contrary, if this Sublease is terminated as a
consequence of the termination of the Lease following a default by Sublessor,
as Tenant, thereunder (and not attributable to a default by Sublessee under
this Sublease), Sublessee shall have the remedies provided under Paragraph
11(f) hereof.
3. Term and Delivery of Premises.
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(a) The term (the "TERM") of this Sublease shall commence on the
date of delivery of the Premises to Sublessee (the "COMMENCEMENT DATE"). If
Landlord, for any reason whatsoever, does not deliver possession of the
Premises to Tenant on any given date, this Sublease shall not be void or
voidable and Sublessor shall not be liable to Sublessee for any loss or damage
resulting therefrom; provided, however, if the term of this Sublease does not
commence by June 15, 1998, as such date is extended due to any act or omission
of Sublessee, Sublessee may at any time thereafter terminate this Sublease on
five (5) days prior written notice to Sublessor, and this Sublease shall
terminate on the fifth (5th) day following the receipt of said notice unless
Sublessor delivers possession of the Premises to Sublessee in the condition
required by this Sublease. In the event of any such delay, the Expiration Date
of this Sublease shall be extended by an equivalent number of days. The term
of this Sublease shall expire on June 30, 2003; provided, however, Sublessor,
and, provided no Event of Default (as that term is hereinafter defined) shall
then exist under this Sublease, Sublessee, each shall have the right to
terminate this Sublease effective on July 1, 2001, by giving not less than six
(6) months prior written notice of such party's intent to terminate this
Sublease (the last day of the Term, whether such date is June 30, 2003 or July
1, 2001, is hereinafter referred to as the "EXPIRATION DATE").
(b) Sublessor's obligation to deliver the Premises to Sublessee,
and Sublessee's access to the Premises for any purposes shall be subject to
and conditioned upon the delivery to Sublessor of certificates of insurance
evidencing the insurance coverages required by Paragraph 15 of this Sublease.
In addition, the Term of
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this Sublease shall not commence until the contingency provided in Paragraph
25 of this Sublease has been satisfied.
(c) Notwithstanding anything to the contrary in this Paragraph 3,
if after the Commencement Date Sublessor undertakes any improvements in or to
any portion of the Building, and such improvements result in a requirement
that any upgrades, improvements or alterations be made to the Premises or to
any common areas (including restrooms) located on the third floor of the
Building, Sublessor shall be solely responsible for such mandated
improvements, alterations and upgrades (and the same shall be done in
compliance with any and all applicable building codes and laws); provided,
however, if at any time during calendar year 1998 any local or State
governmental agency mandates or requires the installation of fire sprinklers
or other life safety equipment on the third floor of the Building, Sublessor
shall perform such work, at its expense, and Sublessee shall reimburse
Sublessor a proportionate share of such expenses (based on the proportion that
the rentable square footage of the Premises bears to the total rentable square
footage on the third floor of the Building), not to exceed $40,000.
4. Monthly Rent.
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(a) Subject to Paragraph 3(a) hereof, monthly base rent (the
"MONTHLY BASE RENT") for the Premises shall begin to accrue commencing on the
later of (X) the later of the Commencement Date, and (Y) the earlier of (i)
Sublessee's occupancy of the Premises for the purpose of conducting business
therein, or (ii) June 1, 1998 (the "RENT COMMENCEMENT DATE"). Monthly Base
Rent shall be payable as follows:
Rent Commencement Date through June 30, 1999: $28,068.25
July 1, 1999 through June 30, 2000: $28,851.55
July 1, 2000 through June 30, 2001: $29,895.95
July 1, 2001 through the Expiration Date (provided this Sublease $39,165.00
is not terminated as herein provided)
Sublessee shall pay Monthly Base Rent in advance on the first (1st) day of each
month of the term of this Sublease; provided, however that Sublessee shall pay
to Sublessor, upon Sublessee's execution of this Sublease, the sum of Twenty
Eight Thousand and Sixty Eight and Twenty Five Hundredths Dollars ($28,068.25),
which shall represent the Monthly Base Rent for the first full calendar month
for which rent is due. If the Rent Commencement Date is a day other than the
first day of a calendar month or ends on a day other than the last day of a
calendar month, a prorated monthly installment shall be paid at the then current
rate for the fractional month during which the Sublease commences and/or
terminates.
(b) All sums due to Sublessor under this Sublease shall be
deemed payable as rent. All rent (whether referred to herein as Monthly Base
Rent or as additional rent) shall be paid without deduction, offset, prior
notice or demand, in lawful money of the United States of America. All rent
shall be paid to Sublessor at Sublessor's offices in the Master Premises or to
such other person or at such other place as Sublessor
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may from time to time designate in writing. Sublessee hereby acknowledges that
late payment by Sublessee to Sublessor of rent and other sums due hereunder
will cause Sublessor to incur costs not contemplated by this Sublease, the
exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges and late
charges which may be imposed by Sublessor by the terms of the Lease.
Accordingly, if any installment of Monthly Base Rent or additional rent
payable under Paragraph 5 hereof shall not be received by Sublessor within
five (5) days after such amount shall be due, Sublessee shall pay to Sublessor
a late charge equal to three percent (3%) of such overdue amount. The parties
hereby agree that such late charge represents a fair and reasonable estimate
of the costs Sublessor will incur by reason of late payment by Sublessee.
Acceptance of such late charge by Sublessor shall in no event constitute a
waiver of Sublessee's default with respect to such overdue amount, nor prevent
Sublessor from exercising any of the other rights and remedies granted
hereunder.
5. Additional Rent. In addition to Monthly Base Rent payable by
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Sublessee, Sublessee shall pay to Sublessor during the Term, as additional
rent, Sublessee's Percentage Share (as hereinafter defined) of any increase in
Operating Expenses (as defined in the Lease) and any increase in Real Estate
Taxes (as defined in the Lease) paid or incurred by Sublessor during such
calendar year over the amount of Operating Expenses and Real Estate Taxes paid
or incurred by Sublessor during the calendar year 1998 (which increase is
hereinafter referred to as "INCREASED OPERATING AND TAX COSTS"). "Sublessee's
Percentage Share" shall be _____________ percent (____%). Sublessee shall pay
to Sublessor each month, in advance, together with the payment of Monthly Base
Rent, an amount equal to one-twelfth (1/12) of Sublessee's Percentage Share of
the estimated Increased Operating and Tax Costs, as reasonably determined by
Sublessor. After the end of any calendar, Sublessor shall provide Sublessee
with a copy of any statement of Additional Lease Charges provided by Landlord
pursuant to Section 4.1(c) of the Lease. If Sublessee's Percentage Share of
actual Increased Operating and Tax Costs is greater than Sublessee's
Percentage Share of estimated Increased Operating and Tax Costs for any
calendar year, Sublessee shall pay the difference to Sublessor within twenty-
five (25) days after the date of Landlord's notice pursuant to Section 4.1 of
the Lease. If actual Increased Operating and Tax Costs are less than estimated
Increased Operating and Tax Costs, Sublessee shall be entitled to a refund or
credit against the installments of Increased Operating and Tax Costs next due.
If Sublessee has an objection to Landlord's statement provided pursuant to
Section 4.1(c) of the Lease, Sublessee shall raise any such objection to
Landlord's statement with Sublessor, and Sublessor, in its sole and absolute
discretion, shall determine whether to pursue Tenant's right of audit under
Section 4.4 of the Lease. Subject to the foregoing, Landlord's statement of
Additional Lease Charges shall be final and binding on Sublessee.
6. Security Deposit. Upon execution of this Sublease by Sublessor,
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Sublessee shall deposit with Sublessor the sum of Fifty-Nine Thousand Seven
Hundred and Ninety Two Dollars ($59,792.00) (the "DEPOSIT"). The Deposit shall
be held by
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Sublessor as security for the faithful performance by Sublessee of all of the
provisions of this Sublease to be performed or observed by Sublessee. If
Sublessee fails to pay rent or other charges due hereunder, or otherwise
defaults with respect to any provision of this Sublease, Sublessor may use,
apply or retain all or any portion of the Deposit for the payment of any rent
or other charge in default, or for the payment of any other sum to which
Sublessor may become obligated by reason of Sublessee's default, or to
compensate Sublessor for any loss or damage which Sublessor may suffer
thereby. If Sublessor so uses or applies all or any portion of the Deposit,
Sublessee shall within ten (10) days after demand therefor deposit cash with
Sublessor in an amount sufficient to restore the Deposit to the full amount
thereof and Sublessee's failure to do so shall be a material breach of this
Sublease. Sublessor shall not be required to keep the Deposit separate from
its general accounts. No trust relationship is created herein between
Sublessor and Sublessee with respect to the Deposit. Within thirty (30) days
following the expiration or sooner termination of this Sublease, provided
Sublessee has faithfully performed its obligations hereunder, the Deposit (or
so much thereof as remains) shall be refunded to Sublessee, without interest.
7. Use. Sublessee shall use the Premises for general office use and
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for no other purpose, and with occupancy of the Premises not to exceed one
person per 100 square feet of usable space.
8. Electric Current and Interruption of Building Services.
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(a) It is the intention of the parties that Sublessee pay directly
for all electric current used in the Premises. Sublessor shall have the right
to install a meter or submeter at the electrical panel serving the Premises to
determine the exact amount of electricity used by Sublessee. Sublessee and
Sublessor shall share equally in the cost of installation and replacement of
the submeter (but with the cost of any maintenance and replacement
attributable to the act or omission of Sublessee being borne solely by
Sublessee). Sublessee shall pay, as they become due, all charges shown by the
meter or submeter for the use of electric current. Sublessor shall not charge
a rate for the use of electric current higher than the rate charged to
Sublessor by the electric company for electricity consumption in the Building.
If Sublessor is able to do so, Sublessor reserves the right to cause all
electrical power to be metered directly to, and for the separate and sole
account of, Sublessee by the public utility company.
(b) Sublessee shall not use or install any apparatus, device or
equipment in the Premises, which will in any way require cooling load
capabilities in excess of 3.5 ▇▇▇▇▇ per usable square foot, or require
electrical loads in excess of the capacity available at the existing
electrical panel on the third floor of the Building.
(c) Notwithstanding anything to the contrary in this Sublease, in
the event any of the Building services provided to Sublessee under this
Sublease or the Lease are interrupted, other than due in whole or in part to
the act or omission of Sublessee or as a consequence of a casualty described
in Paragraph 19 of this Sublease
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(an "UNSCHEDULED INTERRUPTION"), and the Unscheduled Interruption results in
an actual and material interference with Sublessee's ability to conduct its
business operations in the Premises for a period of more than twenty (20)
consecutive days, Sublessee, as its sole and exclusive remedy, shall be
entitled to terminate this Sublease, without penalty, effective on the date
that is five (5) days after written notice of termination given to Sublessor,
provided that the Unscheduled Interruption is not remedied to enable Sublessee
to conduct its business operations in the Premises prior to the expiration of
said five day period.
9. Construction of Tenant Improvements.
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(a) Subject to the terms and provisions of this ▇▇▇▇▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇▇ shall have the right, at Sublessee's sole cost and expense, to
construct certain tenant improvements (the "LEASEHOLD IMPROVEMENTS") in the
Premises. Any and all plans related to or in connection with the construction
of the Leasehold Improvements and any contractors or vendors used by Sublessee
in connection with the construction of the Leasehold Improvements shall be
subject to (a) Sublessor's prior written approval, which may not be
unreasonably withheld or delayed, and (b) Landlord's approval in accordance
with the terms and provisions of the Lease.
(b) Notwithstanding anything to the contrary in this ▇▇▇▇▇▇▇▇▇ ▇,
▇▇▇▇▇▇▇▇▇ acknowledges that it shall be reasonable for Sublessor to withhold
its consent to any proposed Leasehold Improvements if the same (i)
contemplates any structural changes to the Premises or any other portion of
the Building, (ii) contemplates any penetrations of the floor slab, utility or
telecommunication risers or roof of the Building, (iii) would require the use
of additional electrical power from that presently available at the electric
panel serving the third floor of the Building, (iv) would require supplemental
air ventilation and/or air conditioning equipment from that allocated to the
Premises by the existing air ventilation and cooling system of the Building,
(v) would require any building code upgrades or trigger compliance with law
improvements elsewhere on the third floor of the Building, or (vi)
contemplates a build-out or improvements that would not be readily reusable or
easily demolished (without additional expense) following the expiration of the
Term.
(c) Notwithstanding anything to the contrary in this Paragraph 9,
if Sublessee's Leasehold Improvements (as approved by Sublessor) require any
building code upgrades or trigger compliance with law improvements outside of
the Premises on the third floor of the Building (the "CODE COMPLIANCE WORK"),
and Sublessee proceeds to undertake such work, Sublessor shall reimburse
Sublessee at the end of the term of this Sublease (unless this Sublease is
terminated as a result of a default by Sublessee hereunder), for the
unamortized cost of the Code Compliance Work, based on a 10 year useful life
and a straight line amortization schedule.
10. Hazardous Waste. Sublessee shall not store, use or dispose of any
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hazardous materials in, on or about the Premises or the Building, other than
incidental
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storage and use of customary office products and cleaning solutions used in
the conduct of Sublessee's business in the Premises, in which case all such
substances shall be stored, used and disposed of strictly in accordance with
all applicable laws. Sublessee shall be solely responsible for and shall
defend, indemnify and hold harmless, Sublessor, its agents and employees from
and against, and shall reimburse Sublessor, its agents and employees for all
claims, costs and liabilities, including attorneys' fees and costs, arising
out of or in connection with Sublessee's breach of its obligations hereunder.
Sublessee shall be solely responsible for and shall defend, indemnify and hold
harmless Sublessor, its agents and employees from and against, and shall
reimburse Sublessor, its agents and employees for, any and all claims, costs
and liabilities, including attorneys' fees and costs, arising out of or in
connection with the removal, cleanup and restoration work and materials
necessary to return the Premises and/or the Building and any other property of
whatever nature located in the Building to the condition existing prior to
Sublessee's breach of the provisions of this paragraph. Sublessee shall
immediately provide Sublessor with copies of any notice, report or other
correspondence between Sublessee and any governmental agency concerning any
hazardous materials in, on or about the Premises or the Building. Sublessee's
obligations hereunder shall survive the expiration or termination of this
Sublease. California Health and Safety Code Section 25359.7(b) requires any
tenant of real property who knows, or has reasonable cause to believe, that
any release of a hazardous substance has come to be located on or beneath such
real property to give written notice of such condition to the owner. Sublessee
shall comply with the requirements of Section 25359.7(b) and any successor
statute thereto and with all other statutes, laws, ordinances, rules,
regulations and orders of governmental authorities with respect to hazardous
substances. Sublessor shall have the right to pursue all legal and equitable
remedies available to it in the event of failure of Sublessee to comply with
the requirements of this paragraph.
11. Default.
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(a) Events of Default. In addition to any other event specified in
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this Sublease as an event of default, the occurrence of any one or more of the
following events (individually and collectively, an "EVENT OF DEFAULT") shall
constitute a breach of this Sublease by Sublessee: (i) failure by Sublessee to
pay rent or any other sum when and as the same becomes due and payable; (ii)
any breach by Sublessee of any obligation of Sublessor, as Tenant, under the
Lease (other than the Excluded Lease Provisions); (iii) failure by Sublessee
to perform or observe any other obligations of Sublessee hereunder (except as
otherwise provided in this Paragraph 10), and such failure or breach continues
for more than fifteen (15) days after Sublessee 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 Sublessee
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 a reasonable time; (iv) the transfer of any interest
in the Premises or under this Sublease without Sublessor's prior written
consent;
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(v) a default or breach by any guarantor of this Sublease under its guaranty;
(vi) the making by Sublessee of a general assignment for the benefit of
creditors, or the admission of its inability to pay its debts as they become
due or the filing of a petition, case or proceeding in bankruptcy, or the
adjudication of Sublessee bankrupt or insolvent, or the filing of a petition
seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future
statute, law or regulation, or the filing of an answer admitting or failing to
contest the material allegations of a petition filed against it in any such
proceeding, or the seeking or consenting to or acquiescence in the appointment
of any trustee, receiver or liquidator of Sublessee or any material part of
its properties; (vii) the failure to have any proceeding against Sublessee
seeking any reorganization, arrangement, composition, readjustment,
liquidation, dissolution or similar relief under any present or future
statute, law or regulation, dismissed within sixty (60) days after
commencement, or the failure to have the appointment, without the consent or
acquiescence of Sublessee, of any trustee, receiver or liquidator of Sublessee
or of any material part of its properties vacated within sixty (60) days after
such appointment; or (viii) the failure to have any levy upon this Sublease or
any estate of Sublessee hereunder pursuant to any attachment or execution
vacated within ten (10) days after such attachment or execution.
(b) Sublessor's Remedies. If an Event of Default occurs, at any time
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thereafter:
(i) Sublessor may reenter the Premises and remove all persons and
property and again repossess and enjoy the Premises, without notice, either by
summary proceedings, or by any other applicable action or proceeding, or by
force or otherwise (without being liable to indictment, prosecution, or
damages therefor). Sublessor may use the Premises for Sublessor's own purposes
or relet it, without prejudice to any other remedies that Sublessor may have
by reason of Sublessee's default. None of these actions will be deemed an
acceptance of surrender by Sublessee. To the extent permitted by law,
Sublessee expressly waives the service of any notice of intention to terminate
this Sublease or to retake the Premises, and waives service of any demand for
payment of rent or for possession, and of any and every other notice or demand
required or permitted under applicable law.
(ii) Sublessor, at its option may relet the whole or any part of
the Premises from time to time, either in the name of Sublessor or otherwise,
to such tenants, for such terms ending before, on or after the Expiration
Date, at such rentals and upon such other conditions (including concessions
and free rent periods) as Sublessor, in its sole discretion, may determine to
be appropriate. Sublessor shall have no obligation to relet the Premises or
any part thereof and shall not be liable for refusal or failure to relet the
Premises or, in the event of any such reletting, for refusal or failure to
collect any rent due upon such reletting. No such refusal or failure shall
operate to relieve Sublessee of any liability under the Sublease or otherwise
affect any such liability. Sublessor, at its option, may make such physical
changes to the Premises as Sublessor, in its sole discretion, considers
advisable or necessary in connection with any such reletting
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or proposed reletting, without relieving Sublessee of any liability under this
Sublease or otherwise affecting Sublessee's liability.
(iii) Whether or not Sublessor retakes possession or relets the
Premises, Sublessor shall have the right to recover unpaid rent and all
damages caused by the default, including attorneys' fees. Damages shall
include, without limitation, (A) all arrears of Monthly Base Rent and all
other sums payable by Sublessee under this Sublease (together with interest
thereon at the Specified Rate), (B) all legal expenses and related costs
incurred by Sublessor following Sublessee's default, (C) all costs incurred by
Sublessor in making such physical changes to the Premises as Sublessor, in its
sole discretion, considers necessary in connection with any reletting, (D) all
cost incurred by Sublessor in reletting the Premises, including, without
limitation, any brokerage commissions and the value of Sublessor's time, and
(E) all other costs and expenses incurred by or on behalf of Sublessor
hereunder.
(iv) Upon such termination, in addition to any other rights and
remedies to which Sublessor may be entitled under applicable law, Sublessor
may recover from Sublessee: (A) the worth at the time of award of the unpaid
rent which had been earned at the time of termination; (B) the worth at the
time of award of the amount by which the unpaid rent which would have been
earned after termination until the time of award exceeds the amount of such
rent loss that Sublessee proves could have been reasonably avoided; (C) the
worth at the time of award of the amount by which the unpaid rent for the
balance of the term of this Sublease after the time of award exceeds the
amount of such rent loss that Sublessee proves could be reasonably avoided;
and (D) any other amount necessary to compensate Sublessor for all the
detriment proximately caused by Sublessee's failure to perform its obligations
under this Sublease 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 (A) and (B) above shall be computed by allowing interest at the
Specified Rate. The worth at the time of award of the amount referred to in
clause (C) above shall be computed by discounting such amount at a rate equal
to the greater of nine percent (9%) per annum or the discount rate of the
Federal Reserve Board of San Francisco at the time of award plus one
percentage point.
(v) If Sublessee shall fail to pay any sum of money required to be
paid by Sublessee hereunder or shall fail to perform any other act on
Sublessee's part to be performed hereunder, Sublessee may, but shall not be
obligated so to do, and without waiving or releasing Sublessee from any
obligations of Sublessee, make any such payment or perform any such other act
of Sublessee's part to be made or performed under this Sublease. All sums so
paid by Sublessor and all necessary incidental costs shall be paid to
Sublessor on demand, together with interest thereon at the Specified Rate.
(c) Specified Rate. Every installment of rent and every other
--------------
payment due hereunder from Sublessee to Sublessor which shall not be paid when
due shall bear interest at the interest rate specified in Section 3.2(a) of
the Lease (the
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"SPECIFIED RATE"), from the date that the same became due and payable until
paid, whether or not demand be made therefor.
(d) Sublease Continues Until Termination. If Sublessee has
------------------------------------
breached this Sublease and abandoned the Premises, this Sublease shall
nonetheless right to possession, and Sublessor may enforce all its rights and
remedies under this Sublease, including the right to recover the rent as it
becomes due under this Sublease. Acts of maintenance or preservation or
efforts to relet the Premises or the appointment of a receiver upon initiative
of Sublessor to protect Sublessor's interest under this Sublease shall not
constitute a termination of Sublessee's right to possession.
(e) Breach of Lease. If Sublessee breaches any of the terms
---------------
of the Lease, then, in addition to its other rights and remedies under this
Sublease, Sublessee shall indemnify, defend and hold Sublessor harmless from
all damages, costs and expenses resulting from the default (including, without
limitation, Sublessor's attorneys' fees and costs).
(f) Sublessee Remedies. If this Sublease is terminated as a
------------------
result of a default by Sublessor, as Tenant, under the Lease, Sublessor shall
pay to Sublessee, as liquidated damages (and as Sublessee's sole and exclusive
remedy against Sublessor), the unamortized cost (based on a 3 year
amortization schedule on a straight line basis) of Sublessee's Leasehold
Improvements (assuming a maximum cost of Sublessee's Leasehold Improvements of
not to exceed $200,000), plus Sublessee's actual costs of relocation,
including brokerages charges (adjusted proportionately to equal the commission
that is payable for the period comprising the remaining unexpired term of this
Sublease), and any increased rental payable by Sublessee for the remaining
unexpired term of this Sublease.
12. Holding Over. If Sublessee remains in possession after the
------------
expiration or sooner termination of this Sublease, all of the terms, covenants
and agreements hereof shall continue to apply and bind Sublessee so long as
Sublessee remains in possession insofar as the same are applicable, except
that if Sublessee remains in possession without Sublessor's written consent,
the Monthly Base Rent shall be two (2) times the rent payable by Sublessor
pursuant to the Lease during the period of Sublessee's holding over, prorated
on a daily basis for each day that Sublessee remains in possession, and
Sublessee shall indemnify Sublessor against any and all claims, losses and
liabilities for damages resulting from failure to surrender possession,
including, without limitation, any claims made by any succeeding tenant or
Landlord. If Sublessee remains in possession with Sublessor's written consent,
such tenancy shall be from month to month, terminable by either party on not
less than thirty (30) days' written notice.
13. Assignment and Subletting.
-------------------------
(a) Sublessee shall not (i) assign, mortgage, pledge, encumber
or otherwise transfer this Sublease, the term or estate hereby granted, or any
interest
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hereunder; (ii) permit the Premises or any part thereof to be utilized by
anyone other than Sublessee (whether as alliance partner, consultant,
licensee, permittee or otherwise); or (iii) sublet or offer or advertise for
subletting the Premises or any part thereof, in each case without the prior
written consent of Sublessor, which consent Sublessor may withhold in its sole
and absolute discretion. Any assignment, mortgage, pledge, encumbrance,
transfer or sublease not in accordance with this Paragraph 13 shall be
voidable and, at Sublessor's election, shall constitute a default. If
Sublessee is a corporation, any merger, consolidation or other reorganization
of Sublessee, or the sale or other transfer of a controlling percentage of the
capital stock of Sublessee, shall be deemed a voluntary assignment of this
Sublease by Sublessee. The phrase "controlling percentage" shall mean the
ownership of, and the right to vote, stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of Sublessee's capital
stock issued, outstanding, and entitled to vote for the election of directors.
The preceding two sentences shall not apply to corporations, the stock of
which is traded on a national public stock exchange, or to transactions
pursuant to which stock is issued in connection with a transaction whereby the
stock of said corporation becomes so traded. If Sublessee is a partnership, a
withdrawal or change, voluntary, involuntary, or by operation of law of any
partner or partners owning a total of fifty percent (50%) or more of the
partnership, or the dissolution of the partnership, shall be deemed a
voluntary assignment of this Sublease by Sublessee. If Sublessee consists of
more than one person, a purported assignment, voluntary, involuntary, or by
operation of law, by any one of the persons executing this Sublease shall be
deemed a voluntary assignment of this Sublease by Sublessee.
(b) If at any time or from time to time during the Term, Sublessee
desires to assign or sublet all or any part of the Premises, then Sublessee
shall given the same notice to Sublessor that Landlord is entitled to receive
pursuant to Section 13.2 of the Lease. If Sublessee assigns this Sublease or
sublets the Premises, Sublessee shall reimburse Sublessor for all costs and
expenses incurred in connection therewith, and shall pay to Landlord any and
all sums due pursuant to Section 13.8 of the Lease, including, without
limitation, Sublessor's reasonable attorneys' fees incurred in connection
therewith.
(c) Sublessee acknowledges that Sublessor and Sublessee engage in
a field of business where the secrecy of certain business activities and
opportunities is of paramount importance to the business of each party, and
that the right of Sublessor to be able to withhold its consent to a potential
sublessee or assignee of Sublessee (or following a merger, reorganization or
other change in a controlling percentage of Sublessee as hereinabove
provided), based on Sublessor's good faith, but otherwise sole and absolute,
discretion as to the impact or related nature of the business of such third
party (or reorganized entity) is a material consideration for Sublessor in
entering into this Sublease, and has been separately bargained for by
Sublessor in this transaction.
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(d) No subletting or assignment shall release Sublessee from its
obligation or alter the primary liability of Sublessee to pay the rent and to
perform all other obligations to be performed by Sublessee hereunder. The
acceptance of rent by Sublessor from any other person shall not be deemed to
be a waiver by Sublessor of any provision hereof. If any assignee of Sublessee
or any successor of Sublessee defaults in the performance of any of the terms
hereof, Sublessor may proceed directly against Sublessee without the necessity
of exhausting remedies against such assignee or successor.
14. Waiver of Liability. Sublessor shall not be liable or
-------------------
responsible in any way for, and Sublessee hereby waives all claims against
Sublessor, its agents or employees, with respect to or arising out of any
death or any injury of any nature whatsoever that may be suffered or sustained
by Sublessee or any employee, licensee, invitee, guest, agent or customer of
Sublessee or any other person, from any causes whatsoever, or for any loss or
damage or injury to any property outside or within the Premises belonging to
Sublessee or its employees, agents, customers, licensees, invitees, guests or
any other person, unless and to the extent such death, injury, loss or damage
is caused by the gross negligence or willful misconduct of Sublessor, its
employees or agents. Without limiting the generality of the foregoing,
Sublessor shall not be liable for any loss or damages of any nature whatsoever
to persons or property caused by explosion, fire, or sprinkler damage, or by
the interruption of any public utility or service, by steam gas, water, rain
or other substances leaking, issuing or flowing into any part of the Premises,
by natural occurrence, acts of the public, riot, strike, insurrection, war,
court order, or order of governmental body or authority, or for any damage or
inconvenience which may arise through repair, maintenance or alteration of any
part of the Building, or by anything done or omitted to be done by any tenant,
occupant or person in the Building.
15. Indemnity. Sublessee shall indemnify and hold Sublessor and
---------
Landlord, its agents and employees harmless from, and defend Sublessor and
Landlord, and their respective agents and employees against, any and all
losses, damages, claims, or liability for any damage to any property or
injury, illness or death of any person occurring in, on, or about the
Premises, or any part thereof, arising at any time and from any cause
whatsoever other than solely by reason of the gross negligence or willful
misconduct of Sublessor or Landlord, or their respective agents or employees.
The provisions of this paragraph shall survive the termination of this
Sublease with respect to any damage, injury, illness or death occurring prior
to such termination.
16. Insurance.
---------
(a) Sublessee, at its cost, shall maintain such insurance in such
amounts as is required of Sublessor pursuant to Sections 10.1 and 10.3 of the
Lease; provided, however, where any such insurance requires the "Landlord" to
be named as an additional insured, Sublessee shall cause Sublessor and
Landlord to be named as an additional insured thereunder. Sublessee's entry
upon the Premises for any purpose is conditioned upon the deliver to Sublessor
of certificates of insurance, in form and
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substance reasonably acceptable to Sublessor, confirming that Sublessee
maintains en effect the insurance coverages required under this Paragraph
16(a).
(b) Each policy, or a certificate of the policy, together with
evidence of payment of premiums, shall be deposited with Sublessor at the
commencement of the term, and on renewal of the policy not less than twenty
(20) days before expiration of the term of the policy. If Sublessee fails to
insure or fails to furnish to Sublessor any insurance policy required herein,
Sublessor may from time to time effect such insurance for the benefit of
Sublessee for a period not exceeding one year, and any premium paid by
Sublessor shall be recoverable from Sublessee on demand with interest thereon
at the Specified Rate, without waiver or other remedies available to Sublessor
because of the default.
17. Notices. Whenever in this Sublease it is required or permitted
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that notice or demand be given or served by Sublessor or Sublessee to or on
the other, such notice or demand shall be deemed properly given only if made
in writing and either deposited in the United States mail, postage prepaid,
certified with return receipt requested, or delivered by hand (which may be
through a messenger or recognized delivery, courier or air express service)
and addressed, if to Sublessor, at the address hereinafter provided and, if to
Sublessee, at the Premises, or at such other place as either party may from
time to time designate in a written notice to the other. Such notices or
demands shall be effective on the date of receipt (evidenced by the certified
mail receipt), if mailed, or on the date of hand delivery, if hand delivered.
If any such notice or demand is not received or cannot be delivered due to a
change in the address of the receiving party of which notice was not
previously given to the sending party or due to a refusal to accept by the
receiving party, such request, approval, consent, notice or other
communication shall be effective on the date delivery is attempted. Sublessee
hereby appoints as its agent to receive the service of all default notices and
notice of commencement of unlawful detainer proceedings the person in charge
of or apparently in charge of or occupying the Premises at the time, and, if
there is not such person, then such service may be made by attaching the same
on the entrance of the Premises and such service shall be effective for all
purposes under this Sublease. The address for notices to Sublessor is ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇.
18. Attorneys' Fees. The prevailing party in any action or
---------------
proceeding brought by either party against the other under this Sublease shall
be entitled to recover court costs and the fees of its attorneys in such
action or proceeding (whether at the administrative, trial or appellate
levels) in such amount as the court or administrative body may adjudge
reasonable, plus all costs and expenses incurred for title and lien searches,
deposition costs and all other costs and expenses reasonably incurred by the
prevailing party in connection with the subject proceeding. For purposes
hereof, the giving of any notice of default by Sublessor shall be deemed to
constitute part of an action or proceeding thereby entitling Sublessor to
reimbursement of attorneys' fees and disbursements even if an action or
proceeding is not commenced. All sums due under
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this paragraph shall be deemed additional rental. Sublessee's obligations
hereunder shall survive expiration and/or termination of this Sublease.
19. Casualty. The terms and provisions of Article 11 of the Lease are
--------
specifically incorporated herein by reference (with each reference therein to
Landlord and Tenant to be deemed to refer to Sublessor and Sublessee,
respectively); provided that to the extent Article 11 requires that the Landlord
repair or restore any portion of the Premises arising out of a casualty to the
Building, the Master Premises or the Premises, Sublessee shall seek recourse
from the Landlord only, and Sublessor shall not be liable for any breach by the
Landlord under the Lease; and provided, further, that Sublessee shall only be
entitled to rent abatement to the extent Sublessor is entitled to rent abatement
pursuant to Section 11.8 of the Lease for that portion of the Master Premises
consisting of all or a portion of the Premises. In addition to any rights
granted to Sublessee, as Tenant under the Lease, Sublessee shall have the right
to terminate this Sublease, if the time estimated by Landlord in Landlord's
Casualty Notice (as that term is defined in the Lease) is greater than ninety
(90) days, Sublessee may terminate this Sublease by written notice to Sublessor;
provided, however, notwithstanding anything to the contrary in this Sublease or
in the Lease, upon any termination of this Sublease following a casualty where
the Lease is not terminated, any and all insurance proceeds payable to Sublessee
with respect to the replacement, repair and/or restoration of the Premises
(other than Tenant's furniture, fixtures and equipment) shall be paid over by
Sublessee to Sublessor. Sublessee's obligations under this Paragraph 19 shall
survive the termination of this Sublease.
20. Entry.
-----
(a) Sublessee agrees that Sublessor may, upon twenty-four (24)
hours' telephonic notice (except in the event of an emergency, in which case
no notice shall be required), at any time during regular business hours, enter
upon the Premises for the purpose of inspecting the same and determining
whether Sublessee is complying with all of its obligations hereunder;
provided, that any such entry shall be conducted so as to cause as little
interference to the Sublessee as reasonably possible, and Sublessee shall have
the right to have a representative accompany Sublessor during any such
inspection.
(b) Sublessee acknowledges that Sublessor intends to occupy the
remainder of the third floor of the Building (subject to the terms of
Paragraph 26 below), and that in connection with such occupancy Sublessor will
require access to the Premises in order to facilitate the improvements and
work being conducted by Sublessor to the remainder of the third floor of the
Building. In furtherance thereof, Sublessee agrees that Sublessor, upon twenty-
four hours' telephonic notice, may enter and perform work in the Premises
during the hours after 6:00 p.m. and before 6:00 a.m., Monday through Friday,
and at anytime on Saturdays and Sundays, as is reasonably required in
connection with Sublessor's build-out and improvement of the remainder of the
third floor of the Building; provided that the same does not, as a whole,
materially interfere with the ability of Sublessee to conduct its business
operations in the Premises, taking
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into account that there may be times during the first six months of the term
of this Sublease when as a consequence of Sublessor's build-out of the
remainder of the third floor of the Building non-critical electrical power and
other services may need to be interrupted to the Premises, and when
construction may need to be conducted in the Premises (with attendant noise
and disruption) and that during said hours of Sublessor's entry into the
Premises, and in the specific areas where Sublessor is causing work to be
performed, Sublessee's business may be interfered with and interrupted.
Without limiting the generality of the foregoing, Sublessor agrees that it
will cooperate with Sublessee to reschedule work that would cause an
interference with any television studio production and editing activities in
the Premises.
21. Estoppel Certificate. Sublessee shall, without charge to
--------------------
Sublessor or Landlord, at any time from time to time, within ten (10) days
after receipt of written request therefor, deliver a fully executed
certificate certifying, if true: (a) that this Sublease is unmodified and in
full force and effect, or if there have been any modifications, that same is
in full force and effect as modified and stating any such modifications; (b)
whether or not there is then existing any claim of default of the other party
hereunder and if so, specifying the nature thereof; and (c) the current amount
of fixed rent payable hereunder by Sublessee and the date to which the same
has been paid.
22. Signage.
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(a) Sublessor will provide a Building directory sign in the
ground floor and third floor elevator lobby of the Building to allow Sublessee
to insert a panel identifying Sublessee and, space permitting, other relevant
information therein, at Sublessee's sole cost and expense. Sublessee shall
have no other signage or identification rights in or on the Building.
(b) Sublessee shall not place any posters, signs (including neon
or electrically illuminated signage) or other material along the exterior
windows of the Premises and visible from the outside of the Building.
Sublessor shall have the right to adopt and implement uniform window covering
standards and materials for the Building, and Sublessee shall place such
window coverings in the Premises (or allow Sublessor to install the same, at
the request of Sublessor), and shall reimburse Sublessor, promptly following
being invoiced thereof, the pro-rata cost of such window coverings; provided
the window coverings selected by Sublessor are not materially more expensive
than that generally provided for general office tenants of comparable office
buildings in the vicinity of the Building.
23. Parking. Subject to the consent of the owner of the parking
-------
facility, Sublessee shall have the right, at Sublessee's sole cost and
expense, to use up to twenty five (25) of the non-exclusive parking spaces to
which Sublessor is entitled to use pursuant to Section 1.5(a) of the Lease, at
the same rate and in the same manner Sublessor is charged for such parking
spaces pursuant to Section 1.5(a) of the Lease.
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24. Access. Sublessor reserves the right to exclude from the Building
------
during the evening, night and early morning hours beginning at 6 P.M. and
ending at 8 A.M. Monday through Friday, and at all hours on Saturdays,
Sundays, and legal holidays, all persons who do not present identification
acceptable to Sublessor. Sublessee shall provide Sublessor with a list of all
persons authorized by Tenant to enter the Premises and shall be liable to
Sublessor for all acts of such persons. Landlord shall in no case be liable
for damages for any error with regard to the admission to or exclusion from
the Building of any person. Subject to the foregoing, Sublessee shall have
access to the Building on a twenty-four (24) hour, seven (7) day a week basis.
25. Contingency. This Sublease is subject to and conditioned upon
-----------
receipt of Landlord's consent to this Sublease, including, without limitation,
Landlord's approval of the Tenant Improvements. If such consent is not
obtained on or before May 1, either party hereto shall have the right to
cancel this Sublease, and this Sublease shall be null and void upon receipt of
such written notice of such cancellation from either party hereto.
26. Right of First Offer. There is presently approximately 2,500
--------------------
rentable square feet of additional space available for sublease occupancy on
the third floor of the Building (the "ADDITIONAL THIRD FLOOR PREMISES"). The
location of the Additional Third Floor Premises is identified as such on
Exhibit "A" to this Sublease. Upon written notice to Sublessor given prior to
May 1, 1998 (the "EXERCISE NOTICE") Sublessee may lease the Additional Third
Floor Premises on the same terms and conditions of this Sublease. If Sublessee
delivers an Exercise Notice to Sublessor, Sublessor and Sublessee will
promptly execute an amendment to this Lease adding the Additional Third Floor
Premises to the Premises (and Sublessee's Base Monthly Rent and Sublessee's
Percentage Share shall be increased accordingly). On or after May 1, 1998:
(i) If Sublessor wishes to lease any of the Additional Third
Floor Premises, and provided that no Event of Default shall then exist
under this Sublease, Sublessor shall give Sublessee written notice of the
availability of the Additional Third Floor Premises and the economic
terms and conditions (including rent) (the "RIGHT OF FIRST OFFER TERMS")
that Sublessor is willing to offer to prospective tenants for such space
(the "OFFER"), and Sublessee shall have two (2) business days following
receipt of the Offer to accept the Offer and elect to lease the
Additional Third Floor Premises upon the terms and conditions contained
in the Offer. If Sublessee accepts the Offer and leases the Additional
Third Floor Premises, such space shall be added to the Premises on the
terms and conditions of this Sublease, except for and as modified by the
Right of First Offer Terms.
(ii) If Sublessee does not timely notify Sublessor in writing
of Sublessee's response to the Offer, the failure to respond shall be
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deemed a rejection of the Offer. In the event of the rejection or deemed
rejection of the Offer, Sublessor shall be permitted to lease the
Additional Third Floor Premises to any third party on any terms it
chooses, without any further obligation to reoffer the Additional Third
Floor Premises to Sublessee.
(iii) Notwithstanding anything to the contrary in this
Paragraph 26, if the Offer contains a proposed lease term which is
longer than the remaining term of this Lease, any monetary concessions
and allowances contained in the Offer, if any, shall be proportionately
reduced based on the period remaining in the term of this Sublease.
(iv) Notwithstanding anything to the contrary in this
Paragraph 26, the right granted Sublessee herein shall be subject to the
right of Sublessor to occupy the space and to remove the Additional Third
Floor Premises from the market as space subject to sublease.
27. Brokers. Each of Sublessor and Sublessee represents that it has not
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incurred an obligation to any broker in connection with this Sublease, other
than ▇▇▇▇▇▇▇ & Wakefield of California ("SUBLESSOR'S BROKER"), and each party
hereto shall hold the others harmless from and against any and all liability,
loss, damage, expense, claim, action, demand, suit or obligation arising out
of or relating to a breach by either party of this representation. Sublessor
shall pay the commission of Sublessor's Broker.
28. Entire Agreement. This Sublease represents the entire agreement
----------------
between the parties to this Sublease, and supersedes all prior agreements by
the parties, both written and verbal.
IN WITNESS WHEREOF, this Sublease is made the day and year first above
written.
SUBLESSEE: SUBLESSOR:
PREVIEW TRAVEL, INC., CNET, a Delaware corporation
a Delaware corporation
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------- ------------------------------
Its: CHAIRMAN Its:
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By:
----------------------------------
Its:
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