SUBLEASE AGREEMENT BETWEEN ORACLE USA, INC. AND VITALSTREAM HOLDINGS, INC. Costa Mesa, California Entire Fourth (4th) Floor
Exhibit
10.1
BETWEEN
ORACLE
USA, INC.
AND
VITALSTREAM
HOLDINGS, INC.
▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
Entire
Fourth (4th) Floor
SUBLEASE
THIS
SUBLEASE ("Sublease") is entered into as of July 31, 2006, by and between ORACLE
USA, INC., a Colorado corporation ("Sublandlord") and VITALSTREAM HOLDINGS,
INC., a Nevada corporation ("Subtenant"), with reference to the following
facts:
A. Pursuant
to that certain Lease Agreement between AGL Investments No. 5 Limited
Partnership (“Original Landlord”) and ▇. ▇. ▇▇▇▇▇▇▇ World Solutions Company
(“Original Tenant”) dated as of March 26, 1999 (“Original Master Lease”) as
amended by (i) that certain First Amendment to Lease between Original Landlord
and Original Tenant dated April __, 2003 (“First Amendment”), (ii) that certain
Second Amendment to Lease between Original Landlord and Original Tenant dated
May __, 2003 (“Second Amendment”), (iii) that certain Third Amendment to Lease
between Original Landlord and Original Tenant dated June 30, 2003 (“Third
Amendment”), (iv) that certain Fourth Amendment to Lease between Original
Landlord and Original Tenant dated July 29, 2003 (“Fourth Amendment”), (v) that
certain Fifth Amendment to Lease between Original Landlord and Original Tenant
dated August 28, 2003 (“Fifth Amendment”), (vi) that certain Sixth Amendment to
Lease between Original Landlord and Original Tenant dated September 30, 2003
(“Sixth Amendment”), and (vii) that certain Seventh Amendment to Lease between
Original Landlord and Original Tenant dated December 26, 2003 (“Seventh
Amendment”) (the Original Master Lease, as amended by the First Amendment, the
Second Amendment, the Third Amendment, the Fourth Amendment, the Fifth
Amendment, the Sixth Amendment and the Seventh Amendment, being referred to
herein as the “Master Lease”), Sublandlord, as the successor-in-interest to
Original Tenant under the Master Lease leases from 555 Anton Associates, LLC
(“Landlord”), as the successor-in-interest to Original Landlord under the Master
Lease, approximately 40,256 rentable square feet of office space (the “Master
Lease Premises”) located on the entire fourth (4th) and fifth (5th) floors of
the building (the “Building”) located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇.
B. Subtenant
wishes to sublease from Sublandlord, and Sublandlord wishes to sublease to
Subtenant, a portion of the Master Lease Premises containing approximately
20,128 rentable square feet located on, and consisting of the entire fourth
(4th) floor of the Building, said space being more particularly identified
and
described on the floor plan attached hereto as Exhibit
A
and
incorporated herein by reference (the "Subleased Premises").
NOW,
THEREFORE, in consideration of the foregoing, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged by
the
parties, Sublandlord and Subtenant hereby agree as follows:
1. Sublease.
Sublandlord hereby subleases to Subtenant and Subtenant hereby subleases from
Sublandlord for the term, at the rental, and upon all of the conditions set
forth herein, the Subleased Premises.
2. Term.
(a) Generally.
The
term of this Sublease ("Term") shall commence on the date (the “Commencement
Date”) that is the later to occur of (x) October 1, 2006 and (y) the date that
Sublandlord delivers possession of the Subleased Premises to Subtenant in the
condition required hereunder and (z) the date upon which Sublandlord procures
Landlord’s consent to this Sublease (the “Consent”, and the date upon which
Sublandlord procures the Consent being the “Effective Date”) and end on May 31,
2009 (the
"Expiration Date"), unless sooner terminated pursuant to any provision hereof.
Upon the determination of the Commencement Date, Sublandlord and Subtenant
will
enter into a letter agreement in the form of Exhibit
B
attached
hereto.
(b) Early
Access.
Subtenant and Subtenant’s representatives shall have the right to enter the
Subleased Premises from and after the later to occur of (i) August 15, 2006
and
(ii) the Effective Date (the date upon which Subtenant first has such access
to
the Subleased Premises being referred to herein as the “Early Access Date”) for
the sole purposes of installation of Subtenant’s personal property and the
testing of equipment, furniture, fixtures and voice and data cabling, all
subject to the terms, conditions and requirements of the Master Lease. All
of
the rights and obligations of the parties under this Sublease (other than
Subtenant’s obligation to pay Base Rent, but expressly including without
limitation Subtenant’s obligation to pay excess utility charges pursuant to the
Master Lease, Subtenant’s obligation to carry insurance pursuant to the Master
Lease, and Subtenant’s indemnification obligations, and/or damages, reasonable
costs and expenses incurred by Sublandlord by reason of any default by Subtenant
or failure on Subtenant’s part to comply with the terms of this Sublease) shall
commence upon the Early Access Date, and Subtenant shall be deemed to occupy
the
Subleased Premises from and after the Early Access Date. Subtenant shall be
liable for any damages to the Subleased Premises caused by Subtenant’s
activities at the Subleased Premises from and after the Early Access Date and,
prior to entering the Subleased Premises, Subtenant shall obtain all insurance
it is required to obtain hereunder and shall provide certificates of such
insurance to Sublandlord. Subtenant shall coordinate such entry with
Sublandlord, and such entry shall be made in compliance with all terms and
conditions of this Sublease, the Master Lease and the rules and regulations
attached to the Master Lease.
(c) Delayed
Commencement Date.
If, for
any reason other than delays caused by Subtenant (including, without limitation,
Subtenant’s failure to promptly execute and deliver the Consent), the
Commencement Date has not occurred on or before December 1, 2006, Subtenant
shall have the right to terminate this Sublease by written notice delivered
to
Sublandlord on or before (x) December 10, 2006 and (y) the occurrence of the
Commencement Date. Immediately upon such termination, Sublandlord shall return
to Subtenant all amounts paid by Subtenant to Sublandlord upon execution of
this
Sublease, or otherwise in connection with this Sublease.
3. Rent.
3.1 Rent
Payments.
(a) Generally.
From
and after the Rent Commencement Date (defined below) Subtenant shall pay to
Sublandlord as base rent for the Subleased Premises during the Term (“Base
Rent”) the following:
|
Months
of
Term
|
Base
Rent Rate Per Rentable
Square
Foot Per Month
|
Monthly
Base
Rent
|
|
1
-
12
13
- 24
25
- Expiration Date
|
$1.80
$1.85
$1.90
|
$36,230.40
$37,236.80
$38,243.20
|
As
used
herein, the “Rent Commencement Date” shall be the later of (i) the date that is
forty-five (45) days after the Early Access Date, or (ii) October 1, 2006.
Base
Rent shall be paid on the first day of each month of the Term following the
Base
Rent Abatement Period (defined in Section 3.1(b) below), except that Subtenant
shall pay one (1) month’s Base Rent to Sublandlord upon execution and delivery
of this Sublease to Sublandlord; said pre-paid Base Rent will be applied by
Sublandlord to Base Rent first due and payable hereunder following the Base
Rent
Abatement Period. Base Rent and Additional Rent (hereinafter defined) for any
partial month shall be prorated by multiplying the monthly Base Rent and
Additional Rent by a fraction, the numerator of which is the number of days
of
the partial month included in the Term and the denominator of which is the
total
number of days in the full calendar month. All
Rent (hereinafter defined) shall be payable in lawful money of the United
States, by regular bank check of Subtenant, to Sublandlord at the following
address:
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
Lease Administration
or
to
such other persons or at such other places as Sublandlord may designate in
writing.
(b) Abatement.
Notwithstanding anything in Section 3(a) above to the contrary, so long as
Subtenant is not in material monetary default (“Abatement Default”) under this
Sublease, Subtenant shall be entitled to an abatement of Base Rent for the
first
three (3) full calendar months following the Rent Commencement Date (the "Base
Rent Abatement Period"). The total amount of Base Rent abated during the Base
Rent Abatement Period is referred to herein as the "Abated Base Rent". If
Subtenant commits an Abatement Default hereunder at any time during the Term
and
fails to cure such Abatement Default within any applicable cure period, all
then
unamortized Abated Base Rent shall immediately become due and payable (assuming
amortization of the Abated Base Rent on a straight-line basis over the Term).
The payment by Subtenant then unamortized of the Abated Base Rent in the event
of an Abatement Default shall not limit or affect any of Sublandlord's other
rights, pursuant to this Sublease or at law or in equity. During the Base Rent
Abatement Period, only Base Rent shall be abated, and all Additional Rent and
other costs and charges specified in this Sublease shall remain as due and
payable pursuant to the provisions of this Sublease.
3.2 Operating
Costs.
(a) Definitions.
For
purposes of this Sublease and in addition to the terms defined elsewhere in
this
Sublease, the following terms shall have the meanings set forth
below:
(1) "Additional
Rent"
shall
mean the sums payable pursuant to Section 3.2(b) below.
(2) "Base
Operating Costs"
shall
mean Operating Costs payable by Sublandlord to Landlord for the Master Lease
Premises during the Base Year.
(3) "Base
Year"
shall
mean the calendar year 2007.
(4) "Operating
Costs"
shall
mean the aggregate of Expenses and Taxes (as said terms defined in the Master
Lease) charged by Landlord to Sublandlord pursuant to the Master
Lease.
(5) "Rentable
Area"
of the
Subleased Premises and of the Master Lease Premises is stipulated by Sublandlord
and Subtenant to be 20,128 rentable square feet and 40,256 rentable square
feet,
respectively, for all purposes of this Sublease.
(6) "Rent"
shall
mean, collectively, Base Rent, Additional Rent, and all other sums payable
by
Subtenant to Sublandlord under this Sublease, whether or not expressly
designated as "rent", all of which are deemed and designated as rent pursuant
to
the terms of this Sublease.
(7) "Subtenant's
Percentage Share"
shall
mean 50%. Subtenant's Percentage Share has been obtained by dividing the
Rentable Area of the Subleased Premises by the Rentable Area of the Master
Lease
Premises and multiplying such quotient by 100. In the event Subtenant's
Percentage Share is changed during a calendar year by reason of a change in
the
Rentable Area of the Subleased Premises or the Master Lease Premises,
Subtenant's Percentage Share shall thereupon be adjusted to equal the result
obtained by dividing the Rentable Area of the Subleased Premises by the Rentable
Area of the Master Lease Premises and multiplying such quotient by 100,
Subtenant's Percentage Share shall be determined on the basis of the number
of
days during such calendar year at each such percentage share.
(b) Payment
of Additional Rent.
In
addition to the Base Rent payable pursuant to Section 3.1 above, from and after
the expiration of the Base Year, for each calendar year of the Term, Subtenant,
as Additional Rent, shall pay Subtenant's Percentage Share of the amount by
which Operating Costs payable by Sublandlord for the then current calendar
year
exceed Base Operating Costs. Sublandlord shall give Subtenant written notice
of
Sublandlord's estimate of the amount of Additional Rent per month payable
pursuant to this Section 3.2(b) for each calendar year after the Base Year
promptly following the Sublandlord's receipt of Landlord's estimate of the
Operating Costs payable under the Master Lease. Thereafter, the Additional
Rent
payable pursuant to this Section 3.2(b) shall be determined and adjusted in
accordance with the provisions of Section 3.2(c) below.
(c) Procedure.
The
determination and adjustment of Additional Rent payable hereunder shall be
made
in accordance with the following procedures:
(1) Delivery
of Estimate; Payment.
Upon
receipt of a statement from Landlord specifying the estimated Operating Costs
to
be charged to Sublandlord under the Master Lease with respect to each calendar
year, or as soon after receipt of such statement as practicable, Sublandlord
shall give Subtenant written notice of its estimate of Additional Rent payable
under Section 3.2(b) for the ensuing calendar year, which estimate shall be
prepared based on the estimate received from Landlord (as Landlord's estimate
may change from time to time), together with a copy of the statement received
from Landlord. On or before the first day of each month during each calendar
year following the Base Year, Subtenant shall pay to Sublandlord as Additional
Rent one-twelfth (1/12th) of such estimated amount together with the Base
Rent.
(2) Sublandlord’s
Failure to Deliver Estimate.
In the
event Sublandlord's notice set forth in Subsection 3.2(c)(1) is not given on
or
before December of the calendar year preceding the calendar year for which
Sublandlord's notice is applicable, as the case may be, then until the calendar
month after such notice is delivered by Sublandlord, Subtenant shall continue
to
pay to Sublandlord monthly, during the ensuing calendar year, estimated payments
equal to the amounts payable hereunder during the calendar year just ended.
Upon
receipt of any such post-December notice Subtenant shall (i) commence as of
the
immediately following calendar month, and continue for the remainder of the
calendar year, to pay to Sublandlord monthly such new estimated payments and
(ii) if the monthly installment of the new estimate of such Additional Rent
is
greater than the monthly installment of the estimate for the previous calendar
year, pay to Sublandlord within thirty (30) days of the receipt of such notice
an amount equal to the difference of such monthly installment multiplied by
the
number of full and partial calendar months of such year preceding the delivery
of such notice.
(d) Year
End Reconciliation.
Within
thirty (30) days after the receipt by Sublandlord of a final statement of
Operating Costs from Landlord with respect to each calendar year, Sublandlord
shall deliver to Subtenant a statement of the adjustment to be made pursuant
to
Section 3.2 above for the calendar year just ended, together with a copy of
any
corresponding statement received by Sublandlord from Landlord. If on the basis
of such statement Subtenant owes an amount that is less than the estimated
payments actually made by Subtenant for the calendar year just ended,
Sublandlord shall credit such excess to the next payments of Rent coming due
or,
if the term of this Sublease is about to expire, promptly refund such excess
to
Subtenant. If on the basis of such statement Subtenant owes an amount that
is
more than the estimated payments for the calendar year just ended previously
made by Subtenant, Subtenant shall pay the deficiency to Sublandlord within
thirty (30) days after delivery of the statement from Sublandlord to
Subtenant.
(e) Survival.
The
expiration or earlier termination of this Sublease shall not affect the
obligations of Sublandlord and Subtenant pursuant to Subsection 3.2(d), and
such
obligations shall survive and remain to be performed after any expiration or
earlier termination of this Sublease.
4. Security
Deposit.
Concurrently with Subtenant's execution of this Sublease, Subtenant shall
deposit with Sublandlord the sum of $72,460.80 (the "Security Deposit"). The
Security Deposit shall be held by Sublandlord as security for the faithful
performance by Subtenant of all the provisions of this Sublease to be performed
or observed by Subtenant. If Subtenant fails to pay rent or other sums due
hereunder, or otherwise defaults with respect to any provisions of this
Sublease, Sublandlord may use, apply or retain all or any portion of the
Security Deposit for the payment of any rent or other sum in default or for
the
payment of any other sum to which Sublandlord may become obligated by reason
of
Subtenant's default, or to compensate Sublandlord for any loss or damage which
Sublandlord may suffer thereby. If Sublandlord so uses or applies all or any
portion of the Security Deposit, Subtenant shall within ten (10) days after
demand therefor deposit cash with Sublandlord in an amount sufficient to restore
the Security Deposit to the full amount thereof and Subtenant's failure to
do so
shall be a material breach of this Sublease. Sublandlord shall not be required
to keep the Security Deposit separate from its general accounts. If Subtenant
performs all of Subtenant's obligations hereunder, the Security Deposit, or
so
much thereof as has not theretofore been applied by Sublandlord, shall be
returned, without interest, to Subtenant (or, at Sublandlord's option, to the
last assignee, if any, of Subtenant's interest hereunder) within forty-five
(45)
days following the later to occur of (x) the expiration of the Term, and (y)
the
date upon which Subtenant has vacated the Subleased Premises. No trust
relationship is created herein between Sublandlord and Subtenant with respect
to
the Security Deposit. Sublandlord shall not be required to keep the Security
Deposit separate from its other accounts. Subtenant hereby waives any and all
rights under and the benefits of Section 1950.7 of the California Civil Code,
and all other provisions of law now in force or that become in force after
the
date of execution of this Sublease, that provide that Sublandlord may claim
from
a security deposit only those sums reasonably necessary to remedy defaults
in
the payment of Rent, to repair damage caused by Subtenant, or to clean the
Subleased Premises. Sublandlord and Subtenant agree that Sublandlord may, in
addition, claim those sums reasonably necessary to compensate Sublandlord for
any other foreseeable or unforeseeable loss or damage caused by the act or
omission of Subtenant or Subtenant’s officers, agents, employees, independent
contractors, or invitees.
5. Use
and Occupancy.
5.1 Use.
The
Subleased Premises shall be used and occupied only for general office use,
and
for no other use or purpose.
5.2 Compliance
with Master Lease.
Subtenant agrees that it will occupy the Subleased Premises in accordance with
the terms of the Master Lease and will not suffer to be done or omit to do
any
act which may result in a violation of or a default under any of the terms
and
conditions of the Master Lease, or render Sublandlord liable for any damage,
charge or expense thereunder. Subtenant further covenants and agrees to
indemnify Sublandlord against and hold Sublandlord harmless from any claim,
demand, action, proceeding, suit, liability, loss, judgment, expense (including
attorneys fees) and damages of any kind or nature whatsoever arising out of,
by
reason of, or resulting from, Subtenant's failure to perform or observe any
of
the terms and conditions of the Master Lease or this Sublease. Any other
provision in this Sublease to the contrary notwithstanding, Subtenant shall
pay
to Sublandlord as Rent hereunder any and all sums which Sublandlord may be
required to pay the Landlord arising out of a request by Subtenant for, or
use
by Subtenant of, additional or over-standard Building services from Landlord
(for example, but not by way of limitation, charges associated with after-hour
HVAC usage and overstandard electrical charges). Subject to the foregoing and
to
the terms and provisions of the Master Lease, Subtenant shall have access to
the
Subleased Premises 24 hours per day, 7 days per week.
5.3 Landlord’s
Obligations.
Subtenant agrees that Sublandlord shall not be required to perform any of the
covenants, agreements and/or obligations of Landlord under the Master Lease
and,
insofar as any of the covenants, agreements and obligations of Sublandlord
hereunder are required to be performed under the Master Lease by Landlord
thereunder, Subtenant acknowledges and agrees that Sublandlord shall be entitled
to look to Landlord for such performance. In addition, Sublandlord shall have
no
obligation to perform any repairs or any other obligation of Landlord under
the
Master Lease. Sublandlord shall not be responsible for any failure or
interruption, for any reason whatsoever, of the services or facilities that
may
be appurtenant to or supplied at the Building by Landlord or otherwise,
including, without limitation, heat, air conditioning, ventilation, life-safety,
water, electricity, elevator service and cleaning service, if any; and no
failure to furnish, or interruption of, any such services or facilities shall
give rise to any (i) abatement, diminution or reduction of Subtenant's
obligations under this Sublease, except to the extent that Sublandlord’s
obligations under the Master Lease are also abated, or (ii) liability on the
part of Sublandlord. Notwithstanding the foregoing, Sublandlord shall promptly
take such action as may reasonably be indicated, under the circumstances, to
secure such performance upon Subtenant's request to Sublandlord to do so and
shall thereafter diligently prosecute such performance on the part of
Landlord.
6. Master
Lease and Sublease Terms.
6.1 Subject
to Master Lease.
This
Sublease is and shall be at all times subject and subordinate to the Master
Lease. Subtenant acknowledges that Subtenant has reviewed and is familiar with
all of the terms, agreements, covenants and conditions of the Master Lease.
Additionally, Subtenant's rights under this Sublease shall be subject to the
terms of the Consent. During the Term and for all periods subsequent thereto
with respect to obligations which have arisen prior to the termination of this
Sublease, Subtenant agrees to perform and comply with, for the benefit of
Sublandlord and Landlord, the obligations of Sublandlord under the Master Lease
which pertain to the Subleased Premises and/or this Sublease, except for those
provisions of the Master Lease which are directly contradicted by this Sublease,
in which event the terms of this Sublease document shall control over the Master
Lease.
6.2 Incorporation
of Terms of Master Lease.
The
terms, conditions and respective obligations of Sublandlord and Subtenant to
each other under this Sublease shall be the terms and conditions of the Master
Lease, except for those provisions of the Master Lease which are directly
contradicted by this Sublease, in which event the terms of this Sublease shall
control over the Master Lease. Therefore, for the purposes of this Sublease,
wherever in the Master Lease the word "Landlord" is used it shall be deemed
to
mean Sublandlord and wherever in the Master Lease the word "Tenant" is used
it
shall be deemed to mean Subtenant. Any non-liability, release, indemnity or
hold
harmless provision in the Master Lease for the benefit of Landlord that is
incorporated herein by reference, shall be deemed to inure to the benefit of
Sublandlord, Landlord, and any other person intended to be benefited by said
provision, for the purpose of incorporation by reference in this Sublease.
Any
right of Landlord under the Master Lease (a) of access or inspection, (b) to
do
work in the Master Lease Premises or in the Building, (c) in respect of rules
and regulations, which is incorporated herein by reference, shall be deemed
to
inure to the benefit of Sublandlord, Landlord, and any other person intended
to
be benefited by said provision, for the purpose of incorporation by reference
in
this Sublease.
6.3 Modifications.
For the
purposes of incorporation herein, the terms of the Master Lease are subject
to
the following additional modifications:
(a) Approvals.
In all
provisions of the Master Lease (under the terms thereof and without regard
to
modifications thereof for purposes of incorporation into this Sublease)
requiring the approval or consent of Landlord, Subtenant shall be required
to
obtain the approval or consent of both Sublandlord and Landlord.
(b) Deliveries.
In all
provisions of the Master Lease requiring Tenant to submit, exhibit to, supply
or
provide Landlord with evidence, certificates, or any other matter or thing,
Subtenant shall be required to submit, exhibit to, supply or provide, as the
case may be, the same to both Landlord and Sublandlord.
(c) Damage;
Condemnation.
Sublandlord shall have no obligation to restore or rebuild any portion of the
Subleased Premises after any destruction or taking by eminent
domain.
(d) Insurance.
In all
provisions of the Master Lease requiring Tenant to designate Landlord as an
additional or named insured on its insurance policy, Subtenant shall be required
to so designate Landlord and Sublandlord on its insurance policy. Subtenant
will
maintain the insurance coverage described in Section 9.2 of the Original Master
Lease.
6.4 Exclusions.
Notwithstanding the terms of Section 6.2 above, Subtenant shall have no rights
nor obligations under the following parts, Sections and Exhibits of the Master
Lease:
(a) Original
Master Lease: Sections 1.1 (except subsection (o)), 1.2, 1.3 (except Subsections
(d), (e), (f), (h), (i), (j), (k) and (m)), Article 3 (except Sections 3.5
and
3.6), Sections 9.1, 15.2, Articles 19, 21, 23, 25, Sections 26.11, 26.18,
Articles 27, 28, 29, 30, Exhibits A, B and C.;
(b) First
Amendment: All;
(c) Second
Amendment: All;
(d) Third
Amendment: All;
(e) Fourth
Amendment: All;
(f) Fifth
Amendment: All;
(g) Sixth
Amendment: All;
(h) Seventh
Amendment: All.
6.5 Modifications.
Notwithstanding the terms of Section 6.2 above, the following provisions of
the
Master Lease are modified as described below for the purpose of their
incorporation into this Sublease.
(a) Subtenant
will not be entitled to any abatement of Rent pursuant to the provisions of
Section 5.3 of the Original Master Lease except to the extent that Sublandlord
is entitled to a similar abatement;
(b) Subtenant
shall have the right to use parking spaces pursuant to Section 16 of this
Sublease, subject to the provisions of Section 19 of the Master
Lease;
(c) Subject
to Landlord’s consent, Subtenant shall have the right, at Subtenant’s expense,
to include one (1) listing in the Building directory board in the Main Building
lobby and to install one (1) sign at the entrance to the Subleased Premises,
subject to the provisions of Section 21.1 of the Original Master
Lease.
7. Assignment
and Subletting.
Subtenant shall not assign this Sublease or further sublet all or any part
of
the Subleased Premises except subject to and in compliance with all of the
terms
and conditions of Article 13 of the Original Master Lease, and Sublandlord
(in
addition to Master Landlord) shall have the same rights with respect to
assignment and subleasing as Landlord has under said Article 13.
8. Default.
Except
as expressly set forth herein, Subtenant shall perform all obligations in
respect of the Subleased Premises that Sublandlord would be required to perform
pursuant to the Master Lease. It shall constitute an event of default hereunder
if Subtenant fails to perform any obligation hereunder (including, without
limitation, the obligation to pay Rent), or any obligation under the Master
Lease which has been incorporated herein by reference, and, in each instance,
Subtenant has not remedied such failure after delivery of any written notice
required under this Sublease and passage of fifty percent (50%) of any
applicable grace or cure period provided in the Master Lease as modified, if
at
all, by the provisions of this Sublease, provided that with respect to
non-monetary defaults, Subtenant’s cure period shall be the longer of (A)
one-half of, or (B) five (5) days less than, the actual cure period provided
for
such non-monetary default under the Master Lease.
9. Remedies.
In the
event of any default hereunder by Subtenant, Sublandlord shall have all remedies
provided to the “Landlord” in the Master Lease as if an event of default had
occurred thereunder and all other rights and remedies otherwise available at
law
and in equity. Without limiting the generality of the foregoing, Sublandlord
may
continue this Sublease in effect after Subtenant’s breach and abandonment and
recover Rent as it becomes due. Sublandlord may resort to its remedies
cumulatively or in the alternative.
10.
Right
to Cure Defaults.
If
Subtenant fails to perform any of its obligations under this Sublease after
expiration of applicable grace or cure periods, then Sublandlord may, but shall
not be obligated to, perform any such obligations for Subtenant’s account. All
costs and expenses incurred by Sublandlord in performing any such act for the
account of Subtenant shall be deemed Rent payable by Subtenant to Sublandlord
upon demand, together with interest thereon at the lesser of (i) twelve percent
(12%) per annum or (ii) the maximum rate allowable under law (the “Interest
Rate”) from the date of the expenditure until repaid. If Sublandlord undertakes
to perform any of Subtenant’s obligations for the account of Subtenant pursuant
hereto, the taking of such action shall not constitute a waiver of any of
Sublandlord’s remedies. Subtenant hereby expressly waives its rights under any
statute to make repairs at the expense of Sublandlord.
11. Consents
and Approvals.
In any
instance when Sublandlord's consent or approval is required under this Sublease,
Sublandlord's refusal to consent to or approve any matter or thing shall be
deemed reasonable if, among other matters, such consent or approval is required
under the provisions of the Master Lease incorporated herein by reference but
has not been obtained from Landlord. Except as otherwise provided herein,
Sublandlord shall not unreasonably withhold, or delay its consent to or approval
of a matter if such consent or approval is required under the provisions of
the
Master Lease and Landlord has consented to or approved of such
matter.
12. Sublandlord’s
Liability.
Notwithstanding any other term or provision of this Sublease, the liability
of
Sublandlord to Subtenant for any default in Sublandlord’s obligations under this
Sublease shall be limited to actual, direct damages, and under no circumstances
shall Subtenant, its partners, members, shareholders, directors, agents,
officers, employees, contractors, sublessees, successors and/or assigns be
entitled to recover from Sublandlord (or otherwise be indemnified by
Sublandlord) for (a) any losses, costs, claims, causes of action, damages or
other liability incurred in connection with a failure of Landlord, its partners,
members, shareholders, directors, agents, officers, employees, contractors,
successors and /or assigns to perform or cause to be performed Landlord’s
obligations under the Master Lease, (b) lost revenues, lost profit or other
consequential, special or punitive damages arising in connection with this
Sublease for any reason, or (c) subject to Section 14, any damages or other
liability arising from or incurred in connection with the suitability of the
Subleased Premises for Subtenant’s intended uses or the condition of the
Subleased Premises, other than liability arising from Sublandlord’s gross
negligence. Subtenant shall, however, have the right to seek any injunctive
or
other equitable remedies as may be available to Subtenant under applicable
law.
Notwithstanding any other term or provision of this Sublease, no personal
liability shall at any time be asserted or enforceable against Sublandlord’s
stockholders, directors, officers, or partners on account of any of
Sublandlord’s obligations or actions under this Sublease. As used in this
Sublease, the term “Sublandlord” means the holder of the tenant’s interest under
the Master Lease and “Sublandlord” means the holder of sublandlord’s interest
under this Sublease. In the event of any assignment or transfer of the
Sublandlord’s interest under this Sublease, which assignment or transfer may
occur at any time during the Term in Sublandlord’s sole discretion, Sublandlord
shall be and hereby is entirely relieved of all covenants and obligations of
Sublandlord hereunder accruing subsequent to the date of the transfer and it
shall be deemed and construed, without further agreement between the parties
hereto, that any transferee has assumed and shall carry out all covenants and
obligations thereafter to be performed by Sublandlord hereunder. Sublandlord
may
transfer and deliver any then existing Security Deposit to the transferee of
Sublandlord’s interest under this Sublease, and thereupon Sublandlord shall be
discharged from any further liability with respect thereto.
13. Attorneys’
Fees.
If
Sublandlord or Subtenant brings an action to enforce the terms hereof or to
declare rights hereunder, the prevailing party who recovers substantially all
of
the damages, equitable relief or other remedy sought in any such action on
trial
and appeal shall be entitled to receive from the other party its costs
associated therewith, including, without limitation, reasonable attorney's
fees
and costs from the other party.
14. Delivery
of Possession.
14.1 Generally.
Sublandlord represents that it has no notice of any violation of environmental
laws or regulations with respect to the condition of the Subleased Premises.
Subject to the foregoing representation, Sublandlord shall deliver, and
Subtenant shall accept, possession of the Subleased Premises in their "AS IS"
condition as the Subleased Premises exists on the date hereof. Sublandlord
shall
have no obligation to furnish, render or supply any work, labor, services,
materials, furniture (other than the Furniture, defined below), fixtures,
equipment, decorations or other items to make the Subleased Premises ready
or
suitable for Subtenant's occupancy. In making and executing this Sublease,
Subtenant has relied solely on such investigations, examinations and inspections
as Subtenant has chosen to make or has made and has not relied on any
representation or warranty concerning the Subleased Premises or the Building,
except as expressly set forth in this Sublease. Subtenant acknowledges that
Sublandlord has afforded Subtenant the opportunity for full and complete
investigations, examinations and inspections of the Subleased Premises and
the
common areas of the Building. Subtenant acknowledges that it is not authorized
to make or do any alterations or improvements in or to the Subleased Premises
except as permitted by the provisions of this Sublease and the Master Lease
and
that upon termination of this Sublease, Subtenant shall deliver the Subleased
Premises to Sublandlord in the same condition as the Subleased Premises were
at
the commencement of the Term, reasonable wear and tear excepted; Subtenant
acknowledges that the foregoing provision requires Subtenant to remove from
the
Subleased Premises any improvements constructed therein by Subtenant unless
Sublandlord shall have previously agreed that such improvements do not have
to
be removed; additionally, at Subtenant’s cost, Subtenant will remove all
telecommunications and data cabling installed by Subtenant.
14.2
Subtenant's
Improvements.
(a) Generally.
If
Subtenant constructs improvements within the Subleased Premises ("Subtenant
Improvements"), all Subtenant Improvements shall be carried out in accordance
with the Master Lease. Sublandlord will have the right to approve the plans
and
specifications for any proposed Subtenant Improvements, as well as any
contractors whom Subtenant proposes to retain to perform such work. Accordingly,
Subtenant will submit all such information for Sublandlord’s review and written
approval prior to commencement of any such work. Subtenant expressly
acknowledges that Landlord or Sublandlord may require Subtenant to remove some
or all of the Subtenant Improvements at the expiration or sooner termination
of
the Term. Promptly following the completion of any Subtenant Improvements or
subsequent alterations or additions by or on behalf of Subtenant, Subtenant
will
deliver to Sublandlord a reproducible copy of “as built” drawings of such work
together with a CAD file of the “as-built” drawings in the then-current version
of AutoCad. Notwithstanding the foregoing, Sublandlord hereby approves the
conceptual changes to the Subleased Premises based on the space plan attached
hereto as Exhibit
D
(Block
Plan 6 - BP6) and will not require Subtenant to remove such improvements unless
it is a requirement of the Landlord.
(b) Code-Required
Work.
If the
performance of any Subtenant Improvements or other work by Subtenant within
the
Subleased Premises "triggers" a requirement for code-related upgrades to or
improvements of any portion of the Master Leased Premises or any common areas,
Subtenant shall be responsible for the cost of such code-required upgrade or
improvements.
15. Holding
Over.
If
Subtenant fails to surrender the Subleased Premises at the expiration or earlier
termination of this Sublease, occupancy of the Subleased Premises after the
termination or expiration shall be that of a tenancy at sufferance. Subtenant’s
occupancy of the Subleased Premises during the holdover shall be subject to
all
the terms and provisions of this Sublease and Subtenant shall pay an amount
(on
a per month basis without reduction for partial months during the holdover)
equal to 150% of the sum of the Base Rent and Additional Rent due for the period
immediately preceding the holdover. No holdover by Subtenant or payment by
Subtenant after the expiration or early termination of this Sublease shall
be
construed to extend the Term or prevent Sublandlord from immediate recovery
of
possession of the Subleased Premises by summary proceedings or otherwise. In
addition to the payment of the amounts provided above, if Sublandlord is unable
to deliver possession of the Subleased Premises to a new subtenant or to
Landlord, as the case may be, or to perform improvements for a new subtenant,
as
a result of Subtenant’s holdover or perform improvements, Subtenant shall be
liable to Sublandlord for all damages, including, without limitation,
consequential damages, that Sublandlord suffers from the holdover; Subtenant
expressly acknowledges that such damages may include all of the holdover rent
charged by Landlord under the Master Lease as a result of Subtenant’s holdover,
which Master Lease holdover rent may apply to the entire Master Lease
Premises.
16. Parking.
During
the Term Subtenant shall be permitted to use eighty (80) of the parking spaces
allocated to Sublandlord in the Master Lease of which twenty-four (24) parking
spaces are surface areas outside the Building. Subtenant will pay the rate(s)
being charged by Landlord pursuant to the Master Lease for such
spaces.
17. Notices:
Any
notice by either party to the other required, permitted or provided for herein
shall be valid only if in writing and shall be deemed to be duly given only
if
(a) delivered personally, or (b) sent by means of Federal Express, UPS Next
Day
Air or another reputable express mail delivery service guaranteeing next day
delivery, or (c) sent by United States Certified or registered mail, return
receipt requested, addressed: (i) if to Sublandlord, at the following
addresses:
| Oracle USA, Inc. | |
| c/o Oracle Corporation | |
| ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | |
| ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |
| Attn: Lease Administration |
with
a
copy to:
|
Oracle
USA, Inc.
|
||
|
c/o
Oracle Corporation
|
||
|
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
|
||
|
▇▇▇
▇▇▇▇
|
||
|
▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
||
| Attn: Legal Department | ||
and
(ii)
if to Subtenant, at the following address:
Prior
to
Commencement Date:
|
VitalStream
Holdings, Inc.
|
||
|
▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
|
||
|
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇
|
||
| Attn: ▇▇▇▇▇ ▇▇▇▇▇ | ||
Following
Commencement Date:
At
the
Subleased Premises, Attn: ▇▇▇▇▇ Stitch
or
at
such other address for either party as that party may designate by notice to
the
other. A notice shall be deemed given and effective, if delivered personally,
upon hand delivery thereof (unless such delivery takes place after hours or
on a
holiday or weekend, in which event the notice shall be deemed given on the
next
succeeding business day), if sent via overnight courier, on the business day
next succeeding delivery to the courier, and if mailed by United States
certified or registered mail, three (3) business days following such mailing
in
accordance with this Section.
18. Furniture.
During
the Term, at no charge to Subtenant, Subtenant shall be permitted to use the
existing modular and office furniture and data and telephone cabling located
in
the Subleased Premises and described in more particular detail in Exhibit
C
attached
hereto (the “Furniture”). Subtenant shall accept the Furniture in its current
condition without any warranty of fitness from Sublandlord (Subtenant expressly
acknowledges that no warranty is made by Sublandlord with respect to the
condition of any cabling currently located in or serving the Subleased
Premises); for purposes of documenting the current condition of the Furniture,
Subtenant and Sublandlord shall, prior to the Commencement Date, conduct a
joint
walk-through of the Subleased Premises in order to inventory items of damage
or
disrepair in the Furniture. Subtenant shall use the Furniture only for the
purposes for which such Furniture is intended and shall be responsible for
the
proper maintenance, care and repair of the Furniture, at Subtenant’s sole cost
and expense, and using maintenance contractors specified by Sublandlord. No
item
of Furniture shall be removed from the Subleased Premises without Sublandlord’s
prior written consent. On or about the date of expiration of the Term, the
parties shall once again conduct a walk-through of the Subleased Premises to
catalog any items of damage, disrepair, misuse or loss among the Furniture
(reasonable wear and tear excepted), and Subtenant shall be responsible, at
Subtenant’s sole cost and expense, for curing any such items (including, with
respect to loss, replacing any lost item with a substantially similar new item
reasonably acceptable to Sublandlord). Subtenant shall not modify, reconfigure
or relocate any furniture except with the advanced written permission of
Sublandlord, and any work of modifying any Furniture (including, without
limitation, changing the configuration of, “breaking down” or reassembly of
cubicles or other modular furniture) shall be performed at Subtenant's sole
cost
using Sublandlord’s specified vendors or an alternate vendor approved in writing
by Sublandlord (such approval to be granted or withheld on Sublandlord's good
faith discretion, based upon Sublandlord's assessment of factors which include,
without limitation, whether the performance by such vendor will void applicable
warranties for such furniture and whether such vendor is sufficiently
experienced in the design of such furniture). Notwithstanding the foregoing,
Sublandlord hereby approves the conceptual furniture changes in the Subleased
Premises based on the drawings attached hereto as Exhibit
E
that is
in accordance with the Subtenant Improvements required in Block Plan 6
(Exhibit
D).
19. Brokers.
Subtenant represents that it has dealt directly with and only with ▇▇▇▇▇▇▇,
Inc.
(“Subtenant’s Broker”), as a broker in connection with this Sublease.
Sublandlord represents that it has dealt directly with and only with ▇▇▇▇▇▇▇▇
▇▇▇▇ Company (“Sublandlord’s Broker”), as a broker in connection with this
Sublease. Sublandlord and Subtenant shall indemnify and hold each other harmless
from all claims of any brokers other than Subtenant’s Broker and Sublandlord’s
Broker claiming to have represented Sublandlord or Subtenant in connection
with
this Sublease. Subtenant and Sublandlord agree that Subtenant’s Broker and
Sublandlord’s Broker shall be paid commissions by Sublandlord in connection with
this Sublease pursuant to a separate agreement.
20. Right
of First Refusal.
Subject
to Landlord’s consent, prior to subleasing all or any portion of the Master
Lease Premises on the fifth (5th) floor of the Building (“Expansion Space”),
Subtenant shall have the on-going right of first refusal to sublease (“Right of
First Refusal”) any available Expansion Space so long as such space is leased
and controlled by the Sublandlord. If Sublandlord and a prospective new
subtenant agree on economic terms pursuant to which such subtenant will sublease
any of the Expansion Space (“Approved Sublease Offer”), then Sublandlord shall
deliver a written offer (“Offer”) to Subtenant setting forth the terms of
Approved Sublease Offer (the “Refusal Notice”) and Subtenant shall have a right,
to be exercised by the delivery of irrevocable written notice to Sublandlord
within five (5) days after delivery of the Refusal Notice, to sublease the
Offered Space on the terms and conditions set forth in the Refusal Notice.
If
Subtenant does not timely elect to Sublease the applicable Expansion Space
on
the terms set forth in the Refusal Offer, then Sublandlord shall be free to
sublease the applicable space to the prospective new subtenant based on such
terms and conditions in the Approved Sublease Offer; provided, however, if
Sublandlord is willing to sublease the applicable space to the prospective
subtenant upon Economic Terms (defined below) which are more than five percent
(5%) less than the Economic Terms set forth in the Refusal Notice, Sublandlord
must first re-offer the space at the revised Economic Terms (“Revised Offer”) to
Subtenant after which Subtenant shall have five (5) days to accept the Revised
Offer. If Subtenant fails to timely accept the Revised Offer, then Sublandlord
shall be free to sublease the space to the prospective subtenant pursuant to
such terms and conditions in the Revised Offer. If Subtenant timely accepts
the
Offer or the Revised Offer, as applicable, then Sublandlord shall prepare and
submit to Subtenant an amendment to this Sublease containing the terms of the
Refusal Notice or the Revised Offer, as applicable, and otherwise on the form
of
amendment then in use by Sublandlord and reasonably approved by Subtenant.
Subtenant shall execute and deliver such an amendment to Sublandlord within
ten
(10) business days after delivery of same to Subtenant for execution. However,
if Subtenant fails to timely execute and deliver the amendment (or fails to
object to the terms contained therein as not correctly being in accordance
with
the terms of the Refusal Notice, Revised Offer, or this Sublease), Subtenant
shall nonetheless be irrevocably bound to sublease the applicable space from
Sublandlord on the terms set forth in the Refusal Notice or the Revised Offer.
This Right of First Refusal is personal to the original Subtenant, and shall
automatically terminate with the expiration or sooner termination of this
Sublease, the expiration or earlier termination of the Master Lease with respect
to the fifth (5th) floor of the Building, or upon the assignment of the Sublease
(to a non-affiliated entity of Subtenant) or the sub-subletting of all or more
than fifty percent (50%) of the rentable area in the original Subleased
Premises. As used herein, “Economic Terms” shall mean the net, aggregated, cost
to Subtenant or another party, on a present value basis, of the following terms
for the space in question: (i) the rental rate, (ii) the amount of any subtenant
improvement allowance (which amount is a deduction from Subtenant's or the
other
party's cost), (iii) the amount of free rent (which amount is a deduction from
Subtenant's or the other party's cost), (iv) the amount of protection from
the
payment of operating and tax expenses , and (v) any other lease concessions
or
inducements which have a reasonably ascertainable monetary value.
21. Complete
Agreement.
There
are no representations, warranties, agreements, arrangements or understandings,
oral or written, between the parties or their representatives relating to the
subject matter of this Sublease which are not fully expressed in this Sublease.
This Sublease cannot be changed or terminated nor may any of its provisions
be
waived orally or in any manner other than by a written agreement executed by
both parties.
22. Interpretation.
Irrespective of the place of execution or performance, this Sublease shall
be
governed by and construed in accordance with the laws of the State of
California. If any provision of this Sublease or the application thereof to
any
person or circumstance shall, for any reason and to any extent, be invalid
or
unenforceable, the remainder of this Sublease and the application of that
provision to other persons or circumstances shall not be affected but rather
shall be enforced to the extent permitted by law. The table of contents,
captions, headings and titles, if any, in this Sublease are solely for
convenience of reference and shall not affect its interpretation. This Sublease
shall be construed without regard to any presumption or other rule requiring
construction against the party causing this Sublease or any part thereof to
be
drafted. If any words or phrases in this Sublease shall have been stricken
out
or otherwise eliminated, whether or not any other words or phrases have been
added, this Sublease shall be construed as if the words or phrases so stricken
out or otherwise eliminated were never included in this Sublease and no
implication or inference shall be drawn from the fact that said words or phrases
were so stricken out or otherwise eliminated. Each covenant, agreement,
obligation or other provision of this Sublease shall be deemed and construed
as
a separate and independent covenant of the party bound by, undertaking or making
same, not dependent on any other provision of this Sublease unless otherwise
expressly provided. All terms and words used in this Sublease, regardless of
the
number or gender in which they are used, shall be deemed to include any other
number and any other gender as the context may require. The word "person" as
used in this Sublease shall mean a natural person or persons, a partnership,
a
corporation or any other form of business or legal association or
entity.
23. Counterparts.
This
Sublease may be executed in separate counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same instrument. This Sublease shall be fully executed when each party whose
signature is required has signed and delivered to each of the parties at least
one counterpart, even though no single counterpart contains the signatures
of
all parties hereto.
IN
WITNESS WHEREOF, the parties hereto hereby execute this Sublease as of the
day
and year first above written.
| SUBLANDLORD:
ORACLE
USA, INC.,
a Colorado corporation
|
||
| By: | /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |
| Print Name: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ | |
| Title: | VP, Real Estate and Facilities | |
|
SUBTENANT:
VITALSTREAM
HOLDINGS, INC.,
a
Nevada corporation
|
||
| By: |
/s/
▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇
|
|
| Print Name: |
▇▇▇▇▇▇
▇.
▇▇▇▇▇▇
|
|
| Title: |
President
and Chief Operating
Officer
|
|
EXHIBIT
A
Subleased
Premises
EXHIBIT
B
Commencement
Agreement
Date
September
14, 2006
Subtenant
VITALSTREAM
HOLDINGS, INC.
Address
▇▇▇
▇▇▇▇▇
▇▇▇▇. ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
|
Re:
|
Commencement
Letter with respect to that certain Sublease dated as of the 31 day
of
July, 2006, by and between ORACLE
USA, INC., a Colorado corporation,
as Sublandlord, and VITALSTREAM
HOLDINGS, INC., a Nevada corporation, as
Subtenant, for 20,128
rentable square feet on the fourth (4th) floor of the Building located
at
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇.
|
Dear ▇▇.
▇▇▇▇▇:
In
accordance with the terms and conditions of the above referenced Sublease,
Subtenant accepts possession of the Premises and agrees:
1. The
Commencement Date is October
13, 2006 (Early Access on August 29, 2006;
2. The
Expiration Date is May
31, 2009;
3. The
Base
Rent Abatement Period began October 13, 2006 and terminates on January 13,
2007.
Please
acknowledge your acceptance of possession and agreement to the terms set forth
above by signing all 3 counterparts of this Commencement Letter in the space
provided and returning 2 fully executed counterparts to my
attention.
Sincerely,
/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Oracle
USA, Inc.
▇▇▇▇▇▇
▇.
▇▇▇▇▇▇▇▇
▇▇.
Real
Estate Manager
Agreed
and Accepted:
Subtenant: VITALSTREAM
HOLDINGS, INC.
By:
/s/
▇▇▇▇ ▇.
▇▇▇▇▇▇
Name:
▇▇▇▇
▇.
▇▇▇▇▇▇
Title:
CFO
Date:
9/21/06
EXHIBIT
C
Furniture
[image]
EXHIBIT
D
Subtenant’s
Space Plan
[image]
EXHIBIT
E
Furniture
Modifications
[image]