Exhibit
10.02


 


SUBLEASE


 


This
Sublease (“Sublease”) is entered into as of September 24,
2009, by and between Dimensional Fund Advisors LP, a Delaware limited
partnership (“Sublandlord”), and Demand Media, Inc.,
a Delaware corporation (“Subtenant”),
with reference to the following facts:


 


R E C I T A L S


 


A.                                   Sublandlord, as
successor in interest to Dimensional Fund Advisors Inc., through conversion, is
the “Lessee” under that certain Office Lease dated January 15, 1985 (“Original Lease”), which Original Lease has been amended by
that certain (i) First Amendment to Lease dated June 30, 1989 (“First Amendment’), (ii) Second Amendment to Lease dated
December 12, 1994 (“Second Amendment”)
[subsequently deleted in the Fifth Amendment (as defined hereinafter)], (iii) Third
Amendment to Lease dated February 20, 1997 (“Third
Amendment”), (iv) Fourth Amendment to Lease dated
November 10, 1997 (“Fourth Amendment”),
(v) Fifth Amendment to Lease dated May 27, 1999 (“Fifth Amendment”), letter dated November 15, 2000, (vi) Sixth
Amendment to Lease dated November 20, 2002 (“Sixth
Amendment”), (vii) Commencement Letter dated April 24,
2003, (viii) Seventh Amendment to Lease dated March 30, 2004 (“Seventh Amendment”), (ix) Eighth Amendment to Lease
dated August 27, 2004 (“Eighth Amendment”),
(x) Ninth Amendment to Lease dated June 9, 2005 (“Ninth Amendment”), and (xi) Tenth Amendment to Lease
dated June 9, 2005 (“Tenth Amendment”
and collectively with the Original Lease and all of the other documents
referenced above, the “Master Lease”),
between Sublandlord and CA-Wilshire Palisades Limited Partnership, a Delaware
limited partnership (“Master Landlord”),
as ultimate successor in interest to Tele/TAC Associates, the originally named “Lessor”
under the Original Lease.  Pursuant to
the Master Lease, Sublandlord leases approximately 73,031 rentable square feet
of the ground, fourth, fifth, tenth and eleventh floors (“Premises”)
of that certain building commonly identified as 1299 Ocean Avenue (“Building”) in the City of Santa Monica, State of California.


 


B.                                     A true copy of
the Master Lease, redacted to delete certain financial terms and omitting
certain sections and lease amendments which do not apply to this Sublease, is
attached to this Sublease and marked as Exhibit A.


 


C.                                     Sublandlord
desires to sublease to Subtenant the fifth floor of the Premises commonly
identified as Suite 500 of the Building (“Subleased
Premises”), and Subtenant desires to sublease from Sublandlord the
Subleased Premises, upon the terms and conditions set forth in this Sublease.


 


D.                                    All initially
capitalized terms not otherwise defined in this Sublease shall have the
meanings ascribed to such terms in the Master Lease.


 


Agreement


 


NOW,
THEREFORE, in consideration of the mutual covenants contained in this Sublease,
and for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows.


 


1

















 


1.                                       Subleasing of
the Premises.  Sublandlord
hereby subleases to Subtenant, and Subtenant hereby subleases and hires from
Sublandlord, the Subleased Premises upon and subject to the terms and
conditions set forth in this Sublease. 
Sublandlord and Subtenant agree that the rentable area of the Subleased
Premises for purposes of this Sublease shall be deemed to be 19,320 rentable
square feet; provided, however, if the square footage of the Subleased Premises
is remeasured by Master Landlord and/or Sublandlord pursuant to the terms of
the Master Lease and the square footage of the Subleased Premises is deemed to
be less than that stated above, the square footage of the Subleased Premises
and all amounts and figures set forth herein based thereon shall be revised
accordingly.


 


2.                                       Sublease Term.  The term of this Sublease (“Sublease Term”) shall commence as of December 1, 2009 (“Sublease Commencement Date”), and shall expire on
April 30, 2013 (“Sublease Expiration Date”).  Notwithstanding anything herein or in the
Master Lease to the contrary, Subtenant shall have no right or option to extend
the Sublease Term beyond the Sublease Expiration Date.  Subtenant acknowledges that the Sublandlord
currently occupies the Subleased Premises and that from and after the date
hereof and until November 16, 2009, Subtenant shall have no right to access
the Subleased Premises.  During the
period from November 16, 2009 until the Sublease Commencement Date,
Subtenant may have access to the Subleased Premises, but Subtenant may not
operate for business in the Subleased Premises. 
Prior to any entry by Subtenant or its representatives, Subtenant shall
provide Sublandlord the certificates of insurance required pursuant to
Paragraph 15 below.  Subtenant shall
have no right to commence any work of improvement or alteration to the
Subleased Premises, including the installation of any cabling or communications
equipment, until the consent of Master Landlord and Sublandlord have been
obtained as provided in Paragraph 4 below. 
In no event shall any Subtenant work affect any Building systems or
Sublandlord’s telephone or telecommunications equipment and cabling.  If Master Landlord does not consent to this
Sublease or this Sublease is terminated for any other reason before the
Sublease Commencement Date, Subtenant shall remove any installations,
alterations or improvements made by it within five (5) business days
following Subtenant’s receipt of Sublandlord’s written request therefor.  Subtenant agrees to indemnify and hold
Sublandlord harmless from and against any damage to the Building, Building
systems or the Premises or any claim by Master Landlord resulting or arising
from Subtenant’s entry into the Subleased Premises and the performance of any
work by Subtenant prior to the Sublease Commencement Date; provided, however,
the foregoing indemnity shall not apply to any damage or claim to the extent
such damage or claim arises out of, is caused by or results from the negligence
or willful misconduct of Sublandlord, Master Landlord or any of their
respective agents, contractors, employees, invitees and/or representatives.  Upon the Sublease Expiration Date or any
earlier termination of this Sublease, Subtenant shall deliver the Subleased
Premises to Sublandlord in as good condition as existed on the first date of
possession by Subtenant, ordinary wear and tear, alterations approved by
Sublandlord and Master Landlord expressly permitted by such parties to remain
after the Sublease Expiration Date and damage from casualty excepted.


 


3.                                       Acceptance of
Subleased Premises. 
Notwithstanding any provision of the Master Lease to the contrary,
Subtenant agrees to accept the Subleased Premises and all improvements therein
in their current “as is” but broom cleaned and swept condition as of the
Sublease Commencement Date and Sublandlord shall have no obligation to make any
improvement to the Subleased Premises as a condition to or in connection with
Subtenant’s acceptance of the 


 


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Subleased
Premises; provided, however, the foregoing shall not be deemed a waiver of any
obligations that Sublandlord and/or Master Landlord may have pursuant to the
terms of the Master Lease to maintain and repair the Subleased Premises,
Premises and/or Building (as more particularly set forth therein).  Subject to the foregoing, the taking of
possession of the Subleased Premises by Subtenant shall conclusively establish
that the Subleased Premises and the Building were at such time in satisfactory
condition.  Subtenant acknowledges that
neither Sublandlord nor any agent of Sublandlord has made any representation or
warranty with respect to the Subleased Premises or the Building or with respect
to their suitability for the conduct of Subtenant’s business, and that
Sublandlord shall not, either prior to the Sublease Commencement Date or at any
time in the future, be required to make any expenditures whatsoever to make any
new improvements to the Subleased Premises.


 


4.                                       Improvements.  Subtenant shall obtain Master Landlord’s and
Sublandlord’s prior written approvals to any improvements which Subtenant
proposes to make to the Subleased Premises (which approval shall not be
unreasonably withheld, conditioned or delayed by Sublandlord), and shall
otherwise comply with the applicable provisions of the Master Lease, including
Paragraph 8 of the Original Lease, in connection with any proposed
improvements.  On or before the Sublease
Expiration Date, Subtenant shall remove any and all improvements, alterations
and additions made to the Subleased Premises, including Subtenant’s telephone
and data cabling, if such removal is required by Master Landlord in accordance
with the terms of the Master Lease. 
Subject in all events to receipt of Master Landlord’s prior approval,
the following procedures shall apply to Subtenant’s design and construction of
tenant improvements to the Subleased Premises:


 


(a)                                  Subtenant shall
have the right to use architects, contractors and subcontractors of Subtenant’s
selection, subject to Sublandlord’s and Master Landlord’s reasonable
approval.  Subtenant shall choose
engineers for mechanical/electrical and/or structural design services from a
list reasonably pre-approved by Master Landlord.


 


(b)                                 There shall be
no Sublandlord or Master Landlord supervision fee or similar cost charged to
either the Subtenant or the contractor in connection with the Subtenant work or
any future alterations.


 


(c)                                  All Subtenant
work shall be subject to final approval by the Master Landlord in accordance
with the terms of the Master Lease.


 


5.                                       Base Rent.  From and after the Sublease Commencement
Date, Subtenant shall pay to Sublandlord monthly base rental (“Base Rent”) in the amount of $2.25 per rentable square foot
of the Subleased Premises, full service gross in advance, on the first day of
each month during the Sublease Term, without demand, offset, abatement or deduction
of any kind (except as expressly set forth herein).  For purposes of this Sublease, Base Rent
shall initially mean the sum of Forty-Three Thousand Four Hundred Seventy
Dollars ($43,470.00), subject to the annual increase in the Base Rent
hereinafter provided.  Base Rent for the
first full calendar month of the Sublease Term shall be paid in advance no
later than the date three (3) business days following Master Landlord’s
written approval of this Sublease.  If
the Sublease Commencement Date is other than the first day of a calendar month,
Base Rent for the first 


 


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partial
calendar month shall be prorated based on the number of days from the Sublease
Commencement Date to the end of the month in which the Sublease Commencement
Date occurs, and such prorated Rent shall be paid together with the Base Rent
payable for the first full calendar month. 
The monthly Base Rent shall be increased on each anniversary of the Sublease
Commencement Date by an amount equal to three percent (3%) of the monthly Base
Rent in effect for the calendar month immediately preceding the adjustment
date.


 


6.                                       Additional Rent.  For purposes of this Sublease, Subtenant’s “Base Year” shall mean calendar year 2010 and “Subtenant’s Share” shall mean the increase in Operating
Expenses and real property taxes payable by Sublandlord under the Master Lease
for the Subleased Premises for each calendar year during the Sublease Term in
excess of the actual Operating Expenses and real property taxes attributable to
the Subleased Premises under the terms of the Master Lease for the Base Year;
provided, however, that Subtenant’s Share shall not include any increase in
real property taxes to the extent that such increase is due to the sale of the
Building.  For each year commencing from
and after January 1, 2011, Subtenant shall pay to Sublandlord in addition
to Base Rent, an amount equal to Subtenant’s Share.  The calculation of Subtenant’s Share shall be
prorated for any year which is less than a full calendar year.  Sublandlord shall have the right to charge
and collect Subtenant’s Share on an estimated basis commencing January 1,
2011 based on Master Landlord’s estimated Operating Expenses and real property
taxes for each calendar year with any reconciliation for underpayments or
overpayments to be made by the parties within thirty (30) days following
Sublandlord’s receipt of the actual year end statements from Master Landlord in
accordance with the terms and procedures specified in the Master Lease.  Subtenant shall also pay all other costs and
charges allocable to the Subleased Premises and payable by Sublandlord under
the Master Lease in the amounts and at the times required under the Master
Lease and shall pay all such amounts directly to Sublandlord.  Base Rent, Subtenant’s Share, and all other
costs and expenses which Subtenant assumes or agrees to pay to Sublandlord
under this Sublease shall constitute and be referred to herein as “Rent” and the Subtenant’s covenant and obligation to pay
Rent (and Sublandlord’s obligations to reconcile payments with respect to
Subtenant’s Share) shall survive the expiration of the Sublease Term or any
earlier termination of this Sublease. 
Sublandlord shall provide copies of the invoices it receives from Master
Landlord for payment of Sublandlord’s Share and Subtenant shall pay Subtenant’s
Share within thirty (30) days thereafter. 
Subtenant shall have no right of audit or right to dispute Master
Landlord’s statements or invoices of Operating Expenses and real property
taxes; provided, however, Sublandlord shall have the right to audit Sublandlord’s
books and records with respect to any amounts paid to Sublandlord under this Section 6
upon fifteen (15) days prior written notice. 
All payments of Rent shall be made in lawful money of the United States
of America and shall be paid to the Sublandlord at the address for Sublandlord
set forth in Paragraph 23 below, or to such other party or address as
Sublandlord may designate in writing to Subtenant.  Except as otherwise provided in this
Sublease, Rent hereunder shall not include (i) any amounts directly
resulting from Sublandlord’s default under the Master Lease, provided that such
default is not the result of a default by Subtenant under this Sublease; (ii) Operating
Expenses and real property taxes to the extent the same are not the obligation
of Subtenant under this Sublease; (iii) Base Rent payable by Sublandlord
under the Master Lease; (iv) any amounts relating to optional or
additional services to the Subleased Premises (such as after-hours HVAC
service) not requested or authorized by Subtenant; provided, however, Subtenant
acknowledges that the supplemental cooling units located in the Subleased
Premises are within Subtenant’s control; or (v) any amounts directly
resulting from 


 


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the
acts or omissions of Sublandlord under the Master Lease and not the result of
Subtenant’s acts or omissions under this Sublease.


 


7.                                       Security
Deposit.  A security deposit equal to
Forty-Seven Thousand Five Hundred and 84/100 Dollars ($47,500.84) shall be on
deposit with Sublandlord at all times during the Sublease Term and shall be
delivered to Sublandlord within thirty (30) days following Master Landlord’s
approval of this Sublease.  Subtenant
shall have no right, title or interest in any security deposit which
Sublandlord has on deposit with Master Landlord from time to time.  Subtenant’s security deposit shall be
governed by the provisions of Paragraph 33 of the Original Lease (except
for those provisions specifically relating to payments by Sublandlord to Master
Landlord under Paragraph 6 of the Original Lease).  Subtenant’s security deposit, or so much
thereof as has not theretofore been applied by Sublandlord, shall be returned,
without interest, to Subtenant within thirty (30) days following the Sublease
Expiration Date, and after Subtenant has vacated the Subleased Premises in
accordance with the terms of this Sublease.


 


8.                                       Sublandlord’s
Covenants and Representations Regarding Master Lease.  Sublandlord hereby represents to Subtenant
that:  (i) the Master Lease is in
full force and effect and attached hereto as Exhibit A is a true
copy of the Master Lease, redacted to remove certain financial terms not
applicable to this Sublease and further redacted to omit those sections and
amendments to the Master Lease not applicable to this Sublease; (ii) the
Master Lease represents the entire agreement between Sublandlord and Master
Landlord relating to the Premises and Sublandlord’s right to use, occupy and
possess the Subleased Premises; (iii) the Premises represent all of the
premises leased by Sublandlord from Master Landlord; (iv) Sublandlord has
received no written notice of default from Landlord with respect to the Master
Lease, to Sublandlord’s knowledge, there are no existing events of default on
the part of Sublandlord or Master Landlord under the Master Lease nor has any
event or condition occurred which, with the giving of notice or the passage of
time or both, would result in a default by Sublandlord or Master Landlord under
the Master Lease; (v) Sublandlord has received no written notice of
noncompliance from any governmental agency or insurance company that would
require any work to be performed in the Subleased Premises; and (vi) Sublandlord
has not assigned its interest in the Master Lease or sublet any part of the
Subleased Premises.  Sublandlord hereby
covenants that during the Sublease Term, Sublandlord shall not do or suffer or
permit anything to be done which would constitute a default under the Master
Lease (beyond any applicable notice and cure period) permitting Master Landlord
to terminate the Master Lease.


 


9.                                       Subtenant’s
Assumption of Obligations. 
Except as otherwise expressly provided in this Sublease, Subtenant hereby
assumes and agrees to perform all of the obligations of Sublandlord as the “Lessee”
under the Master Lease to the extent such obligations relate to or concern the
Subleased Premises.  In addition to the
foregoing, Subtenant hereby covenants and agrees that:  (i) Subtenant shall not do or suffer or
permit anything to be done which would constitute a default under the Master
Lease or which would cause the Master Lease to be canceled, terminated or
forfeited; (ii) except as otherwise specifically provided herein to the
contrary and/or to the extent caused by the negligence or willful misconduct of
Sublandlord, its employees, contractors, representatives and agents, Subtenant
will indemnify and hold Sublandlord harmless from and defend Sublandlord
against all claims, liabilities, losses and damages of any kind whatsoever that
Sublandlord may incur by reason of, resulting from or arising out of Subtenant’s
actions resulting in such cancellation, termination or forfeiture; (iii) 


 


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whenever
the consent of Master Landlord is required under the terms of the Master Lease
with respect to any action of Subtenant, Subtenant shall obtain the consents of
Sublandlord (which approval shall not be unreasonably withheld, conditioned or
delayed) and Master Landlord prior to taking such action; and (iv) Subtenant
will promptly deliver to Sublandlord copies of any and all notices or other
correspondence received by Subtenant from Master Landlord.


 


10.                                 Incorporation of Terms of
Master Lease.  Subtenant
hereby acknowledges that it has read and is familiar with the provisions of the
Master Lease (as redacted herein) and agrees that this Sublease is and shall
remain in all respects subordinate to and subject to the Master Lease and any
amendments, modifications or supplements to the Master Lease hereafter made,
provided that Sublandlord shall not enter into any amendment, modification or
supplement of the Master Lease without the prior written consent of Subtenant
if such amendment, modification or supplement would materially increase the
obligations of the Subtenant or materially decrease its rights under this
Sublease.  All waivers of claims against
or exculpations of Landlord contained in the Master Lease shall run in favor of
each of Master Landlord and Sublandlord. 
All rights of approval granted to Master Landlord under the Master Lease
shall run in favor of each of Master Landlord and Sublandlord.  If Master Landlord approval is required under
the Master Lease and withholds such approval, Sublandlord’s withholding of its
approval shall be deemed reasonable. 
Notwithstanding the foregoing, whenever the consent of Master Landlord
shall be required by, or Master Landlord shall fail to perform its obligations
under, the Master Lease, upon Subtenant’s request to Sublandlord to do so,
Sublandlord shall use commercially reasonable efforts, as reasonably indicated
under the circumstances, to secure such performance or consent by Master
Landlord under the Master Lease.  Except
as otherwise expressly provided to the contrary in this Sublease, the terms,
provisions, covenants, stipulations, conditions, rights, obligations, remedies
and agreements contained in the Master Lease are incorporated herein by
reference and are made a part hereof, and shall, as between the Sublandlord and
the Subtenant (as if the Sublandlord were the “Lessor” under the Master Lease
and the Subtenant were the “Lessee” under the Master Lease), constitute the
terms of this Sublease except to the extent that such terms are inapplicable,
inconsistent with, or modified by the terms of this Sublease and except that
with respect to each obligation or act of Subtenant to be performed under this
Sublease, whenever the Master Lease grants to “Lessee” a specified number of
days to perform its obligations or acts under the Master Lease, then Subtenant
shall have two (2) fewer days, with respect to each obligation or act that
relates to the payment of money (but in no case less than two (2) business
days), and ten (10) fewer days, with respect to each non-monetary
obligation or act, to perform the applicable obligation or act (but in no case
less than ten (10) business days). 
If any provision of this Sublease is inconsistent with or differs from
any provision of the Master Lease, then the provision of this Sublease shall
control, it being expressly agreed and understood that in the event of a
conflict between the provisions of this Sublease and the provisions of the
Master Lease, then, as between Sublandlord and Subtenant, the provisions of
this Sublease shall control.  The
provisions of the Master Lease which do not relate to and concern the Subleased
Premises are not incorporated into this Sublease, and it is expressly agreed
and understood that Subtenant shall not be entitled to exercise or enjoy any
renewal options, expansion options, purchase options and other similar rights
and benefits granted to Sublandlord as the “Lessee” under the Master Lease.


 


Notwithstanding
the foregoing, as between the Sublandlord and the Subtenant, the following
provisions of the Master Lease shall not apply (and all cross references in the
Master 


 


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Lease
to such provisions shall be deemed deleted) and shall be of no force or effect
with respect to this Sublease:


 


	
  Original Lease Paragraphs

  	
   

  	
  Description of Deletion

  
	
   

  	
   

  	
   

  
	
  Basic
  Lease Information

  	
   

  	
  The
  entirety of such information.

  
	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  The
  first sentence of Paragraph 1 to the extent the premises being leased to
  Subtenant is limited to the Subleased Premises.

  
	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Term,
  Completion of Improvements

  
	
   

  	
   

  	
   

  
	
  3(a)

  	
   

  	
  The
  amount of the Base Rent shall be as provided in Paragraph 5 of this Sublease.

  
	
   

  	
   

  	
   

  
	
  3(b)

  	
   

  	
  CPI
  Adjustment.

  
	
   

  	
   

  	
   

  
	
  6(c),
  (f), (g)

  	
   

  	
  Lessee’s
  Percentage Share of Operating Expenses.

  
	
   

  	
   

  	
   

  
	
  25

  	
   

  	
  Only
  that language added to Paragraph 25 of the Original Lease providing that
  Subtenant is to be provided with a nondisturbance certificate or agreement as
  a condition to Subtenant’s obligation to subordinate the Sublease to any
  ground leases or underlying leases or mortgages or deeds of trust is deleted
  and inapplicable to the Sublease. The remainder of Paragraph 25 is
  applicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  32

  	
   

  	
  Relocation
  to Substituted Premises.

  
	
   

  	
   

  	
   

  
	
  35
  (last sentence only)

  	
   

  	
  Agent
  for Service of Dispossessory or Other Notice

  
	
   

  	
   

  	
   

  
	
  Lease
  Rider

  	
   

  	
  Letter
  of credit security deposit.

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  Diagram
  of Suite 650.

  
	
   

  	
   

  	
   

  
	
  Exhibit B

  	
   

  	
  Initial
  Improvement of Premises.

  
	
   

  	
   

  	
   

  
	
  Wilshire
  Palisades Building Parking Agreement

  	
   

  	
  The
  number, location and rates payable for the parking spaces shall be governed
  by Paragraph 21 of this Sublease but the remainder of such agreement
  shall be applicable to this Sublease.

  
	
   

  	
   

  	
   

  
	
  First
  Amendment

  	
   

  	
  The
  entirety of the First Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Second
  Amendment

  	
   

  	
  The
  entirety of the Second Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Third
  Amendment

  	
   

  	
  The
  Third Amendment shall be inapplicable to the Sublease except Sections 10.1,
  10.2, 10.3, 10.4, 15.2, 15.3, 15.6, 15.7, 15.9, 15.10, 15.12 and 17 which are

  



 


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  applicable
  to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Fourth
  Amendment

  	
   

  	
  The
  entirety of the Fourth Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Fifth
  Amendment

  	
   

  	
  The
  entirety of the Fifth Amendment other than the arbitration provisions shall
  be inapplicable to the Sublease. The applicable arbitration provisions are
  set forth in the partial excerpt from the Fifth Amendment attached hereto.

  
	
   

  	
   

  	
   

  
	
  Sixth
  Amendment

  	
   

  	
  The
  entirety of the Sixth Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Seventh
  Amendment

  	
   

  	
  The
  Seventh Amendment shall be inapplicable to the Sublease except to the extent
  the Premises under the Master Lease were expanded to include the Subleased
  Premises as provided in Section I.A. of the Seventh Amendment and except
  for Section IX.A. as modified by Paragraph 21 of this Sublease. All
  other sections shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Eighth
  Amendment

  	
   

  	
  The
  entirety of the Eighth Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Ninth
  Amendment

  	
   

  	
  The
  entirety of the Ninth Amendment shall be inapplicable to the Sublease.

  
	
   

  	
   

  	
   

  
	
  Tenth
  Amendment

  	
   

  	
  The
  entirety of the Tenth Amendment shall be inapplicable to the Sublease.

  



 


11.                                 Services and Amenities.  Subtenant hereby acknowledges and agrees
that:  (i) the only services and
amenities to which Subtenant is entitled under this Sublease are those which
relate to and benefit the Subleased Premises under the Master Lease, plus
access to the Building parking garage to the extent and subject to the terms
and conditions provided in Paragraph 21 of this Sublease; (ii) Sublandlord
has no obligation to repair, maintain or improve the Subleased Premises or the
Building or to provide any other services or amenities of any kind to Subtenant
or the Subleased Premises, other than Sublandlord’s requirement to maintain, in
a manner consistent with the requirements outlined in the Master Lease, those
portions of the Premises lying outside of the Subleased Premises; (iii) with
respect to the performance of any of the obligations of the “Lessor” under the
Master Lease (including without limitation, any and all work, services,
utilities, repairs, restoration, Lessor’s insurance obligations, indemnities,
payments and reimbursements to be made or provided by the “Lessor” under the
Master Lease and any and all representations and warranties of the “Lessor”
under the Master Lease), whether or not incorporated herein, the sole
obligation of Sublandlord shall be to promptly request the performance of
delivery of the same in writing from Master Landlord, as and when requested to
do so by Subtenant, and to use Sublandlord’s reasonable efforts [(not including
the payment of money, the incurring of any liabilities, or the institution of
any legal proceedings)] to obtain Master Landlord’s performance; and (iv) Sublandlord
shall not be liable to Subtenant or be deemed in default under this Sublease
for or due to any failure of Master Landlord to furnish any


 


8














 


services
or amenities required under the Master Lease or to perform any other
obligations of the “Lessor” under the Master Lease, nor shall any such failure
by Master Landlord to furnish services or perform its obligations under the
Master Lease be construed as an eviction of Subtenant or as entitling Subtenant
to any abatement of rent or other sums due under this Sublease unless said
default or failure to perform would be construed as an eviction of the
Subleased Premises under the terms of the Master Lease.  Notwithstanding anything to the contrary
contained herein, if such default or failure of performance of the Master
Landlord is due to a default by Sublandlord as Tenant under the Master Lease
(except due to a default of Subtenant hereunder), all costs of Subtenant to
enforce the Master Lease against Master Landlord shall be paid by Sublandlord
within thirty (30) days of receipt of written demand therefor.  If Sublandlord fails, after using reasonable
efforts, to cause Master Landlord under the Master Lease to observe and/or
perform its obligations under the Master Lease, upon prior written notice to
Sublandlord, Sublandlord shall non-exclusively assign to Subtenant Sublandlord’s
right under the Master Lease to enforce such provisions of the Master Lease and
Sublandlord, upon Subtenant’s reasonable request and at Subtenant’s sole cost
and expense, shall reasonably cooperate with Subtenant in this regard.  Notwithstanding anything to the contrary
herein, Subtenant’s obligation to pay Rent under this Sublease will abate if
(and only if) Sublandlord receives an abatement of the Base Rent payable by
Sublandlord with respect to the Subleased Premises under the terms and
provisions of the Master Lease.  If
Sublandlord receives such an abatement of Base Rent under the Master Lease,
then the Rent payable by Subtenant under this Sublease will be abated in the
same proportion that the Base Rent payable by Sublandlord with respect to the
Subleased Premises under the Master Lease is abated (i.e., if the Base Rent payable
by Sublandlord with respect to the Subleased Premises under the Master Lease is
abated by 50%, then the Rent payable by Subtenant under this Sublease will be
abated by 50%).


 


12.                                 Termination of Master Lease.  If the Master Lease is terminated for any reason
whatsoever, Sublandlord, then, notwithstanding any provision to the contrary
contained in this Sublease:  (i) except
as otherwise agreed among Master Landlord, Sublandlord and Subtenant, this
Sublease shall terminate simultaneously with such termination of the Master
Lease and Subtenant shall have no further obligations under the terms of this
Sublease unless the termination of the Master Lease is due to any default by
Subtenant under the terms of this Sublease; and (ii) Sublandlord shall
have no liability to Subtenant in connection with such termination unless such
termination is due to a default by Sublandlord of those obligations (and only
those obligations) of Sublandlord as the “Lessee” under the Master Lease which
have not been assumed by Subtenant under this Sublease or unless Sublandlord
has voluntarily agreed with Master Landlord to an earlier termination of the
Master Lease or the Sublease (except in the case where termination results from
casualty or condemnation in accordance with the terms of the Master Lease).


 


13.                                 Use.


 


(a)                                  Generally.  The Subleased Premises shall be used and
occupied for general business office purposes and for no other use or purpose.


 


(b)                                 Entry.  In connection with any entry into the
Subleased Premises by Sublandlord, except in the event of an emergency,
Sublandlord agrees to provide Subtenant with at least


 


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twenty-four
(24) hours prior written notice of the same and to complete such entries during
Subtenant’s business hours (unless directed otherwise).


 


(c)                                  Telecommunications Equipment.  Subject to the receipt of Master Landlord’s
express written consent, Sublandlord agrees that, at any time during the
Sublease Term, Subtenant shall have the non-exclusive right to install, at
Subtenant’s sole cost and expense, a satellite dish and/or antennae in an area
of the roof of the Building (“Roof Location”)
reasonably designated by Master Landlord and conduits, cables, risers, feeders
and materials in the shafts, ducts, conduits, chases, utility closets and other
facilities of the Building as is reasonably necessary to connect the satellite
dish and/or antennae to the Subleased Premises and Subtenant’s other machinery
and equipment therein. (collectively, the “Telecommunication Equipment”)
solely for its own use; provided, however, any such installation shall be
completed by Subtenant at its cost in accordance with all applicable laws.  The physical appearance and location of any
exterior Telecommunication Equipment shall be subject to Master Landlord’s
reasonable approval, and Master Landlord may require Subtenant to install
screening around such exterior equipment, at Subtenant’s sole cost and expense,
as reasonably designated by Master Landlord. 
Subtenant shall maintain such Telecommunication Equipment at Subtenant’s
sole cost and expense.  In addition,
Subtenant’s use of the Telecommunications Equipment shall not interfere with
any other entities’ telecommunications equipment located on or in the Building
at the time Subtenant installs the Telecommunications Equipment thereon or
therein.  In the event Subtenant elects
to exercise its right to install Telecommunication Equipment as set forth in
this Section 13(c), then Subtenant shall give Sublandlord and Master
Landlord prior notice thereof; all entry and work on the roof shall be
coordinated in advance with Master Landlord. 
Upon the expiration or earlier termination of this Sublease, Subtenant
shall remove its Telecommunications Equipment and perform any reasonably
requested repairs and patching, at Subtenant’s expense; provided, however,
Subtenant shall not be required to make any repairs required because of
ordinary wear and tear on the roof.


 


14.                                 Assignment and Subletting.  Except as permitted in Section 10.2 of
the Third Amendment, Subtenant shall have no right to assign the Sublease or
its interest therein, sublease all or any portion of the Subleased Premises, or
make or enter into any other transfer of Subtenant’s interest in this Sublease
or in the Subleased Premises without the prior written consent of Sublandlord
and that of Master Landlord as provided in and required by the terms of the
Master Lease.


 


15.                                 Subtenant’s Insurance.  Subtenant agrees to procure and maintain
during the Sublease Term, all insurance required to be maintained by “Lessee”
under the Master Lease relating to or applicable for the Subleased Premises,
with Sublandlord and Master Landlord (to the extent of their respective
interests in the Subleased Premises) named as additional insureds, and to
deliver certificates of such insurance to Sublandlord prior to the earlier of,
the Sublease Commencement Date or the date Subtenant or its representatives
enter onto the Subleased Premises in preparation for Subtenant’s occupancy.


 


16.                                 Repair and Maintenance of the
Subleased Premises. 
Notwithstanding anything to the contrary contained herein, Subtenant
shall be responsible for the repair and/or maintenance of the Subleased
Premises and the performance of all repair, maintenance, replacement and
improvement obligations on the part of the “Lessee” under the Master Lease
regarding the


 


10

















 


Subleased
Premises, and Sublandlord shall have no responsibility for any repair,
maintenance, replacement or improvement of the Subleased Premises during the
Sublease Term.


 


17.                                 Non-Standard Building
Utilities.  Subtenant
shall pay the costs and charges for all non-standard utilities supplied to the
Subleased Premises as provided in Section 5 of the Master Lease.


 


18.                                 Signage.  Subtenant shall have the right, with Master
Landlord’s prior consent, to install and maintain one sign in the fifth floor
elevator lobby bearing the Subtenant’s name. 
Subtenant shall submit any proposed signage to Sublandlord for
Sublandlord’s (which approval shall not be unreasonably withheld and granted if
Master Landlord approves the same) and Master Landlord’s approval and shall pay
for all costs of design, fabrication, installation and maintenance of the
Subtenant’s sign.  Subtenant acknowledges
that under the Master Lease, Master Landlord reserves the right to approve the
graphics, color, size, lighting and other aesthetic elements of Subtenant’s
sign to assure conformity with the Building’s graphics program and existing
commitments to other tenants in the Building. 
Subtenant shall also be entitled to that number of lines on the Building
directory in the ground floor lobby of the Building approximately equal to the
proportion which the rentable area of the Subleased Premises bears to the total
rentable area of the Building.  Subtenant’s
signage rights hereunder are personal to Subtenant and may not be assigned or
transferred by Subtenant to any other person or entity, including, without
limitation, to a transferee of Subtenant’s rights to the Subleased Premises or
to any occupants of the Subleased Premises without Sublandlord’s (which
approval shall not be unreasonably withheld and granted if Master Landlord
approves the same) and Master Landlord’s prior approval.


 


19.                                 Subordination.  Notwithstanding anything to the contrary
contained in the Master Lease, this Sublease is subject and subordinate at all
times to all ground leases or underlying leases which may now exist or
hereafter be executed affecting the Building or the land upon which the
Building is situated or both, and the lien of any first mortgage or deed of
trust which may now exist or hereafter be executed in any amount for which the
Building, land, ground leases or underlying leases, or Master Landlord’s
interest or estate in any of such items is specified as security, and in no
event shall Subtenant have any right to receive a nondisturbance or recognition
agreement from any existing or future lessor, mortgagee or beneficiary under a
deed of trust.


 


20.                                 Furniture and Furnishings.  Effective as of the Sublease Commencement
Date and as further consideration for Subtenant’s sublease of the Subleased
Premises, Sublandlord hereby transfers, conveys and assigns to Subtenant all of
its right, title and interest in and to the furniture, furnishings and equipment,
including any improvements (“FF&E”),
installed or located within the Subleased Premises as of the date of this
Sublease.  Subtenant acknowledges and
agrees that the FF&E is being conveyed to Subtenant in its “as-is”
condition with all faults, and that Sublandlord makes no representation or
warranty regarding the same.  Sublandlord
agrees to execute any commercially reasonable documents requested by Subtenant
to evidence the transfer of the FF&E including, without limitation, a bill
of sale.


 


21.                                 Parking.  Subtenant shall be entitled (but shall have
no obligation), during the Sublease Term to lease from Master Landlord the
following number of parking spaces


 


11

















 


(“Subtenant Parking Spaces”) from those parking spaces
available to Sublandlord under the terms of the Master Lease including, without
limitation, the first paragraph of Section IX.A. of the Seventh
Amendment:  (a) four (4) reserved
parking spaces located in the Building Parking; (b) twenty-seven (27)
unreserved parking spaces in the Building Parking; and (c) thirty-six (36)
unreserved parking spaces in Structure Parking. 
Subtenant shall pay directly to Master Landlord the then prevailing
monthly charges established from time to time by Master Landlord for such
parking spaces.  The initial charges for
the parking spaces provided in the first paragraph of Section IX.A. of the
Seventh Amendment shall not apply to this Sublease.  The second full paragraph of
Section IX.A. of the Seventh Amendment shall not apply to this
Sublease.  The provisions of the Wilshire
Palisades Building Parking Agreement dated January 15, 1985 entered into
between Sublandlord and Tele/TAC Associates as the original Master Landlord (a
copy of which is attached to and made a part of the Master Lease) relating to
and regulating the payment for and use of parking spaces shall be applicable to
Subtenant except that Subtenant will only be entitled to use the Subtenant
Parking Spaces and shall pay the prevailing parking charges and rates as
described in this Paragraph 21.


 


22.                                 Brokers and Finders.  In connection with the transaction
contemplated by this Sublease, each party hereby represents and warrants that
it has not had, and shall not have, any dealings with any third party to whom the
payment of any broker’s fee, finder’s fee, commission or other similar
compensation shall or may become due or payable, with the exception of Cushman &
Wakefield of California, Inc. which represents Sublandlord and Madison
Partners which represents Subtenant (collectively, “Broker”).  In full satisfaction of any brokerage
commissions payable in connection with this Sublease, Sublandlord shall pay a
commission to the Subtenant’s Broker pursuant to the terms of a separate
written agreement entered into between Sublandlord and Subtenant’s Broker.  Sublandlord and the Subtenant shall each
indemnify, defend and hold the other harmless from and against any and all
loss, cost, damage, liability, claim or expense (including, without limitation,
reasonable attorneys’ fees, charges and disbursements), by reason of a breach
of the foregoing provisions or by reason of any claim of or liability to any
broker, finder or like agent (other than the Broker) who shall claim to have
dealt with the Sublandlord or the Subtenant, respectively, in connection with
this transaction and this Sublease.  The
provisions of this Paragraph shall survive the termination of this Sublease.


 


23.                                 Notices.  All notices, requests, demands and other
communications which are required or may be given pursuant to the terms of this
Sublease shall be given in accordance with Paragraph 35 of the Original
Lease at the following addresses:


 


If
to the Sublandlord:


 


Dimensional
Fund Advisors LP


1299
Ocean Avenue, 11th Floor


Santa
Monica, California 90401


Attention:  Dave Martin


With
a second copy to the Attention:  Legal
Department


 


and


 


If
to the Subtenant:


 


12

















 


Demand
Media, Inc.


1333
2nd Street, Suite 100


Santa
Monica, California 90401


Attention:  Matt Polesetsky


 


24.                                 Consent of Master Landlord.  The effectiveness of this Sublease is
conditioned upon the execution by the Master Landlord of consent in a form
Master Landlord may reasonably require (the “Consent”).  Promptly following the full execution and delivery
of this Sublease, Sublandlord shall submit this Sublease to Master Landlord for
its consent and shall, thereafter, use reasonable efforts to obtain such
consent from Master Landlord and Subtenant shall reasonably cooperate with
Sublandlord in connection with those efforts, including, without limitation,
promptly delivering such financial and other information and documentation that
Master Landlord reasonably requests.  If,
notwithstanding such reasonable efforts, Master Landlord does not execute the Consent
by the date forty-five (45) days following the execution and delivery of this
Sublease, Subtenant and Sublandlord shall each have the right to cancel this
Sublease by giving written notice of such cancellation to the other party
following such date and prior to receipt of the Consent.  As of that date which is ten (10) business
days following the proper delivery of any such cancellation notice, and
provided that the Consent has not been obtained within such ten (10) business
day period, this Sublease shall be deemed terminated and both parties shall be
released from all further obligations under this Sublease, except that
Sublandlord shall promptly return any funds provided by Subtenant in connection
with this Sublease


 


25.                                 Entire Agreement.  This Sublease sets forth the entire agreement
between the parties and there are no other agreements or understandings of any
kind or nature between the parties with respect to the subject matter, except
as set forth herein.  This Sublease may
not be modified, altered, or amended, other than by an agreement in writing,
signed by the party against whom enforcement of said agreement is sought.


 


26.                                 Counterparts.  This Sublease may be executed in multiple
counterparts, each of which shall be an original and all of which together
shall form one agreement.


 


27.                                 Confidentiality.  Subtenant acknowledges that the terms of this
Sublease are confidential between Sublandlord and Subtenant.  Subtenant shall not disclose the economic
terms of this Sublease, including the rental rates, to any third party other
than Master Landlord, Subtenant’s attorneys and advisors who are assisting
Subtenant in the consummation of this transaction or in the enforcement or
interpretation of Subtenant’s rights hereunder, or except as otherwise required
by law.


 


[signatures appear on following page]


 


13

















 


IN
WITNESS WHEREOF, the parties have executed this Sublease as of the date first
above written.


 


 


	
   

  	
  Sublandlord:

  
	
   

  	
   

  
	
   

  	
  Dimensional
  Fund Advisors LP,

  
	
   

  	
  a
  Delaware limited partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Dimensional
  Holdings, Inc.

  
	
   

  	
   

  	
  Its:  General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  David R. Martin

  
	
   

  	
   

  	
  Name:

  	
  Dave
  Martin

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President & Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Subtenant:

  
	
   

  	
   

  	
   

  
	
   

  	
  Demand
  Media, Inc.,

  
	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Charles S. Hilliard

  
	
   

  	
  Name:

  	
  Charles
  S. Hilliard

  
	
   

  	
  Title:

  	
  President &
  Chief Financial Officer

  



 


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